Four Reasons why Debenhams is not the Answer for Macclesfield

Letter sent to Cheshire East councillors 11/3/2013

Dear Councillor

The Macclesfield Silk Street development is relying on Debenhams as an anchor store to attract other retailers and shoppers to the town.  We would ask you to consider whether this is a sustainable approach, bearing in mind the following points:

1. Debenhams last week issued profit warnings. The store itself blamed the snow.  Many analysts suggest the problems are deeper, blaming discounting and low margins for the poor performance.
http://www.bbc.co.uk/news/business-21652449

2. Debenhams are now trying to improve margins by cutting prices paid to suppliers – even backdating reductions for orders already agreed – and by moving all suppliers to 120 days payment terms.
http://www.thisismoney.co.uk/money/news/article-2290685/Debenhams-joins-big-squeeze-retailers-force-cuts-payment-delays-suppliers.html?ito=feeds-newsx

3. Cheshire East tell us the town will be attractive to retailers because of its affluent population.  According to the Wilson Bowden/CACI Macclesfield Silk Street Development Study, the department stores that best match the demographic profile of the affluent groups identified are John Lewis, Harvey Nichols, House of Fraser, and Marks and Spencer. Not Debenhams.

4. Debenhams pays very low salaries. See the following job ad.
Debenhams Chester

Supervisor – Lingerie – FT 36.5 hrs

You will be responsible for the day to day running of a multi million pound turnover department and its Sales team within the store.

Strong commercial skills are preferable with the ability to make effective decisions. You will have excellent communication, delegation and time management skills as well as being a proven leader who can motivate and coach people to achieve.

You will be available to work varied hours throughout the week, to include shifts covering Monday – Sunday, morning, afternoon or evening. You will be working on a rota basis therefore shifts may change weekly.

Salary £6.75 – £7.92 per hour

Source: Debenhams online job ad Nov 2012
The National Planning Policy Framework requires that development should be economically sustainable. Relying on any single anchor store would be risky; relying on Debenhams now seems even more so.

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