Write a short critical essay explaining how the poor economic climate in the UK might affect the marketing mix of a start-up retail venture in the high street.

I will look critically at setting up a retail business on the high street in the current economic climate and the affect this may have on the marketing mix. I will first give a brief overview of the economic situation in the UK and high street retail in general.

The UK economy has undergone a protracted period of instability since the banking crisis of 2007/08, which sparked economic downturn for the UK and caused a dramatic fall in both consumer and business confidence. Between 2008 and 2012, the UK experienced two periods of recession and has been subject to austerity measures, such as public spending cuts, welfare reforms and increased taxation, imposed by the UK Government in an attempt to reduce the country’s budget deficit and reverse economic decline. These measures coupled with high inflation, rising levels of unemployment and low wage growth have contributed to less disposable household income and subsequently lower consumer spending across most of the UK.

The economic constraints of the last five years, such as falling consumer spending, increasing operating costs for businesses (20% rise since 2006) alongside less available, affordable borrowing to businesses have led to large numbers of high street retailers closing their doors. The Centre for Retail Research (2013) reported that 54 retail companies went into receivership in 2012 alone, affecting almost 4,000 stores across the UK. Administration of longstanding retailers such as Jessops, Woolworths, Comets and Past Times has meant their departure from the high street leading to reduction in footfall across many town centres.

Yet it is not just the economy that can have detrimental impact on UK high. Changing technological and social