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Boots plans a big expansion in China Thursday, 16th May 2013
Photo credit: Boots
Alliance Boots plans to expand in China within two years. The company expects to become a nationwide operator in China by expanding to all 34 Chinese provinces, the company currently has 17.
The firm's revenue fell by 2.6 per cent to £22.4 billion and its profit after tax went up by 12.7% to £805 million.
With 2000 stores in UK and high street continuing to suffer, the company’s sales in UK declined by 2.9 per cent to £6.55 billion.
Alec Gourlay, the chief executive of health and beauty said: "Footfall is down across the whole UK by around 3% and we mirror that."
The chief executive explains that the decline in sales is also due to high selling medicines losing out on exclusivity patents, such as high cholesterol-reducing drug 'Lipitor'.
On the other hand, hair care profits soared by increase in margins as the company explains that indulgent goods like bathing products are specially doing well, including the No 7 anti-ageing products which has seen success since being introduced in Walgreens' Hollywood store.
Steffano Pessina, Boots' chairman makes it clear that the cigarettes being sold in Walgreens will not be put on shelves in Boots, explaining that it will be 'inconceivable' for their European stores to sell cigarettes.
Alliance Boots' tax bill has increased to £114 million, up £31 million plus, UK corporation tax bill to £64 million.
H&M hit by cold weather as April sales fail to meet expectations Wednesday, 15th May 2013
H&M Beijing store in China. Photo credit: H&M
Hennes & Mauritz on Wednesday revealed sales in April came in beneath expectations as cold weather continued to plague spring trading.
Same-store sales fell 1 per cent for the world’s second largest fashion retailer, beneath the 5.6 per cent consensus forecast polled by Reuters.
Total sales for the month were up 11 per cent, but still beneath the 14.6 per cent expected by analysts.
The Swedish fast fashion company cited the “unseasonably” cold weather that persisted across its key European markets as the main reason for the lagging sales, along with the continuing weak consumer demand on the continent.
With relatively soft comparable results from April 2012, the pressure is on for H&M to turnaround weaker sales in the current second quarter.
LK Bennett plots store openings in China Monday, 13th May 2013
Photo credit: LK Bennett
The news comes after a spokesman told the Mail On Sunday that a deal with China is ‘looking very close’ and could be signed as early as the summer.
Financial reports show that profits before finance charges had rose 37 per cent to GBP 11 million for the financial year.
This is largely due to the fact that 70 per cent of the business is owned by private equity group Pheonix Equity Partners and Sirius Equity, after its founder Linda Kristin Bennett sold in 2007.
The group remains confident despite the pre-tax loss, saying that they are operating with ‘considerable headroom’ when it comes to its borrowing.
The premium brand, a favourite of the Dutchess of Cambridge and her sister Pippa Middleton, saw overseas sales grow 65 per cent to GBP 20 million last year, accounting for more than a fifth of its turnover, and a spokesman for the chain said the potential could be ‘enormous’.
“The perception of the brand continues to build around the world and that has strengthened our position”.
LK Bennett now has 160 stores with plans to expand its international business by opening more outlets in the US and Middle East.
Hong Kong continues to demand world’s priciest retail rates Monday, 13th May 2013
Hong Kong held its place as having the world’s highest rent for prime retail properties in the first quarter, demanding almost 50 per cent more than property in comparable locations worldwide.
According to a report by CBRE Group Inc., rents in Hong Kong were more than four times those in similar locations for London and Paris, with annual retail rent in high-end shopping areas in the Chinese metropolis averaging at USD 4,328 per square foot.
Joe Lin, CBRE executive director of retail said: "Given that space is so expensive in Hong Kong's prime shopping streets largely driven by continued demand from international luxury brands, many traditional retailers have moved into more niche secondary retail locations as they still want to be in and access the market, but have been priced out of the prime space."
New York came in second for the world’s most expensive global retail markets, with prime rents averaging USD 2,970 per square foot, while London came in third place at USD 1,053 per square foot. Paris took fourth position, just behind London with an average of USD 1,050 per square foot.
In fifth place, Sydney maintained its prime rent at USD 1,018 per square foot on average, while Tokyo came in sixth at USD 895 per square foot. Melbourne, Zurich, Brisbane and Moscow finished off the top 10, with the Russian capital demanding an average of USD 739 per square foot.
The report added that all 10 of the world’s most expensive cities for retailers had benefited from strong demand and modest new supply, which boded well for stable record-high prime retail rates.
Christie's responds to Asian demand for vineyard acquisition service Friday, 10th May 2013
Photo credit: Christie's Instagram page
The auctioneer is merging their real estate and fine wine segments to create a new service which aids clients in purchasing vineyards.
The legendary auction house, which specialises in 80 different categories including, fine art, jewellery, photographs and collectibles, will form Vineyards by Christie’s International Real Estate in response to a growing demand from its customers.
Bonnie Stone Sellers, CEO of Christie’s International Real Estate, based in New York, said: “Christie’s International Real Estate has the great advantage of being the only real estate network owned by a fine art auction house with a deep knowledge of the wine business.
