MPs warn that independent retailers risk extinction

Consumers will lose out in the long run, says the report:

"Prices of products will remain fairly low until consolidation reaches a saturation point and the attention of the multiples turns to increasing value to shareholders by growth through margin. Prices are then likely to increase with fewer competitors in the market."

‘High Street Britain:2015’ is a 91-page report. It has a number of recommendations including the creation of a a retail ‘tsar’ to oversee the sector. The report also calls for a halt to any more supermarket takeovers and allowing local people greater say in the local planning process.

‘"The erosion of small shops is viewed as the erosion of the social glue that binds communities together," says the report.

According to the report, half of the 278,630 shops in the UK are owned and managed by a sole trader and 103,000 have five employees or less.

The retail sector as a whole employs 3.1 million people.

Kevin Hawkins, director general of the British Retail Consortium was typically bullish in his response to the report. On Radio 4’s Today programme this morning he aired his usual view that the supermarket sector has been crawled over by many regulators and offers consumers choice.

In a statement on the BRC website, Hawkins said:

"We are disappointed that the Committee has not grasped the realities of modern retailing, nor have they understood all the burdens small retailers face with regulation.

"The Committee is trying to turn the clock back and reverse some well established trends in consumer shopping habits. Over the past 30 years or so, supermarkets and other large multiple retailers have grown and become the dominant form of shopping because they have met the changing needs of their customers. Consumers have clearly voted with their feet.

"Nevertheless, there are still many thousands of independent specialist butchers, bakers and other food shops that are alive and well throughout the UK and most of them will still be around in 2015.

"The secret of success for the small retailer in what is a highly competitive market, is not to try to compete head on with larger rivals, but to offer consumers something different, something better and something targeted very precisely at a particular portion of the market."