How Is The Service Economy Changing?

Question 1

What changes have occurred to services on high streets in recent years?

Answer 1

• Increase in budget shops (e.g. Poundland)
• Increase in charity shops (Don’t pay tax on vacant properties)
• Decreased proportion of ‘local shops’
• Increase in vacant shops
• Range of ‘traditional’ services decreased
• Significant proportion of coffee shops
• Increase in ‘non traditional’ street businesses (e.g. Gyms)

Question 2

Why have there been changes on high streets?

Answer 2

• Decrease in footfall due to rise of internet shopping and rise of out of town shopping centres
• Tax incentives and difficulties in local council rules in high street areas, encouraging large business to relocate out of town centres
• Ability to have on site warehouses in out of town centres, cheaper for businesses

Question 3

Why is/has e-commerce rapidly increased?

Answer 3

• Confidence in online safety (e.g. PayPal)
• Greater access to devices (e.g. Smartphones)
• Faster internet connection
• Investment in delivery services (e.g. Amazon Prime)
• Easier access to global markets (e.g. Goods from US)

Question 4

Impacts of a changing service economy

Answer 4

• Low level industry receive low pay, to make profit must pay low wages)
• Often seasonal work only
• Zero hour contracts
• Clone towns from reduction of local businesses and increase in chains
• Greenfield land taken up by out of town shopping centres and business parks

Question 5

Give an example of a high street in decline

Answer 5

Dudley

• West Midland has shop vacancy 18%, Dudley has 32.4%
• Merryhill (out of town shopping centre) is main reason Dudley is seeing decline
• Dudley are investing to try and get shopper back

Question 6

Why are service businesses also moving to out of town locations?

Answer 6

• Cheaper rent
• Easier access for staff and customers
• High end facilities and services help attract high end workers
• Easier access to national/international travel networks

Question 7

Give some key statistics from the Portas report

Answer 7

• Nearly 1 in 6 shops vacant
• High street footfall has fallen by 10% in last 3 years
• Town centre stores fell by 15,000 between 2000 and 2009
• Only 40% of Britain’s spend takes place of high street