Marchpole distribution deal Ungaro

British fashion retailer Marchpole Holdings has signed an exclusive distribution agreement with Emanuel Ungaro in Japan with Via Bus Stop, which is part of the Onward Kashiyama Corporation. Marchpole designs, produces and sells clothing and accessories for six major brands including Yves Saint Laurent, Boateng and Emanuel Ungaro. It has been in the business for over 30 years.

Onward Kashiyama specialise in the importation and licensing of luxury brands, including Ralph Lauren, Donna Karen, Calvin Klein, Jean Paul Gaultier and Viktor and Rolf.

Meanwhile, Via Bus Stop has 18 retail stores devoted to the development of luxury designer brands in the Japanese market. It will launch Emanuel Ungaro Men's collection for Spring Summer 2006. The agreement is for three seasons, with minimym guarantees of EUR 600,000 (GBP 410,000) for the period.

www.marchpole.co.uk
12 May 2005

Mosaic Fashions To Float

Mosaic Fashions, the group of UK clothing retailers assembled by Baugur, is to float a stake on the Icelandic Stock Exchange.

Mosaic Fashions, in which Baugur has a 42 per cent stake, operates 600 stores including the Oasis, Karen Millen, Coast and Whistles chains. It hopes to raise £40m through the listing.

Other shareholders include Icelandic bank Kaupthing, which has an 11 per cent stake, and the management led by chief executive Derek Lovelock, with 19 per cent. None of the current investors will be selling any of their stake.

By listing a minority stake in Iceland, Mosaic Fashions will be the first non-Icelandic business to be listed on the Iceland Stock Exchange, the only retail company and will also be one of the largest and most profitable companies.

Lovelock said: "The listing is a further step in our strategy of becoming a leading international fashion retailer through development of our market leading brands. The rationale behind the listing of the company is to raise capital for further growth and to develop international activities, as we will have a stronger balance sheet going forward.

The company said international expansion is a key element of Mosaic's strategy. In Iceland, Mosaic operates three Oasis and Karen Millen stores and made a successful move into the Scandinavian market. Karen Millen has three sites in the US and hopes to open in New York later this year. The additional funds will enable the group to consider more international openings. Mosaic Fashions has seen average organic sales growth of 13 per cent over the last three years. In 2004/05 the company had a turnover of £355.6m.

www.baugur.is
3 May 2005

UK Shoppers Staying At Home

According to the Retail Bulletin, the office for national statistics have shown retail figures have dropped in March. The ONS said sales declines for household goods retailers, particularly furniture, as well as a fall in non-store retail sales, which includes mail order and the internet, contributed to a 0.1 per cent month-on-month decrease.

The annual growth rate declined to 2.7 per cent, the lowest since August 2003. Across the three months from January to March 2005, sales volumes were up 0.3 per cent higher than in the previous three months, an improvement on the 0.6 per cent decline in the prior three-month period.

Commenting on the figures, Paul Clarke, national retail director for Barclays Business Banking said: "The traditional Easter bounce has failed to materialise and retailers remain very cautious about the sector's outlook. Current trading conditions are difficult as footfall continues to be subdued and consumer behaviour has been tempered by a static housing market.

"We do not anticipate any upturn in high street fortunes until after the election and warmer weather prompts shoppers to restock their summer wardrobe."

23 April 2005

Primark On Top Form

Discount retailer Primark has turned in another strong performance for owner Associated British Foods, despite harsh competition on the high street, which has pushed down prices.

In the 24 weeks to March 5, Primark saw sales increase by 12 per cent of £448m, up from £399m a year ago, with operating profit up to £59m from £50m. Associated said the chain's 'excellent performance' was driven by a 6 per cent increase in like-for-like sales, as well as an increase in selling space. Like-for-like value growth was achieved against a background of 5 per cent price deflation.

Three new stores opened in the period in Lincoln, Sunderland and Dundrum, with two smaller stores closed. Stores in Watford, as well as Drogheda and Cork in Ireland, where the group trades as Penney's, were extended. completed. The programme of new store openings includes plans to rebrand the recently acquired Allders stores.

Associated reported total group sales up 10 per cent to £2,618m, with a good performance by its food brands business, which includes Sliver Spopon, Twinings and Ovaltine

George Weston, chief executive, said:"These results reflect the strong contribution from recent acquisitions and good progress from our existing businesses. The integration of the acquisitions is virtually complete and these businesses are performing in line with our expectations."

19 April 2005

Liberty Sold To Clear Debt

Retail Stores, owner of landmark London store Liberty, has agreed a £66.5m sale of its store and office complex in Regent Street. Retail Stores, who own luxury boutique Liberty, have announced the sale of the landmark store for £66.5m, in a bit to clear the store's debts.

