New Lease set to inject fresh life into the British high street #IndieRetail

RICS has launched a free small business retail lease to try and attract new and independent retailers. This lease is designed to provide jobs for people and help to support the independent retail sector. RICS have reached out to the independent trader and offered a simpler way of navigating the ‘costly and complicated’ process of obtaining their first commercial lease. The lease has been developed in collaboration with the British Retail Consortium (BRC) and authored by Nick Darby, SNR Denton UK LLP.

WHY NOW? “We hope to support SMEs and provide a boost to the British high street in a time of decline”

It has been devised to simplify the time-consuming process associated with commercial property leases. The new freely available contract is an advantage as it will stimulate the British high street at a time when latest figures from the BRC show more than 11% of town centre properties are currently standing vacant.

“In simplifying the leasing process for landlords and small business tenants, we hope to support SMEs and provide a boost to the British high street in a time of decline – thereby contributing to overall UK economic productivity. Moreover, by offering mutually beneficial terms to landlords and tenants in a flexible lease, we are directly addressing the principles of the Code for Leasing Business Premises – identified in the Portas Review as a key tool in tackling the high street’s decline.” Paul Bagust, RICS Associate Director

New lease will boost the opportunities for independent retailers

Independent retailers will benefit from the new lease as it will increase their opportunities to expand without the high costs. Landlords will benefit from rental income on a previously unoccupied space that can then re-establish its viability in the market place.  For both parties the costs of a long lease negotiation process are significantly reduced.It offers entirely flexible terms for occupiers, including break clauses.

The lease takes the form of an easy-to-use eight page proforma, providing the tenant with fixed property costs and a clear picture of the responsibilities they are signing up to. Intended for leases of up to five years, it is a standalone short-term contract with no rent review.

In response to industry feedback, two versions of the lease have been developed, one with security of tenure under the Landlord and Tenant Act 1954 and one without. Under the Act tenants have the right to renewal of the lease. In circumstances where this may not be appropriate landlords should state at the start of negotiations that the protection of the 1954 Act is to be excluded and encourage tenants to seek early advice as to the implications.

Improving footfall on the suburban centre high street

This new lease will help small independent retailers as it has been designed to bring in new jobs for people; a new market could also boost how much consumers spend over this period. This could mean there will be an increase in retail expenditure. At the beginning of the year, 26% of retailers were at risk of failure. There is a need for a more flexible and affordable leasing process. There has been a decline in high street performance because retailers are unable to keep up with the expenses of the leases, therefore they are forced to close down. Authorities are seeking to be adaptable to changing economic circumstances through the planning regime – with the clearly articulated ambition of improving footfall on the a suburban centre high street through a more flexible approach to uses.

There are still risks involved that Independent Retailers must be mindful of

Although the new lease would be beneficial to many independent retailers, there are still risks involved.  There has been a decline in high street performances because retailers are unable to keep up with the expenses of the leases, Some independent retailers may not be as successful as others therefore after a while they may not be able to pay the fixed costs of the lease, so as a result they could be forced to close down.

To sum up, it still appears that the benefits of this lease outweigh the risks, so if you are an independent retailer, this  could be the a fantastic opportunity for a very successful future for your business.

This blog was written by Samantha Chadoka. Samantha is an 18 year old apprentice working toward an NVQ Level 3 in business and administration. Samantha works full time alongside Clare Rayner and her apprenticeship role is “Campaign coordinator” for the 2 Independent Retail campaigns – “An Independent Christmas and Independent Retailer Month”. 

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About Clare Bailey

Clare Bailey, The Retail Champion (formerly Clare Rayner), is one of the most well-known and respected retail experts in the UK. With unrivalled knowledge in retail, high streets and consumer matters, she offers unbiased, independent content – whether engaged as a professional speaker, for broadcast media, or for a written feature. Clare is a business woman, entrepreneur and founder of several small businesses. Having been born into a family of successful business owners, it was inevitable that she’d eventually jump off the corporate treadmill and step out on her own! Today her brand portfolio includes The Retail Champion, The Retail Conference, the Future High Street Summit and the Support for Independent Retail campaign. In addition, she is co-founder of Mobaro Retail UK and a non-exec director of Beed Virtual Assistant Services. Having started her career as a fast-track store management trainee for McDonalds, she went on to work with leading retailers such as M&S, Dixons and Argos. She moved swiftly into management roles before being headhunted into senior consulting roles with global software giant SAP, and international management consulting brand, Accenture. Her corporate background in senior retail, consulting and technology roles, coupled with her experience of creating and running her own business, has enabled her to be equally capable whether consulting to global brands or micro businesses. This unique blend has not only positioned her as a leading expert in all things retail, but has enabled her to add meaningful commentary and insight to the debate around the future of the high street, and, how technology is driving fundamental change in the way consumers, and businesses, interact. Clare has become an influential voice in her field, which has resulted in her becoming a regular media contributor and sought-after conference speaker. Often seen on Good Morning Britain, BBC Breakfast, Sky News, and Chanel 5 (to name a few), Clare speaks on a myriad of retail, high street and consumer issues – but is particular adept when it comes to explaining the context behind retail trading results, newly released data, and government stats, in a palatable and informative manner. In addition to broadcast and conference speaking, Clare is the proud author of two best-selling business books published by Kogan Page - The Retail Champion: 10 Steps to Retail Success, published July 2012 and How to Sell to Retail: The Secrets of Getting Your Product to Market, published February 2013. She has provided contributions to various academic texts, including Retail Marketing Management (published by Pearson). With an engaging, conversational yet informative style, Clare writes for press and content agencies, providing features, articles, blogs and opinion pieces as well as contributions to white papers and reports. However, when the situation demands a more serious style, Clare can deliver - In 2016 she wrote an extensive report for a major insurance and risk law firm, as a retail expert witness, to support a public liability suit. She found that project particularly enjoyable as it played well to her strengths – assimilating large amounts of data and information, identifying the key points and articulating that in an understandable manner. When not on TV or speaking at conferences, Clare’s “day job” sees her supporting consumer-facing businesses through her consultancy services. When asked to describe what she most loves about retail consulting it is typically the opportunity to “dig deep”, getting “under the bonnet”, in order to leverage the business data to uncover the insights that lead to “lightbulb moments”. She also loves working on business change programmes that centre on improving the processes and systems to increase profitability by supporting more rapid, better informed decision making, improving the customer experience, or simply by become more efficient and streamlined. In this respect she considers herself a “business engineer” with a brain that works like a relational database! Due to her years of experience, her logical, objective approach, her quick, rational thinking, she is known for being able to cut through complexity, seeing right through to the crux of issues, finding creative solutions that others may have overlooked. As if all that wasn’t enough, Clare is a working mum, juggling a home life in rural Lincolnshire with her partner, their 5 kids, 4 cats, and geriatric Labrador! For all enquiries, contact Clare directly on 01727 238890 or email champion@retailchampion.co.uk.
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