UK Retail Sector Research Articles

The evolution of green leases: towards inter-organizational environmental governance

Improving the environmental performance of non-domestic buildings is a complex and ‘wicked’ problem due to conflicting interests and incentives. This is particularly challenging in tenanted spaces, where landlord and tenant interactions are regulated through leases that traditionally ignore environmental considerations. ‘Green leasing’ is conceptualized as a form of ‘middle-out’ inter-organizational environmental governance that operates between organizations, alongside other drivers. This paper investigates how leases are evolving to become ‘greener’ in the UK and Australia, providing evidence from five varied sources on: (1) UK office and retail leases, (2) UK retail sector energy management, (3) a major UK retailer case study; (4) office leasing in Sydney, and (5) expert interviews on Australian retail leases. With some exceptions, the evidence reveals an increasing trend towards green leases in prime offices in both countries, but not in retail or sub-prime offices. Generally introduced by landlords, adopted green leases contain a variety of ambitions and levels of enforcement. As an evolving form of private–private environmental governance, green leases form a valuable framework for further tenant–landlord cooperation within properties and across portfolios. This increased cohesion could create new opportunities for polycentric governance, particularly at the interface of cities and the property industry.

Financial reporting for commercial service charges in the retail sector

Purpose – The purpose of this paper is to assess whether financial reporting practices for commercial service charges in the UK retail sector match the best practice requirements of the Royal Institution of Chartered Surveyors (RICS) Code of practice for commercial service charges. This assessment was performed by benchmarking commercial service charge documents provided to retail occupiers at UK shopping centres against the RICS Code’s financial reporting requirements. Design/methodology/approach – Data were generated from direct analysis of actual service charge documents supplied to commercial retail occupiers. This ensures authenticity by removing reliance upon third party reporting of said data. The paper uses a sample size that is representative of the financial reporting practices for commercial service charges at UK shopping centres. Findings – Levels of compliance with the financial reporting requirements of the RICS Code of Practice for commercial service charges are found to be poor, especially in terms of the disclosure of the accounting policies used during the preparation of the service charge accounts. These results contrast with claims by the professional body. Research limitations/implications – The work analyses service charge documents prepared during 2010-2012 by 44 managing agents and 87 landlords at 126 UK retail shopping centres located in Great Britain. Content analysis was utilised to interpret the data and required some subjective judgement by the researchers. Originality/value – Data are original and the paper provides a unique benchmarking test for assessing Code compliance. This contrasts markedly with the anecdotal evidence offered by the profession in defending current standards of practice and whilst the paper has limitations, it is the largest and most in-depth study of commercial service charge practices at UK retail shopping centres.

Integrating intermodal transport with logistics: a case study of the UK retail sector

Retail traffic is one of the main drivers for the growth of intermodal transport services in the UK. This paper examines the key factors underpinning this modal shift in order to learn lessons for other market and geographical contexts. Since successful retail intermodal logistics involves many actors, this paper is based on semi-structured interviews with major UK retailers, third-party logistics providers (3PLs) and rail operators, supplemented by document analysis. The qualitative data are analysed via a conceptual framework derived from the literature. Despite past successes and the presence of drivers for future growth, the paper identifies many operational issues without current solutions and the presence of ongoing public subsidy. The major conclusion is that the importance of 3PLs, aggregation and multi-user platforms must be recognised by transport planners in supporting the use of intermodal transport by retailers and other large shippers.

A socio-technical approach to improving retail energy efficiency behaviours

In recent years, the UK retail sector has made a significant contribution to societal responses on carbon reduction. We provide a novel and timely examination of environmental sustainability from a systems perspective, exploring how energy-related technologies and strategies are incorporated into organisational life. We use a longitudinal case study approach, looking at behavioural energy efficiency from within one of the UK's leading retailers. Our data covers a two-year period, with qualitative data from a total of 131 participants gathered using phased interviews and focus groups. We introduce an adapted socio-technical framework approach in order to describe an existing organisational behavioural strategy to support retail energy efficiency. Our findings point to crucial socio-technical and goal-setting factors which both impede and/or enable energy efficient behaviours, these include: tensions linked to store level perception of energy management goals; an emphasis on the importance of technology for underpinning change processes; and, the need for feedback and incentives to support the completion of energy-related tasks. We also describe the evolution of a practical operational intervention designed to address issues raised in our findings. Our study provides fresh insights into how sustainable workplace behaviours can be achieved and sustained over time. Secondly, we discuss in detail a set of issues arising from goal conflict in the workplace; these include the development of a practical energy management strategy to facilitate secondary organisational goals through job redesign.

