This week sees the government closing their consultation on proposals to allow local councils to decide on the relaxation of Sunday trading hours. The question is how will an extension of Sunday trading hours affect Britain’s thousands of independent retailers?
The current Sunday trading laws
Currently only small shops with 280 sq meters of floor space are allowed to open all day. Therefore these retailers have a significant competitive advantage over the supermarkets that are only allowed to open for a maximum of six hours on a Sunday.
Why is the Government proposing these changes?
George Osborne, the chancellor, argues that with 11% of all retail sales taking place online, longer hours will provide bricks and mortar stores with a boost.
Additionally the Government claims that this is part of their move to continue to promote local-decision making and removing restrictions on free markets.
However it appears that the public is against any changes to the current compromise. A poll published by ComRes earlier this month showed that more than three-quarters of the public support the Sunday Trading Act in it’s current form.
Supermarkets unsure of the impact
Any extension of the hours by local authorities stands to offer the most benefit to the UK’s supermarkets by enabling them to open 24 hours on a Sunday. However, even the big retailers are wary of an extension in trading hours with increased costs associated to keeping store open for longer hours – with customer spending staying the same.
Only Asda has spoken out in favour of the extension of trading hours. Andy Clarke, chief executive of Asda, has been a vocal supporter of extending Sunday trading hours.
“It’s common sense to relax Sunday trading hours and the majority of our customers agree, says Clarke. “Currently, customers pay more on Sunday evenings because they are forced to shop in small stores where prices are higher.”
Independent retailers view
An extension in the trading hours will erode the profits of convenience stores, with Sunday often the busiest trading day for the UK’s convenience stores after Friday. The result will likely be the closure of thousands of independent convenience stores across the country as the stores operating on small profits are forced to close.
As reported by the Guardian, when the government temporarily relaxed Sunday trading laws for three weeks during the 2012 Olympics, sales in convenience stores dropped by between £9.7m and £26m. needless to say, the impact over year would be a significant loss to the convenience store industry.
James Lowman, chief executive of the Association of Convenience Stores, says “giving local authorities the responsibility for setting Sunday trading hours will lead to inconsistency and confusion for businesses and shoppers.
“In areas where large stores’ trading hours are extended, we will simply see the same amount of trade spread over more hours and shifting from small stores to large stores, as was the case when the laws were suspended for the 2012 London Olympics, when overall retail sales actually fell.”
However according to a piece by the Financial Times, there are potential benefits to some independent retailers. They spoke to Faz Matador who runs a newsagents in Manchester city centre, he said that an extension would benefit his business by increasing Sunday footfall in the city centre.
Unfortunately most of the UK’s independent convenience stores are based in local communities, where the supermarkets are strongest.
Photo credit: 1000 Words / Shutterstock.com
Posted on September 14, 2015 |