Retail News from The Appointment Magazine

Japanese giants call off merger

The Appointment Magazine — Mon, 8 Feb 2010 09:21:20 GMT

Japanese brewers and food groups Kirin and Suntory have called off merger negotiations due to lack of agreement on ways to ensure management independence and transparency within the new company. The deal would have created one of the world's largest food groups. In a statement, Kirin said it had been negotiating on the premise that the new entity would be managed as a listed company in order to ensure appropriate management independence and transparency. However, it became apparent that Suntory held a different view on this matter".Kirin is the owner of the Ichibanshibori beer brand as well as Afternoon Tea bottled drinks, whilst Suntory is known for its Premium Malt's beer and Boss canned coffee.

Clinton formalises internal training

The Appointment Magazine — Mon, 8 Feb 2010 09:20:46 GMT

Clinton Cards has overhauled its in-house training and launched a nationally accredited staff training programme, to coincide with National Apprenticeship week which gives employees the chance to gain a nationally recognised qualification through a bespoke training scheme.
The EDI-accredited Retail Diploma, NVQ and apprenticeship programme forms part of a move by the retailer, which employs thousands of staff across 700 UK stores, to raise the profile of retailing. Employees can opt for either of three qualifications depending on their skills and career progression wishes.
Speaking to Personnel Today, HR director Annette Middlebrook said the group had, for many years, provided in-house training that ran in tandem with the opportunity for employees to study an NVQ and achieve a vocational qualification.
"When we evaluated this we felt it was no longer fit for purpose and did not deliver the consistency of learning that we were striving to achieve," she explained.
"We redesigned the programme and enlisted the support of both Protocol Skills, our NVQ provider, and EDI, accredited awarding body, to map the company's bespoke programme with national retail NVQs and the Retail Apprenticeship.
"This now gives us the opportunity to offer work-based learning to a nationally recognised qualification that is designed by us – so completely focused on the needs of our people and our business, adding real value to both, and helping deliver consistently high quality customer service in our stores".
Ms Middlebrook added that the initiative would play a significant part in attracting and keeping valued employees and said it would help to raise the profile of retail as a career.

Compass sales point to recovery

The Appointment Magazine — Mon, 8 Feb 2010 09:20:20 GMT

Catering giant Compass has seen sales recover in the first quarter of 2010, down by just 1.7% compared with a 3% fall in the last three months of 2009. The group said the improvement was driven by new contract wins, efficiency drives and "encouraging" trends in the hardest hit markets; business and industry and sports and leisure.
In the year to September 30th the group reported a 37% jump in pre-tax profits to £733 million, better than analysts' expectations, while revenues rose by 1.3% to £13.4 billion.
"We continue to see strong growth in new business both in food service and in our fast growing support services business and retention rates remain high," the group said.
Compass has acquired The Hurley Group, a Toronto-based cleaning and facility management services firm, and agreed several new contracts with companies including Aviva, Banca d'Italia and Viva.

Carluccio’s posts strong sales

The Appointment Magazine — Mon, 8 Feb 2010 09:19:53 GMT

Carluccio's has reported strong trading over Christmas, with turnover for the 17 weeks to January 24th up by 8% compared with last year. The chain expects trading conditions to remain challenging in 2010 and added that it was on track to open five stores this year.
The first new site of the financial year has already opened in Exeter, Devon with trade exceeding expectations. Two new sites are set to open in Wimbledon in February and Cardiff in March, bringing the group's estate to 45 outlets. Carluccio's added that "good progress" was being made by its Middle Eastern franchisee, with another two sites in Dubai scheduled to open this spring.

Raymond Blanc to open first Brasserie in London

The Appointment Magazine — Mon, 8 Feb 2010 09:19:27 GMT

Brasserie Blanc, Raymond Blanc's restaurant chain, is set to open its first outlet in London and is planning further expansion. The new site is located in the redevelopment of the former Stock Exchange on Threadneedle Street in the City and plans to open in the spring.
Following further investment, the group will launch between two and four new sites a year over the next five years.
Speaking to The Caterer, Ian Glyn, director at Brasserie Blanc, said: "We have raised funds to take Brasserie Blanc to the next stage of growth and will expand the brand to the same locations we specialise in already in towns outside of London".
Managing director, John Lederer added: "We are delighted that our first restaurant in London should be in such a prestigious building and location and look forward to introducing our City customers to the Brasserie Blanc offer which has proved so popular outside London".
Current sites of Brassiere Blanc include Bristol, Cheltenham, Leeds, Milton Keynes, Oxford, Portsmouth and Winchester.

