Retail Day
Retail Week, today
Archive for October, 2009
Great British Fashion
Our sister magazine Drapers hosted a party last night in honour of Great British Fashion, celebrating the brands and retailers which make this country such a leader in the fashion world. It was, as you’d expect, a glamorous affair, and there was a good turn out from the fashion multiples. Among others I caught up with the newly promoted Derek Lovelock and Mike Shearwood from Mosaic (the latter sporting a rather modish new haircut), Tania Foster-Brown from Arcadia, Lindsay Page from Ted Baker, and John King from House of Fraser.
John was on ebullient form and said HoF is having a great week. The business certainly seems to be on good form at the moment. We were joined by Numis analysts Andy Wade and Nick Coulter, which I particularly enjoyed because while I’m not particularly tall, chatting to the three of them together made me feel like Magic Johnson.
Drapers’ excellent new editor Jessica Brown gave her first big speech in the job and was followed by Harold Tillman, who to me always comes across as the epitome of an industry grandee. I was about to head to the after-party at celebrity hangout China White but the queue was massive so I thought better of it.
Earlier in the day George and I had lunch with Stephen Robertson, director general of the BRC and without question one of the nicest guys in the business. He also has one of the hardest jobs in the industry, but handles the challenge of uniting its disparate and ultra-competitive membership with aplomb. He’s very cautious about the outlook for 2010 and so am I, think it’s going to be tough.
“I don’t want a bookcase called Billy, or a table called Sven”
I love listening to 6 Music in the mornings, as they seem hardwired into knowing what music I a) already love or b) almost certainly will. I heard this song about Ikea by a band called the Lancashire Hotpots for the first time this morning, although it’s not actually new, and I couldn’t stop laughing. Apologies if you’ve heard it before but if not have a listen, it’s brilliant
Off-colour off-licence
We’ve been following the increasing chaos at Thresher for months and the inevitable looks about to happen, with KPMG being called in to help find a rescue package. The business has lurched from crisis to crisis and it never seemed that the owners or management had a credible strategy for the company.
Now running high street off licences is never going to be easy in a market where the supermarkets discount so aggressively on booze, but even so I don’t think anyone could argue Threshers has been well run. There have been all sorts of failed initiatives, like trying to turn itself into a convenience food retailer, but none have really worked, and the supply chain problems seem to have spiralled over a period of years.
The really unfortunate thing about Threshers’ problems is that there are a lot of small guys who are going to lose out if it goes under. We’ve had loads of correspondence from franchisees over recent months who have been in a state of increasing despair over lack of stock, while many of the properties were sold at auction to small investors who saw the company as their pension fund.
A pre-pack could be a possible outcome - the fragmented ownership would seem to rule out a CVA - but there’s going to be a lot of pain whatever happens.
Olympic dreams
I’ve always been an enthusiast about the Olympics coming to my home city - then again I was just about the only person who excited about the Millennium Dome - so I was keen to go and have a look at the Stratford site, which I did on Friday. The reason wasn’t so much the stadium itself, but the giant shopping centre Westfield is developing next door to it.
It’s going to be a massive scheme - at 1.9m sq ft bigger even than Westfield’s other scheme in west London - but is well advanced in terms of construction, as is the stadium and the very eye catching aquatic centre next door. Lettings haven’t really kicked off yet, apart from the anchors M&S, John Lewis and Waitrose, and that’s where Westfield now have to really get moving.
They’ve not been helped by the caution of retailers when it comes to signing new deals, nor by their newly emboldened stance on terms - the story doing the rounds at the moment goes that Philip Green kicked Westfield out of his office when they refused to grant him the same terms as John Lewis, which must have been an amusing scene.
But that sort of negotiation is what business is all about and neither retailers nor landlords are shrinking violets. In the end all the big retailers will end up going in there. Stratford is going to be where it’s at in 2012, and because it lies bang in between the stations and the stadium, it’s going to be at the heart of the Olympic excitement. But it’s not just about the games - the east of London and the Home Counties around it aren’t well served with retail and with it’s very good transport links Stratford could well become a destination of choice for people in that area.
