EXCLUSIVE: Symbol groups slashed funding for store investments in the last year

Symbol group funding has dropped significantly as a propor­tion of investment in the convenience sector in the past 12 months.

According to new data from the ACS Local Shop Report, total investment in convenience stores hit the £1bn mark for the first time, marking a 55% increase year on year as self-funding by retailers notably grew. However, despite the 55% jump, the contribu­tion of symbol groups shrunk as a percentage of the total to 12%.

Funding from symbol groups made up 20% of the £646m total investment in the convenience sector in the 12 months preceding last year’s report, amount­ing to around £129m.

This year, the report says 12% of all store invest­ment came from symbol groups, suggesting that symbol group investment fell by almost £10m year on year to around £120m.

This means symbol groups provided less funding to their fascia retailers than suppliers (approximately £140m) in the period covered by the ACS report.

Other sources of investment growing

Last year, symbol groups funded 20% of all convenience store investment, compared to suppliers’ 16%. Symbol groups were the only funding source to fall year on year as a propor­tion of all investment, with contributions from financial institutions and wholesalers also growing.

The data from the ACS was gathered from the or­ganisation’s Voice of Local Shops Survey, as well as a comparable survey cover­ing multiples.

Explaining its invest­ment calculations, the report said: “Questions were asked relating to the amount retailers have invested over the past quarter, what they have invested in and how they have funded their investments.”

The figure was calculat­ed from an initial sample of 1,100 retailers.

Read more ACS news

Much of the increase in spending has gone towards security measures for shops. As shoplifting incidents soar, crime-prevention measures made up by nearly a quarter (23%) of the money retailers invested in stores.

Better Retailing approached several symbol groups for com­ment. Nisa confirmed that the number of its partners who choose to fund 100% of their store development versus those who take up its fascia incentive offer is split approximately 40/60.

A Nisa spokesperson added: “Nisa provides significant financial contributions for store de­velopment and this hasn’t dropped over the previous 12 months.”

Read more symbol group news