Friday, May 30, 2014

From COP To Primark

I'm trying to think of the year. Was it 1964 or 1965? When the Sainsbury in my by-then home town of Camberley ceased to be a sort of High Street deli with porcelain walls that were reminiscent of a public lavatory and became a supermarket. Its modernised upgrading was due entirely to the development of the new town centre. Sainsbury was the first proper supermarket. Tesco followed, as did Presto (for those of you who can remember Presto before it was Safeway-ed).

Supermarkets in Britain were an invention of the 1950s, largely thanks to Jack Cohen, a one-time tailor from the East End, reinventing his pre-war Tesco stores. They were representative of the new consumerist society in much the same way as mass tourism was. And in a similar way to tourism, they operated according to a mass production model adapted for the service sector. And when the mass became so great, urban planning allowed for their relocation to the out-of-town retail park, signalling crisis on the high street. No sooner had Brent Cross Shopping Centre opened than the road to Wembley was abandoned by shopping supporters switching their allegiance to the retail stadia of the North Circular Road.

The story of Mallorca's retail development is not dissimilar. It differs mainly in the development having occurred much later. Recent relaxations of planning regulations have facilitated a further increase in the number of commercial centres, predominantly out-of-town. Primark's arrival in Carrefour's new centre in 2016 will be one further example of this and an example also of an internationalisation of Mallorca's retail sector which had long given the impression of being antagonistic towards foreign investment.

The commercial centres have not all been greeted with open arms. When Media Markt, the German electrical goods giant, opened its Palma store, there was a campaign against it and in favour of small shops in towns out in the sticks. It was a campaign with more than just a slight hint of xenophobia, but it was, nonetheless, an understandable one. Communities, like those which existed along Britain's high streets, were and are threatened by a concentration of commercial centres in the greater Palma conurbation; this threat exacerbated by Mallorca's small size and so ease of transport.

But Mallorca's commercial centres are, again like Britain, an extension of how retail competition evolves and can leave smaller retailers trailing behind, struggling to adapt or out of business. When Sainsbury opened in the new town centre in Camberley, competitors along the high street which didn't adapt were affected. Mac Fisheries, Cullen found the going tough. And the story of competition from larger stores, i.e. supermarkets, in Mallorca is largely the story of one man - Francisco Lavao.

He wasn't from Mallorca originally but from Tetuán, a district in Madrid. He came to Mallorca at the age of ten in 1952. He was to go on to form a chain of supermarkets. Their name was COP. Lavao was the first true supermarket entrepreneur, and his story is a remarkable one. In 1977, the supermarkets having suffered in the wake of the oil crisis, he upped and left Mallorca. He fled to Argentina with a suitcase stuffed full with fourteen million pesetas. Three years later, he was extradited to Spain in order to stand trial on a charge of unlawful bankruptcy that had brought about the collapse of the COP stores. The most astonishing aspect of this story is that Lavao, who seemed genuinely remorseful, picked himself up and started all over again. His new supermarket venture took its name from the words "servicio" "y" "precio". SYP.

If Francisco Lavao was arguably the man who created Mallorca's supermarket sector, it was a businessman from Asturias whose company was to give Mallorca its best-known retailing name, that of the department store El Corte Inglés.

There is a connection between El Corte Inglés and Tesco insofar as the Madrid store was originally a tailor's shop, established in 1895. The Asturian Ramón Areces Rodríguez bought the shop in 1935. It was the start of the creation of a retail empire. Yet, despite the fact that El Corte Inglés is so well-known in Mallorca and that its reputation might suggest that it has been long-established here, the Avenidas' store isn't even twenty years old. It wasn't opened until 20 September, 1995. In the same year, the company bought fifteen commercial centres from Galerias Preciados, one of them having been the Jaume III store. It had taken eleven years for the building and then opening of the Avenidas' store to become a reality. The administrative process to permit it had started in 1984.

Such administrative processes don't now take as long. Permissions for commercial centres are generally easier to obtain. And Primark will be a beneficiary. The latest chapter in the story of the changing face of Mallorca's retailing.

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