The picture is of me and Westfield’s Michael Gutman, John Burton and Laura Passam stood on top of part of the centre, having climbed some wobbly metal stairs to get there
. Originally they were going to be building offices and flats on top but the recession has put paid to that, so instead they’re going to be renting it to a US TV station to use as it’s studio for the Games. It’s going to be one hell of a vantage point.
Lukewarm
I brought myself a nice new coat from Reiss last weekend, but haven’t had the chance to wear it yet because it’s been so extraordinarily mild. And with another week of Indian Summer ahead of us, that spells bad news for fashion retailers.
If you don’t feel cold, you don’t buy Winter clothes. Simple. That’s why I’ve never understood why fashion retailers fill their stores with Winter lines from late July onwards
But to have such unseasonal weather in late October is really unfortunate. Not sure what can be done about it, other than pray.
Tiny bit of common sense
Fresh from completing the weekly Retail Week office ritual of the BBC’s Seven Days Quiz - John scored 5, Jo 4, while Lisa and I got only a dismal 2 each - there was at least some good news, which is that the government is talking about extending the period in which retailers will be allowed to reprice their goods when the VAT rate goes back up.
It’s a sensitive subject, because customers may not take kindly to being charged more at the till than the prices at the shelf say, but as long as there is clear communication at the entrance to the store then it should be possible to get around that.
Of course the government could make everyone’s life easier by delaying the date of the increase, because if they implement the increase retailers will still have to change all their systems overnight on New Year’s Eve, which is stupid. I suspect many might choose to absorb it for a few weeks while they get everything into order, and that way they can use it as a January Sales marketing device as well.
Our store design guru John has a new blog by the way: storesentinel.blogspot.com Well worth a look if you’re into store design, as no one knows that world like he does. I’m not sure what a sentinel is or does, but it sounds good.
Have a great weekend.
Green day
Sir Philip Green was in typically effervescent form when I went to see him yesterday to talk through Arcadia’s results, which are all over the news today, and why not, as to grow profits by 13% in what has been a very tough recession is good going. I know Green is not everyone’s cup of tea and it’s certainly not great fun getting on the wrong side of him, but it’s hard not to find his sheer enthusiasm and energy for the business of retailing both infectious and endearing, and a visit to his office is always time well spent.
What I thought was interesting yesterday is that while Topshop and Topman will take all the headlines for their record-breaking performances, he was very keen to also talk about the back end efficiency savings as having been key drivers of the profit growth. He was talking about logistics and the supply chain, not the sort of areas you’d associate with the billionaire tycoon, but he is hugely proud of what his teams in those areas have achieved.
The merger of Bhs into Arcadia now gives the group scope to look hard at its property cost base, which is high because of the multiple stores it has in most towns. There is potential scope to merge a lot of the mainstream Arcadia brand stores into the sprawling Bhs units, and I’m sure that’s going to be the gameplan. And why not, as there’s also a real benefit to be derived from bringing more brands in to liven up Bhs’s fashion offer.
Congratulations to Ian Grabiner on his promotion to chief executive by the way. Ian is Philip’s right hand man and while he too has a pretty ferocious bark, he was a a very likeable judge on the Retail Week Awards panel for many years, and plays a vital role in the success of the business.
Two become one
To Fulham last night where DSGi unveiled its first dual-branded Currys and PC World megastore. It’s an evolution of the concept first revealed at the so-called J9 store by the M6 in Birmingham last year, and is a good looking store with the same walls of TVs and washing machines which were introduced at J9, and a lot of support from the electricals brands, with apparently 115 brand-funded display areas.
About 10,000 sq ft smaller than the Birmingham original, at 45,000 sq ft it is still a big unit for such a central London location, and befitting the number of yuppies who live in the area, various upmarket brands like Smeg have been introduced. Interestingly the store has been created by the simple expedient of knocking down the wall between the adjoining sheds which previously housed the two brands, and the result is a light and airy store with only a few pillars suggesting they used to be two. The only downside I noticed was rather more gaps on the shelves for small ticket items than one might have expected.
