Retail Day
Retail Week, today
Archive for December, 2009
An honourable profession?
This morning I went through the whole of the whole of the new year’s honours list trying to find anyone with a retail connection who we ought to mention on the website. But while there are quite a few from the fashion and design worlds - congratulations to Cath Kidston, Michelle Mone, Timothy Everest, Amanda Wakely and Luella Bartley - I couldn’t see a single person who you’d call a retailer on there.
That surprised me. There a clearly a lot of very deserving people on the list who do a great job in their local communities - along with an awful lot of time-serving public servants - but wouldn’t it be nice to see a store manager on there, or someone who works in a store who is really at the their community? And what about the retail entrepreneurs who generate thousands of jobs and huge tax revenues for the country? For a sector that generates nearly 10% of GDP and represents more than 10% of private sector jobs, the antipathy to retail in the corridors of power never fails to amaze me.
One thing that’s hugely impressed me over the past month or so is - with only a very small number of exceptions - the consistently high standard of service I’ve encountered in stores either in the run up to Christmas or just after. It can’t be easy keeping people motivated when their on their feet for hours and serving huge crowds of shoppers, particularly when many are temps, but retailers large and small seem to have really got their act together on service. I know I’m always banging on about this, but retail workers really don’t get the credit they deserve.
Anyway, goodbye to 2009 and while I’ll be quite pleased to see the back of it, for the retail world it’s been a decent year, much less bad than it could have been. That’s not to downplay the massive challenges many in the sector have faced, but by and large retailers have dealt with them effectively, helped in many cases by the collapse of rivals and better than expected consumer confidence.
Yesterday’s collapse of D2 shows there is still more pain to come and some more capacity still needs to come out of the market, particularly in fashion. But here’s hoping that all those retailers who were expressing “cautious optimism” before Christmas will be proved right.
Thanks for all your visits to and comments on the blog, particularly to the regulars like Rich and Ian, and very best wishes for a happy and prosperous new year.
The weird world of the Sales
Hope you all had a great Christmas and got a chance to have a break from retailing, although I imagine it was probably a short one. I had a few phone calls from TV types on Boxing Day invariably beginning “Sorry to disturb you at Christmas, are you at the Sales,” to which I was delighted to be able to answer “No I’m having a life,” but I know many people in the sector won’t have had much of a break, something which doesn’t get widely appreciated.
I was interested to see the TV pictures of the queue outside Selfridges, which the broadcast media seemed to take as proof positive that everyone in the UK had given up on celebrating Christmas and instead had stayed up all night in a desperate urge to buy a designer handbag. I wonder if anyone else noticed that the majority of people in the queue appeared to be Chinese visitors, and that - admittedly judged purely on appearance alone - pretty much no-one in the queue looked like they would have celebrated Christmas.
Nothing wrong with that but worth flagging up because I think the pictures from Selfridges every year allow journalists short of anything to talk about to make easy judgments about how consumers are behaving. To be honest there’s nothing to do in London on Boxing Day morning so if you were visiting from China you might as well join the queue in Oxford Street and grab some real bargains while you’re there.
Now I can see the attraction of going to Selfridges because it sells expensive things and offers generous markdowns. What I don’t get is the way people at provincial centres get up at the crack of dawn to queue up at Next. I saw a couple on the telly at the Metro Centre who said they’d spent 45 minutes queueing up to pay.
Why? Next isn’t expensive in the first place. It’s products might be a bit more fashionable now, but honestly? Nothing better to do on Boxing Day? I don’t get it, but hats off to Simon Wolfson and Christos, they get people hyped up to go down earlier every year and I’m sure they’ll be clearing their stock very quickly. You won’t be catching me in there though.
A Christmas wish
Well the office is deserted this morning, but to be honest Oxford Street wasn’t much busier when I was down there earlier on. Admittedly it was about 10-ish so pretty early in the day, but I was surprised there weren’t more last minute Christmas shoppers out, particularly as many people will have had their plans disrupted earlier in the week by the weather.
Anyway it meant I could polish off my last few bits of gift shopping pretty straightforwardly and then head into the office. I’d been on the BBC earlier talking about Christmas sales, but the media interest in the sector is nothing like it was last Christmas Eve, when I vividly recall my last-minute panic shopping in Leadenhall Market being thrown into chaos by the collapse of Zavvi.
My saviour this morning was its former rival HMV, the last man standing in the entertainment sector, and it was a really pleasurable experience with loads of helpful and friendly staff on hand. Simon Fox has got that business in great shape and although his hand was forced by another suitor, his deal to buy live venues business Mama yesterday was yet another sign that he is building for the future so that HMV dominates the entertainment space beyond pure retailing.