Blacks Leisure seeking £20million to fund growth and revamp

The Appointment Magazine — Fri, 5 Feb 2010 10:43:57 GMT

Outdoor clothing specialist Blacks Leisure is today asking City investors for around £20 million in order to fund its proposed expansion and overhaul of its store portfolio. The group is seeking to generate the cash through a placing and open offer of new shares. Should it prove successful Blacks is understood to be set for a 35-store expansion programme and will redress underinvestment in some of its existing stores.
Commenting on the proposals, Neil Gillis, chief executive said: "The fund raising proposals being announced today will enable us to pursue the crucial growth phase of our recovery plan. The proceeds will underpin a selective expansion of our outdoor retail estate by the addition of up to 35 new stores, in towns where we have previously traded successfully or which currently lack an outdoor retail offer, and accelerate the refurbishment of our core estate which has suffered from years of underinvestment. With a clear and well financed recovery plan now in place, Blacks Leisure is in a stronger position than it has been for a number of years to realise the potential of its market leadership position in outdoor retail and deliver returns to shareholders."

Speciality Retail Group proposes CVA to stave off collapse

The Appointment Magazine — Fri, 5 Feb 2010 10:42:22 GMT

Speciality Retail Group (SRG), which operates retail brands such as Suits You, Young's Hire and Racing Green, has proposed a Company Voluntary Agreement (CVA) as a last ditch attempt to save the business by dramatically reducing costs.
SRG is proposing that it pay 60% of its normal rent levels on 42 of its 71 stores for a period of 18 months – although such a move would require a minimum of 75% of its landlords to agree in order to proceed. The group is owned by Egyptian textiles supplier Arafa Holding, which is understood to be likely to withdraw its support if the CVA is not accepted.
SRG boss Peter Lucas stated: "Unfortunately, despite undertaking a thorough operational restructuring of the business in the past year, we have been forced to take more radical steps.
"The combination of refocusing the business on to designers outlets, with a revitalised trading stance, and operational restructuring measures to improve margins and reduce operating costs will make a reorganised Suits You a profitable concern."
If the CVA proposal is accepted there is no immediate threat to jobs within the group as no short-term store closures are planned.
Commenting on the announcement, Richard Fleming, UK head of restructuring at KPMG, and proposed 'supervisor' of the CVA, said: "SRG is a successful brand in its designer outlet stores but has been unable to stave off the drop off in consumer demand in its high street stores. While the company has taken significant steps to address its problems, the business faces administration unless it can restructure its operations via a CVA.
"Unlike the JJB and Blacks CVAs where loss-making stores were closed and landlords of these stores were offered 6 months rent plus rates, SRG is not proposing to close any of its stores immediately. Landlords of the 42 loss-making stores will be offered 60% of the full rent for a period of 18 months. The stores will continue to trade during this period. If, however, the landlords wish to take on new tenants, they can do so by giving 45 days notice. We believe this offers the landlords more flexibility and, indeed, is more generous than previous proposals as the reduced rent over 18 months equates to 11 months rent. SRG will continue to pay rates in full."
KPMG will be holding a series of meetings with landlords this month ahead of a formal creditors meeting on 23rd February at which the 75% CVA consent will be sought.

