Monday 14 August 2023

London Chamber of Commerce and Industry (LCCI) is calling for the viability of local owned shops to be considered in the Government’s plans to reduce food prices.

LCCI is supportive of the Government’s plans to reduce food prices, and the Chamber has been active in supporting the Government’s Help for Households campaign to ensure businesses and the Government can work together to support households during the cost of living crisis.

However, in a letter to the Chancellor of The Exchequer, Jeremy Hunt MP, LCCI expressed concerns that agreements reached between the Government and large-scale retailers, such as supermarkets, could bypass locally-owned shops, who are critical in bringing communities together and often lack the finances necessary to weather high supply chain costs.

According to the House of Commons Library, there were 5.5 million private sector businesses in the UK in 2022, compared to 5.9 million in 2020, a fall of 6.8%. This is only the second year-on-year fall in the number of private sector businesses in the UK since comparable records began in 2000 – the other was between 2017 and 2018, when the number of businesses fell by 0.5%.

Many locally-owned shops have struggled to compete with ‘one-stop-shop’ retail centres and supermarkets and have been left out of important debates on energy support and post-pandemic recovery, suffering as a consequence.

Therefore, any decision made to lower food prices must include the voices of local shops vital to the communities they serve. Local shops encourage community spirit, create desirable high streets and serve deprived and disconnected communities who often cannot afford additional costs of transport to larger retail centres and supermarkets.

James Watkins, Head of Policy and Public Impact at the London Chamber of Commerce and Industry (LCCI) said:

“Locally owned-shops – from convenience stores to butchers, DIY centres and grocers – play an important role in serving local people and creating desirable communities for residents and visitors alike. Shops suffered throughout the dual blows of pandemic lockdowns and the rapid rise in energy prices and have little working capital to withstand increases in food prices which may drive away customers. 

“The Government must include small shops in its discussions with retailers regarding reducing food prices, to ensure that small shops are able to compete with larger shops also cutting costs. We have written to the Chancellor on this issue and look forward to his response. If the Government does not make the businesses that serve our local communities central to any plans to reduce consumer costs, high streets across the capital and country could suffer.”

Notes:

• Click to read LCCI’s letter to the Chancellor on the topic.

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