The impacts of marketing and operations capabilities on financial performance in the UK retail sector: A resource-based perspective

Drawing upon the resource-based view (RBV) of the firm, this study investigates the relationships among marketing capability, operations capability, and financial performance. Using archival data of 186 retail firms in the UK, we find that that marketing capability has a significant impact on operations capability, and that operations capability is significantly and positively related to retail efficiency. The results also suggest that operations capability fully mediates the relationship between marketing capability and financial performance. The findings of this study provide practical insights for practicing managers to consider when developing functional capabilities in order to achieve superior financial performance.

Reverse logistics in the UK retail sector: A case study of the role of management accounting in driving organisational change

This paper illustrates how interventionist research can be helpful in providing managerially relevant solutions and furthers the debate about the relationship between social science research and practice. Through this use of interventionist methods, the paper contributes to knowledge by illustrating the way in which management accounting was used alongside other managerial disciplines in a UK retail organisation to promote change and influence outcomes. Specifically, the paper focuses on changes to the reverse logistics processes of the organisation and the important role that management accounting played. It also illustrates the use of management accounting in the pursuit of strategic and commercial advantage. As researchers, our work was grounded in action rather than being just observers.

AN OVERVIEW OF CURRENT UK FRESH PRODUCE FARMING PRACTICES THAT MINIMISE THE RISK OF FOODBORNE ILLNESS OUTBREAKS ASSOCIATED WITH READY TO EAT FRESH PRODUCE

As a consequence of recent outbreaks of food borne illness associated with consumption of fresh produce, there is increased scrutiny of the microbiological risks associated with the consumption of ready to eat produce within the UK retail sector This project was funded to summarise the UK industry approach to managing risk in fresh produce production and identify best practices and areas of risk. Copies of quality assurance scheme codes of practice for fresh produce growers were reviewed from a food safety viewpoint against the stipulations of Codex Alimentarius. In general, all of the guides require good practices conducive with the production of food that is free from human pathogens. A survey of growers was undertaken to assess compliance with these codes and to identify areas in the codes that growers found difficult to comply with or to implement. Growers find it difficult to risk assess water sources used for irrigation and water usage. Furthermore, the selection of bacterial indicators that were encountered was diverse and growers experienced difficulty in choosing appropriate indicators to test for, and in using the results of these tests as the basis of informed decisions. Large growers supplying the UK multiple retail chains are required by their customers to comply with one or more assurance code as a condition for the sale of their produce. Small growers that supply farmers’ markets and wholesalers are under little or no pressure from their customers to do the same. This disparity in supply chains suggest that moves to encourage wholesalers to comply with assurance schemes would help reduce the risks to UK consumers from the consumption of fresh produce.

DETERMINANTS OF CAPITAL STRUCTURE IN THE UK RETAIL INDUSTRY: A COMPARISON OF MULTIPLE REGRESSION AND GENERALIZED REGRESSION NEURAL NETWORK

SUMMARYFirms need to rely on different financing sources, but the question is how capital structure is determined for a particular industry. Our aim is to undertake an investigation into the factors which determine capital structure in the UK retail industry. Our initial sample consists of 163 (final sample: 100) UK retail companies, using data from 2000 in order to analyse capital structure from 2002 to 2006. Nonlinear models tend to be unduly neglected in capital structure research, and so we apply generalized regression neural networks (GRNNs), which are compared with conventional multiple regressions. We utilize a hold‐out sample for the multiple regressions to make them comparable with the GRNNs. Stability of the data is also confirmed. Our main findings are: net profitability and the depreciation‐to‐sales ratio are key determinants of capital structure based on GRNNs, while two more variables are added in the multiple regressions, namely size and quick ratio; there is strong support for the pecking‐order theory; both root‐mean‐square errors and mean absolute errors are much lower for the GRNNs than those for the multiple regressions for overall, training and testing datasets. The potential benefit of this research to financial managers and investors in the UK retail sector is the identification of the overriding role of net profitability in reducing the financial risk from high levels of gearing. Copyright © 2012 John Wiley & Sons, Ltd.