“This is a great opportunity to combine our joint expertise to help high-net-worth individuals navigate the often complex world of buying a vineyard.
“We can offer personalized service, offering know-how in the responsibilities of wine production, fine and rare wine prices, and an amazing international portfolio of international vineyards from which to choose.”
The service will include an introduction by a property specialist regarding vineyards available for purchase, useful advice from their fine wine connoisseurs, custom travel arrangements and translation services if required.
The proposed service comes from a high demand from Christie’s Asian markets, especially those in China and Hong Kong.
Last year, Christie’s made a staggering USD 36.9 million from its nine wine sales in Hong Kong, and investors in China are also showing a keen interest for foreign wine.
62 per cent of the chateaux vineyards were sold to Chinese buyers last year.
Christie’s is not the only company aiming to attract an Asian market. In fact, China and other areas of Asia are emerging as a good demographic for luxury consumption, and many marketers are aware of the potential to market to Asian consumers.
Jane Lauder, global president and general manager of the Estee Lauder Origins, Ojon and Darphin brands, said: “As a company focused on luxury beauty, we can’t win unless we win in China.
“When we look at China, we see growing opportunity, and we see a growing population and more consumers moving into cities.”
Ms Sellers said about the new service: “Buying a vineyard isn’t as easy as it may seem,
“We can help assist clients to learn about the wines they want to acquire and to find vineyards to address their interests and realise their dreams.”
Esprit shares fall 6.6 per cent Wednesday, 8th May 2013
Photo Credit: Esprit
The second-half loss is thought to be due to the substantial costs relating to store closures and acquisitions in China.
The company claimed it would close approximately 16 loss-making stores at an estimated cost of HK 250m to HK 300m.
Esprit have said that after the market closed on Tuesday, the retailer will record a ‘goodwill impairment’ of between HK 1.8 billion to HK 2 billion relating to the acquisition of the remaining interests of associated companies in China.
E-commerce giants Alibaba see profits triple from last year Wednesday, 8th May 2013
Photo Credit: Alababa
China’s biggest e-commerce group, Alibaba, has seen its net profits almost tripled according to regulatory filing by Yahoo.
Yahoo currently has a 24 per cent stake in the company after the Chinese group bought back some of its shares last year. The buyback is understood to include incentives for Alibaba to list its shares by the end of 2015.
Despite no public announcement being made regarding the details of the share sale, industry observers expect the sale could be completed as early as this year.
Alibaba currently runs online companies: Alibaba.com, Taobao and Tmall, who specialise in connecting small sellers and major companies with consumers and business partners.
Alibaba are part of an ever-growing e-commerce industry in China, which is set to surpass the US in coming years.
Hugo Boss hit with fall in Q1 sales Thursday, 2nd May 2013
Photo credit: Hugo Boss
Hugo Boss reported a bigger-than-expected fall in first-quarter sales as tough trading in Europe and a slowdown in Asia hit home for the German fashion house.
Sales eased by 2 per cent to £593 million for the first quarter, while EBITDA fell 11 per cent to £133 million.
A Reuters’ consensus poll expected flat results, with analysts forecasting a core profit decline between 7 and 13 per cent.
“The market environment proved to be very challenging in the early months of this year,” said Claus-Dietrich Lahrs, chief executive of Hugo Boss, adding, “With a better performance of the wholesale business in the further course of this year, we shall return to renewed growth in the second quarter already. We therefore reconfirm our sales and profit targets for 2013.”
Overall, sales generated in the wholesale business in the first quarter were down 14 per cent compared to the previous year after adjustment for currency effects. Hugo Boss’ own retail business, including outlets and online business, posted a sales increase of 15 per cent in local currencies.
Worldwide, Hugo Boss reported a mix bag of results: sales in Europe, where wholesale remains the most important distribution channel, were down 5 per cent compared to the previous year. In the Americas, sales in local currencies increased by 6 per cent supported by a continued positive performance in the US. A slight growth in China led to a 1 per cent increase in sales in Asia after adjustment for currency effects.
Stella McCartney’s whistle stop tour Wednesday, 24th April 2013
Photo credit: Stella McCartney
Stella McCartney’s eponymous label is set to continue its expansion into Europe and Asia, having recently opened new stores in Sweden, Denmark and Japan.
According to WWD, McCartney is set to celebrate the launch of her two new stores in both Stockholm and Copenhagen on Friday, ahead of a visit to Tokyo in May to see the city's second Stella McCartney store, which opened just last week.
The new stores are expected to be joined by further openings in China this year, including a second store in Shanghai.
Burberry H2 bolstered by China demand Wednesday, 17th April 2013
Image courtesy of Burberry
Burberry has posted a ten per cent fourth-quarter revenue boost as demand in China continues to beat sales forecasts.
The fashion label has reported a Q4 group sales rise to £503 million.
Revenue for the six months to 31 March hit £1.11 billion and retail sales grew 14 per cent to £376 million during the period.
Comparable store sales were up seven per cent, including double-digit rises in China and Hong Kong.