Certainly, this is true when talking about business-to-business trade in manufacturing, food & drink and many other industries.

However, when it comes to the cross-border retail trade the statistics run dry, the research is non-existent or over a decade out-of-date and a whole industry depends on shopping centres along the border region to provide estimated data. More often than not this information is gauged by the amount of number plates arriving in their car parks from the opposite side of the border or by how many customers wish to pay in Sterling or Euro.

Retail expert Dr Barry Quinn, head of School of Business, Retail and Financial Services at the University of Ulster, says that within the Irish context there is a lack of current data and hard evidence on the extent of cross-border shopping activity and the effect of the border on retail trade and retailer-supplier networks.

He adds that government statistics on the retail sector do not provide a breakdown at regional level for the border counties and do not take account of the border effect on retail trade.

"The only previous research studies on cross-border retail trade in Ireland have been conducted by Fitzgerald et al (1996) and these studies focused on the extent of cross border shopping and price differentials North and South," he says. "This most recent work by Fitzgerald et al, in 1996, was commissioned by the General Consumer Council for Northern Ireland, and examined the extent and influences on cross border shopping with particular attention given to consumer rights and protection.

"This study noted that the Irish border has significantly restricted cross-border shopping, where travel between Belfast and Dublin for instance was less than 25 per cent of what would otherwise be expected. This has been borne out in various studies conducted into cross-border shopping across Europe, for instance between Germany and Denmark (Bygvra, 2005)."

Transport links

However, in light of the political and economic developments between North and South as well as improving road and rail transport links between Belfast and Dublin, Dr Quinn also believes that this may have led to an increase in cross-border retail traffic in recent years.

And while many shopping centres have invested in the introduction of the acceptance of their respective currencies, Brian McAtamney, centre manager at Erneside shopping centre in Fermanagh, believes the introduction of the Euro may have damaged the smaller outlets.

He adds: "Way, way in the distant past at the old punt stage, when there was roughly a 5p difference in the punt, we used to offer 'Pound for Punt' promotions, but we have stopped that obviously because the exchange rate for the Euro wouldn't allow it. Therefore, at present we don't have any currency incentives for shoppers from across the border."

In Newry both the Buttercrane Centre and The Quays are keenly aware of the beneficial impact of introducing acceptance of the Euro.

Peter Murray, centre manager for Buttercrane, says: "Buttercrane and Newry, generally is 100 per cent Euro friendly, having invested significantly in training, awareness and publicity campaigns prior to and immediately after the introduction of the Euro.

"Buttercrane stores are therefore more than happy to accept Euro currency at their tills, indeed most stores offer a preferential rate on sales in Euro vis a vis the prevailing bank rates.

"The centre also has a dedicated Bureau de Change whilst Euro dispensing ATMs are readily available."

Cathal Austin, centre manager for The Quays, echoes Murray's comments: "Newry has always accepted the Euro, Newry was at the forefront of encouraging cross-border trade, even back in the days of the punt," he says.

Of the malls which responded to Shopping Centre Ireland's request for cross-border retail information it was found that some border shopping centres can achieve in excess of 40 per cent of their trade coming from across the border.

At Erneside, McAtamney says: "The percentage of our trade coming from across the border varies but I would say it is approximately 15 per cent. This probably rises at certain periods of the year because we advertise in Sligo at Christmas and Easter, on RTE and regularly on Northern Sound and North West Radio in Sligo."

However, the most lucrative cross-border market seems to be Newry, between Dublin and Belfast, where the retail trade has fully embraced the idea of tapping into cross-border markets.

Murray at Buttercrane shopping centre says: "Given Buttercrane's location in Newry which is only four miles from the border with the Republic of Ireland, it is not surprising that 25 per cent of regular business comes from across the border. The percentage will increase to approximately 50 per cent at busy seasonal times such as bank holidays and Christmas.

"What we have seen recently is a major growth in retail tourism with many traditional day trippers to Newry now coming on shopping breaks and enjoying the other excellent tourist attractions.

"With major infrastructural improvements on the road network between Newry and Dublin, a new political climate in Northern Ireland and five new hotels planned for the Greater Newry area, this is set to increase."

Like Buttercrane, Austin at The Quays says their cross-border trade also depends on the time of year.

He adds: "I suppose it also depends a little on the Euro rate too. I would estimate that 30-35 per cent of our customers on average would come from across the border. It would rise significantly at weekends to maybe 60 per cent, then as you get to Christmas the amount of cross-border trade increases again with people coming here for Sainsbury's, for the off-licence and for many other shops in our centre.

"I wouldn't be surprised if we did a bit of research and somebody said on average over the year our custom from across the border was 40 per cent."

Shopping in Newry

From the information gathered by Shopping Centre Ireland it would seem that primarily cross-border trade is higher from the South to the North with cheaper prices and alternative shops being one of the reasons.

Dr Quinn believes that by looking at studies carried out in other regions of Europe some assumptions can be made.

He says: "Borders can lead to serious distortions of trade in market hinterlands. Widening markets across borders increases consumer choice and access to better value for money, while also encouraging competition and stimulating retailer competitiveness. Past research on cross-border shopping in various regions of Europe indicated that consumers travel to shop for various reasons, including variety of choice and lower prices. The shopping trip may also be linked to other activities such as business, tourism or leisure."

And it seems that in order to tap into the cross-border market a shopping centre must be pro-active in its pursuit of the cross-border customer.

At Monaghan shopping centre, where no cross-border information could be provided, it comes as no surprise to learn that they do not market themselves specifically cross border.

In Newry, The Quays and Buttercrane shopping centres both have regular, directed marketing campaigns to tap into the southern market and it shows in their statistics.

l Additional research by Andrea Clarke & Ryan Kennedy

Shoppers cross the border for the outlet

The Outlet at Bridgewater Park in Banbridge was conceived from the outset as a cross-border scheme, sitting right on the A1/M1 which links Belfast and Dublin. And four months after opening a clear pattern of trade is emerging, which shows that the centre is successfully drawing shoppers from both sides of the border.

Joanne Skilton, commercial director at developer GML Estates, explains that number plate recognition establishes where cars come from as they pull into the car park, and the balance is 70:30 between the North and South.

All the centre's leases include a clause requiring retailers to accept both Sterling and Euros over the counter, and the centre is now looking at installing a Euro-denominated ATM alongside its Sterling machines.

"We've very quickly become an all-Ireland entity," she says. "Our catchment is concentrated along the A1/M1 corridor but that doesn't bother me. After all, that's where the people are." And she's pleased with the way the centre's marketing has successfully reached its two key target audiences: what she calls the BT9'ers who live in the affluent south Belfast postcode and their Dublin counterparts in the D2 district.

Marketing spend is allocated roughly in proportion to the balance of shoppers. And this summer, the centre ran its first ad campaign specifically targetting the South, aiming to take advantage of the Republic's bank holidays.

Printer friendly version

Email this article to a friend