FPB and Iceland boss in war of words

The Appointment Magazine — Fri, 5 Feb 2010 10:41:09 GMT

The Forum of Private Business (FPB) and Malcolm Walker have become embroiled in a war of words following a controversial interview given by the Iceland chief executive in which he described the new Grocery Supplier Code of Practice and proposed supermarket ombudsman as a "waste of time".
The FPB reacted particularly strongly to statements made by Mr Walker in the Daily Telegraph article suggesting that difficult relationships between suppliers and retailers were inevitable and that the phenomena of large suppliers bullying smaller retailers and larger retailers bullying smaller suppliers was "a fact of life". The Iceland boss also intimated that his company would do the bare minimum to comply with the new code.
"Malcolm Walker's comments are extremely disappointing and reflect the common attitude supermarkets have towards their suppliers," said the FPB's chief executive Phil Orford. "This bullying behaviour is simply bad practice and an abuse of their dominant market position. To attempt to normalize it is unacceptable.
He added: "Mr Walker goes on to admit the importance of supermarkets co-operating with suppliers in order to ensure the quality of the products they sell to consumers. Similarly, the old code of practice said large retailers should be 'reasonable' in their dealings with suppliers.
"But time and time again they are simply unreasonable in the demands they place on suppliers and fail to properly negotiate and co-operate with them. That is why a new, more robust code of practice and an ombudsman to enforce it are entirely necessary."
The Forum of Private Business (FPB) is understood to be writing to Mr Walker to express its concerns at his comments, and to invite Iceland to sign up to the Government's Prompt Payment Code, which ha been launched to encourage big businesses to pay their small suppliers promptly.
However it would appear that Mr Walker is not necessarily interested in diplomacy on this issue. Speaking to the Telegraph from Barbados where he is on holiday, the Iceland boss is alleged to have commented: "The FPB are pillocks."

Career Forums opens today

The Appointment Magazine — Thu, 4 Feb 2010 09:37:54 GMT

Career Forums, the UK's top retail and hospitality careers event, opens its doors today from mid-day in central London.
The two-day event, now a permanent fixture on the recruitment calendar, will feature top brands from both retail and hospitality. The line-up includes All Saints, Benefit Cosmetics, BP, Comptoir des Cotonniers, Dreams, Hospitality & Leisure Recruitment, House of Fraser, Iceland, Nando's, Retail Human Resources, Sainsbury's, Selfridges, Vue, Wickes and Wallis – each looking to recruit for a variety of management and head office positions. Visitors to the event can also benefit from attending its free, careers-based seminars delivered by industry experts and professional recruiters. In addition, a team of CV Doctors will be on hand to help candidates maximise the impact of their applications.
Commenting prior to doors opening, Career Forums organiser Adam Tomkinson said: "We are looking forward to today's event, which features an amazing line-up of retail, hospitality and recruitment specialists. Career Forums is a must for anyone serious about their career in management or head office, whether looking to change jobs, get promoted or simply make the best of the opportunities available to them in their current role".
Career Forums will be open 12 noon – 7pm today and 10am – 4pm tomorrow, at the Marriott Grosvenor Square, London W1K 6JP. Fast-track registration is recommended (though not essential) through www.careerforums.co.uk. It is also possible to register at the venue.

Designer Rooms in liquidation

The Appointment Magazine — Thu, 4 Feb 2010 09:07:18 GMT

Designer Rooms, the outlet chain, has gone into liquidation. All ten stores have closed after a potential buyer withdrew an offer.
In a statement, the company said: "James Cowper (Liquidators) was first approached in December when the management were trying to find a buyer for Designer Rooms. After extensive negotiations over terms, a prospective purchaser willing to take on a number of the outlets withdrew forcing the store closures. Problems procuring quality stock lines, reduced consumer demand and adverse weather conditions all proved too much in the end".

Abercrombie & Fitch continues to struggle

The Appointment Magazine — Thu, 4 Feb 2010 09:06:48 GMT

Abercrombie & Fitch has posted a 19% decline in December sales at stores open at least a year, with sales at its Hollister division down by 25%.
The retailer reduced its average unit retail price by 14% during the holidays but even with more promotions, it has struggled during the festive season.
However, despite declining domestic demand, Abercrombie continues to perform well internationally in spite of retail prices that are nearly double that of the domestic merchandise. Late last year, Abercrombie opened megastores in Milan and Tokyo, both of which have performed well, as have Hollister mall-based stores in the UK. Currently international sales account for around 10% of group revenues but this could grow to more than 20% in 2010.

