Value retailers have more than doubled their store count on out-of-town (OOT) schemes from 5,000 to 10,000 stores since 2014, largely driven by the changing perceptions of both landlords and consumers.

For shoppers, many of whom first developed a taste for value grocers during the global financial crisis, there has been a firm realisation that low price does not mean low quality. From a landlord perspective, the covenants offered by value retailers have become some of the strongest available, with the fact they are often willing to take longer leases than other types of retailer further underlining their appeal.

Perceptions have also changed among other types of retailer, with more upmarket brands increasing their presence on OOT schemes anchored by value grocers. M&S and Next now have 23 and 22 stores adjacent to value grocers respectively, compared with nine and 14 in 2011. This trend extends beyond value grocers to value comparison goods retailers, such as Home Bargains and B&M. Next and M&S have increased their store count on schemes with at least one comparison value retailer present by 375 per cent and 160 per cent respectively since 2011.

At the same time, value grocers such as Aldi, Lidl, Iceland and Farmfoods have broadened their appeal to more affluent consumers. In general, a relatively sparse product inventory has allowed them to offer the highest quality products at the lowest possible price. This has led to growing footfall, allowing the brands to move into more upmarket product ranges, appealing to a wider shopper demographic and thus becoming even more attractive to landlords and developers alike.

Since 2014, value grocers have taken space in affluent market towns including Brentwood, Canterbury, Harrogate, Oxford and York. Analysis of the catchments surrounding value grocery space developed since 2011 reveals that as much as 45 per cent have a customer base with a disposable income level described as good or better. That’s not to say value retailers have forgotten their conventional consumer and locations, rather that their growth has been more representative of the mixed demographic proportions that exist across the UK as a whole.

Furthermore, this story is not exclusive to value grocers. Value retailers from all sectors, such as TK Maxx, B&M and Home Bargains, have used bulk buying and economical packaging techniques to create efficient supply chains, with the savings passed on to consumers.

The psyche of UK consumers is now firmly one of getting value for money. Given current economic pressures, this is unlikely to change, creating a climate in which multi-sector value retailing will continue to flourish. Shopper demand for value fashion, comparison and grocery products will fuel store openings, with landlords and developers keen to bring in retailers with wide demographic appeal to anchor and drive footfall to their developments.

The lower rents and larger units available away from city centres means OOT schemes are an attractive choice for value retailers, and the value element of retail parks schemes will therefore continue to be prominent.

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