Money Programme

Up to 35,000 shops could be shut during the course of 2009 reveals research obtained by the BBC’s Money Programme.

According to research firm Experian, shops on the high street could be closing at up to a rate of a hundred every day.

The findings feature in a special programme, Mary Portas: Save Our Shops, BBC Two, Tuesday 23 June at 9.00pm, presented by international retail guru Mary Portas exploring why the nation’s favourite pastime is under threat – and why it matters.

Mary Portas visits some of the UK’s worst hit and most boarded-up high streets to see how bad things can get. She also speaks to leading figures on the high street including Sir Stuart Rose, Executive Chairman of Marks and Spencer and Justin King, Chief Executive of Sainsbury’s, to get a view of what this recession looks like from the top of the retail ladder.

Retail is vital to the British economy. Not only do we spend 40% of our income on retail, it’s also the biggest employer in Britain accounting for one in nine jobs. When people stop shopping, the real economy suffers.

Charlie Mayfield, Chairman of John Lewis, says: “Retail employs more people than any other private sector business in the UK. So it matters a lot for jobs and it’s not just any jobs because actually retail offers jobs for people who want to be creative, people who want to work in distribution, someone who wants to work part time. You know, retail can offer a huge range of jobs. So it’s actually vital to the economy.”

Since late last year at least 67,000 more shopworkers have found themselves looking for jobs.

According to leading accountants BDO Stoy Hayward the worst is still to come. They predict 4,300 retail businesses – large and small – will go bust in 2009. But next year, they predict more than 7300 retail businesses will collapse, as customers lose their jobs and see pay packets shrink.

Many of the leading high street retailers are conscious about the future. Sir Stuart Rose, Executive Chairman of Marks and Spencer, says: “Since Christmas it hasn’t got any worse and I think in the current environment not having got any worse is probably a win. But it is too early to say green shoots. We are all very conscious as retailers. Let’s see how the rest of the year pans out. I mean we are in for a very interesting time.”

Justin King, Chief Executive of Sainsbury’s, adds: “I think what we are seeing is getting over the worst of the shock of entering a recession. It is less bad than we feared but I don’t think you can start to say its green shoots just yet. We are certainly not seeing growth returning in total to retail markets.”

When towns lose too many retailers, they can literally lose heart. Their whole purpose as shopping centres vanish, along with their customers.

The research by Experian also found that the country’s three ghostliest ghost towns are Walkden in Greater Manchester, Harwich in Essex and – emptiest of all – Gateshead on Tyneside, with almost 60% of its shops standing vacant.

Mary Portas looks at retail success in central London and visits market town, Tewksbury, where a campaign is on to save the high street from oblivion.

Sir Stuart Rose says: “It’s [shopping] about social interaction, it’s about excitement, it’s about sharing, it’s about newness, it’s about really expressing one’s self. The high street for me is a really important place and I think in Britain we’d be very much poorer off without them.”

The Money Programme will be the first BBC Television programme broadcast in virtual online world Second Life.

Reporter Max Flint and his spiky-haired alter-ego, MP Masala, travel deep into cyberspace to meet its virtual entrepreneurs, and find out how real fortunes are made.

The programme will explore two different examples of these virtual worlds.

First, places such as Second Life, which attempts to recreate the real world, with real trading and real money changing hands, but which is free to enter.

Multi-nationals like Reebok, Nissan and Calvin Klein are also getting in on the act and making real money selling “virtual” products in Second Life.

Secondly, Massively Multiplayer Online Games (MMORPG) which charge monthly subscriptions to participants, like World of Warcraft which has more than eight million paying members.

Both Second Life and MMORPGs are proof that there are real fortunes to be made in cyber space.

Flint (the real one, that is) travels to San Francisco to meet one of the industry’s biggest names: Philip Rosedale, the creator of Second Life.

He also meets the people behind Reebok’s virtual shop, and then in London visits marketing company Rivers Run Red.

Rivers Run Red has amassed a multi-million pound turnover by doing all its business inside virtual worlds, including creating the cinema in Second Life where The Money Programme will be “screened”.

But virtual riches bring virtual crime, and the programme will also look at how the industry is responding to MMORPG players who illegally trade items for real money.

There are two ways to watch this episode of The Money Programme…

In the real world, you can see it on Friday 1 June 2007 at 7pm on BBC Two.

If you are in Second Life, get your avatar to the Rivers Run Red Cinema (coordinates Rivers Run Red 200, 123, 45) at 7pm, 8pm and 9pm on 1 June to see the first BBC programme broadcast in Second Life.

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