On January 3rd, ToyNews reported that 12-year industry stalwart, The Cambridge Toy Shop, had closed its doors. The shop’s owner Vivienne Watson cited high rent and increased parking fees as some of the reasons for the closure, leaving the business unable to compete with High Street chains and online retailers.
As the economic environment grows harsher, many retailers are stepping into the New Year cautiously, knowing that a few false moves or unforeseen setbacks could be enough to sink an independent business.
ToyNews reached out to Paul Warner, owner of When I Was a Kid, who’s shop in Cambridge also closed in the last twelve months, to get his take on what 2017 holds for indies across the nation.
“If you think about the fact that two independent retailers have closed down in one of the most affluent cities in the country, that sends a huge message about the industry,” said Warner.
“Retail is changing and people want convenience. People can get toys while buying groceries at Tesco or on Amazon and get it the next day. People want to do things at their convenience, when and where it suits them, and that doesn’t involve going into town.”
While most retailers still feel positive about the industry, there is one major concern shared by almost all indies, which is undercutting from supermarket chains. Matt Booker of Automattic Comics and Toys spoke optimistically about his business, but explained that his 2016 was fraught with roadblocks from large chains discounting.
“Now the supermarkets have entered the business, they’re discounting stuff that hasn’t even hit the shelves yet and there’s nothing we can do to combat it,” explained Booker.
“People seem to be coming back to the High Street more, but discounting and bootlegging are becoming major problems.”
Dave Carter, owner of the Arcade Toy Shop in Dudley echoed Booker’s sentiments.
“The discounts offered by bigger companies like Tesco and Argos means they end up selling products cheaper than we can buy them off the wholesalers because they get them from the manufacturers direct.”
Cautiously optimistic following a successful year, Carter also highlighted lingering economic concerns. He added: “Companies are putting prices up, but I think that would have happened either way given the current economic climate. I remain on the fence as to whether Brexit will affect us but if these problems arise we will have to deal with them as best we can.”
However, Peter Allinson of Whirligig had a rather more positive outlook, confident that the store’s offering was sufficiently unique to separate it from those struggling to compete with supermarket chains.
“I’m not expecting 2017 to be a more difficult year,” commented Allinson. “We do something very different, we don’t sell LEGO or Barbie or any other big brands. ‘Make and Do’ products are really catching the attention of people because it’s something so different from most retailers.”
Paul Warner shared Allinson’s sentiments saying that indie retailers simply cannot compete with the buying power of national chains and need to find ways of making themselves unique.
“Once you’re stuck in the price war you end up slashing your margins and then you haven’t got a viable business,” added Warner.
“Retailers need to re-invent themselves because retail is changing. At When I Was a Kid we’re creating personalised products, making products unique to us and finding ways of removing ourselves from that apples to apples comparison.”
Supermarkets are showing no signs of easing off on their discount-all strategies that has led many retailers to focus on what makes them unique. For those retailers armed with a keen eye for new ideas, there is no reason not to be optimistic about the year ahead.