Liberty will continue to lease its retail and office space from the new owner. Lasenby House, Kingly Street and the Liberty Island site in Regent Street are being acquired by the Great Victoria Partnership, a joint venture between Great Portland Estates and Liverpool Victoria Friendly Society. The two properties currently generate an annual rental income of around £4.4m.

Retail Stores, which is 68 per cent owned by Marylebone Warwick Balfour said the proceeds will be used to repay its entire £61.9m debt. Lasenby House is a freehold property with office space let to Liberty, while the Liberty Island site is on a lease from the Crown Estate Commissioners, expiring in 2051. It includes retail and office space, with tenants including Liberty, Gap and Barclays Bank.

Richard Balfour-Lynn, chairman of Retail Stores, said: "This is a positive deal for the company as it enables us to repay all our debt and focus resources on developing Liberty designed luxury goods aimed at the international market.

"As a result of this sale, the financial structure of Retail Stores has been greatly enhanced, thus underpinning the core operations of the business. Since Autumn 2004, Liberty has been proving increasingly popular and our sales have improved dramatically at a time when many retail groups have reported flat or declining sales."

Toby Courtauld, chief executive of Great Portland Estates, said: "We announced the formation of our joint venture relationship with Liverpool Victoria in November last year. These latest acquisitions will see this partnership fully invested in first class assets with real angles for value creation."

"We are delighted to be buying into the renaissance of Regent Street and to be able to build on our existing relationship with the Crown Estate."

18 April 2005

Alexon trade collapse

The UK retail company Alexon Group Plc, which operates Dolcis and Bay Trading fashion chains, has warned the the fall of the Allders department store group could cause the company's earnings to drop by GBP 3 million this year.

Alexon owned 118 Allders-based concessions and has already lost GBP 2.2 million from money owed and fixtures write-downs. Profits for the year ending 29 January 2005, Alexon profits dropped to GBP 26.9 million from GBP 29.4 million the year before.The company also reported a 1.3 per cent decrease in same-store sales for last year.

www.alexon.co.uk
5 April 2005

Tough Times For British Retailers

As was reported in the Guardian, Britain's retailers are facing tough times in trading with a combination of poor weather, higher utility bills and a slowing housing market affecting activity, the CBI said yesterday. Analysts predicted a spate of spring bargains for consumers as retailers seek to rid themselves of unsold stocks. Of the 200 firms to respond to the CBI's distributive trades survey in the first half of March, only 10% said business was good for the time of year, against 47% who said it was bad.

The CBI said the gap of 37 points was the poorest result since November 1992, two months after the UK suffered the psychological shock of sterling crashing out of the exchange rate mechanism. It was not a one-off month affected by the wintry weather; the CBI said figures for the latest three months showed no increase over the same period last year. It added that consumers' wariness of spending in the shops was matched by a reluctance to purchase big-ticket items.

In the City, economists said the gloomy news from the high street put paid to any prospect of an increase in interest rates at next month's meeting of the Bank of England's monetary policy committee (MPC). In what would be the last meeting of the nine-strong committee before a May 5 election, rates are expected to be left at 4.75% for the eighth month in a row. Some economists believe the next move will be down if consumer spending remains sluggish.

Vicky Redwood, an analyst at Capital Economics, said: "The survey suggests the trend in retail spending continues to weaken. As such, it casts further doubt on the MPC's assumption that the housing market downturn will have little negative effect on spending." Thirty-one per cent of retailers said sales were up last month compared with a year earlier but 40% said they were down.

31 March 2005

Retailers to face rate increases

Many retailers will face rises in property rates as the first revaluation for five years takes effect from the 1st of April.As the property market changes in value, so too do their rates which are subsequently re-calculated. Some retailers may find there rates increased by up to 33.4 per cent. The increases come from the Valuation Office and are listed by billing authority.The small business rate relief scheme has been set up to help small business who incur extra rates costs.

30 March 2005

Fashion Retail Academy Gets 10 million Grant

Bhs and Arcadia owner Philip Green has seen his £10m pledge of support for a UK fashion retail academy matched by similar funds from the government, Education Secretary Ruth Kelly said that it would commit £10m in funding to the academy, the first of a number planned to focus on developing vocational skills.

The fashion retail academy will open in September 2005.It will be supported by Arcadia and set up in collaboration with the London College of Fashion and retail sector skills agencies. It will offer places to 60 students aged 16 to 18 a year, who will learn what Green calles the "fundamental skills" of clothing retail and create a "conveyor belt" of new talent.

