The retail sector is facing unprecedented challenges, and as highlighted by the Scottish Retail Consortium (SRC), it is time for policymakers to prioritize the cornerstone of local economies: retail. The call to embed retail interests at the heart of economic policy comes in light of significant shifts—accelerated by events like the COVID-19 pandemic and geopolitical issues such as the Ukraine war—that challenge the viability of town and city centres across Scotland.
The Current Landscape for Retail Sector
In its recently published manifesto ahead of the 2026 Holyrood elections, the SRC outlined a series of pressing issues that are undermining the vitality of high streets. Reports indicate that overall footfall at retail destinations in Scotland decreased by 0.9% over the year leading to July. In stark contrast to the bustling centres of yesteryears, the modern landscape reveals a bleak picture where increasing operational costs, changes in consumer behavior, and mounting competition from online platforms have made it difficult for many retailers to survive.
Key Challenges
Increased Operational Costs: Retailers are grappling with rising business rates and other government-imposed costs, with an estimated burden of nearly £200 million added in the past year alone. This pressure creates an unsustainable model for many shops, especially those relying heavily on local foot traffic.
Shift to Online Shopping: The rapid increase in e-commerce has led retailers to reconsider their physical presence. More shops are closing, and those remaining are often downsizing, focusing on a just-in-time model that minimizes overheads.
- Retail Crime: An increase in retail crime, particularly in urban areas, poses a significant threat to the security and appeal of brick-and-mortar stores. The SRC’s manifesto suggests that increased funding for law enforcement and the introduction of an elected Scottish police and crime commissioner could curb retail crime and restore consumer confidence.
Proposed Solutions
The SRC’s proposal to place retail at the heart of economic decision-making comes with several recommendations aimed at revitalizing high streets:
Competitive Business Rates: One of the prominent suggestions is to introduce a more competitive rate structure than that found in England. Less financial strain could enable retailers to invest back into their businesses and infrastructure.
Simplified Refitting Processes: The SRC calls for streamlined processes that would ease the burden of refitting shops. This could potentially make it more appealing for new retailers to enter the market and for existing businesses to adapt to changing consumer preferences.
Infrastructure Investment: Enhancements to public and private transport networks are essential. Making town and city centres more accessible can attract foot traffic necessary for retail longevity.
- Support for Public Safety: Ensuring safe shopping environments is crucial. By proposing increased funding for law enforcement, the SRC believes that confidence can be restored in urban shopping areas.
The Government’s Role
Deputy First Minister Kate Forbes acknowledged the tough climate facing retailers and emphasized the Scottish Government’s current initiatives aimed at economic recovery. Notably, she mentioned the provision of £733 million in relief for retailers through the Small Business Bonus Scheme.
However, she also pointed out the limitations imposed by the lack of comprehensive economic powers, especially concerning taxation and business oversight. Forbes argued that a reversal of the recent increase in employers’ national insurance contributions by the UK government is vital for business confidence.
The Political Response
Across the political spectrum, there is recognition of the urgency to recalibrate economic policies to support retail effectively. Conservative Party representatives such as Murdo Fraser have stressed the need for a shift in government focus to prioritize business growth, advocating that this is essential for funding public services and revitalizing urban environments.
Conclusion
Retail is a foundational element of Scotland’s economic fabric, supporting jobs, providing services, and contributing to community cohesion. The SRC’s call for action should not only resonate with government officials but also inspire a collective response from consumers, local businesses, and civic leaders. In navigating the realities of modern retail—marked by online competition, economic pressures, and shifting consumer habits—effective policy solutions can pave the way for revitalizing Scotland’s high streets. For a prosperous future, it is imperative that town and city centres are at the core of economic decision-making to foster resilience, growth, and ultimately, a thriving retail sector.
By placing retailers at the heart of economic policy, Scotland can not only salvage struggling high streets but also embrace a transformative pathway that prepares them for the future.
