Retail Trends: 15 February 2008
Each week Hays Retail brings you the latest news from Barclays Commercial Bank Retail & Wholesale Weekly.
To read previous reports, click here .
Retailer News
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Stylo, owner of Barratts, Shelleys and PriceLess brands, has acquired parts of Dolcis, the shoe chain that went into administration last month. Administrators KPMG and Michael Ziff, chairman of Stylo have not disclosed financial terms of the deal, under which 300 jobs will be retained as 24 stores transfer ownership. John Kinnaird, former owner of Dolcis is believed to have been seeking to buy back the company.
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TV shopping group Ideal Shopping Direct has received a bid approach. The retailer said it had received a "very preliminary approach which may or may not lead to an offer being made for the company".
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Topshop is taking over its first New York premises from Yellow Rat Bastard, a Soho landmark for more than a decade, which sold streetwear by young, urban designers.
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Elvi, the plus-size women's fashion retailer, is up for sale after falling into administration. It is understood that financial backers, Langholm Capital, pulled out of the business earlier this year. The business trades from 28 of its own stores and a further 63 department store concessions.
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Icelandic investor Baugur has made moves to strengthen the management teams at some of its key fashion brands. Heads are being appointed for each of the major brands at Mosaic, with Liz Shipwright now the managing director of Coast, Mosaic chief executive Derek Lovelock overseeing boutique brands Coast, Karen Millen, Odille and Anoushka G, and deputy chief executive Mike Shearwood taking responsibility for high street brands Warehouse, Principles and Oasis.
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MandMDirect.com is embarking on a multimillionpound marketing campaign to help it achieve 20% growth per annum for the next three years. It has appointed brand response agency The Black Hole to deliver planning and creative for the campaign which will encompass on and offline media.
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Lord Saatchi has teamed up with John Clare, the former Dixons chief executive, to launch
Myfaveshop.com, a social networking and online shopping venture that allows users to create their own stores. Brands and retailers will pay a monthly rent for each shop that they are included in and commissions on subsequent sales.
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John Lewis is poised to break into the burgeoning US$330 billion (£168 billion) Indian retail market. The department store is understood to be scouting for an Indian partner for a joint venture or franchise business in the country, with the first opening likely to be in Mumbai.
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Play.com beat Amazon this week to become the first big online entertainment retailer in Britain to offer unrestricted digital music downloads. The service will offer 1.3 million tracks free of the digital rights management (DRM) technology that limits the devices on which legitimately downloaded tracks can be played.
Industry News
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The BRC Retail Sales Monitor for January reveals that UK retail sales rose 2.6% on a like-for-like basis, compared with January 2007, when sales were up 3.1% compared with a weak January 2006. The threemonth trend rate of growth rose to 1.5% from 0.8% in December for like-for-like sales, and to 3.7% from 2.8% for total sales, reflecting the continuing growth of retail space. While these figures are stronger than expected, lifted by the strong growth in the first week of January, the clothing sector continues to underperform, particularly womenswear. Clothing sales have been lower than last year for four consecutive months, despite aggressive discounting by retailers on bigger investment purchases.
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The Competition Commission (CC) will publish its much anticipated remedies report for its inquiry into the £120 billion grocery sector this afternoon after 4.30pm. A CC spokesman said: "We are obliged to publish outside LSE trading hours and, because of the need to allow sufficient response times for the parties, we want to publish this week if at all possible." The Daily Telegraph reported this week that retailers are concerned that the Competition Commission will recommend the creation of an independent regulator to police the relationships between suppliers and supermarkets.
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Defra has confirmed its intention for packaging waste recovery and recycling targets in Great Britain to increase from 2008 onwards. Defra’s new overall recovery targets of 72% in 2008, 73% in 2009 and 74% in 2010, ensure that we meet our 2008 EU Directive target of recycling at least 60% of our packaging waste.
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A year after new legislation came into force, a survey by SME-nvironment commissioned by environmental website www.netregs.gov.uk , found that only 12 per cent of SMEs could name the WEEE Regulations unprompted and just a third (36 per cent) had heard of them once they were named. SMEs that are still ignoring WEEE legislation could be paying the price through avoidable waste charges and unnecessary effort in disposing of their own electrical waste.
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This week’s inflation data were softer than expected, helped by discounting in the clothing and footwear sectors. Consumer prices rose by 2.2% in January, up from 2.1% in December. It was the highest rate of growth since June 2007 but lower than the 2.3% consensus of economists' forecasts. In the clothing and footwear sectors prices fell 5.2% when many economists had expected a more modest decline of 4.1%, in line with the seasonal norm in recent years. Economists have warned that prices are set to rise sharply in the coming months as rising food, energy and utility bills continue to ratchet up the cost of living.
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