Other retailers, including Marks & Spencer, are also expected to support the academy either through funding or by committing to work placement and mentoring. Ruth Kelly said: "By supporting this joint venture Philip Green is showing a real commitment to productive partnership in education.The academy will promote fashion retail as a career, and will deliver a flow of young people to the industry with excellent skills."

However, the first set of students will start their training against the backdrop of continuing consumer caution. At the launch, Green the predicted little upturn in the months ahead; He said: "It's pretty tough right across the whole sector. I don't think there is any significant growth in the short term. "There has definitely been a slowing down since last October. From the more clothing point of view, the weather has been slightly unusual for the opening of spring, but I think it is going to be a tougher year."

24 March 2005

Stead & Simpson Heading For Floatation

Stead & Simpson, one of the UK's longest-established retailers, is considering a stock market float or sale as part of a review of options for the business. Development Securities, the investor which holds 38 per cent of the company, has appointed Clearwater Corporate Finance to carry out a strategic review which will consider a wide range of exit options. These include a possible flotation as well as a sale.

The group operates 400 stores across a variety of fascias including Shoe Express. In the year to January 1, Stead & Simpson's pre-tax profits rose to £8.9m from £4.6m a year ago, with sales up £140.3m from £130.1m in 2003.
Chief executive David Lockyer said the improvement was driven by a combination of stores refurbishments and an increase in branded ranges. He said the strategic review would allow the company to fund its next stage of "significant growth".

Founded as a footwear manufacturer in 1834, the group has focused on retail since the 1960s. Development Securities bought a stake in Stead & Simpson in the 1980s, while the 1990s saw acquisitions of chains including Famous Footwear and Peter Briggs as well as Shoe Express. Chairman John Shannon, chief executive Lockyer, and finance director Peter Foot bought out private equity backer Apax last year. City estimates of a £90m stock market valuation of the business would value their combined share at around £55m.

16 March 2005

La Rinascente sold

The Italian retail chain La Rinacente has been sold by Italian-French holding company Eurofind to a group led by real-estate company Pirelli RE SpA. The transaction has been valued at EUR 888 million.Eurofind revealed that the group out-bid a number of rivals like the French department store company Galeries Lafayette.

The Pirelli-led group consisted of a number of parties such as Deutsche Bank Real Estate, the private equity company Investitori Asscoiati, and the Borletti family, which owned La Rinascente before selling it to the Agnelli family in the 1970s.La Rinascente's clothing divisions include Italian chains Upim and Grandi Magazzini.

www.rinascente.it
15 March 2005

Urban Outfitters On Profitable Path

Urban Outfitters' growing popularity with trend-led shoppers have seen earnings and sales growth for the fourth quarter of 72.2 and 42.9 percent, respectively. Higher merchandise margins, increases in customer transactions and strength in catalogue and Internet-based sales bolstered results as the company had double-digit profitability increases in each of its three brands in the quarter. Year-end results also were impressive with profits that doubled, year-over-year.

But that doesn't mean Urban is resting on its laurels. The 25-year-old specialty retailer is ramping up sales by better serving its core demographic as well as reaching new consumers via stores in shopping malls, historically nontraditional locales for the company.

Total quarterly sales were $251.6 million, up from $176.1 million last year. By division, sales at Urban Outfitters stores rose 34.4 percent to $112.2 million. Direct-to-consumer sales increased 69.5 percent to $33.4 million, and gross profit margin as a percentage of sales climbed to 43 percent in the fourth quarter from 41.5 percent last year.

"Unlike many other specialty apparel retailers that develop a core segment, then create a new concept when saturated, Urban Outfitters has built a complex business platform of three brands as well as a direct-to-consumer business," wrote Bear Stearns analyst Dana Telsey in a March 7 research report initiating coverage of the retailer. "None of these divisions have reached maturity, which sets the stage for a great deal of future organic growth."

Because Urban has a relatively small store base versus its peers, that growth potential is considerable, analysts say. Urban currently operates 75 Urban Outfitters stores, 65 Anthropologie units and two Free People locations, in addition to its wholesale operations that sell to more than 1,100 specialty stores, department stores and catalogues. Telsey, who has a "peer perform" rating on Urban shares, thinks the company could eventually reach 150 to 200 Urban stores, 200 to 300 Anthropologie stores and more than 30 Free People stores.

11 March 2005

Major retailers miss out

Small online businesses have picked up the slack where major clothing retailers have lacked the vision to pick up on what customers want in the leather accessories.

According to Carrie Reeder, owner of The Level Collection, a popular online retailer of leather wristbands, cuffs, cuff watch bands and cuff watches, customers tell her what they want: "We listen to our customers. Our customers tell us what they want, what they are looking for and we listen. We are constantly striving for better quality leather wristbands and more unique designs. We also keep an eye on Hollywood and popular fashion trends."

