“RETAIL HAS HAD A VERRY TORRID AND CHALLENGING TIME, THOUGH SOME BRANDS HAVE SHONE THROUGH THE GLOOM IN 2019!”
|RETAILER||% gain 17/1/19 to 18/1/20|
|PETS AT HOME||+131%|
|Company||% loss 17/1/19 to 17/1/20|
|DEBENHAMS||-47% (Shares close to worthless)|
NOTE – Not included in the losers’ table are – HOUSE OF FRASER, KAREN MILLEN, LK BENNETT, MOTHERCARE, BONMARCHE, LINKS, JACK WILLS & ODDBINS – all of whom have gone to the wall or have been trimmed down, taken over or are in administration. The John Lewis Partnership is also excluded from this table, but we know their Christmas sales, despite “Edgar”, have been disastrous. Let’s hope Dame Sharon White brings a little sunshine to this group and hopefully JLP will avoid paying no bonus this year. We will know in February.
We have now just about seen off the first month of 2020, so I thought I might just sign off on retail for 2019. What a dismal period it has been for so many operators in this field. In the first six months of last year 2800 units were closed and I suspect the final total will be close to 5000. This of course damages society in so many towns around the country. There was a slew of commentators who wanted to blame the uncertainty from the BREXIT process. Few hung their hat on the pegs of the downturn of Europe’s economy or for the exorbitant corporate rates charged by councils for their premises. Such is life. Online retail, with Amazon well to the fore, has damaged many retailers. Amazon’s shares have rallied by 18% in the last year. It also goes without saying that many observers have seriously underestimated the way the consumer spends his/her disposable income in comparison to five years ago.
Today people want to have a great time – going out for drinks, eating and clubbing and, above all else, many want two to three holidays a year, even if they are short breaks. They care little about looking sartorially elegant and are more than happy dressing themselves in leggings, jeans, shorts, sneakers, with a smattering of designer stubble. I think that’s the way it is. Retailers need to adjust their plans according to the consumers’ requirements, with some needing to sharpen up their online service. Retail seems to have fragmented into the expensive and the cheap with the middle ground becoming incredibly competitive.
I must extoll the virtues of JD Sports, Pets at Home, Dunelm, Boohoo, Greggs and NEXT, whose performances in very challenging circumstances has been brilliant, in providing what the consumer wants at the right price. It would be remiss of me not to mention Sports Direct. Even though Mike Ashley has encountered difficulties with House of Fraser and Debenhams, Sports Direct has made a great recovery, with the company changing its name to Frasers. Apart from Tesco, the supermarkets have been under the cosh and have suffered at the hands of Aldi and Lidl, whose sales over the Christmas period have increased by 7.9% and 11% respectively. Aldi has also grossed £1 billion from sales in a year for the first time.
I mention in passing three household brands, which have been outstanding this year. Burberry from the top end of the market. Under Marco Gobbetti and Ricardo Tischi stewardship and fashion guidance have maintained strong luxury sales, with their shares rising 37% in the last year. Halfords and Kingfisher have found the going tough and sadly it looks like Beales will go into liquidation, unless a buyer can be found by KPMG, the administrators. Well done to Just Eat in passing, which will be taken over by Takeaway.com and to Ocado for their significant achievements in delivery.