Thursday, 12 December 2013

The changing face of retail...

Being part of the construction industry we know how hard the recession has been.

There are not many industries which have been as hard hit as construction but retail must be a contender. Not only has it been effected by reduced spending but also the way people shop has changed dramatically.

This change in spending is having an impact on all forms if retail, be it high street or out of town. 

As people increase the level of online shopping the supermarkets are left with an growing amount of unused out of town square footage which is not generating turnover or profit. Their smaller local shops are growing but these deliver a smaller profit per square foot.

The non food retail sector has similar if not greater challenges. We have already seen the demise of the traditional bookstore and record shop as people have either bought books and music  online or converted to downloads. 

Book stores and music shops  still exist but now they have moved to a more specialist offer.

Clothing and electrical goods are now being effected by the growth of online trade. With lower overheads the online store can offer a  lower price for the same product.

So where doses this leave retail in the future. I think the out of town mall faces one of the biggest challenges. The retail offer will reduce  and these malls will become a destination or leisure venue. Restaurants, cinemas and coffee shops will be interspersed with specialist shops.

The out if town retail park faces the biggest challenge. Big shed shopping does have low costs but it has to compete with the Internet on price.

The real opportunity is in the high street as shoppers change their habits. Shopping has become far more local, specialist and social. Families will carry out their large shopping on line but this will be supplemented with fresh and specialist produce such as meat and vegetables. The mass produced produce will be used but will be enhanced by specialist offers

The social aspects of the high street will continue to grow. We will have even more coffee shops, bars and restaurants where people can meet. This mix will attract people throughout the day and night making the high street the centre of the community.

We have come full circle from where we were 30 years ago where the corner shop played a central role in the community.

While the high streets prosper we will see decline and change out of town. Retailers will try new ideas and concepts to adapt their existing space. We are already seeing Tesco adding restaurants and coffee shops to their stores however I am not convinced that these will provide a long term alternative to the high street community.

Wednesday, 4 December 2013

Education, Education, Education.

You might remember this battle cry from Tony Blair when he was elected in 1997. 

I read a really disturbing article in the Sunday Times this week which I think will have a huge impact on the future of the United Kingdom and that of our children.

On Wednesday this week the OECD ( Organisation for Economic Co operation and Development) will publish its global survey of 65 countries regarding educational standards. What this report will say is that the UK has made no progress from where it stood 4 years ago. 

It may surprise many that the UK are 25th placed for reading, 28th for maths and 16th for science. The counties who are leading are China, South Korea and Singapore. All countries who already have thriving economies and are developing an exceptional workforce for the future.

The UK is sitting behind Estonia and Poland.

The Labour governemnt did spend billions on education as well a many new school buildings however clearly this has had no impact on outcomes.

There is an arrogance in the UK which goes back to the days of the British Empire. We believe we are better than everyone  else in the world. It's a very similar situation to the English football team. Every time there is a world cup we truly believe we can win when in reality we don't even get to the qualifying rounds.

It is similar when we compete on the global stage. Not only can we not compete with those a the top of the league such  as China or South Korea they also have excellent education which will only make them stronger in the future.

In the decades ahead the gap will continue to grow and we struggle to be competitive in a global market. Our young people are ill prepared and unaware of the world they coete within. 

I am worried for my children's generation but even more so for our children's children. My generation has benefitted  from the last and have been supported by a fantastic welfare system. Unfortunately we have spent the money and we can no longer afford to provide the level of support we are used to.

What we must do is become a global power again and that can only be achieved by developing an education system which produce the best minds on the planet.

I don't see this as something to score political points over as it is too important. What I do know is what the previous government tried has failed. The league tables are evidence enough.

The issues are not only financial but also cultural.

In the UK it is forbidden to criticise  nurses or teachers. Teachers must take note of where we area in the league tables and accept it's not good enough. 

If we were a football club,we are languishing in the lower divisions and not improving. In football we would sack the manager and invest in training and coaching. If we are going to change something we need to change something.

Parents also have to take responsibility and need to invest time in their children and support schools.

This is so important as we all must play our part. The previous government thought the answer lay in new buildings. Clearly spending billions is not enough. What we need is lots of incremental change. Government, parents and teaches all need accept its not good enough.

We mist get away from blame and accept our system is not good enough and has to improve. We have to accept we may upset some people along the way but I believe this is a price worth paying as without change the future looks bleak for future generations in non league football.

Monday, 2 December 2013

Here we go again?

The construction industry has a habit of sticking to what it has always done. 

The term contracting suggests that there is a legal agreement in place and that a relationship falls between the commencement and completion of this agreement. This may be over simplifying things but I believe it is this project and contract approach which is at the root of the lack of innovation across our industry.

As we head toward the end of 2013, those working in London are thinking boom times are here again. This confidence is having a ripple effect and is starting to effect the regions also

While in recession there has been an opportunity for discussion and debate as to how we could do things differently. Building Information Modelling has been the biggest development and discussion over the last 5 years.

BIM started off in the states as the reference term for the federating of 3D geometry. However, and particularly in the UK, it has become a collective movement for the improvement of the construction industry with the focus being on a single language which can be shared openly.

Many small to medium sized companies have invested and developed skills which can take the industry forward. However the laws of the jungle come into force when capital expenditure increases and confidence grows. 

The main contractors now have projects  and cash flowing through their accounts once again. They have projects  which have to be serviced. The quick answer is to recruit skills and talent from the companies who have invested in lean times. The lure of high salaries and company cars from the prelim pot is often overwhelming for the cash starved construction newcomer.

Whilst this is to be expected  and is the law of the jungle, the down side is we become project orientated as an industry once again and don't look beyond the current project or the potential for continual improvement. 

There are exceptions however who give hope for the future. Laing O Rouke are an excellent example of a business who have invested in the future, through the development of  processes and people. Their commitment to a high tech concrete factory and its technology alone has to be admired. They have continually invested in their young people and truly nurture talent.

Unfortunately in the recession margins have been slashed and their precence in the UK has reduced. I hope that clients will look at the long term value that the investment Laing O Rouke make can have on the wider industry and employment.

The only way we will achieve our 2025 vision is to take a long term view and to invest in our young talent. I hope the large contractors will take some of their profits  from an improving market and invest it wisely in the future so we can develop new intelligent methods of working.