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More than 26,500 retailers will dissolve by 2015, says BDO

Published: 18 October 2010
More than 26,500 retailers could disappear from the high street by 2015 as consumers become increasingly canny, according to new research from accountancy firm BDO.
A new report, titled 'Transitions to the New Consumer', urges retailers to avoid joining the future ranks of failed high street business, which BDO says could include 1,500 homewares retailers, by acting now to adapt to the post-credit crunch consumer mindset.

The study says customers have shifted to a more "reasoned and thoughtful form of consumption", meaning shoppers are less impressed by size, volume or variety of product, and instead make purchasing decisions based on individualised service and personal shopping experience.

Overall, BDO forecasts that consumer spending will recover and grow, with growth in retail spend expected to increase from 2.6% to 2.8% next year. However, it warns, only those businesses that pay attention to the habits of an "increasingly canny consumer" will safeguard their future success.

BDO head of retail Don Williams said: "One size no longer fits all. Businesses will not survive and thrive if they do not take steps to understand the psychology of the new consumer. The recession has been a catalyst for change and people are becoming much more demanding - they want a personalised experience without paying a premium for it. That means consumers want to buy from retailers who target and treat them as individuals."

According to the report, retailers need to build brand loyalty by re-thinking who their customers are, and re-visiting "what great service looks, feels and sounds like". It also suggests reviewing customer spending data to provide a more personal experience, as well as developing and investing in multi-channel. Other tips include considering the "international dimension" and focusing on what customers want and need rather than product range variety.

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