Scotland’s retail sector: key themes from our discussion with the SRC and the First Minister

It’s not every day that you host the country’s leader at your offices.

However, that’s what happened earlier this week when Burness Paull welcomed the Scottish Retail Consortium (SRC) senior leadership team and a stellar line up of retail leaders for a roundtable lunch in our Edinburgh offices with Scotland’s First Minister, Rt Hon John Swinney MSP, for a discussion ahead of this year’s Scottish Parliament elections.

The focus for discussion was the future of Scotland’s high streets and delivering economic growth.

The SRC has been consolidating hard-won gains for the sector resulting from tireless campaigning throughout the current parliament. Its focus will shortly shift to what policy promises can be secured ahead of the elections.

At Burness Paull, we are proud of our enduring connection to the retail sector. Many of our clients have a direct interest in retail – whether they be traders, investors, landlords or developers.  For our retail-focussed lawyers, these events are a valuable opportunity to hear about the challenges facing the sector first hand and advocate for our clients’ interests.

Many of the themes that were raised will be familiar to those operating in the retail sector.

Retail crime continues to be a matter of significant concern for the industry. While funding from the Scottish Government for a police retail crime task force has been warmly welcomed, more action is needed. Attendees were glad to hear the First Minister speak of being very much open to what more can be done to deal with this persistent problem.

Trading in illegal, counterfeit and non-compliant goods remains an issue. This is a particular problem on local high streets – and undermines the ability of legitimate traders to turn a profit and maintain jobs in their communities. Trading Standards is stretched, meaning many selling illegal goods go unchecked. The First Minister promised a follow-up meeting to look at this specific issue in more detail.

It's also clear that the cost of doing business is an ongoing and significant challenge. The burden of non-domestic rates on bricks and mortar retailers continues to be a priority concern. The disparity between rates charged in England (where the business rate is to be significantly lower from April) and Scotland is stark for those trading across the country. The danger is that it becomes easier to make the case for investment south of the border. The First Minister raised his own concerns around anomalies arising in the most recent rates revaluations – a matter for further consideration.

Similarly, regulation (for example, the new employment rights legislation) brings new burdens and costs for retailers. While employment matters are reserved to Westminster, retail’s key role in creating jobs across communities means it is on the front line of coping with change. Anything that further erodes margins needs to be carefully considered.

Finally, rent controls and the temporary suppression of the build-to-rent sector was discussed. The relevance to retail is the desire to see people return to city centre living with the attendant uptick in retail footfall. The First Minister was able to report that the Housing Bill in its updated form now offers protections for tenants while securing a more encouraging environment for investors.

With the retail sector being such a large and valued employer, it is clear that the SRC and its members will continue to have an important voice in the debates leading towards this year’s election – which will hopefully result in supportive policy that allows the retail industry to further grow the significant contribution it makes to Scotland’s economy.  

At Burness Paull, we continue to keep close to the evolving conversations and policy changes to ensure that we continue to provide the best-informed advice and guidance to our retail focused clients. If you would like to discuss anything raised in this article, please get in touch with Graeme Bradshaw or your usual Burness Paull contact. 

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