HMV has done well out of the failure of its competitors, as will sister chain Waterstones from Borders collapse, but many in the industry have real doubts about its long-term future because of the structural change going on in how people buy and consume entertainment. I was speaking to someone a bit younger than me just the other day who loves music but said she hadn’t bought a CD in years, and I suspect many younger people are the same.
While I have no favouritism towards any retailer I think it would be tragic if this change meant entertainment and indeed book retailing disappeared from the high street, not just for HMV itself but for retailing generally, as a diverse range of businesses is vital to the health of the high street. Let’s hope Fox’s diversification of HMV can really give it a sustainable future - the jury’s still out but the fact he turned down the top job at ITV to stay put shows he believes the job can be done.
I’m off now to get wrapping but we’ll be publishing online between Christmas and New Year. Whether you’re in store or head office, I hope your Christmas numbers are everything you wished for, and that you’re able to enjoy a peaceful and relaxed Christmas.
Online, on Sale
There’s a lot of excitement about retailers launching their sales online before Christmas - led, of course, by Tesco - and some big numbers being thrown around by people like IMRG, which is predicting £120m will be spent on the web on Christmas Day itself.
I always try to retain a healthy degree of scepticism about predictions like this as I don’t see how it’s possible for any human to see into the future, but there’s no doubt that retailers are vying to get their online Sales up and running as early as they possibly can to get a headstart on their rivals, making sure of course not to damage the last minute Christmas trade in their stores.
There is an extra reason to move quickly this year, with the return of VAT to 17.5% on January 1 likely to pull some big ticket sales in categories like furniture and white goods forward from the new year. After all, while 2.5% VAT doesn’t make much difference on small items, it does on a £2,000 sofa.
A lot of people seem quite indignant about shopping online on Christmas Day, but my view is it’s a personal choice, particularly because it doesn’t involve retailers compelling their staff to work on the day itself. Personally I can’t think of anything I’d less want to do, but I suppose that reflects the fact that I’m fortunate that I have a close family and we all love spending Christmas together. For people on their own it might be that being able to shop on Christmas Day might give them an escape from loneliness. Each to their own I say, it’s not doing anyone any harm.
Clown in a cassock
I consider myself a defender of the Christian nature of Christmas, and one of the first rules you learn as a sub-editor on Retail Week is that you can’t take Christ out of Christmas - ie never use the word Xmas in print. But while I firmly believe that our Christian traditions should be maintained, I would always struggle to become a regular church-goer these days, largely because of the assorted loonies and do-gooders who seem to run it.
Take Father Tim Jones, a vicar in York who is all over the papers today because he advised hard-up parishoners to steal from retailers if they’re struggling at Christmas. Not any retailers, just multiple retailers because they can afford it.
I’ve no doubt Father Jones is a very decent, thoughtful man and I almost feel sorry for him today because his naivety has got him into the headlines. But he is wrong on so many levels.
Firstly, however well intentioned his comments, dishonest people will use them as an excuse to steal from shops. Secondly, if shoplifting goes up, costs rise leading to higher prices for all the honest people who don’t use being less well off as an excuse to steal. And thirdly, any retailer will tell you that along with shoplifting comes intimidation and violence when store staff challenge thieves.
Of course we all have sympathy for those who have fallen on hard times, particularly at Christmas, but that’s why we those of us who work - along with retail businesses too - pay a large proportion of our earnings in tax to support the UK’s comprehensive welfare system. I hope no shop worker inadvertently has their Christmas ruined by a violent shoplifter as a result of Father Jones’s stupid comments.
Snow joke
The bad weather won’t be doing anyone any favours at the moment, but it doesn’t seem that consumers are allowing the snow to derail Christmas. We certainly wouldn’t want it to get any worse, but at the moment in most of the country the weather isn’t bad enough to put the kibosh on shopping trips. That said, the conditions are pretty nasty out in Camden High Street right now.
I was talking to Greg Hodge from Planet Retail in the pub at lunchtime and he was bemoaning how the national media aren’t that interested in retail this Christmas. Certainly after the fever pitch of last year, there doesn’t seem that much excitement around the sector, but while that’s not great news for us in the media and might limit mine and Greg’s TV appearances this Christmas, it has to be a good sign that things are playing out in a pretty benign sort of way.
I did a fairly extensive shopping tour of central London yesterday, taking in everything from Sports Direct to Molton Brown. I deliberately avoided the main shopping streets for the sake of my sanity but while nowhere was packed all the shops I visited seemed to be doing a decent trade. I went in Foyles which was its usual eccentric self, but had the obscure book I was looking for in stock, while across the road the queue in Borders seemed to stretch for miles as the vultures swooped on what little stock was left.
Black mark of the day goes to Halfords in Brixton, where I encountered the worst customer service of the day despite it being the least busy store I visited. I was passed from assistant to assistant, then ignored once I’d made my purchase when they forgot to go and get the product I’d actually bought. David Wild is doing a great job with the petrolheads’ favourite, but the gospel clearly hasn’t spread to SW2 yet.
