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About Small Retailers



For the purposes of this paper a small retailer is defined as a retailer that employs between zero and 10 employees. As per this definition, in London in 2004 there were 34,763 small retailers with a total of 104,154 employees.  Employing this same explanation, in Great Britain (Great Britain) in 2004 there were a total of 243,508 small retailers employing a total of 831,099 employees.  Small retailers make up 87 per cent of all retailers in London and  85 per cent for Great Britain as a whole. London consists of approximately 14 per cent of all small retailers in the whole of Great Britain.

During the years 1998 and 2004 the number of small retailers reduced by 4 per cent (a full amount of a little over 10,000 small retailers) in Great Britain, and by 2.3 per cent (a little more than 800 small retailers) in London. During the same duration of time the number of large retailers (defined as those employing 10 or more employees) heightened by 9.5 per cent in Great Britain, and by 13 per cent in London.  On the other hand, carefulness is required when utilizing such figures to form an opinion on differences in the number of different sized retailers across time. This is due to the fact that the number of small retailers as explained by the number of employees can be distorted by a number of elements. First of all, the number may be increased by a rise in the quantity of new retail business that have sprung up. On second count, the quantity may be reduced by a number of small retail organizations exiting the industry. In addition to these factors the quantity of small retailers may rise if several medium-sized retailers decrease their employees and downsize (and as a result be re-categorized as small retailers). And last of all, the quantity of small retailers may reduce if several small retailers increase in size and turn into medium-sized retail businesses. For this reason, even as there has been a smaller decrease in the quantity of small retailers in London as compared to the UK, over the past few years it is hard to be accurate about the causes for this discrepancy.

As has become obvious from other research on the retail industry, and as the small retailer firms revealed to us during the course of this study, it is hard to acquire data from retailers themselves. For this reason most of the data acquired for this paper ha to be obtained from interviews with small retailer firms, instead of from straightforward responses from small retailers themselves

After a study of the literature and the resulting study, this dissertation then examines a few of the possible steps small retailers might execute in order to alleviate the harmful effects of some of these problems and ends by summarizing the main results of the paper and discusses the suggestions for retailers to take.



Planning policy



Even though it is possible that small retailers that compete directly with large retailers will confront very hard conditions when a large retailer come into their area, because of the expenses and brand advantages of large retailers, it is possible that other small retailers in the area may profit, with respect to enhanced sales, due to enhanced footfall caused by the large retailer. This means that it has been contended that when a large retailer comes into an area it brings with it a greater level of footfall to the location. Other retailers in the neighbourhood of the large retailer will profit from this increased footfall because of increased sales.


On the other hand, another consequence of this increased footfall is possible to be higher rents – as more retailers see the location as feasible enabling landlords to raise rents. For this reason, other small retailers in the location that do not compete directly with the large retailer may find circumstances harder if their sales, which will profit from the increased footfall, are not enough to cover the higher rental, which also is a consequence of the increased footfall. All the same, even though the entry of a large retailer to an area may have an effect on a number of retailers in the location– both because of direct competition as well as through their impact on rental levels – it is possible that other retailers will come in as a consequence of the greater footfall thus preserving retail (even though not the same retail as previously) in the location.


Some have contended that this alteration in the organization of the High Street should be opposed, stating that small retailers offer variety of choice for consumers, supply goods and services that might not if not be offered by the large retailers and usually result in a more socially agreeable environment. Despite this, proof that small retailers do result in about such an environment is not strong. Indeed, it can equally be stated that if there is a demand for a specific good or service then the large retailers will acknowledge the consumer demand and cater to it; that is having small retailers is not a compulsory stipulation for offering diversity and choice in goods or services. Apart from in the case of retailers that offer very specialised goods or services, it is possible that large retailers will typically offer goods and services wherever there is enough consumer demand for them.


Planning policy
One cause for large retailers entering into high street locations could be the consequence of changes to the Office of the Deputy Prime Minister’s planning policy in the shape of Planning Policy Guidance 6 (PPG6) Town centres and retail developments, in 1996. The main provision of PPG6 included:


• A focus on a plan-led approach to leading development in town centres
• A focus on the chronological method for selecting sites for development
• Backing for local centres.


A revised Planning Policy Statement (PPS6), which replaces PPG6, was in print in early 2005. Roughly speaking it keeps the focus on in-town development.


Changes in consumer demand patters
In addition to planning policy, alterations in consumer demand may have led to the rise in the number of small format stores of the large retailers. For example it could be contended that in recent years while consumers’ disposable income has risen, the amount of time that they have for shopping has decreased. These alterations may have led to a rise in demand for longer operatng hours and increased convenience both with respect to location (therefore more high street stores) and with respect to the goods that are wanted (for example more ready-prepared foods).


