Sunday 22 September 2013

Why Enforcement Is A Poor Model For QVM - We Are Not A Shopping Centre.

Enforcement is a term often used at QVM when describing trader/management relations. And it goes beyond the often criticised prevalence of management staff with previous work history in security. For some reason traders are regarded as an element that needs to be controlled when in fact freedom is an essential ingredient for attracting and keeping the traders who will make QVM successful in the future.

Let’s make it clear that this article is not against enforcement in itself. Setting standards of behaviour that enhance the retail environment is essential. But regulating to advantage one side, while disadvantaging the other, requires careful assessment and re-evaluation as conditions change. 

The shift from PE licences to SL licences (in many ways a retail lease) is part of an attempt to formalise or control the environment in which traders operate at QVM. Let us just pause to understand the difference between PE and SL licences. PE licences are the old licences that have operated for many years at QVM and are often called Daily Licences although it is understood that they carry common law rights, including succession, which have longer term implications. SL licences involve a signed legal document while PE licences do not. SL licences are a comparatively recent development and were originally called Transferable Licences which gives a clue to their main attraction at the time of introduction. You cannot sell a PE licence, but you can sell an SL licence. That is where the advantage ends because it is generally conceded that SL licences are part of an enforcement model that disadvantages traders. 

Our previous CEO often said that QVM was not a shopping centre but attempts to shift traders from PE licences to SL licences suggested otherwise. And from a corporate managers point of view, that shift is understandable. Corporations seek a high level of predictability. Accurate budgeting demands that fluctuations are minimised so a property management company would prefer an SL licence model that restricts leave to 4 weeks per year (8 weeks for PE traders) and doesn't allow single day absences (PE traders get single day absences). That model is easier to maintain, and probably, less leave is taken although the impact on rental returns of the 8 weeks leave model probably depends on the available pool of casual traders.

But for traders, flexibility and adaptability are essential ingredients for doing business. Most of the businesses at QVM are accurately described as fragile and modest. Most of us are single person or family businesses that not only have to adapt to the changing requirements of consumer demand but adopt a bewildering array of multi-tasking activities just to stay afloat. And if we are new retailers that flexibility is even more important.

The core of our businesses is individuality with a big dose of entrepreneurship. History shows us that traders with a big personality, a commitment to their product, a dedication to the customer, and a willingness to devote an unreasonable amount of time to their business, will succeed.

That individuality generates a fair share of rebels but that is simply one of the prices you pay for a successful public retail market. To a Property Manager, 8 weeks leave is excessive and the disruption caused by single day absences is difficult. To a Market Trader, a flexible 8 weeks leave is essential to maintain sanity in a demanding manic business world that requires sacrifices not just for business but for family life as well.

SL licences are a poorly conceived part of trader/management relations at QVM. They are an enforcement model that attempts to curtail the flexibility that is essential for survival in a public retail market. In addition they allow operators who don't have the aforementioned entrepreneurial qualities to simply buy into the market and lower the standard (not always the case of course). For newcomers a restrictive licence is particularly undesirable. We can wonder how many of today’s traders who started with a new untried retail concept would have taken the chance if they had been required to sign a licence, even a short term one. It is claimed that licences are a legal document and cannot be easily changed. Try telling that to your insurance company when they announce global changes to legal insurance policies. 

Would this argument be different if traders were in a healthy retail environment and easily able to sell their businesses for a good price? – it probably would. Obviously the trade off for punitive licence conditions versus the ability to sell your business was presented as a good deal back in the 90’s. But that healthy retail environment hasn’t existed for a while and only the most optimistic see a return soon. 

Enforcement is simply not the answer to our market's future. Establishing a flexible trading environment that recognises the needs of all parties and encourages newcomers is the answer. Let’s foster an environment that supports commitment, individuality, innovation, and entrepreneurship. Essentially, that is what QVM customers come to see.

23/09/2013 07:57:45 Contracts "We have been in the market 13 years now and have never taken one week off let alone 4 or 8 weeks. We may be under a different model because we have a shop rather than a stall and have signed a lease, but we still run a retail business that requires entrepreneurship, sales experience and customer service skills. What's the difference?  If we were to take extended leave we would put a manager in. If we were to sell, the bottom line is whether the business is viable and whether we can find the right buyer, not what type of contract we have with the market.  If QVM was run more like a shopping centre maybe we would not have so many empty stalls now, especially A shed on Sundays which is a ridiculous situation. The problem is also that some stall holders run their sites with absolutely no concern for others whatsoever, a stricter contract may help this situation."  Jodi