The Store Through Time
A microcosm of UK retail restructuring and retail
planning?
Michelle Lowe*, Steve Wood* and Neil Wrigley**
* School of Management, University of Surrey
** School of Geography, University of Southampton
Our focus today…
• To argue that this store is a microcosm of
structural change across the UK food industry
• To provide case study evidence of how retailers
are becoming strategic in managing the
development process
• Our focus today will be on the second of these
aims
Presentation outline
• A new retail format – Carrefour enters the UK in 1974
• A focus on recent strategic management of the store
development process
• Recent adaptive retail strategy
• Planning regulatory tightening
• Asda Wal-Mart background
• Strategic behaviour at Chandler’s Ford hypermarket
• Conclusions
A new retail format – Carrefour
enters the UK
• July 1974 – Chandler’s Ford, Hampshire
• Carrefour open a 50,000 sq ft store emblematic
of a new era of ‘modern’ retail development of
which there was little experience in Britain.
• A hypermarket based on ‘the French model’
(Department of the Environment, 1976, 2)
A new retail format – Carrefour
enters the UK
• A gross ground floor area of 102,000sq ft
– 50,000sq ft was sales area.
– A mezzanine floor of 21,000 sq ft which housed a selfservice restaurant for the public, staff canteen, offices and
more storage space.
• Unusually for its time, sold a wide range of non food
goods in addition to its food offer, including clothes,
DIY and garden supplies, and electrical goods.
• Incorporated a “drive thru” petrol filling station and a
tyre bay ‘where customers [could] buy tyres and have
them put on while they shop’ (Department of the
Environment, 1976, 2).
A new retail format – Carrefour
enters the UK
• Subsequent changes in ownership
– 1989 – Gateway takeover
– 1991 – Asda
– 1999 – Wal-Mart acquires Asda
Recent adaptive retail strategy
• Retailers are flexible – they ‘had understood the
recent changes in government policy and had to
some extent adjusted their development
strategies’ (Guy and Bennison, 2006, p 960)
• Retailers attempt to influence the “rule-making”
(Pal et al., 2001)
• Retailers challenge established rules (Wood et
al., 2006)
Retail planning tightening
• Since 1996: Planning Policy Guidance Notes (PPG6)
– Introduce the “needs” test
– Sequential test
– Protection of town centres
• Planning Policy Statement 6 (PPS 6) in 2005 reaffirms
core values
• Barker Review 2006 – makes the case for elimination
of the “needs” test
• White Paper of May 2007 suggest potential for easing
of red tape (and will replace “needs” and “impact”
tests).
Asda – Strategic Market Behaviour
1) Round 1: Challenge the “rules”
• ‘Successful performance requires
identification of the opportunities and
constraints imposed by the regulation
authorities, prediction of how these
constraints might shift over time, and
identification of opportunities for influencing
the way in which these things occur’
(Cronshaw and Thompson, 1991, p 91)
Asda – Strategic Market Behaviour
• Sept 2002 Application to Council for a
Certificate of Lawfulness to construct a
mezzanine floor of 50,000 sq ft (already a
sales area of 83,305 sq ft)
• Eastleigh Borough Council refused
permission in May 2003 on the basis:
–
‘[the mezzanine] constitutes development for
which planning permission is required.’ (HM
Planning Inspectorate, 2004, p 1)
Asda – Strategic Market Behaviour
•
Asda Wal-Mart appealed to the High Court at the
start of 2004 and won.
•
This case (and others) catalysed a rush to mezzanine
construction across the food and non food retail
market
…and a round of (re)regulation
•
–
–
The retailer’s ‘vulgar boasting’ catalysed interest in
legislative intervention (Gummer, 2004, p 57).
‘significance of uncontrolled mezzanine installation,
particularly in out-of-centre locations…potentially
undermines the Government’s key objective for town
centres’ (ODPM, 2005, p 6)
Asda – Strategic Market Behaviour
• Round 2: The on site replacement proposal
• June 2005: Proposed demolition of the
existing store and the redevelopment of the
site to build a new two storey store of 214,000
sq ft (gross) including a decked and surface
level car parking (1011 spaces).
Asda – Strategic Market Behaviour
• ‘…[mezzanine] appeal on 20 February 2004
confirmed that there is no restriction on the
level of sales floorspace permitted at the store.
The additional 14% could, therefore be
accommodated at the store at present without
the need for planning consent…This is a
material consideration in assessing the merits
of this proposal.’
• (Asda Wal-Mart, 2005, p 23, my emphasis)
Asda – Strategic Market Behaviour
• September 2006 – Eastleigh Council refuse
permission
• Late 2006 - Asda extend their mezzanine and
add a travellator.
• April 2007 – Asda Wal-Mart appeal against
Eastleigh’s decision.
• The story continues….
Asda – Strategic Market Behaviour
Conclusion
• A store as a case study of retail change
• The retailer is an active agent in redefining the
planning “rules”
• Context specific nature of strategy - “strategy in
action”:
– Retail innovation ‘is not wholly seen as being the product of
deliberate design. Winning formats emerge from an
opportunistic and incremental process’ (Reynolds et al.,
2007, p 658).
– ‘Incremental evolution makes it hard – and from a retailer’s
point of view, often undesirable – to set a format in stone’
(Reynolds et al., 2007, p 658).