A positive Verdict
Apologies for the weird appearance of the blog and problems with comments, we’ve managed to break something but we’re not sure how. Will get it sorted asap.
It was the Emap Christmas party last night so forgive any typos, but before heading over there George and I went to Verdict’s 25th birthday party at Deloitte’s offices last night. Given how close it was to Christmas there was a decent turnout of people, with Stephen Robertson from the BRC, analyst Nick Bubb, Richard Lowe from Barclays and ex-BDO head of retail Rupert Eastell among those I caught up with. Of the corporate affairs crew, Christine Watts from Waitrose was there, as was Geoff Lancaster from Primark, who it was nice to see back in good health.
Verdict do know their stuff and their analysts always have an interesting and informed take on the market, and although Richard Hyman was always the face of it, people like Maureen Hinton and Neil Saunders have become more prominent since his amicable departure a couple of years ago.
They sent an interesting press release out this morning comparing the retail scene in 1984 with today, pointing out that while a lot of the big names from then have disapeared - Sears, C&A, Argyll and Dee - the market leaders in food and fashion were Tesco and M&S, just like today, with Tesco enjoying its final year of supremacy before being overtaken by Sainsbury’s. It just goes to show how things can change, although saying that I wouldn’t put money on that happening again in my time.
ONS top of their game
The ONS numbers for November were out today and they’re not great, but we all knew already that November wasn’t the best month. I’ve spoken to quite a few of the big retailers this week and they’re all pretty calm considering it’s just a week until the big day - our front page headline tomorrow is “It’ll be alright on the night” and I think that just about sums it up.
That said I started my Christmas shopping, late as ever, on Tuesday night and I was surprised by how quiet Oxford Street was. Great news as a shopper, less good for retailers. While not deserted by any means, HMV (the east end one), the Pantheon M&S and Debenhams were all quieter than I’d have expected, and the pavements weren’t that busy either, although of course the Victoria Line was.
Only John Lewis seemed to be doing a roaring trade with long queues which fortunately seemed to be more down to the volume of shoppers than malfunctioning tills which were causing such major problems there last week. I’ve little doubt John Lewis are going to be the big winners this year - the stores feel on top form, the assortment is right and they’re pressing all the right buttons with their core middle class shoppers.
Anyway, would be interested to hear your experiences from around the country on how Christmas trade is shaping up.
Unnatural Habitat
Habitat has been sold by the Kamprad family - better known for being the owners of Ikea - to Hilco, with chief executive Mark Saunders remaining in charge. Hilco is saying it sees a future for the business and intends to invest in it, but with its track record you can’t blame Habitat’s employees for being nervous.
I’ve always had a soft spot for Habitat, I think because my parents used to take me in the Kings Road branch a lot when I was a kid, in the days when Terence Conran still owned it and the store was genuinely innovative and cutting edge.
It still does really good stores, but it seems to have lost is its place in the affections of trendy young professional types, and is perceived as expensive. In effect it’s been left behind - good design isn’t the preserve of the middle classes any more, thanks ironically to Ikea, so what’s the role of an expensive, in-town business like Habitat?
I seem to remember Hilco - under the guise of its “private equity arm” Valco - saying Borders had a future not that many months ago, and look what’s happened there. On the other hand, Allied Carpets is still going under Hilco’s ownership, against all the odds. But I still fear for the future of Habitat, there’s inevitably some pain to come whatever happens, and like many I struggle to see a long term future for the brand. Hopefully I’m wrong.
Oracular spectacular
I was in Reading yesterday and had a spare half-hour before going down to Waitrose HQ so I had a stroll round the shops. The town is undeniably unglamorous but has I’ve always really liked its shopping centre, the Oracle. I hadn’t been down for a long time though so was interested to see how it was faring in the recession.
I shouldn’t have been worried, as although the centre is celebrating its tenth birthday this year, it still looks really strong. I could barely see any empty units, and most of the retailers seem to have kept investing in their stores (with the notable exception of Debenhams, which still sports a very 1999 giant D on the outside). The centre was busy too.
What I like about the Oracle is the way it combines retail and leisure probably more effectively than any centre in the UK. Topographically the interior of the centre isn’t ideal - lots of different levels - but that seems to work OK and the riverside leisure area, while unashamedly mass market, is one of the few shopping centre environments which genuinely creates somewhere you’d like to stop and hang out, especially on a sunny day.
It’s the sort of thing we’re going to have to see more of in the next generation of shopping centres. An old-style food court isn’t going to be enough - growing dwell time will require the creation of more genuinely pleasant environments.
On a separate note, anyone know why its called The Oracle?
