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Market Workshop (2/3/11)

March 22, 2011

Workshop on the Future of the Market.

(2/03/11)

This workshop was ordered by Scrutiny Board to gauge initial opinion on the way forward for the Market, in particular the issues of investment and management.

Present from LCC Martin Farrington (MF), Paul Stephens (PS), and Cath Follin (CF).

Present from Traders Liz Laughton (LL), Michelle Hocken (MH), Pav (P) and Cliff Hocken (CH).

Present from Friends of Leeds Kirkgate Market Alan Wheeldon, Chris Leonard and Sarah Covell (SC).

MF opened the meeting by getting everyone to fill in a questionnaire with reactions to statements ranging from totally agree to totally disagree, via neutral.  He said the object was to identify what was agreed upon and what was not.  Questions were roughly as follows:

  1. The Market is vital in supporting start up businesses and independent entrepreneurs.
  2. Major investment is needed to ensure the Market sustainable.
  3. The Market’s management need to be able to make decisions more quickly.
  4. Kirkgate Market needs to become a more significant visitor destination.
  5. On balance Eastgate Quarters is an opportunity for Kirkgate Market.
  6. The Council is best placed to manage Kirkgate Market.
  7. Kirkgate Market is too large.
  8. The Market needs a management model that isn’t totally led by the Council.
  9. The Market should be more aspirational in its offer.
  10. Private investment is crucial to the success of the Market.
  11. The market should focus on providing services to its existing customer base.

Replies were as follows:

  1. Traders totally disagreed.  Trader LL said the current system of 10% rent for new businesses unfair competition to existing traders.  Need to check new traders have sound business plan, rather than one which just uses the rent discount to undercut the rest of the traders.
  2. Most agreed or neutral – AW of Friends of the Market said investment may come with conditions and lead to a problem of accountability.
  3. Mixed – Trader MH agreed, but felt things would improve if they had the right team.  AW said if someone other than the Council ran it there is a danger of a loss of democratic control.  Council Officer PS said the way the Council has to operate as a democratic body means it is not best placed for commercial activity.
  4. Nearly everyone agreed – in the past there would be many coach parties from around Yorkshire to come and see the Market.  Some traders felt the only problem could come if the Market was turned into a ‘tourist market’, rather than a working one.
  5. Trader MH said Eastgate could cause a hole around it as big firms draw in customers.  Friend of the Market CL said people who don’t use the Market don’t know the offer: cheaper, more variety, and better service.  The Council’s MF said people might be drawn to the area by Eastgate and go into the Market.
  6. Friends of the Market were against: CL – it’s aspirational already e.g. far wider range of fish than you’d find in the supermarket.  AW- ‘aspirational’ seems to suggest gentrification.  Traders had mixed opinions.
  7. Size – another mixed response, more agreed.  Among the traders MH said the Council was greedy in 1981, building too large a hall after the fire, and LL said pre-fire Market had designated aisles so the Market had more coherence, outside was the “Tatters Market” which was more open to anyone to set up.  Council Officer CF said the Market is too big – if it were smaller there would be a waiting list and no voids, also more event space. It is currently overwhelming to new visitors.  Trader Pav disagreed, asking if shrinking the Market was really the answer.
  8. Traders said the current structure could be improved by a Market Committee, as used to happen (and is starting again, albeit in limited form) – and for the Market to be in a separate Market Division, as also used to be the case.  LL said Council should still run the Market, just in a different way.
  9. SC disagreed saying the Market should build on the current customer base.  CF said a new type of customer was needed.
  10. Traders were against, as were Friends of the Market.  Council Officer PS said new investment is needed.
  11. Council Officers disagreed, CF saying the Market needed a different type of customer.  SC of FOLKM said the Market should build on its current customer base.

The meeting then went on to discuss the implications of the opinions discussed.  On management CH said there was a Market Division in the 80’s and this worked a lot better than the current arrangement (in which the Market is run by City Centre Development). Staff were specifically trained and dedicated to the Market and there was a Market Committee.  CL made the point that the Council took out £2m from the Market’s revenues each year was no point discussing different models of management if the money wasn’t available.

Funding

MF said question of funding would be covered shortly.  He said retail was a fast-changing environment – Woolworths and C & A had disappeared and quickness was key to survival.  He added that some would say he had power and influence but others like C. Proctor (Chair of Scrutiny Board) also had influence, and he had to report to his superior and to the Executive Committee etc., and was therefore unable to be quick.

MF then went through the various options for investment including Council funding; a bank loan; ring-fencing some of the surplus and borrowing against that; an equity stake; a joint venture; development or a concession (e.g. 30 yr licence to operate – not a lease, with investment as a condition).  Council funding was unlikely in the current climate. An equity stake or joint venture would mean private involvement, which generally the traders and Friends of the Market were against.  There is a development possibility on the land between Eastgate and George St, which could raise money, as could a concession.  MH asked if talks had occurred with the developer Hammerson, and MF replied he had had no discussion with Hammerson.

Management

MF said he felt the group seemed against most funding options and neutral about the concession.  He then proposed a quick run down of management options.

Friends of the Market made various points on this: SC said it was more about how the Market was managed, e.g. management needed to liaise directly with traders in language they could understand.  CL asked who in the Council would agree to ring-fencing the £1m or so of Market revenue that would be needed?  AW said that the main problem was not management but neglect – e.g. the large backlog of repair work (£1.6m), the high rent, the lack of advertising money etc.

MF said time was running out and the options for management were as follows:

  1. staying with Leeds City Council
  2. an Arms Length Management Organisation (ALMO)
  3. the Private Sector
  4. a Partnership
  5. a Trust
  6. Traders
  7. a Social Enterprise or CIC (Community Interest Company)

MF then expanded on the options with help from CF.  An ALMO could make quicker decisions.  Glasgow Market had this – run by a board of elected members and staff.  A Partnership or Joint Venture – Liverpool Market is run by one elected member and management staff from a company.  A Trust – set up with trustees, can include traders, e.g. Borough Market.  Trader model – best for small markets, e.g. Oakwood Market.  A CIC has social objectives.  There is no standard model.  It could be a limited company with shares, set up on a not-for-profit basis.  It usually has one director.  It can be similar to a Coop or Trust.

MF said time was running out so the group was invited to give their top three in order of preference.  SC asked if there could be a CIC in partnership with the Council.  PS said this would be difficult.  Generally the three favourite options were an ALMO, a Social Enterprise and the Council, not always in that order.  Council Officers CF and PS said as long as investment was secured then ALMO’s, Partnerships and CIC’s would be their choice.

MF said there was a lot of overlap with the favoured models so there was a kind of consensus there.  He thanked everyone for coming and said this was just an initial sounding, a ‘toe in the water’ and that it would be fed back to the Scrutiny Board.  AW asked when the report to the Executive Committee would be.  PS said he didn’t know but it would be after the Scrutiny Board so that they didn’t clash.

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