Does voluntary carbon reporting meet investors’ needs?

Abstract Through initiatives such as the Carbon Disclosure Project, investors have encouraged companies to report on their climate change-related risks and opportunities, their greenhouse gas emissions and their climate change management systems and processes. Despite the large number of companies that now report climate change-related information, investors have consistently criticised companies for not providing information that can be readily used in investment decision-making. Companies, in turn, have criticised investors for not utilising the information that they provide. This article, taking the case of the UK retail sector, analyses the reasons for this debate between companies and their investors. It concludes that there are two factors at play. The first is that while investors have encouraged companies to report, they have, at least to date, paid much less attention to the quality of the reported information. The second is that company reporting on climate change falls far short of the quality required for investors to make meaningful comparisons between companies. This, in turn, has limited investor interest in these data. The article considers the potential for mandatory reporting to address these problems and concludes that mandatory reporting is, at best, a partial solution, and that it is a combination of voluntary and mandatory reporting, underpinned by active investor interest in the data being reported, that offers the greatest potential for progress.

Soft skills and employability: Evidence from UK retail

This article contributes to ongoing debates about soft skills in front-line interactive service work in considering employability in the UK retail sector. It recognizes how UK government policy has emphasized the importance of qualifications in enhancing employability. However, it suggests that for front-line work in retail it is soft skills that are required to access entry-level jobs. The article notes how these soft skills have traditionally been dominated by debates about emotional labour. Drawing on a survey of 173 clothing, footwear and leather goods retailers, the article argues for a need to recognize the broadening of soft skills to also include aesthetic labour. The article concludes by discussing the implications of the broadening of soft skills with regard to policy initiatives to encourage the long-term unemployed into the retail sector.

Regulation and UK Retailing Productivity: Evidence from Microdata

We explore the effects of planning regulation on the UK retail sector between 1997 and 2003 using microdata from the UK census. We document a shift to smaller shops following a 1996 regulatory change that increased the costs of opening large stores. Our analysis suggests that total factor productivity (TFP) of multi‐store retail chains fell after the introduction of the reform due to the reduction in store size. Overall, the reduction in store size was associated with TFP of retail chains falling by 0.4% per annum, or 40% of the post‐1995 slowdown in UK retail TFP growth.

Investment in the UK retail sector by mid-market private equity: 2000–2008

This study examines 107 ‘mid-market’ private equity investments in established businesses in the retail sector between 2000 and 2008. The research design comprises a bespoke data set built by the authors. Our reason for adopting this methodology is to create a specific data set on the retail sector which is derived from the views of private equity practitioners on what constitutes the mid-market in this sector. The findings from the data set lead us to present three conclusions which are of relevance to academics and practitioners. Firstly, the data set and related qualitative interview material suggest that there is no common definition of mid-market to report a diversity of private equity practitioner approaches to and definitions of the mid-market. Secondly, management capability in potential portfolio firms is a decisive factor in private equity investment in the retail sector but that it is not the key factor. Thirdly, mid-market investors in the retail sector find it difficult to realise an exit in terms of trade or sector buyers.