The large grocery retailers have modified according to the fluctuations in consumer demand patterns by offering ‘fresh and chilled’ food and by increasing their opening hours, with some offering 24-hour operating times. Besides this, many stores of the large grocery retailers (including large and small stores) are now operative on a Sunday, subsequent to the easing of the Sunday Trading Laws. This is a noteworthy issue for small retailers because in the past, longer operating hours tended to act as a comparative edge for small retailers over large retailers. As more large retailers utilize longer operating hours this comparative edge is eaten away. Certainly there is proof in the literature to imply that small retailers have observed a reduction in their earnings since the move towards Sunday Trading. The London Chamber of Commerce in its investigation of the independent retail industry set up that just over 80 per cent of respondents to their survey (of small retailers) said that the letting of Sunday Trading Laws had led to a reduction in their revenues.


Small retailers have also discovered that it is harder to modify according to these changes in consumer demand patters. Part of the cause for this is due to the expense involved in adapting to the changes. For instance, in comparative terms, it is more costly for small retailers to stay open for longer hours than it is for large retailers. The logic for this is that large retailers are apt to have some staff working 24 hours a day (for instance people stocking shelves) and for this reason it does not raise their costs by the same proportion to stay open longer.
In addition in many cases small retailers will not have the floor space needed to offer ‘fresh and chilled’ foods or other products demanded as a consequence of changes in consumer behaviour. In addition, in instances where floor space is not a problem small retailers may find it difficult to obtain the capital to make the required changes to their store to be able to adapt to consumer demand, for example for buying the fridges and cabinets required for ‘fresh and chilled’ foods.


It can be deduced that competition from large retailers, specially in the grocery sector, has affected greatly small retailers. Probably most significantly, the greater buyer clout that the scale of large retailers delivers enables them to be much more competitive in terms of price (in their large or small format stores) as opposed to small independent retailers. The trend of the large, particularly grocery, retailers towards offering a greater range of goods and services in addition to small format stores in high street locations will raise the competition that many small retailers have to face. As a consequence of these changes and other elements such as alterations in operating hours for example a tremendous amount of small retailers’ former comparative edge in terms of convenience has been eroded.




Marketing Strategy



Marketing strategy is the process though which organisations use their scarce resources to achieve competitive advantage in an industry through creating opportunities for increased revenues by applying various methods and techniques (Baker 2008). According to Ferrell and Hartline (2007) the strategic planning process involves an in depth analysis of an organisation’s internal and external environment and implementing tools and techniques to gain a competitive advantage within this environment. The strategic planning process is also referred to as a situational analysis where the situation and environment is evaluated and marketing techniques are implemented through a specific marketing strategy. Implementing a marketing strategy is not only important to gain a competitive advantage but also for the long term survival of an organisation especially in the retailing industry. According to Lamb, Hair and McDaniel (2008) implementing a marketing strategy in any type of retailing company are very important and lead to strategic competitive advantage within the retailing industry.


Sethi (2009) described ten methods of improving a marketing strategy in the current environment which include new strategies for new times, segmentation and decision, search for newer markets, emphasis on value and brand portfolio, updating distribution channels, helping the consumer through various techniques, providing state of the art products and services for consumer convenience, applying effective communication techniques, going digital and using various Information Technology tools and techniques and analysing the changing patterns of consumer demands and behaviour.


Types of Marketing Strategies
There are several types of marketing strategy as described by many researchers and practitioners which are based on various concepts and frameworks. According to Christ (2009) the types of marketing strategies applied by companies are market leader, market challenger, market follower, market niche and alliance marketing. Turnbull and Valla (1986) presented five types of marketing strategies which include technical innovative strategy, product adaptation strategy, availability and security strategy, low price strategy and total adaptation or conformity strategy. Companies implement one of these types of marketing strategies or a mix of these strategies to gain competitive advantage within an organisation.




Problems Faced by Small Retailers



Throughout at least the past two decades the market share of large retailers, including Tesco PLC has increased considerably.  This increased size has led to increased buyer clout for large retailers and has consecutively led to large retailers being able to sell their wares at decreased prices as compared to small retailers in several cases. This has led to a type of honourable circle for retailers such as Tesco whereby the economies of enhanced buyer clout can be spent in superior customer services or lower prices which then lead to increase sales and so even more buyer clout and so on an so forth. As long as this progression does not lead to extreme market power, a matter which the national competition authorities would have to take into account, it is expected to be advantageous to consumers by resulting in lower cost goods. Supposing that large retailers are not big enough to employ market power (i.e. to increase prices without dread of corrective proceedings from competitors) then putting a ceiling on the increase and growth of large retailers, in order to amplify the number of small retailers will lead to increased prices to consumers (as the capacity for retailers to take advantage of increased buyer clout will be restricted).