The advantage that small businesses have over major retailers is that they are more atuned to what their customers want and hear first-hand what they want. This is an advantage to be exploited. Customers remain true to a provider that delivers up to the minute trends, as well as quality.

Major retailers also suffer by way of timeframes. It takes them longer to get new designs approved, manufactured and delivered to stores. By the time the process has been completed, a new trend has already taken place.

8 March 2005

AnnTaylor profit warning

The US womenwear retailer AnnTaylor Stores Corp announced worse than expected fourth quarter losses as a result of a singular change in the way the New York-based chain accounts for leases and falling sales.

The company forecast a net loss of 14 cents (0,08 pence) to18 cents a share for the fourth quarter ending 29 January. However, it added that it expects return to profit in the following quarter with first quarter earning of 27 cents to 30 cents a share, beating average analyst forecasts of 25 cents. Ann Taylor added that organisational changes would result in severance payments of $3 million, but the company would ultimatley save $3 million a year.

www.anntaylor.com
15 February 2005

Slow Start To 2005

UK shoppers have made a painfully slow start to 2005, according to the Retail Traffic Index compiled by SPSL. The January index was down 5.2 per cent year-on-year and down by 24 per cent against December. The three-month year-on-year trend continues the decline which began in October and which went into the negative in December.

Dr Tim Denison, director of knowledge management at SPSL, said: "As we had predicted, after the frenzied rush to the sales after Christmas, shoppers ran out of momentum after the first week of the new year.

"Although Government officials may be pleased that interest rate hikes seem to have stemmed the ever rising consumer debt, the figures will be worrisome to retailers, raising renewed concerns about consumer confidence. The 5.2 per cent year-on-year fall in national footfall levels is the greatest drop since March 2003 when the Iraqi War started. "Though this drop in shopper numbers is unwelcome for many, we shouldn't automatically assume, however, that last month's results signify that shoppers are tired of sustaining the retail economy.

1 February 2005

UK Retailers Reacts To Tsunami Appeal

With a high percentage of British retailers and brands relying on India for sourcing, manufacturing and production, a crisis could follow the tsunami catastrophe if manufacturers cannot produce the goods.

With the high number of casualties many suppliers are bound to be missing as companies such as Tesco do much sourcing in the affected areas. Generally speaking, textile factories are further from the coastline than other businesses and have remained intact. Rather, the rising death toll is what could shake-up the industry as the manufacturing workforce could be greatly depleted.

The UK is the second largest market for the Sri Lankan textiles after the US. It is estimated that 30 per cent of the UK high street retail products is manufactures in India.

UK retail businesses have been generous in their support to the disaster and aid and donations are still going out in high numbers. One of Britain's most altruistic businessmen, Tom Hunter, the former boss of the retailer Sports Division, is to give £1m to the tsunami appeal. Philip Green of Arcadia and BHS has pledged £1m worth of clothing in conjunction with the Daily Mail. London luxury retailer Harrods has donated £150,000 from its first day of sale and New Look is donating £200,000 in addition to customer contributions.

11 January 2005

Good Trading At Liberty

Upmarket London store Liberty has shrugged off the poor Christmas trading reported by other rivals, reporting a 14.2 per cent sales increase between December 1 and Christmas Eve. In the first full week of the post Christmas sale, the Regent Street retailer saw volumes up by more than 5 per cent.

Liberty owner Retail Stores said the December sales increase "reflects Liberty's increasing popularity as a destination shopping venue" following a revamp of both the the retail offer and management team over the past year. The company stressed that volumes were not boosted by aggressive discounting or pre-Christmas sales.

Four key product areas all performed strongly: beauty and cosmetics; ladies accessories; jewellery and menswear. There was also a strong performance from Liberty's revamped home department. Retail Stores said its December results built on a 10 per cent increase in sales across the 26 weeks to December 25. The result was achieved without substantial markdown, and with fashion stock levels in the first week of sale in line with expectations. Liberty's average transaction value has increased by 13 per cent year-on-year.

Iain Renwick, chief executive, said: "December's performance has been most encouraging in view of the generally difficult retailing environment. Over the past six months we have seen steadily increasing sales volumes as the hard work behind the scenes to reposition Liberty as London's destination store has borne fruit. Liberty Chairman Richard Balfour-Lynn said: "We hope to reinvigorate the Liberty brand the emporium is becoming one of London's most exciting and rewarding places to shop."

