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The future is not so grim up north

Bashir Mohammed believes the trading climate in the north will soon follow the south's upturn

I was sad to learn last week of the demise of another old friend, Limeys. Happily the stores will continue to trade under new ownership, hopefully safeguarding the staff if not the management team.

Many suppliers and retailers continue to report that trading remains tough. However, I am seeing something of a north-south divide, which gives me some cause for optimism.

From my own experience we first noticed a slowdown in trade in October 2004. At first I thought poor autumn sales were due to the long, hot summer that continued well into November. In fact it was the start of the downturn in retail sales that has affected us all over the past three years. Interestingly, the popular press continued to talk about a retail boom for at least another six months. Indeed there was a continuing boom - in the Midlands and the north.

Without wanting to tempt fate, I noticed the beginnings of a marked increase in trade in the second half of last year, which was followed by a good Christmas. At the halfway point of this year we have continued to see a welcome improvement.

So why should I be doing better than retailers elsewhere? I'd like to say it is because of my business acumen, but that is not the whole story. As with most trends, things tend to start in London and spread across the country. So the north is now experiencing things that we in the south adapted to several years ago, such as higher house prices and, more significantly, bigger mortgages - which means there is less money around to spend. Also, the branded multiples and department stores have more or less reached saturation point in the south-east and are expanding across the UK, bringing competition to independents who've not had to deal with them before.

But if I am right, in a year or so the improvement I have seen will have spread across the UK, and independents will have developed new strategies to take on the multiples and will emerge better and stronger. In the meantime, if you are feeling the pain, here are my top tips to help you get through it.

First, stick to what you are good at. Don't try to diversify your way out of trouble - you will only lose existing customers rather than gain new ones.

Second, control costs with an iron fist. Sign off on every penny, re-tender all supplier contracts and centralise your buying to get better prices.

Third, be creative. At Christmas, I ran a competition to see which of my stores could make the best window display for £5. This had a far better effect on morale than spending hundreds of pounds.

Keep your staff on-side. It is always best to tell them what is happening and why. When I could not give them a pay rise, I wrote personally to them all explaining why. They stuck with me, and I have been able to reward their loyalty by making up the difference this year.

Finally, don't give up. Keep a positive attitude, and things can only get better.

- Bashir Mohammed owns independent designer fashion business American Pie. He runs nine stores in west London.

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