Limiting the development and progress of large retailers, because of its impact on restricting cost reductions, might also lead to restraining the number of regions in which retailers work. This means that reducing the expenses of operation is apt to imply that regions which until that time were not economically feasible become more feasible and so competitors enter into the region. Limiting the expansion and development of retailers such as Tesco is apt to decrease economies of scale and, as a consequence, may restrict the number of regions retailers operate in.

These consequences are motivated mainly by the buying clout enjoyed by large retailers. Independently, small retailers are unable to attain any considerable buyer clout. On the other hand, to the degree that they create buying faction, small retailers may be able to tackle some of the competitive return of large retailers with respect to buyer clout and so likewise tackle some of the consequences outlined above.

The latest attempt by retailers, principally Tesco, to set up small format outlets in high street sites along with increased operating hours has resulted in smaller retailers lose a great deal of their earlier unique selling point of handiness (when it came to site and operating hours). Similarly as the case with the increase in buyer clout, these adjustments are the consequence of market forces and imply that no public policy interference is needed on the pretext of economic efficiency (except that believed to be necessary by national competition authorities to tackle any competition problems that may result as a consequence of these changes).

While the expenses of setting up shop in London, as weighed against the remainder of the country are greater for all retailers, there are some expenses that influence specifically on small retailers. The expense of retail felony seems to impact more heavily on small retailers as measured up to large retailers. Into the bargain, the expenses of acting in accordance with government laws, such as the Disability Discrimination Act, fall unreasonably on small retailers. Local Authorities and other organizations such as chambers of commerce or trade associations, could offer backing and/or counsel to small retailers on observance of rules in order to decrease the expenses of putting into practice legislation.

The ease of access of retailers to customers is a problem for all retailers in UK, nevertheless a few of the problems of availability influence more severely small retailers than Tesco. This is due to the fact that Tesco operates on a scale that allows it to extend the expense of interference to customer availability over a higher level of sales (typically in a larger number of outlets) in contrast to small retailers. For this reason it is critical that the effect on small retailers of possible changes to means of transportation is taken into account by the authorities concerned.

Whereas several of these elements, along with elements such as the problem of ancestry, have led to a number of small retailers shutting shop, there are methods by which small retailers can compete more efficiently with Tesco. These consist of heightened specialisation and competing on the basis of customer service among other factors



Understanding ethics Concept of ethics



Philosophical developments advanced by think tanks in different fields, has led to human civilization. Medicine, politics, economics, ethics, government, military, business, entrepreneurship, arts and sports, among others, have underestimated the dexterity and prolificacy of philosophers. Philosophers ethics for instance, has been shaped by philosophers such as Aristotle, Emmanuel Kant and John Locke have revolutionized all these particular fields. As a branch of philosophy, ethics is a moral philosophy that addresses the questions concerning morality, goodness or badness of a conduct by an individual or community


Aristotle


He existed between 384 BC and 322 BC; he advocated that ethics be seen as a self realization. To Aristotle, the lucidity of ethics is based on the fact that if an individual acts in accordance with his nature and to the realization of his full potential, he will be contented. Aristotle visualizes ethics as the key contributor to the realization of individual’s full potential. He postulates that at birth, the child is not a person, but the potential to become a person. In order to becomes a real person, that child’s intrinsic potential must be realized. Aristotle mentions that the application of ethics makes the society acts in accordance with nature so as to nurture the child’s latent talents so that he may be complete and contented (Bakewell) .


According to Aristotle the absence of this ethical observation by the parents or the society may lead to frustration and unhappiness. This frustration emanates from the potential that is never realized of a person. Aristotle asserts that this will eventually lead to poor. Ethics is also the most primeval factor in the realization of a happy society since it allows for self actualization, while happiness in itself is seen as the ultimate goal of human existence. To give emphasis to his point, Aristotle maintains that socio-political constructs such as wealth and civic life are the only means to the end, and therefore being ancillary to ethics and the happiness. He advocates that proper ethics must ensure that there is room for awareness of one’s nature, and the subsequent nurturing of one’s talents since they are essential ingredients of happiness according to Aristotle (Barnes) .





To label one or action as “selfless”



To many people the label altruist is likely to solve some difficult mental problem to them. Their definition of altruism is denying ones self for higher good; yet sometimes they do not imagine any person willingly sacrificing all those things that include their conception for the self for some greater cause. After all people with self-interested respect does not willingly give that self respect for anything else. Now how then can a person give accord to the actions that seems to have altruism? To label one or action as “selfless” or “altruistic” will answer this conundrum.


Altruism here is viewed as a character trait while selflessness is seen something that comes easily to somebody because that is part of how he or she work and others does not necessarily posses that same character trait. Some people having explained altruistic actions of others in terms of traits which seemingly they don’t have, need not to speculate further why altruists are motivated to do selfless acts.


