LETTER: Asda will not boost Louth economy

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Having read many wild and conflicting statements being bandied about by both sides relating to the Cattle Market and the proposed new supermarket – including the results of “surveys” that any 6th form maths pupil could demolish in seconds, as an outsider it is with some trepidation that I will try and put some factual base into the various salient arguments.

First of all, if we disregard the push to build several hundred new homes, Louth and area has a fixed size of customer base that everyone must share (although you can be 100% sure that proposed new housing and a proposed new supermarket are being factored together at a high level – if you get one you will most assuredly get the other).

The engine driving regional economies is the injection and circulation of money within the region, so as an example of the currently healthy economy of Louth, DS Smith sell their product to a national concern which injects money into the economy via an employees’ wages; he buys vegetables from the local greengrocer which fuels that business, the greengrocer buys his product locally which fuels the farmers business, and from his profits the farmer’s wife goes to the local hairdresser while the farmer uses a local builder for building work. This circulation of money results in a thriving local economy.

Now if we take the case of that same employee going to a supermarket, his money now goes straight out of the local economy and into the pockets of distant shareholders, no produce is sourced locally so only the economy of other parts of the country benefit, and any construction work performed is done by large national firms who have the size and set-up which allows them to bid for such contracts.

The only injection of money into the local economy is the salaries of those locals who work in the supermarket (and who may already have jobs elsewhere in the town, so the net result would be no change).

Factually therefore, the net result of supermarket retailing on a town is to depress local retail business by reducing the localised flow of money, halting the injection of new money into the town and increasing the amount which flows out to other parts of the country.

Despite statements to the contrary, there has never been any cross-over of business between two self-contained retail areas where there is something separating them (as in the case of Louth, where the cattle market is up a steep hill), and to understand why you need to look at business centre development in towns in an historical context. If you exclude the effect of castles and spas, trading starts at a focal point such as a church and expands naturally along the line of least resistance, driven by the ease the customer can move through the trading area. Louth is a classic example of this model, with business development running away from the church and along the low ground roughly parallel to the river, and with development uphill only extending a short distance - there has never been any successful growth of retail business connecting the two centres. Surprisingly, even in the age of the motor car this holds true in all towns with separated trading areas - possibly due to the problems for movement and grid-lock that the traffic and roads themselves create. In Louth this is already evident in the usage of the car parking near the Boar’s Head, with the vast majority of the parking being for long term/all day as people will not walk down into town to shop and then walk all the way back up the hill with their purchases.

Business rates go predominately to central government, whether businesses are small and local or international supermarkets, so to get a sense of the two types of income for the local authority you need to look at footfall effects.

At present the council gets income from parking and side effect of footfalls within the unusually vibrant and diverse high street retailing of Louth, coupled with the injection of money from the tourist industry and the specialised markets and events that this attracts. Also added to this is the amount of employment that the current retail model sustains both directly and indirectly (staff in Inns and cafes serving shoppers, parking wardens etc) resulting in relatively low unemployment and reduced strain on associated social services etc.

In the case of the supermarket model, following any gains made from the initial sale of land and the short term influx of money from outside contractors during the building, all council revenue is reduced. As has been explained, there will unfortunately be no associated footfalls from the supermarket into the town, income from parking within the town will be reduced as shoppers use the free space associated with the supermarket, money will flow directly out of the county pocket, and due to the finite customer base the retail business engine within the town will slow down giving rise to reduced visitors and reduced employment. Another more recent driver in the supermarket model, is the online shopping phenomena, where goods are ordered online and despatched from the supermarket: this reduces store footfall and employment requirements even further while still maintaining their sales levels. It is difficult to give a time frame for the rate council revenue falls, but it obviously follows a natural logarithmic law and is continuous and permanent, so given the current economic climate you would expect to see the first effects within 12 months.

One other factor to take into account is the location of Louth in relation to the county border and the distance people will normally travel to reach a retail centre. In medieval times this was roughly 8 miles by horse and cart, so on average nobody in the UK is more than this distance from a market town, and down the arterial route of the A16 Grimsby, Louth, Spilsby and Boston are all spaced 16-17 miles apart. With the advent of the car, people regularly travel at least twice this distance for both work and shopping, so Louth comes well within the orbit of the Grimsby supermarkets for those who wish to use this form of retail centre. Certainly at present, those who like myself live within the semi-circular swathe of villages to the north and shop in Louth do so because they are attracted by the uniqueness and diversity of its shops. If one of the major supermarkets is constructed on the cattle market, as has been explained Louth’s diversity and uniqueness will be destroyed. In this case we will simply gravitate towards Grimsby and spend our money across the border within NE Lincs where there is nothing special to attract our custom but where there are more big players than Louth can support and the competition amongst them drives down prices.

My apologies for the lack of references and a bibliography, but all the information drawn upon is factual and readily available within the public domain. The choice for the ELDC is simple – in the long term is it in the best interest of the county for Louth to be like Stamford or like Scunthorpe? I have refrained from making any personal judgements, but as an outsider can I respectfully suggest that international rankings of “best places to live” never, ever looks at supermarket proximity as a marker; so in order to “move Louth forward” it may be a better idea to look at improving things like your A&E coverage, increasing the education and cultural opportunities for your children and yourself, enhanced healthcare, better transport links – these are the things that people actually care about for themselves and the next generation, and by devoting your energy and commitment to these instead of another Asda you could make Louth an even more wonderful place to be.

B Buckenham BSc (Open)

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