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Retail sector losing four convenience shops a week

Some 800 stores have been forced to shut in past four years. THE country has been losing four convenience stores every week since the recession began, according to a lobby group for the sector.

Vincent Jennings, the chief executive of the Convenience Stores & Retailers’ Association, told the Irish Independent that the number of convenience stores nationwide has fallen by around 800 in the past four years to about 3,900.

Stores have, on average, seen turnover slump by at least 20pc since the downturn began.

Mr Jennings (pictured) said many of the remaining stores were now struggling to survive and claimed that the absence of credible solutions and practices from the banking sector was one of the key inhibitors.

UNFAIR

“It’s almost as if we are a dreadful nuisance,” he said of the banks’ attitude towards the convenience retail sector.

“We don’t get a fair crack of the whip. They don’t have any understanding of the sector. They make it look as if they’re lending, but they’re not lending,” he said in advance of the retail organisation’s annual general meeting in Dublin today.

Mr Jennings claimed that retailers were being put in difficult positions in relation to access to cash resources. He also said that the cash-handling fees being charged by banks – Bank of Ireland and AIB recently raised theirs – was excessive and unfairly calculated. Mr Jennings said the banks based the charge on every €100 they handled, but that most convenience stores could be lodging thousands and tens of thousands of euro in cash every week.

Mr Jennings also said that because the handling fees were high, it made the provision of services such as BillPay in convenience stores uneconomic in many cases.

Consumers can pay their bills, such as ESB or gas, in convenience stores around the country.

However, the retailer only receives between 17 cent and 19 cent per bill processed. If the bill is for €100, for instance, the cost of cash handling wipes out that payment.

Mr Jennings claimed that 60pc of people who entered a store to pay a bill did not buy anything else while there.

He said the sale of smuggled cigarettes throughout the country also continued to depress convenience store turnover and knock-on purchases.

However, he added that he was optimistic for the sector’s future, but said the Government needed to sound a more upbeat message to encourage consumers to spend again.

John Mulligan – Irish Independent


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