Profit falls at Hugo Boss

The Appointment Magazine — Thu, 4 Feb 2010 09:06:20 GMT

Hugo Boss has reported full year underlying EBITDA down by 6%, with sales down by 7%.
Speaking to Reuters, chief executive Claus-Dietrich Lars said he was "cautiously optimistic" for the current year, "especially as we used the past year to strengthen our competitive advantage. The year 2010 as a whole will still be a big challenge for our industry, since many markets will see only very modest growth. However, we expect our market environment to stabilise over the course of the year".
Fourth quarter sales are slightly ahead of last year; an improvement on internal forecasts of a 9% decline.

Unilever annual sales grow

The Appointment Magazine — Thu, 4 Feb 2010 09:05:52 GMT

Unilever has seen "strong growth momentum" despite a challenging environment. Annual underlying sales reported this morning grew 3.5%, with underlying volume growth at 2.3%. Paul Polman, CEO, said: "We made good progress in challenging market conditions. Our market share improvements were broad-based and improved throughout the year. Our brands are stronger, driven by better quality innovation and a step-change in advertising and promotional expenditure."We have further strengthened our leading positions in developing and emerging markets and made encouraging progress in re-establishing volume growth in Western Europe. The organisation is moving fast towards a stronger performance culture. We are faster and more agile and focused on serving over 2 billion consumers every day."We expect continued pressure on consumer spending power and heightened levels of competitive activity in 2010. We will continue to focus on volume growth as the main driver of long term value creation, whilst delivering steady and sustainable year-on-year improvement in operating margin and strong cashflow".

24-year-old woman asked for ID – to buy slice of quiche

The Appointment Magazine — Wed, 3 Feb 2010 09:33:30 GMT

A 24-year-old woman was asked to show ID last month when she tried to buy a slice of cheese and onion quiche at a Tesco store in Cannons Park, Coventry.
The shopper in question, Christine Cuddihy, said that she thought the cashier was joking when she refused to sell the slice of quiche because Ms Cuddihy "didn't look over 21".
Ms Cuddihy said: "The girl told me, "You don't look over 21. I need to see some proof of age".
"I told her I was certain the proof of age laws do not apply to quiche but she said, "We have to be really strict now and this applies to quiche bought over the counter. At first I thought she was joking but her face was deadly serious".
Ms Cuddihy argued with the cashier at the store in Coventry before finally being forced to produce her driving licence to buy the snack.
A baffled spokesman for the supermarket said: "We are at a loss to say what happened here".

Card Factory up for sale

The Appointment Magazine — Wed, 3 Feb 2010 09:29:26 GMT

The husband and wife team behind the Card Factory chain have reportedly put the chain up for sale.
Dean and Janet Hoyle have appointed KPMG to advise on a sale of their business, which could make them up to £400 million, according to press reports.
Card Factory had sales of £168 million in the year ended January 2009, with profits of approximately £29 million. Potential bidders are thought to include private equity firms Advent International and TPG.

Retailers absorbed VAT increase to boost New Year trade

The Appointment Magazine — Wed, 3 Feb 2010 09:28:55 GMT

Retailers picked up the tab in the January VAT rise to boost trading, according to figures released today.
According to the BRC (British Retail Consortium)-Nielsen Shop Price Index, annual shop price inflation stayed largely steady last month, at 2.3% from 2.2% in December despite VAT rising back up to 17.5%.
Many retailers chose to absorb the VAT rise and offset it with discounts and promotions.
While non-food inflation rose to its highest level since the BRC began recording the figures in December 2006, the rate of 1.9% was lower than expected by the BRC.
A fall in annual food price inflation for the first time since August 2009 – to 2.9% from 3.7% in December - also dragged overall prices lower.
The BRC said: "Many retailers held off passing the VAT increase on to consumers in the hope of stimulating demand. As a result, inflation has not risen as fast as we had anticipated".
Stores worked hard to encourage shoppers to spend more, while last month was also impacted by the snow and icy weather.
"Fierce competition, in the face of weakening consumer demand and uncertainty about the recovery is keeping shop prices down," added Stephen Roberston, BRC director general.
Official inflation figures showed a bigger-than-expected rise in the Consumer Prices Index (CPI) to 2.9% in December compared with just 1.9% in November due to unchanged VAT in contrast with a year earlier, when the temporary cut to 15% came in.