Retail reverse logistics: a call and grounding framework for research

PurposeFrom a synthesis of empirical findings and literature, the aim of this paper is to present a conceptual framework for managing retail reverse logistics operations. The framework is designed to assist both practitioners and academics in better understanding the key management aspects involved. The paper also identifies some future research directions that are derived from this conceptual framework.Design/methodology/approachThe study was exploratory and motivated by a grounded theory approach aimed at providing a conceptual framework for managing retail reverse logistics.FindingsRetail reverse logistics operations are multi‐faceted and need to be managed as an integrated supply chain activity. Three overarching management dimensions are proposed; operational performance, organisational integration and management reporting and control.Research limitations/implicationsThis is an inductive piece of research and it is important to recognise that only analytical generalisation is claimed rather than any statistical generalisation. Also, the study was undertaken in the context of the UK retail sector and therefore further comparative work could be undertaken in different international contexts.Practical implicationsThe adoption of the framework will have impact on practitioners by assisting them in reducing the volumes of products being returned, lower their reverse logistics operational costs and increase their product asset recovery values.Originality/valueAlthough there is a growing body of literature relating to retail reverse logistics it is fragmented by multiple perspectives. There is little in terms of frameworks that embody the management aspects involved. Having reviewed the literature the authors' empirical results show that, in some areas, practice leads theory and therefore the findings will add to academic discourse.

The two faces of foreign management capabilities: FDI and productive efficiency in the UK retail sector

We investigate the impact of management capabilities of foreign firms on the management capabilities and performance of domestic firms using survey data on the UK retail sector. On average, foreign-owned retail firms achieve higher management capability scores and are more productive than domestic firms. Our results suggest two faces of foreign management capabilities. On the one hand, capabilities that can be codified, for example human resource management capabilities, generate some positive spillovers on the relevant management capabilities of local firms. On the other hand, dimensions of capabilities that are more tacit and highly competitive exert a negative competitive effect on domestic firms’ own management capabilities. While the overall management capabilities of domestic firms are found to have a significantly positive effect on their own productive efficiency, we find no evidence of a direct efficiency effect of foreign management capabilities on local firms.

The logistics of managing hazardous waste: a case study analysis in the UK retail sector

In recent years there has been a marked increase in the use of hazardous materials in retail activities, resulting in heightened concern about hazardous wastes ending up in landfill. In response, environmental legislation has been enacted to increase re-use and recycling by placing responsibility on producers and distributors for the collection, treatment and recovery of hazardous waste. This has had direct impacts on the type, number and location of treatment/disposal facilities and the design, planning and management of the associated logistics networks. This study has investigated the legislative, contractual and operational practices governing the management of five hazardous waste streams emanating from retailers in a dedicated shopping centre. Using a substantial database of logistics operations compiled from 92 businesses, the study quantifies the considerable transport footprint currently associated with hazardous waste logistics and discusses the scope for coordinated collection strategies across supply chains potentially using local treatment facilities.

Exploring the drivers, scope and perceived success of e‐commerce strategies in the UK retail sector

PurposeThe purpose of this study is to explore empirically the relationship between the scope of the e‐commerce strategies currently being deployed by the largest and most influential UK‐based retailers, the drivers for their adoption, and perhaps most importantly the degree to which they are perceived to be successful.Design/methodology/approachThe objectives of this research were addressed by using a quantitative research strategy, based on a postal questionnaire survey of the UK's largest retailers. The research strategy produced a wealth of primary data, which were thoroughly analysed using a variety of multivariate, statistical techniques.FindingsThe study's findings suggest that the scope of the retailers' e‐commerce strategies is strongly associated with the strength of management support behind the strategy and its perceived strategic fit. By contrast, the perceived success of their strategies is most strongly associated with the degree to which the retailer has deployed a portfolio of appropriate resources and capabilities, in support of its online operations.Research limitations/implicationsThe major limitation associated with the study is with respect to the rather disappointing response rate of 10 per cent. However, this level of response is similar to many previous surveys in this domain, and it is probably not surprising, given the commercially sensitive nature of the data. Moreover, the extensive phone‐based follow‐up of non‐respondents has provided an important reassurance that any resultant bias is likely to have only a modest effect on the results.Practical implicationsThe findings highlight that, despite their close relationship, the scope of an e‐commerce strategy and its success are rather different entities, and therefore the factors that affect the scope of adoption cannot be relied on to deliver success. In particular, retailer managers must recognise that, while their support and commitment may well be the impetus necessary to deliver a wide‐ranging strategy, its ultimate success may be dependent on their ability to deploy a suitable portfolio of resources and capabilities.Originality/valueThe study makes a major contribution in a number of ways. It provides one of the first attempts to measure the relationship between the drivers, scope and perceived success of e‐commerce strategies, and, in so doing, it delivers an objective comparison between those factors that affect the scope and the success of e‐commerce strategies. Moreover, important new measures of e‐commerce scope and success have been developed and deployed.

