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News Release


JLL UK Retail comments on Morrisons Amazon announcement and BRC data

Responding to the two big retail news items of today, Tim Vallance, Head of JLL's Retail & Leisure team, commented: "As Sainsbury's battle to control Argos, an Amazon and  Morrisons fulfilment deal has the potential to shake up the grocery sector further and could lead to other similar deals. We are  seeing a  general shift away from approaching physical retail space and online sales as separate entities.  Shopping is now simply seamless: it's about obtaining goods: whether online or offline, through clicks or bricks, via multi or omni-channel, it is now simply 'commerce.' In other areas of retail, an element of experience can be thrown in to the mix to attract customers away from their sofas, but grocery shopping has almost always been won through convenience.

"This announcement comes on the same day that the British Retail Consortium has said that retail jobs and shops are under threat in the next decade from the rising costs that the apprenticeship levy and the national minimum wage represent. Portfolio 'rightsizing' and partnering with the likes of Amazon have a role in countering these threats. However, the burden of business rates cannot be overestimated. The much vaunted reforms to the tax and the devolution of power to local authorities will be vastly watered down by the overall grant cuts to local government. This will mean that authorities will be reliant on their self-generating income of which business rates will comprise a large part, and so lower costs will not be passed on to retailers. It's nothing but smoke and mirrors."