8 January 2005

Quota-free retail industry

With textile and clothing import quotas due to expire at the end of this month, importers and textile and apparel manufacturers are making far-ranging strategic decisions as to how they will cope with a world of textile trade that, at the moment, is fraught with considerable uncertainty.

Interviews with industry leaders in both the domestic manufacturing and importing sectors highlight the fact that significant change is about to take place, and how and when it happens will shape the very future of the world's textile industry.

16 December 2004

Talk Too Soon Of Christmas Crisis

The latest Retail Traffic Index shows the three-month year-on-year trend at its lowest level for 12 months, -0.8 per cent. SPSL, however, is standing by its forecast that Christmas trading will be similar to 2003. Although the acceleration in footfall towards the end of the month was lighter than anticipated. Shopper numbers for the week starting November 21 were 4.3 per cent down on the same week last year.

Dr Tim Denison, director of knowledge management at SPSL, said: "If you look at the trend over the past six years, shoppers have started their festive spree later and later each year, despite retail attempts to make them do otherwise, so the November figures should be taken in context. Certainly it is not indicative of a Christmas freeze this year."

"The fact is that more people do their reconnaissance work online in November before visiting the shops in December. Furthermore, 'forward planning' is a phase and a process that is rapidly disappearing in modern day living, being replaced by 'last minute manoeuvring'."

Despite November's disappointing figures, SPSL is expecting a marginal drop in year-on-year traffic by 0.3 per cent. Denison further said: "There is no question of a Christmas crisis. Our projection remains that traffic levels will be static this Christmas compared to last. "Our advice to shoppers is to grab bargains as soon as they hit the high streets - there is no guarantee that they will be rewarded this year for delaying their spending until the eleventh hour in the run up to Christmas."

30 November 2004

High Street Invasion

No one can afford to ignore the high street now, says retail analyst Sally Bain, of consultancy The Chambers. Having spent decades watching fortunes and style levels of mass market and designer stores, the changes of the former have much benefited those who prefer shopping in the latter.

What was once cheap and ghastly is now inexpensive and desirable. Take for instance the new collaboration between Karl Lagerfeld and H&M, who's collection debuts in stores November 12th. High street multiples are giving designer boutiques a run for their money and even supermarkets are in on the game.

Tesco's Finest label offers well-fitted cashmere v-neck sweaters for £25. Or perhaps you're more inclined to wear a sleek, short black mac that could be mistaken for a Jil Sander or Prada. Head to Sainsbury's for its TU range. The Mac costs just £35.

Changes in the high street have snowballed, with a slew of new elite ranges - limited in stock, higher priced, well made and often fashion forward. Marks & Spencer's Limited Collection, the brainchild of former womenswear design director Yasmin Yusuf, has been a press hit and sales have exceeded expectations. And Warehouse this autumn introduced Kasbah, a range of sumptuous beaded and embroidered kaftans, partywear and one-off long skirts made in India, often from vintage fabrics and customised for the British market.

Even the supermarkets have upgraded. Collection by George at Asda has helped the chain's clothing sales outstrip Marks & Spencer, while Florence + Fred at Tesco saw sales grow by 39 per cent last year. Sainsbury's TU range aims to be a benchmark on quality for price.

8 November 2004

Hobbs Sold To 3i

Venture capital from 3i is to buy fashion retailer Hobbs from Barclays Private Equity in a deal valuing the business at £111m. The deal follows interest in the womenswear retailer from a variety of potential buyers. The directors of Hobbs will re-invest in the business alongside 3i and have increased their stake in the venture from 20 per cent to 37 per cent.

3 November 2004

Retail sales rise

A survey has shown that retail sales in October rose beyond expectations and at their sharpest in three months. According to the Confederation of British Industry (CBI) 37% of companies saw their sales rise, as opposed to 26% that reported a drop in sales in October. The result gives a balance of +11, which is well above the 1 ½ year low in September.

Retailers are optimistic about sales picking up further in November. However, the CBI warns that retailers shouldn't be overly confident because sales growth still isn't what it should be for this time of year. It has cautioned the Bank of England to refrain from raising interest rates. John Longworth, chairman of the CBI's survey panel told reporters that he did not feel that the current conditions warranted a raise in interest rates and feared that the effects could be potentially damaging if the Bank of England made any changes now. 200 companies responded to the survey, which was held between 29 September and 20 October.

2 November 2004

3i to buy Hobbs

The upmarket UK fashion retailer Hobbs is being sold by the private equity arm of UK Barclays Bank. Various contenders, such as US retailer Liz Claiborne and private equity firms PPM Ventures and Change Capital Partners submitted bids for the company. However, Hobbs is now in exclusive discussion with the British private equity firm 3i Group Plc. According to a source close to the talks, Hobbs will reportedly be sold for £110 million.

