FAQs

To help users understand more about Millward Associates, we’ve provided answers to some Frequently Asked Questions on this page:

Q1) Can Millward Associates help with any aspect of retailing and retail property? More…

Q2) Can I be confident that your analysis of retail performance will be accurate? More…

Q3) Isn’t one catchment analysis technique much like another? More…

Q4) Why would any retailer keep trading from an unprofitable shop? More…

Q5) If they’re paying the rent, why should it matter to my shopping centre if a tenant is unprofitable? More…

Q6) Don’t we just need more visitors to our shopping centre? More…

Q7) Won’t I get a better result if I use a large consultancy employing specialists in market research, catchment analysis or retail performance, rather than a general retail practice like Millward Associates? More…

Q8) No two Millward Associates reports are ever exactly alike, even on the same project. Why is that? More…

Q9) You say you can help with targeted retailer recruitment; doesn’t that get in the way of what agents do? More…

Q1) Can Millward Associates help with any aspect of retailing and retail property?

A) If your business is about supplying goods or services to consumers in a competitive market then yes, absolutely we can help. Our team has insider experience of selling stuff to consumers. We know how retailing works and what successful retailing looks like. We also happen to be expert researchers and analysts and because we are also retailers, we know exactly what research has to do to make a bottom-line impact. Our insider experience means that we have a natural ‘feel’ for whether evidence is credible & stacks-up. The long-term relationships we build with our clients are proof positive.

Q2) Can I be confident that your analysis of retail performance will be accurate?

A) We’ve been incredibly fortunate to have built long-term relationships with blue-chip clients in the UK & Ireland. These relationships have afforded us the opportunity to test and refine the techniques we use to the point where we can triangulate the research results. In other words the results from different research sources serve to confirm and give added confidence in the results from other research components.

We get the same result (£ consumer spend and £ retailer sales) whether the source is tenant sales evidence; the results of in-situ consumer research at the centre; or household survey research to quantify spending in the catchment.

Q3) Isn’t one catchment analysis technique much like another?

A) Not at all. Our views on catchment analysis are strongly influenced by our knowledge of the retail sales achieved at our clients’ centres. If we know that Centre A achieves £250 million turnover, our reasonable expectation is that to be credible, catchment analysis must deliver a shopping population sufficient to sustain this level of turnover. The techniques we use ensure that demand & supply relationships are transparent between our clients business and their competitors. We never analyse consumer demand in isolation from retail supply.

Q4) Why would any retailer keep trading from an unprofitable shop?

A) With the possible exception of a handful of ‘flagship’ locations (for example Bond Street), of course retailers lease space in the hope of trading profitably. Unfortunately that hope often fails to materialise, for a variety of reasons that might include; sales lower than expectation, unsustainably high occupancy costs or both. The performance of a portfolio of shops tends to fit the ‘normal’ distribution curve – most will be of average profitability; some super-profitable; others loss making. The retailer’s objective is to achieve an adequate level of profit in aggregate. Provided they succeed in that objective, unprofitable shops may remain open because: of lease obligations; unprofitable outlets still make a contribution to cash flow by converting stock investment into sales to customers; management may perceive a value in retaining a brand presence in that location. Retailers have often favoured market share over profitability. The recent decade-long retail boom has enabled most retailers to expand fast enough (often including banking enough lease incentives) to out-run problems with unprofitable shops. No longer, hence the plethora of portfolio down-sizing and business failures in today’s market.

Q5) If they’re paying the rent, why should it matter to my shopping centre if a tenant is unprofitable?

A) Contraction in consumer spending and expansion in the supply of retail space when the Internet is taking an increasing share of consumer spending means that retailers in physical shops can no longer avoid confronting the issue. It’s true that there is a disconnect between the rental market and tenant business models. In most circumstances market rents have little or no direct relationship to retail profitability. Today more than ever before, it’s also true that retailers will exit shopping venues where passing rent is unsustainable. If problems with rent sustainability are allowed to reach critical mass amongst your tenants then something must give. Shopping centres need to create & sustain a virtuous circle of targeted improvements in tenant mix and sensitivity to tenants’ need to achieve profitable trading. Rental income and asset value security will only be possible when a critical mass of tenants is trading profitably.

Q6) Don’t we just need more visitors to our shopping centre?

A) Success, measured in increasing tenant sales is best realised by getting more of the right consumers through the doors of your centre. Not all consumers are equal and simply attracting more visitors can be counter productive if it leads to Mall crowding that your target customer may find off-putting. We focus on what we call High Value Customers. These are the 20% or so of your visitors who sustain 80% of retail sales in your centre. We use tried & tested techniques to identify who your High Value Customers are, where they live and the options available to you to attract more of them to your centre.

Q7) Won’t I get a better result if I use a large consultancy employing specialists in market research, catchment analysis or retail performance, rather than a general retail practice like Millward Associates?

A) We are specialists in retailing who happen to be rather good at research & analysis.  We believe passionately that added-value is created when an individual consultant with years of experience and a finely tuned ’sense-check’ delivers the entire project: talking to retailers on the ground; listening-in on discussion groups with consumers; using that insight to design finely judged consumer surveys; analysing the results; drawing conclusions and making recommendations based on detailed knowledge of what clients’ want. Our way can be summed up in one word – ‘context’. We deliver superior contextual analysis in which what we learn in one part of the project benefits all the others. This is harder to achieve when a team of specialist researchers & analysts divides the tasks between them.

Q8) No two Millward Associates reports are ever exactly alike, even on the same project. Why is that?

A) It’s another benefit of working with a small consultancy practice with individuals who are passionate about their work. We hold one on one debriefing sessions with our clients, so opportunities to improve our output emerge from that source. We are constantly learning from exposure to all our client projects and this too sparks ideas for improvements. We don’t believe in throwing out the baby with the bathwater so we seldom change everything at once, it’s about added value and incremental improvement every time we report.

Q9) You say you can help with targeted retailer recruitment; doesn’t that get in the way of what agents do?

A) Yes we do, and no, it’s intended to support our clients’ agents in the vital work they do. We don’t get involved in direct negotiations with prospective tenants or their advisors, that’s the role of our clients’ agent. If all retailers always made a profit from the shops they occupy, leasing space would be easy enough. But most retailers have a proportion of shops which are loss making or only marginally profitable, which makes them cautious about taking new space. We see our role as harnessing the market evidence at our clients’ centres to appeal to the profit motive of potential tenants. Having identified the market opportunity and a shortlist of prospective tenants to deliver it, we can help you to gain the favourable attention of the retail and food services businesses necessary to deliver asset value growth.