Retail success story: Dundrum Town Centre

Retailers have had a good run of luck lately, buoyed by a shining sun and a realisation that customers are willing to spend if they perceive that there is value. There's money out there, but getting people to part with it is the problem. So the 70%-off sales that became common this summer worked in so far as they brought out shoppers and the tills were ringing.

And yet. The whining about the misfortune of the retailer continues and, to be frank, the sector is simply not being proactive enough in responding to the nation's changed mindset. High-street retailers got used to gouging Irish consumers and the realisation that those days are largely over has yet to sink in at most boardrooms in the UK.

The supermarket sector has led the way in responding to changing circumstances. Tesco quickly got into its Change for Good campaign after internal company documents in April of last year pointed out that consumers, media and government associated it "almost exclusively with price differentials between Northern Ireland and Ireland. Having invested circa stg£3bn in Ireland, the damage to the Tesco Ireland brand by our almost exclusive association with the retail premium versus Northern Ireland is unacceptable", the document stated. Supply chains were changed, lines were dropped and prices were cut. Customers voted with their feet and, as can be seen above, the retailer's market share has increased as a result.

Fashion retailers though have been strangely muted, in comparison, at an international level. Sure, there have been cheaper diffusion lines by the likes of Reiss, and even by luxury labels such as Mulberry (which is teaming with US retailer Target) and Louis Vuitton, but in general the high-street retailers have been reluctant to experiment in a similar way.

Likewise in Ireland, they seem reluctant to look at introducing new brands or making more widespread use of concessions, despite the success of what now seem natural bedfellows such as Insomnia outlets in Spar shops and cafés in bookshops. Deals such as these could provide stable rental income for some of those fashion tenants who say they are having difficulty meeting their bills but, despite that, they remain the exception.

Imagination is required and it all seems to be happening outside of this country. In Britain there are proposals to convert empty shops into schools, a process that could be completed within five months. Last week the EC Harris building group estimated it would cost between £13m and £17m to create a school using an existing retail shell, 33% less than the cost of starting a new building. For the retailer it's a ready-made exit from a lease, for the government it's a substantial saving and for the landlord it's a better tenant covenant, making it a rare case of win-win-win, although obviously it's applicable in only a small number of situations.

Also in Britain, developer Land Securities set up a new company called Brand Empire to partner with new brands it was trying to attract into the market. Brand Empire invests in shop set-up and employee costs and in turn Land Securities gets a point of differentiation from its competitors, which should boost footfall and sales, eventually pushing rents higher. Spanish brand Cortefiel has already signed up and will bring three of its retail formats to the UK.

Such a move should be followed here, particularly as most shopping centres in Ireland have the same monotonous line-up of British high-street staples, offering little that is new to the consumer. There is a reason that the Dundrum Town Centre has been so successful: it offers customers brands that can't be found elsewhere.

There have also been suggestions in the UK that some landlords will invest in smaller retailers, allowing them to expand in return for a stake in the company. At the very least it means the landlord won't be paying rates for an empty unit; at best the landlord can be involved in something that might prove much more valuable than an annual rental income.

One retailer said last week that the two main obstacles to retailers coming up with alternative plans for their space are landlord consent and the related issue of attempting to secure rent reductions. But when does the retailer show accountability for its decisions? Retailers knew the current sales market could happen when they signed their 25-year leases. At what point do they take responsibility for finding a mutually beneficial way out?