Barclays acquired Hobbs in December 2002 for approximately £30 million. The company reported a pre-tax profit of £8.5 million for 2003. Sales rose 32% to £51.6 million. The talks with 3i are expected to last two to three weeks, however the deal may still fall through, according to the source.

20 october 2004

Decline In Retail Crime But Not In Impact

The total losses from retail crime in the UK fell by £700m to £1bn in 2003, down from £1.7bn in 2002, but retail employees are at an increased risk of violence. The British Retail Consortium's eleventh annual Retail Crime Survey, sponsored by ADT, shows a rise of 78 per cent in the amount retailers spent on crime prevention to £960m, the largest ever annual investment, bringing the total spent by UK retailers on crime prevention over the past three years to £2.11bn.

However, the survey shows violence against staff rose by 17 per cent, with verbal abuse more than doubling, up by 109 per cent, and threats to staff soaring by 161 per cent. Kevin Hawkins, BRC director general, said: "The visible cost of crime showed a considerable and welcome fall. These figures show how determined retailers have been to tackle this serious problem. Massive investment of resources over recent years has led to significant success, as has their support for initiatives such as Action Against Business Crime.

"However, the hidden cost of crime - the emotional and business viability impact of violence towards staff - has shown a serious and worrying rise. Retail crime is not victimless. Reducing these figures and the terrible unseen cost of this type of crime is a priority for the industry. "The way forward is to ensure the Government and police take retail crime seriously and for the industry to continue play a substantial role in a wide range of initiatives to fight crime and make our communities safer and better places."

21 September 2004

US Could Limit China Imports

A U.S. trade official said last week the United States would limit Chinese apparel imports to protect its firms, the New York Times reports. However U.S. manufacturers would have to provide evidence the restrictions were necessary. Grant Aldonas, the U.S. undersecretary of commerce for international trade, said he anticipated U.S. manufacturers would start filing such requests next week. Aldonas' comments came amid warnings from China's government it would challenge any such restrictions to the World Trade Organization.

While the United States and other countries in 1993 said they would remove quotas on textile and apparel imports from developing countries by the end of 2004, U.S. trade laws also include provisions allowing the country to restrict large-scale waves of imports that would hurt any U.S. industry. Many Chinese apparel manufacturers had planned to increase output after the quotas expired, a recent survey by one Chinese import broker found.

14 September 2004

Clothing Sales Summer Suffering

The combination of rising interest rates and poor weather hit UK retail sales in July, particularly for clothing retailers. The monthly BRC/KPMG retail sales monitor shows retail sales in July increased by 1.8 per cent on a like-for-like basis, with total growth of 4.3 per cent compared to a year earlier. The three-month trend saw the like-for-like rate of growth edge down from 2.7 per cent in June to 2.6 per cent in July for sales, with total sales growth down from 5.4 per cent to 5.3 per cent.

Helen Dickinson, acting head of retail, at KPMG said: "Retail sales improved as the month progressed, to end showing a 1.8 per cent increase on a like for like basis compared to July 2003. There was some deep discounting to clear old stocks, and this came at a cost to margin. Clothing fared worst, bordering on negative like-for-like territory.

"Overall like-for-likes for the year to date have averaged just over 2 per cent. However as we move into August, which is one of the quieter trading months, confidence looks fragile and the average rate may continue to fall. The latest interest rate rise may finally begin to bite and, if the weather holds up, the clothing retailers may wish they hadn't cleared all their summer stock at highly discounted rates."

Clothing sales were hit by the rain in the first week of July in particular, but recovered later in the month, helped by hot sun and the summer sales. Womenswear performed better than menswear, which relied on price cuts helped to clear stocks. "The Monetary Policy Committee's desire to target house prices is already having unnecessary and unwanted consequences on the high street. It needs to refrain from any further rises unless it wants to

10 August 2004

Merchandising Retail Event

Europe's single most important Merchandise Planning & Price Optimisation conference will be held in London on the 22nd of September at the London Marriott in Mayfair. The conference will provide answers to the most important optimisation issues in the retail industry today, through best practice in-depth retail case studies, top retailers, expert retail analysts and optimisation professionals' insight. For more information or to register, please call 020-7430 0077.

7 August 2004

Value Retail Sees Boom

Value Retail, operator of outlet villages selling luxury brands at an average discount of 40 per cent has been in a boom phase for five years. Besides Bicester Village in Oxfordshire, where sales per square foot have grown an average 10 per cent over its nine years of existence, Value Retail has outlets in France, Spain, Belgium, Italy and Germany.

