The owner of high street fashion brands include Topshop, Topman, Dorothy Perkins and Miss Selfridge, says it is clear on a strategic direction that includes selling online, through stores and through third-party retailers, after “a challenging year” when “the retail landscape has changed dramatically” amid competition from both high street and online retailers.
During 2019 Sir Philip Green’s retail group businesses, which operate through holding company Taveta Investments, have used seven company voluntary arrangements (CVAs) to cut the size of its store network by 50 stores in order to reduce its costs. Those stores come from a base of 2,765 outlets operated at the end of September 2018 with a collective 6m sq ft of space.
Now, says Taveta Investments, it is making good progress for the future, with a new online platform that features digital delivery passes across its brands, while developing its wholesale supply relationships with third-party retailers from Asos, Very and Next through to Nordstrom in the US. The retail group trades through 39 brand-specific desktop websites and 28 mobile sites. “This is a key area of growth for the group,” said Sir Philip Green and his fellow directors of Taveta Investments in their full-year 2018 strategic report, “and our objective is to keep abreast of technological developments to ensure these websites allow us to provide the service and inspiration that our customers expect both online and in-store.”
On the high street, say the directors, investment will be strategic. “We are looking forward to investing in key stores within our more focused real estate to ensure we are able to continue to give our customers an exciting shopping experience on the high street,” said the directors.
They added: “We have some of the greatest brands in the fashion market and we are confident that we will deliver on our plan, improve the way we work and win the hearts and minds of more and more of our customers.”
The strategy update came as Taveta Investments published its figures for the 53 weeks to September 1 2018, showing that turnover reached £1.8bn during the year, down by 4.5% on the previous year, operating profits reduced sharply to £78.1m from £124.1m a year earlier, and at the bottom line pre-tax losses of £177.3m, after exceptional costs of £217.1m. were down from a profit of £53.5m a year earlier.
The group is moving brands to a new 1.2m sq ft £29.4m distribution centre in Daventry. Topman has already moved to the site, while Topshop is set to join next spring. “With state-of-the-art technology and automation integral to the operation, the distribution centre is already delivering efficiency and an improved customer experience,” said Taveta Investment’s directors.
A Brexit steering group has been monitoring events since summer 2018, with a strategy of minimising risk to the business despite uncertainty. Steps taken include developing and testing systems changes that allow the group to continue to trade across its UK and European stores, while developing contingency plans for sending goods through rerouted supply chains where needed. It added: “The impact on import duty and tariffs of a potential exit from the European Union with no deal in place is potentially significant and the group is continually reviewing its sourcing strategy and contingency planning to address potential risks to cost prices as new information becomes available.
The Arcadia Group businesses are Burton, Dorothy Perkins, Evans, Miss Selfridge, Outfit, Topman, Topshop and Wallis.
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