Gutted about Funky Mackerel! Although I imagine someone will snap up the chance to take it on.
I may have the wrong end of the stick, but I gather the council ramped up the business rates to the point that it was hard to remain viable to earn a living and the people who ran it felt constructively forced out. It was a popular, thriving business that they were keen to continue, but they felt really taken for a ride and decided they should call it a day. It's been empty for quite a long time now, so that worked - well done, council.
It's not just me that feels really wholesome about Sheringham, is it? It just seems to be the type of place that turns you into a Ladybird books family
No, it's a marvellous place, and you put it so well. Like Daddy Pig and the puddle, you feel like you become Sheringham 
We've deliberately never used the Tesco there, in solidarity with the locals who never wanted it. I don't know if people in general have become more resigned to it now, or if it largely survives on tourists and those from a little further afield; but Tesco 'pressured' the council into allowing it, as they made it clear that they had far more money for lawyers than the council did, so opposing it was never going to stop them. I wonder if their arrival had any bearing on the lovely fruit and veg shop closing down? Thankfully, the excellent bakeries and butcher's shops have survived thus far.
It's such a unique place, with a thriving local community that also extends a friendly welcome to visitors (and not just in a cynical money-grabbing way). Now, a load of holidaymakers will buy up their food for the week as soon as they enter the town and then never have a cause to visit the wonderful local fresh food shops.
Blythe & Wright is still going strong after over a century, though: what an institution!