6 July 2004

Clothing Quota Ban May Mean Price Reductions

According to Merrill Lynch, the quota restrictions on clothing and retail goods that are to be lifted for World Trade Organisation member nations such as China, India and Bangladish, will result in price reductions on certain products sourced from Asia. Certain American-based retail corporations are eagerly anticipating price reductions ranging from 8 to 30 per cent.

Merrill Lynch said, "We see the elimination of apparel quota, and the deflation likely to result, as a longer term negative for our branded apparel stocks." "Lower sourcing costs will eventually be passed onto consumers, we think, depressing organic growth and sector multiples." However, the research house said that for a few seasons next year, it expects the gross margin boost from lower cost sourcing will outpace retail deflation.

In Merrill Lynch's view, exactly how much of the sourcing savings is passed through to retailers and consumers will be largely a function of competitive dynamics and channel inventories.

28 June 2004

Retail sales increase

UK retail sales in May increased by 3.7 per cent on a like-for-like basis, as the sunshine encouraged shoppers to finally splash out on clothing. The BRC/KPMG sales monitor recorded total year-on-year growth of 6.5 per cent, with the three-month growth trend up from 1.7 per cent in April to 2.2 per cent in May on a like-for-like basis, and from 4.8 per cent to 5.2 per cent in total sales.

Clothing sales were much better than in previous months, especially in the second half of May when the sunny weather boosted demand for summer ranges. Shorts and swimwear for both men and women sold well, as did summer accessories such as sunglasses. Along with beer sales, the Euro 2004 tournament has begun to boost sales in sectors such as clothing and televisions. The expected surge in sales of big screen TVs in time for the kick-off materialised slowly, although football-related promotions also expected to help trade in June.

Kevin Hawkins, director general of the BRC told The Retail Bulletin: "May was a good month for retail with the sunshine boosting sales for many sectors. However, the figures are deceptively strong because whilst the weather helped create a feel good factor, much of the spending on clothing and footwear was due to purchases that shoppers had delayed in March and April due to the wet and cold.

8 June 2004

Fashion Retailer Bank To Expand

Up-and-coming UK fashion retailer Bank has announced plans to expand from its current 20 stores to 50 over the next five years. The company, with stores currently located in the midlands and the north, has been encouraged by strong trading, as well as customer response to a new store format developed for the retailer by designers Dalziel and Pow.

Bank's sales more than doubled in the its last financial year, with managing director Damian Scarlett also announcing a 10% increase in like-for-like sales over the 13 weeks to May 1.

3 June 2004

Ethel Austin Announces Ambitious Expansion Plans

Ethel Austin, the UK value retailer, has announced it is planning a 200 store expansion over the next five years of its clothing stores.The drive for growth, which would create 2,500 new jobs totalling the store chain to 470 outlets, was described as "sensible and sustainable" by Ethel Austin chief executive Phil Hoskinson.

The company confirmed last month that its has held preliminary talks with a number of potential buyers, and the announcement will send a clear signal to interested parties that the current management believes there is strong potential in the brand.

Hoskinson, who led a management buy-out of Ethel Austin two years ago, said: "We have put a lot of effort into making sure that as a business we can support this prospective level of growth but this programme has not appeared suddenly. We have been constantly growing sales and profits and rolling-out stores. But all that has been done with the central aim of ensuring that the progress will be continued well into the long-term and the current management team will be here to see that happens."

In the year to the end of August 2003, Ethel Austin's operating profits rose to £12.5m, a 158 per cent increase on the previous year. Turnover grew by 13 per cent to £138m, with like-for-like sales growth in excess of seven per cent. There are plans in place for 35 new stores this year.

25 May 2004

Retail Spending Still Rising

According to the latest figures from the Office of National Statistics, UK retail spending is still rising as shoppers are tempted by competitive high street prices and bargains.

Groceries, clothing and entertainment lines such as CDs and DVDs have all seen downward pressure on prices in recent months. The ONS statistics show that shop prices fell by 1.5 per cent in the year to March, an increase in deflationary pressure since February when the annual decline was running at 1.1 per cent.

However, after reaching its highest level for 20 months in February, the headline growth rate of the Retail Sales Index continued at the same level in March. The volume of retail sales in the three months to March was 1.9 per cent higher than in the previous three months, seasonally adjusted. Increases were strongest for clothing and footwear stores, other non-food stores and non-store retailers, indicating the strength of online spending.

Retail sales totaled GBP22.2 billion during the five weeks of the March 2004 survey period, with average weekly sales of GBP4.4bn up by 5.3 per cent over March 2003.

