Retailers queue up to join the exodus to out-of-town sites

Nigel Cope

City Correspondent

Out-of-town superstores will continue to grab market share from Britain's high streets, with the giant stores predicted to account for a third of retail sales by 2001, according to a new survey.

The report by retail consultants Verdict Research says that, in addition to supermarkets, DIY stores and electrical retailers, which have long been expanding on out-of-town sites, stores groups in other sectors such as furniture, carpets and clothing are increasingly following suit.

The report highlights the rapid out-of-town expansion of companies such as Allied Carpets, Carpetright, DFS and Ikea. PetsMart is rapidly expanding its out-of-town pet accessory stores, while the founders of Pet City, which was taken over by PetsMart last year, are already testing a new format called Craft World.

Billed as a "category killer" for the craft and hobby sector, it caters for all manner of interests ranging from knitting to picture framing. The idea is modelled on US stores such as Michaels and Fabricentres of America. The management, led by Roger Pedder, chairman of shoe group C&J Clark, plans to open a further five stores in the autumn.

In clothing, Burton, Next and River Island are all testing out-of-town formats, though their expansion is certain to be resisted by planning authorities eager to protect high street clothing stores.

According to Verdict, superstores accounted for 51 per cent of the pounds 8.4bn increase in total retail sales during 1996. Verdict's Clive Vaughan says the proportion will be even higher this year, as much of the building society windfalls will be spent on high-ticket items such as furniture, electrical goods and carpets that are increasingly sold in out-of-town warehouse-style stores.

The report forecasts that the number of superstores will grow by a quarter to 6,070 by 2001. They will then account for a third of UK retail sales, up from 28.7 per cent last year.

Mr Vaughan says the superstore format is starting to move more upmarket. "What we are seeing is superstores moving into the next generation. We are seeing less of the old tacky sheds and a move to more professional retailing standards."

High streets can fight back, he says, but will need better parking, security and pedestrianisation to provide attractive destinations. The report calls for the introduction of town centre managers to co-ordinate a counter-attack by towns.