Real shops in town centres almost seem to be in a minority these days, as every variation of cafe, small restaurant and fast food outlet competes for our custom.
You would have thought this should have happened in the last consumer boom, a time of brash "champagne Charlies". Yet this strange phenomenon has come about only since the end of the mid-Eighties. In fact, I believe that the more demure, sophisticated world of "cappuccino Charlottes" is a reflection of how our spending habits are changing.
Evaluating this phenomenon is one of the best ways of seeing where our future investment opportunities may come from. So what has happened?
A decade ago there was still a significant level of employee confidence. Full-time work and jobs for life were considered typical. No more. The "middle-class" recession of the early Nineties meant that, for the first time, many in service industries were "rationalised" out of a job, or shifted to short-term contracts. This, in turn, led to the proliferation of that new term for redundees - the "consultant".
Add to this the collapse in house prices. As a result our spending inevitably changed. Gone is the heavy borrowing; gone also are the high-cost holidays and cars. That does not mean we have stopped spending, but rather that we have changed our style. Investment and saving have also been rising, and any improvement in our financial situation is spent on "good value" entertainment, which covers virtually anything in the leisure industry. From bowling to bingo, from soccer to squash, from cinemas to cafes. Themed leisure industries will be the growth area of the late Nineties.
As a result, our eating habits will be changing. Going out may include a meal, but not necessarily a three-course formal dinner. Increasingly this is being replaced by a family meal, often linked to a film or sporting event.
Already we can see the big brewing combines such as Bass and Whitbread moving in. The latter have just paid an eye-opening price for Pelican, which runs the Cafe Rouge chain, to add to their portfolio of leisure brands. More will come, as further income is drawn into the sector.
Other cafe styles have been cashing in, whether it is Rank expanding its Hard Rock chain, Planet Hollywood's global expansion, Capital Radio's new cafe in Leicester Square. Meanwhile, Internet Cyber-cafes for PC anoraks are spreading. The game is to find a theme quickly, let it blossom and then hope to find a leisure combine to buy the brand before fashion fades.
This initial fashionable phase will pass, and it will be only the sturdy few founded on good business and catering skills that will succeed.
For us as investors, this is one area where our personal knowledge can be brought to bear. Individual research is thoroughly recommended, not only to carry out your own evaluations, but also to prove that, on occasion, money and leisure can be successfully blended together
Justin Urquhart-Stewart is business planning director of Barclays Stockbrokers. He likes watery cappuccinos.Reuse content