23 April 2004

Strategic Outsourcing for Retailers Conference

Retailer Events in association with The Retail Bulletin is hosting a Strategic Outsourcing for Retailers conference on June 15 in London.Speakers from M&S, Tesco and Argos will share their experience and expertise with in depth presentations and case studies pertaining to outsourcing projects and strategies.

For more details or to book your place go to: www.retailevents.co.uk
or telephone 020 7430 0077

20 April 2004

London Retail Sales Up 3.7 Per Cent

An increase in retail sales by 3.7 per cent marked a better performance for London retailers in February on a like-for-like basis. The increase of 3.7 per cent on last year is artificially boosted by comparisons with last February, when sales tumbled after the forced closure of the Central Line. However, tourist numbers held up, with European visitors still more numerous than those from the States.

Valentines Day helped push Beauty and related retail products, but increases were also apparent on leisure products, including new technology items. Home textiles and furniture did less well, however.
David Southwell, LRC director of communication, said: "London's retailers performed better than those in the rest of the UK during February. There were good performances in Valentine's promotions and in leisure products - showing that whatever the impact of last month's interest rate, it did not affect spending on romance or home entertainment in the capital."

"Whilst the higher slightly better level of consumer confidence in London is good news, the comparison with last year is flattered by the appalling impact of the 2003 shutdown of the Central Line. Tourist numbers are holding up thanks to an increase in the number of European tourists, but the question going forward is will they be enough to offset the impact of the continuing fall in the dollar?"

Amanda Aldridge, head of retail at KPMG, said: "Although these figures look strong, it is wrong to be too upbeat about February's performance. Central London retailers suffered in February 2003 from the central line disruption and even at this growth rate they are still not enjoying sales at 2002 levels." "In the same two-year period the UK as a whole has seen growth of 3.5 per cent. One can only conclude that times remain hard for our central London stores."

16 March 2004

Slight Growth For UK Retail Sales

While it comes as no surprise that retail sales in the UK have not been booming for the past few seasons, the British Retail Consortium recently showed that sales were up by 2.2 per cent for the month of February and 5.3 per cent for yearly growth.

Clothing sales were mixed depending on sector, stores and regions. Continuing on last season's trend, childrenswear and womenswear are faring better than menswear. The luxury market has regained consumer confidence, with multibrand Gucci Group reporting profits for some of its holdings, including sales of it's own-name Florentine fashion house. The high street has seen success too, although some less expensive fashion outlets are not keeping up with consumer demand with the fashion turnaround offered by leading highstreet retailers and competitors Topshop and Hennes & Mauritz.

Footwear sales were above average, even with the bad weather affecting regional sales in the UK last month. Colour, and anything out of the ordinary is what is grabbing the consumer's attention. Trends such as court shoes and strappy sandals are what will be selling well for spring/summer.

David Southwell, director of communications, BRC said:
"Retailers expect February to be one of the slowest points on the retail calendar, so no one will be surprised by the steady rather than spectacular sales seen in stores last month. Overall February has been a reasonable month for the retail sector, but there is no sign of the sluggish trend ending."

10 March 2004

Strong Growth In UK Airport Retailing

International airports group BAA reported excellent growth in UK airport retailing for the last quarter. The maturing new space within Heathrow Terminal 3 and Stansted pushed net retail income 9.5 per cent higher to GBP138 million (GBP126m in 2002). Net retail income per passenger rose by 3.1 per cent to GBP4.23 in 2002).

12 February 2004

Turkey Price Hike May Hit Fast Fashion

Retailers with fast fashion operations are being warned that they could be hit by a price hike in Turkish product, after a round of wage inflation and an appreciation of the Turkish lira.

High street suppliers say prices of Turkish product have risen by up to 25 per cent in the past year to 18 months. One said: "The wages of textile workers in Turkey have gone up by as much as 30 per cent in the past year and, with a rising lira, there are going to be some major price rises. At a squeeze, we will be able to get away with a 20 per cent increase."

The rise in prices of Turkish product is expected to hit retailers with larger concentrations of sourcing in the country, and those that use it for fast fashion product. Asda sources a high proportion of its George at Asda product from Turkey. In 200, Next pledged to invest around GBP 20 million over the next three years to establish sourcing operations in Romania, Turkey and Sri Lanka.

3 February 2004

Strong Sales Ease Christmas Blues

Booming January sales are bringing relief to fashion retailers after a poor Christmas, with markdowns being kept in check. Changing shopping patterns are being blamed for the difficulties in December, with retailers suffering as shoppers waited for bargains. As a result, retailers have missed out on full-price sales but cleared stock quickly without having to increase their markdowns against last year. According to research commissioned exclusively from agency Retailmap, the depth of womenswear discounting is slightly less than last year, while menswear discounting remains the same.

12 January 2004-01-12

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