Are there barriers to innovation in retailing?

Recent data from the Community Innovation Survey challenge some of the conventional arguments that retailing is inherently less innovative than other sectors within developed economies. According to the data, firms in the UK retail sector are now converging on the all-sector average. Drawing on qualitative research undertaken within retail firms, this article begins by examining some of the implications of this and the reasons why survey data may still underestimate the extent of innovation in the sector. One of the potential contributory factors to an increase in reported levels of innovation may be a reduction in barriers to innovation. In a new analysis of the data, the article explores the nature and incidence of such barriers in the UK. It judges that, although barriers were already perceived to be low, further reductions may have played a part in stimulating innovation. However, amongst other factors, it also notes that the sector still lacks any reliance upon universities and HEIs to assist with strategic innovation. The article further concludes that present economic conditions are likely to detrimentally affect a number of the cost and market factors, which are the most significant barriers to innovation in the sector.

An assessment of operational efficiencies in the UK retail sector

PurposeThe paper's aim is to assess performance of firms in the UK retail sector.Design/methodology/approachEconomic efficiencies of 41 retail companies working in the UK between 2000 and 2005 are examined in this study using three related methodologies: data envelopment analysis (DEA), Malmquist productivity index (MPI), a bootstrapped Tobit regression model. DEA is used to calculate technical and scale efficiencies of companies. Two outputs (turnover, profit before taxation) and three inputs (total assets, shareholders funds, and number of employees) are employed for the efficiency measurement. MPI is used to analyze the patterns of efficiency change over the six year period 2000‐2005. DEA efficiencies are then used to test important hypotheses on the impact of environmental variables, namely head office location, type of ownership, years of incorporation, legal form and retail characteristic, on the functioning of the UK retail sector using bootstrapped Tobit regression.FindingsDEA analysis has shown that only ten retail companies are considered as efficient under CRS assumption, and 16 firms under VRS assumption in 2005. MPI results have indicated that about 50 percent of retail companies have registered progress in terms of MPI during 2000 and 2005. Twenty out of 41 retail companies have adopted advanced and efficient retailing technologies during this period. Three environmental variables, namely the type of ownership, legal form and retail characteristic, have been found to play significant roles influencing retail efficiency using bootstrapped Tobit regression.Research limitations/implicationsData availability has limited the level of analysis in some parts of this study, especially in the bootstrapped Tobit regression.Originality/valueThis study seems to be the first in applying productivity analysis using DEA for the UK retail sector.

Divine and Dubble go mainstream

PurposeThe purpose of this paper is to investigate the advantages and disadvantages of “mainstreaming” fair trade in the UK retail sector through the example of The Day Chocolate Company.Design/methodology/approachThe article draws on the experience of employees and former employees of the company to provide inside knowledge of this fair‐trade social enterprise.FindingsThis paper demonstrates how radical mainstreaming by 100 percent fair‐trade companies can strengthen the fair‐trade message and not undermine the original ethical interest.Practical implicationsThe article provides valuable insights for stakeholders in the fair‐trade movement.Originality/valueThe article demonstrates the value of such intangibles as relationships and networks.

A Truly Co‐operative Venture: The Case Study of Co‐operative Food, a Retailer Response to Fair Trade

The aim of this paper is to further develop the recent discourse surrounding the mainstreaming of fair trade (FT) products, particularly the strategic responses to fair trade by UK retailers. The research investigates the characteristics of a values‐driven retailer via the exemplar of Co‐operative Food (CF), a UK food retailer. The paper draws on a longitudinal case study (1999–2007) of CF and includes findings from a series of in‐depth semi‐structured interviews with key informants. The paper develops a set of fair trade characteristics for a values‐driven business in the UK retail sector. The paper also illustrates the importance of both social resources and ethical relationship marketing in ensuring the success of a FT retailing strategy. The values‐driven business model investigated in this paper demonstrates the importance of intangibles such as relationships and networks, particularly with upstream stakeholders such as cocoa farmers.