Even before Covid-19 we could see that the retail system in the UK was broken in many ways. It works for quite a lot of people most of the time, but mainly the affluent and the car-borne, but even then it does so at the expense of both society and local economies. This is not sustainable in the broadest sense and does not address our future obligations.
We have accepted the ways things have been for many years, in the pursuit of low prices and the often false god of economic productivity. Many of our retailers have become disassociated from their local markets, consumers and places and even more distant from many of the suppliers on which they rely. Our communities, places, towns and high streets are often struggling as a consequence.
Covid-19 must alter our perceptions and challenge our willingness to accept this ‘bargain’.
This is not to say that multiple and large-scale retailing does not have its place; it does. Nor is it to argue that the just-in-time supply system in food failed under the weight of binge-buying ahead of lockdown. The response from many retailers, producers and supply systems has been impressive and the recovery effective (although some large producers abandoned supplying local stores in order to meet national chain demands). Consumers have benefited from the operation of large retailers.
But do they pay their way and should they be more responsible – to producers, consumers, suppliers, places, communities – in their dealings? More fundamentally, should we now engineer more of a balance in the system to provide properly for more of our population? This is not just about providing economically, but also socially, through the network of social bonds and communities that retailing should be part of.
So, what might we want our retail sector to look like?
It needs to be a system that works for all of our population and not just for some. Food banks are not an acceptable component of any advanced economic system and the presence of so much food poverty is a national scandal. We need an enhanced local focus, reducing dependency on long, complex, supply chains. The pandemic has highlighted the inequality we knew was there, but we wanted to forget about.
Local has to be a major focus of our retail system. This is about local neighbourhoods and places as well as the local supply chains and assets that are required to break our over-dependence on international and distant supply. A renewed focus on community, support and place (including links to our great local producers, many of whom have lost their hospitality markets) has been demonstrable in recent weeks and we need to build on this.
This implies a rebalanced sector with switches from national multiple chains to local and independent operations; moving from taxing physical stores alone to include digital selling and from a reliance on the car and out-of-town stores to in-town, community and neighbourhood stores and markets. It suggests a new relationship with quality and sourcing (and in food, our diet) and an underpinning need to enable people to access this physically and economically.
We have proven through the last six weeks or so that solutions previously thought impossible are anything but, and that we can rethink our approach and systems. We cannot go back to what has been failing us generally; we need to be bold and rethink these relationships and redefine what is acceptable.
So, where have co-operatives been in this? Being essentially local, member-owned, democratic organisations, co-operatives are well-suited to the changing situation. Their record over recent years shows how this operational approach resonates with consumers and communities. Co-operatives are based on an ethos of community and member benefit, driving community resilience and focused on local support and causes. During the pandemic, co-operatives have responded strongly as local and community became more important. With many examples, they have done the right thing by their local communities. National support for food banks, donations at local and national level, local re-purposing of member benefits to form local coronavirus funds and support and home delivery for vulnerable local residents are examples of such community focused responses.
But is such activity enough on its own for a sustainable future?
If we are serious about enhancing communities and supporting “the high street” and town centres, as so many claim, then this is the opportunity to rebalance to focus on what we value and thus what we should be active in encouraging and discouraging. We need to come out of this changed, not simply fall back into old routines.
If we accept that, then what measures could we take to strengthen communities and retailing?
Some initial thoughts might include:
A rebalancing of taxation between digital and physical modes of retail supply. Online has expanded during this crisis and many of those who have used online shopping, may well continue to do so. This is an acceleration of the changing nature of the economy and we need to rebalance taxation to accept and reflect what has now changed in business operations. If we want physical stores we have to stop taxing them out of business, while allowing others a free pass at using, but not paying for common goods. International tax avoidance should be stopped; behaving in that way should abrogate the right to operate in this country.
Immediate substantial increases in income for key workers and those currently marginalised in our economy. We have demonstrated which people and jobs have real value to the operations of our economy and society (including obviously health and care workers, but also local shop workers). They require a substantial increase in living wages, linked with a more progressive tax system (on individuals and businesses), to take people out of the current poverty cycle and to provide them the wherewithal to prosper, not simply exist.
Disincentivise retail components damaging the concept of place and not paying their true social and economic costs, such as out-of-town, car-focused stores. Activities that damage place need to be challenged and refocused. Some of this can be done by fair taxation (including abolition of rates for high street retailers). But if businesses are damaging communities in the broadest sense should they have a right to continue to operate unhindered?
Change the VAT system so as to encourage the reuse of historical and existing buildings rather than as currently happens rewarding new-build on often greenfield sites.
Substantial economic protection and support for local, independent producers and retailers so as to encourage their sustainability and growth and reduce the burden they face. If we value the local and entrepreneurial, then we need to show our support for them. We are saying that convenience stores, local independents and co-operatives have done a fabulous local, community job during the pandemic; then let’s show it afterwards by making the playing field rather more level. Such stores are the glue of the social networks we claim to value (as they have shown over the last few weeks).
Requirements on retailers of all sizes and scale to demonstrate their local credentials in terms of procurement and product and service supply. If we are willing to support local businesses through our taxation and licensing system, then we need mechanisms and measures to demonstrate that localness in products, services, community payback and other measures of local community good.
Financial and managerial support should also be provided for local markets on a regular basis, with ‘local’ (and ‘farmers’ and “fishers” for food) being defined terms and a responsibility on local authorities to provide space and opportunity for such markets on a regular basis.
The focus of these measures is to actively support the local, independent and community focused operations and disincentivise activities that damage community and place.
Co-operatives have a local focus and are engaged in community support and wellbeing. They are less extractive than some other retailers and should be a component of this new agenda. Asking co-operatives and independents to operate in an unfair, unsustainable system cannot be our future; “back to normal” is not the answer to the challenges communities face. We need to support retailers who really get what community and resilience means, and have shown the way over recent months.
If we want to have flourishing communities and towns then we need to support them, not by handouts to repair and rebuild, or exhortations to understand and manage (as important as these are), but by demonstrating that we are serious about stopping damaging activities and refocusing on building sustainable, resilient communities and places, rather than extracting value for remote, often international, shareholders.
The world has changed. Ending lockdown and returning to the old ways should not be an acceptable way forward. We have seen that alternative local and community focused futures and ways of doing things are possible. We must not slip back, but instead take the bold national policy steps that are required, and thus better support those that are doing the right things.