This makes those people to fend off some uneasy questions which are of their personal moral duty in relation to altruist’s perceived actions. Therefore polarizing altruism and selfishness to be a personal trait can enable individuals to avoid their moral actions responsibility. Polarity between altruism and self interest will provide a rationalization for failing to be altruistic: because it is viewed as very immense, too much of a sacrifice. This explains apathy and moral laxity towards the problems facing the world.




This ditochomy is not true



In most that talk about selfishness and altruism, theirs has been assumption that selfishness and altruism are polar opposites. According to those discussions to do moral thing always mean being an altruists. The moral action of the altruists is not influenced by self-interest decisions but is influenced by morally accepted decisions. Conversely selfish act is to prevent or to make impossible for a good to happen which may have been morally implicated.However this view was criticized by descriptive theory of egoism, Feinberg and psychological by arguing that moral deeds are sometimes leads to compromising self needs for other causes.


This ditochomy is not true


It is necessary to note that those who do altruistic acts are always aware of the topic and they do the topics that they feel comfortable with and that they fully identifies with. For instance, for the risk of my life I decided to support a government that will advocate for a democratic, stable and peaceful country. The big question is that what is the reason behind my selfless act and what good will I gain? In this case I will gain security in terms of physical and health securities. Also the elements of identity will rise in. That is whenever people see me they will see me as a democratic person. The point therefore is that a person’s self-identity expands beyond a person’s self interest in a very narrow sense, therefore allowing for situations where selfish action becomes a moral one. In the example above to argue that the sacrifice I have made is to achieve altruism is contradictory. Democracy is highly central in protecting myself interest and is more painful for me to give it up. Altruism and selfishness ceases to exist as mutually exclusive acts.
Assuming that there exist dichotomy between selfishness and altruism is derailing peoples moral integrity.




John Locke



Kant, like Aristotle uses a maxim to bring out the importance and essence of ethics Kant. Given the above maxim made by Kant, it is easy to see that to him, the most important concept that used to appraise an action carried out by an individual as either good or bad, is the will. This is to say that to Kant, an action may be deemed bad, in extrinsic terms, but a careful look at the intrinsic underpinnings may justify the action that has been carried out.


John Locke


He performed his duties as a philosopher between August 29th, 1632 and October 28th, 1704. He did not only make contributions touching on political philosophy, but also made cogent contributions towards ethics as moral philosophy. As a matter of fact, Locke’s concept of ethics is considered in social sciences as the Father of Liberalism (Dunn) . According to Tully, Locke’s viewpoint on ethics is found on intergenerational obligation and stewardship. To Locke, the system of intergenerational ethics is based on five factors: the need to preserve human species; the need to prevent any possible destruction or wastage of creation; the need to treat the earth as opposed to owners the need to leave behind, what is enough and good for other people; and the need to respect and preserve every generation’s right to chart its own destiny by making its own political choices. This means that John Locke’s arguments on ethics are merely geared towards ensuring that there is intergenerational social justice and harmony (Tully) .


The preservation of the human species is the primary concern of Locke in ethics. To him, all ethical standards and fundamentals of all natural laws are ancillary to the need to act towards the realization of the preservation of species. Locke adheres closely to Biblical notion that the earth is given for mankind as a form of intergenerational commons and cites King David’s point that, “God gave the world to Adam and to his posterity in common.” To this effect, the chief obligation of mankind as the tenant is to maintain the property or an asset in as good state as it was, primordially. To Locke, therefore, as a tenant, every individual must be guided by the ethics that will safeguard the earth for both God and the tenant-generations that are to come.


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Wolterstorff



Locke asserts further that the practicing of ethics must ensure that the consideration of the “world as commons” must prescribe waste and destruction. Locke states that given that all human possessions are tokens from the Creator, then it is definite that people have ethical and moral obligations to practice due care of possessions that are within their jurisdiction. Locke sums his point by quipping that “God made nothing for man to destroy or spoil.” In almost the same wavelength, he maintains that it is morally binding for persons in the state of nature to consume the claimed resources before they spoil; otherwise he will be robbing others (Wolterstorff).


Locke opines that an individual can and should through legitimate means create his personal property and interests within the bounty of nature, as long as there are enough resources that are left in common for others. The important bit of this is the 21st century world which is totally embroiled in consumerism, capitalism, materialism and the endless pursuit of expansionist acquisitions. To Locke, political duties may be owed by later generations to earlier generations. This is to the effect that the incumbent generations’ authority to make decisions remains ethical if the decisions are not negatively binding and malevolent to the later generations.


In summary, it is important to note that the variety that is extant in Aristotle’s, Immanuel Kant’s and John Locke’s points of view is brought about by the specific nature of their surroundings at a specific time, and their collective worldview. To Aristotle, since the then Grecian culture and empire was not fully amenable to democracy and equity, the need to reiterate the importance of making felicity conditions needed for self actualization by an individual was paramount.


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