Recommendations for the future of the High Street

“Our small businesses are an integral part of the High Street and will be central in leading the transformation of their local economies,” Tina McKenzie, policy and advocacy chair at the Federation of Small Businesses (FSB), told OT when discussing the High Street of the future.

The organisation represents small businesses and is the UK’s leading business campaigner.

The FSB published a new report following a large-scale survey of small businesses, which sets out recommendations to help transform the High Street and meet the needs of business owners.

Recommendations in The Future of the High Street report are separated into the areas of: destination, transformation, experience, infrastructure, and competitiveness.

Within this, the FSB is calling for a specialised fund to support a mobile phone-based loyalty programme for High Street firms, and the launch of community-specific online marketplaces.

The report highlights the need for accessible transportation and facilities to encourage footfall to local businesses, such as High Street hop schemes providing free bus fares on key routes during peak shopping days, or free parking on two Saturdays a month.

Providing a picture of the High Street today, the report explores topics including retail rents, trends in businesses, vacant units, and ethnic diversity on the High Street.

OT asked McKenzie for insight on key findings and recommendations from the report, to consider what these could mean for the High Street.

What would you say are the key pressures facing the High Street currently?

Tina McKenzie, policy and advocacy chair at the FSB: Our High Streets have evolved dramatically through the decades, with the growth of chain stores, the introduction of out-of-town retail and supermarkets, and the arrival of the internet making their mark.

Business rates, parking charges, the planning system and rent also have an impact on businesses and the High Street as a whole. Changes in consumer behaviour and pressure on the public’s purse strings have added to the challenges, evident by the number of empty units blighting town and city centres across the country.

The seismic shift towards online shopping, in many cases accelerated or cemented by the pandemic, has undoubtedly changed the way people make purchases and when they visit High Streets.

Things are evolving but we do believe that our High Streets can have a bright and thriving future, provided they, and the small businesses at their heart, are given the right support, policies and infrastructure.

 

The report outlined recommendations for improving the accessibility of the High Street. Could shifting consumer demographics and behaviours shape demand for this infrastructure on the High Street going forwards?

TM: A focus on accessibility, as well as convenience, is central to the long-term success of High Streets and town centres. Cheaper and more accessible parking options, improved bus transport links and forward-thinking infrastructure, such as high-quality electric vehicle charging hubs, can play a vital role in bringing in visitors to the High Street. Our research shows that half of High Street small businesses say increased investment in public transportation or infrastructure is one of the biggest opportunities for their local High Street.

Amongst our recommendations is a call for comprehensive scooter, cycling and healthy travel access plans, along with improved parking strategies – all of which are tailored for specific High Streets.These plans need to recognise the importance of healthy travel options for both local residents and tourists and aim to reduce congestion and improve air quality around High Streets.

 

How might reform to the business rates system level the playing field for independent and multiple businesses on the High Street?

TM: The presence of both chain stores and independent retailers is fundamental to having a dynamic and thriving High Street. Implementing business rates policies that are tailored to specific locations and sectors can significantly contribute to protecting this diversity. Having variety on the High Street is not just a hallmark of our village, town and city centres, but is essential to their continued vibrancy and appeal. We’d like to see combined authorities and local authorities given discretionary powers to raise or lower business rates levies on businesses of certain sizes or sectors, or in certain locations, as part of devolution deals.

We believe this framework could provide a cost-neutral way for local authorities to support economic activity in certain sectors or locations while maintaining financial balance.

Having variety on the High Street is not just a hallmark of our village, town and city centres, but is essential to their continued vibrancy and appeal

How likely do you think it is that we will see change in the area of business rates going forward? What might need to happen before we do see change?

TM: Business rates are a crucial factor in the success of small businesses on the High Street and, by extension, the vitality of High Streets themselves. High Street businesses, particularly those struggling to compete with online counterparts with lower rate liabilities, have highlighted the pressing need for a tax system that is conducive to growth.

Each fiscal event in the UK provides regular opportunities to fine-tune the various relief businesses can get on their businesses rates. We are recommending that the Government commissions an in-depth evaluation into balancing High Street and town centre property taxes with out of town and online marketplaces. A ‘fundamental reform’ of business rates was promised in Labour’s 2024 general election manifesto and the business community highly anticipates more detail to come about their plans.

 

The report recognises the benefits of diversity in terms of business types and business owners. How could this be supported in the High Street?

TM: High Streets across the UK are more than just local centres of commerce, they reflect our communities. The cultural diversity and richness of many of our High Streets is driven by the ethnicities of small business owners. This diversity should be celebrated not just for the contribution it brings to local economic growth, but the strong sense of social wellbeing it creates.

We want to see this diversity built on, with support given to ethnically diverse High Streets from local authorities by actively engaging with all business owners, including ethnic minority led businesses. Regular monitoring, with the support of local trusted intermediaries would provide local authorities with a deeper understanding of the challenges small business owners face, particularly those from minority backgrounds and help negate cultural barriers.

 

FSB recommendations for digitalisation of the High Street include funding support for website development of small businesses, and region or community-specific online marketplaces. How could embracing hybrid and digital innovations support the place of optometry practices in the High Street community of the future?

TM: High Streets, and the businesses on them, need to make sure they are constantly evolving to changes in consumer behaviour – as well as how small firms want to work. We know that many business owners have both an online presence and a physical base – and the two often run happily side-by-side. It’s so important that small businesses of any sector are supported to navigate, compete and succeed in both realms.

Introducing initiatives like loyalty schemes can encourage local businesses to collaborate and incentivise consumers to shop, eat, and drink locally, encouraging repeat visits, higher spending, and a stronger sense of connection between shoppers and their High Street.

This could be hugely beneficial for small businesses largely based in physical premises, like optometrists, helping to drive footfall to their shop, offering rewards and exclusive perks and experiences.

Creating community-specific online marketplaces could showcase all local businesses regardless of if they have an existing website or not – essentially giving them another storefront, maximising visibility and reach.

 

In your view, what do you see the High Street of the future representing for independent businesses?

TM: Our small businesses are an integral part of the High Street and will be central in leading the transformation of their local economies. This is a crucial moment for the future of our High Streets and with the right support, policies and infrastructure, we think they have real potential to grow as go-to destinations. By providing the infrastructure, flexibility and digital connectivity that modern businesses demand, High Streets will then have the resources available to become resilient, dynamic hubs ready for the future.