Internet shopping has been blamed for boarding up high streets across the UK. So it looks politically judicious for Amazon, the original ecommerce behemoth, to now be attaching its brand name to a pilot project aimed at sparking a little commercial life in denuded UK towns and cities by parachuting online SMEs into pop-up shops around the country.
The year-long Amazon pop-up pilot program — which is couched as an exploration of “a new model to help up-and-coming online brands grow their high street presence” — will see more than 100 small online businesses selling on the UK high street for the first time via time-slots in ten pop-up shops which will each be open for between six and eight weeks.
The first pop-up opens today on St Mary’s Gate in central Manchester. Others will appear in high streets in Wales, which will get the second pop up in Cardiff; Scotland, the Midlands, Yorkshire and across the South East over the course of the pilot — before winking out of existence again.
We understand the project is being funded by Amazon and its partner organization for the program: Enterprise Nation — a local small business support network. Direct Line for Business and Square are also listed as partners for the pilot.
It is not clear how much they are spending to sustain the ten pop-ups for up to two months apiece.
Last year the UK government called for proposals for reinvigorating high streets, announcing a £675M Future High Streets Fund to help modernise high streets.
And while the pop-up pilot is not receiving any of this public funding, Amazon’s PR states that they have commissioned an external research consultant to produce “a detailed analysis of the impact of the pilot” — saying they plan to submit the findings to the government following its call for new ideas to inform the Future High Streets strategy.
“The Clicks and Mortar pop-up shops will provide customers with the opportunity to discover and buy directly from over 100 small businesses – everything from homeware and health and beauty products to food and drink and electronics,” Amazon writes. “The up-and-coming brands have all built successful online businesses and now want to explore physical retail for the first time.”
Among the online brands that will have their wares showcased on UK high streets via the pilot are a foldable kick-scooter brand for adults (Swifty Scooters); a maker of leather cases for electronics devices (Torro Cases); and a men’s skincare range (Altr for Men).
Participating small businesses will be selling directly to customers, with all payments made straight to them — Amazon confirmed it is not taking any sales commission for the pop-up shops.
Last year the UK chancellor announced a digital services tax that will be applied to tech giants operating search engines, social media platforms and online marketplaces from April 2020 — after floating the idea of a platform tax to help level the playing field with traditional retailers and support high street regeneration.
The digital services tax will put a levy of 2% on revenues of tech giants that can be attributed to UK users.
Amazon’s UK corporation paid just £4.5M in tax in 2017, with revenues from its UK retail sales reported through a separate company in Luxembourg — meaning rising growth in online shopping on Amazon.co.uk has not translated into increased tax contributions to the UK.
This has meant a double whammy for the public purse because Internet shopping competitively squeezes high street businesses that do pay into public coffers. To the point of no return in the case of many traditional bricks and mortar sellers. Hence boarded up high streets are a visual reminder of the wider societal costs of Internet-enabled profit shifting. (Albeit, it’s harder to visualize the impact of shrinking public funds on vital areas such as education.)
Also today, Amazon has announced a £1M SME Apprenticeship Fund — which it is fully funding.
It says this will help create more than 150 full-time apprenticeships in roles including digital marketing, business administration and customer service practitioner at small online businesses.
The fund is open to apprentice applications from any brand-owning SME registered in England that currently sells on Amazon and has a turnover of less than £1M. Each apprenticeship will last between 15-18 months, with apprentices receiving a mix of in-work, online and classroom training.
“Amazon will also provide specialist training on how to build a successful e-commerce business, how participating SMEs can market and advertise their products to customers and how to sell their products to a global customer base,” it writes.
It also says it will be providing free digital training at Amazon Academy events held across the UK to offer additional support to small businesses to sell online — with a special focus on boosting export sales.