One thing I noticed last night is that DSGi people, starting with John Browett and working downwards, have two words they hate more than any other. Best Buy. There, I said it. They bristle at the slightest suggestion that Best Buy will have an impact in the UK - “we could beat them in our sleep” said one of Browett’s senior lieutenants - and god forbid that anyone suggest that some of the features of the store concept might have been inspired by trips to the States.
To be honest that doesn’t really matter - the main thing is that DSGi is working hard to get its stores into shape, and also to explore alternative options and combinations of its different fascias in different formats. They’re doing a good job. And Best Buy’s delayed arrival in the UK has bought the market leader some time to demonstrate that when the American arrival does finally open its doors next Spring, it won’t have it all its own way.
Fantastic Mr Fox…
….might have been a good choice for the opening feature at HMV’s first cinema in Wimbledon, but chief executive Simon is far too modest a character to go for that. So instead the City analysts and a few of us from the RW team got to see Terry Gilliam’s The Imaginarium of Dr Parnassus - notable for being the last film Heath Ledger was in before he died - which was preposterous but entertaining enough. Wouldn’t go out of my way to see it though, although Lily Cole is excellent.
There’s something quite weird about going to the cinema and it being full of people you know, all wearing suits. But the cinema itself looks like an excellent initiative and while it won’t change the world for HMV, it’s a very clever way of using dead space above the stores.
Interestingly Fox deliberately chose Wimbledon because it has one of Odeon’s best performing sites next door, which means that if the concept works there, it should work elsewhere. The two cinemas should serve very different markets because the HMV (which is a joint venture with cinema operator Curzon) is very comfortable and stylish, with a bar and cafe. Best of all, you can take a glass of wine or a beer into the film with you. Should definitely appeal to the more affluent locals who wouldn’t be seen dead in the multiplex next door.
So a good initiative symbolic of the way Fox is expanding the HMV brand into all aspects of how people consume entertainment. The fact he turned down the ITV job shows that, unlike many sceptics, he believes he can continue to reinvent the business successfully for the digital age.
GIVing a little extra
Greetings from Devon, or more precisely the train back from Devon, where I’ve been visiting the extraordinary south-west retailer Trago Mills. I’m going to be writing a piece about it next week so will save the interesting things I learnt there for the magazine, but before catching the train back I extended my repertoire of provincial high streets with a quick look round Newton Abbot’s shops.
It was an unusual town centre, a bit shabby but busy enough and without as many empty shops as a lot of towns its size. The M&S there has been downgraded to an outlet store and looked like it hadn’t had a lick of paint or indeed any attention from the store design department for decades, but to be fair it was packed. But if the age of the sign on the front is a guide to the survival hopes of an M&S store, the dears of Newton Abbot should be worried.
The other thing that struck me was that every other store in Newton Abbot is called Austins, which appears to be the name of the local indie, although it was split across at least four sites.
The main womenswear branch had a poster advertising a visit from George Davies to launch his new Give (or more accurately GIVe) range, although it appeared the visit was actually a fortnight ago. The Give area seemed the emptiest in the store but had a natty computer screen where you could scan the barcode on the item and find out all sorts of stuff about it. Clever stuff but the mature clientele George is targeting don’t seem the type to be pioneers of in-store technology.
Yesterday I was out with TK Maxx, looking at their Homesense store at Brent Cross and then their flagship fashion store in Kensington High Street. Homesense is a very good format and full of things like towels and bedding from top fashion brands that have expanded their reach. An on duty ambulance crew was even shopping there while I was visiting, which I’m not sure they’re supposed to do but presumably they had their radios at the ready.
After visiting the Kensington store I popped into Whole Foods with TK Maxx’s Deborah Dolce and guess what – it was quite busy. OK, only the catering part on the top floor, and a food demonstration in the foyer which appeared so popular it was blocking the entrance for any would-be shoppers, which didn’t seem too clever.
Still think the store as a whole is bombing, but maybe not bombing quite so badly as it was, which I guess is a good thing, although I still find their holier than thou approach a little hard to stomach.
