Reluctance from the multiples to take on stores below 1,500sq ft has created a “massive opportunity” for independent retailers, new research shows.
The study, conducted by location analysis company Maximise UK, shows there are 1,532 remaining sites in the UK fitting supermarkets’ criteria for potential earnings – stores capable of delivering sales in excess of £40,000 a week.
However, the majority of those sites – up to 80% – have a selling area of below 1,500sq ft, which is normally considered too small by the multiples.
David Haywood, Maximise UK managing director, said: “This is a massive opportunity for independent retailers. It’s quite clear from the research that the sites which the multiples require have pretty much run out.”
Vince Malone, of the 900sq ft Tenby Post Office in Pembrokeshire, agreed there is an opportunity for independent retailers to develop smaller stores as long as they are “open-minded” on what they stock.
“We wanted to offer a deli format but our customer research showed it would be better to offer a wider range and just limit the number of varieties of each product we stock,” he said.
David Ramsey, of the 600sq ft Best-One Byram Park Stores in West Yorkshire, also agreed it is possible to run a very successful smaller store, but added being part of a symbol group is helpful for business owners.
“Because we’re with Best-one, we have the option to take new stock every month,” he said.
“It is all about variety. Customer relations are paramount and you’ve got to know what your shoppers want.”
Spar UK retail director Ian Taylor said almost half of Spar’s stores are below 1,500sq ft – around 1,300 out of 2,700 stores.
“These stores are run very successfully by our great independent retailers,” he said.
“As with any store size, to be successful you need to know what shopper missions your store is providing and then ensure you have the right proposition to meet these customer needs.”