Unique, but others are planned: 'Bond Street by the sea' offers haven for shops and shoppers

HORNSEA, a quiet backwater on the Humberside coast south of Bridlington, seems an unlikely site for an innovation in shopping, imported from the United States.

Every day crowds of people come to the resort, which has a population of only 7,000, to hunt for bargains at the Hornsea Freeport Shopping Village. The owners say they will attract one million visitors this year.

Many leave the Freeport clutching clothes, shoes and other goods which they could not normally afford. But although the prices are low, both the owners of the site and the companies which have branches there are happy with the deal.

The success of the Freeport stems from the retail trade's habit of overproducing and of constantly changing its range of goods.

Last year's styles, surplus stock known as 'overmakes', and slightly defective items all find their way to Hornsea.

Hornsea Freeport is the first and only shopping centre of its kind in Britain but it is unlikely to keep this unique status for long. Other companies have plans for a freeport near the M25 around London and for another in Somerset.

The Hornsea Freeport has developed gradually since 1987 when Peter Black Holdings, based in Keighley, West Yorkshire, bought a pottery in the town together with its shop.

A Peter Black executive then saw a freeport in Maine, USA, where many well-known firms had opened branches, and the company decided to reproduce the idea at Hornsea.

Now 10 High Street stores and companies with well-known brand names have opened branches on the 28-acre Hornsea site. They include Aquascutum, Austin Reed, Damart, Laura Ashley and Wrangler.

Another six, including the book shop Dillons, will have moved in by the end of October, and it is estimated that the turnover next year will be about pounds 8m.

Julian Brown, managing director of the Freeport, said: 'It is a controlled disposal of surplus goods. It protects their brands and it protects their full- price outlets and is a way of liquidating stock.'

This is a polite way of saying that because Hornsea is away from conurbations it is just the right place to sell cut-price goods.

Companies such as Laura Ashley do not want these products turning up on market stalls opposite their outlets in the big cities.

In the Aquascutum store at the Freeport a cashmere coat which would normally cost pounds 1,220 is reduced to pounds 425. A raincoat which would sell in the West End of London for pounds 435 can be bought for pounds 119, and sweatshirts are slashed from pounds 40 to pounds 15.

At Laura Ashley, children's dresses for the 3-4 age group are reduced from pounds 33.95 to pounds 16.95, while at Austin Reed some men's suits which normally cost pounds 395 can be bought for pounds 149.

It is left to individual companies to decide how much to reduce prices. Although most are cut by 30-50 per cent, the fact that some shops can lower them by more and still make money may reveal something about the profit margins enjoyed by certain High Street stores.

The companies that have shops on the site pay the owners a percentage of their turnover rather than a proportion of their profits.

This is a typically canny move by Thomas and Gordon Black, the two brothers who are joint chairmen of the company founded by their father.

The Freeport is just a small part of the company's business. It also manufactures footwear, produces toiletries and cosmetics for chain stores such as Sainsbury and Marks & Spencer, makes vitamin pills and runs a distribution business.

The customers appear enthusiastic. Jean Francis, 22, from Leeds, who had just bought a pair of Wrangler jeans reduced by more than a third, said: 'I couldn't get this sort of stuff elsewhere. I've got another pounds 30 to spend and it will all go.'

Like many of the people who come to the Freeport, she was on holiday in the area. But as well as tourists, the Freeport is starting to attract local people and what are known in the trade as 'destination shoppers' from as far away as the East Midlands.

The centre is also developing leisure sections, which include a collection of birds of prey, a miniature village and a children's playground, producing a curious atmosphere somewhere between Butlin's and Bond Street.

(Photograph omitted)