Carpetright sees third quarter sales rise

The Appointment Magazine — Wed, 3 Feb 2010 09:28:30 GMT

Carpetright has said that its third quarter continued the trend of positive sales growth, despite disruptions from the severe post-Christmas weather.
In the 13 weeks ended January 30th, group sales at the company rose by 7.0% and the store base increased to 717 at the period end.
UK and Republic of Ireland sales rose by 7.7%, with like-for-like sales up 2.3%.
Meanwhile, in constant currency terms, the continuing business in the Netherlands and Belgium saw total sales decrease by 5.1% with like-for-like sales down 3.7%. After allowing for the movement in exchange rates, this translates to a total sales growth of 5.4%.
The company added that it planned to exit Poland by the financial year-end, having closed four Polish stores in the third quarter to leave a portfolio of six.
Lord Harris of Peckham, chairman and chief executive, said: "We are pleased with our overall performance during the period and believe our continued growth demonstrates the resilience and strength of our business plan.
"In the UK, trading in the early part of the quarter was strong and we experienced double digit like for like growth. The severe weather conditions post-Christmas impacted the final weeks of the quarter but we are hopeful of recovering some of this lost trade in the coming weeks.
"Our new revenue streams from housebuilding and insurance customers are generating incremental business and we expect this to grow in future periods. We have opened a net four new stores in the last thirteen weeks and have recently launched two transactional web sites supporting the Carpetright and Sleepright brands. These sites are trading in line with management expectations.
"We believe we continue to grow market share in our businesses in The Netherlands and Belgium. Whilst we remain cautious about economic conditions in these markets, our businesses have recently demonstrated signs of a recovery in sales performance. This leads us to be optimistic about a return to growth in our Rest of Europe business in the balance of the year.
"Our previously announced withdrawal from our loss making operations in Poland continues and we envisage full exit by the close of this financial year.
"Whilst we remain cautious about our market in the balance of the financial year, we continue our drive for sustained growth and our expectations for the full year are unchanged".

David Mansfield joins Game Group board

The Appointment Magazine — Tue, 2 Feb 2010 09:12:45 GMT

Game Group plc, Europe's largest specialist retailer of pc and video games products, has announced the appointment of David Mansfield as a non-executive director. He will join the board in April 2010.
Mr Mansfield (56) was the chief executive of GCap Media plc (formerly Capital Radio before May 2005) between 1997 and 2005, and is currently chairman of Radio Joint Audience Research and director of Ingenious Media plc. Before joining Capital Radio, he held various senior sales, commercial and marketing positions at Thames Television and Scottish Television. He has been a non-executive director at Carphone Warehouse plc since 2005, from which he will retire in March 2010.
Due to his relocation to San Francisco with Google as VP, Americas Operations, Dennis Woodside stepped down from the Game Group board on January 31st 2010.
Peter Lewis, chairman, said: "We are delighted to welcome David Mansfield to our board as a non-executive director. He is highly respected for his proven experience on boards of evolving entertainment and communications businesses. His in depth knowledge and insight into customer behaviours, coupled with his passion for the entertainment industries, will bring complementary skills to the board. I would also like to thank Dennis Woodside on behalf of the board for his valuable contribution to our multi channel strategy and growth".
David Mansfield commented: "The video games and interactive entertainment market is extremely dynamic and I'm delighted to be joining Game Group at such an important time in the company's development".

New M&S boss to join in May

The Appointment Magazine — Tue, 2 Feb 2010 09:12:14 GMT

Marc Bolland will take up his new role as chief executive of Marks & Spencer on May 1st, the company said yesterday. In a statement, Morrisons announced that its outgoing boss has formally left the board and will be free to begin his new role from April 30th, six months before the end of his contract. M&S also confirmed that Mr Bolland's pay would comprise a £975,000 salary, annual bonus potential of up to 250% of salary, and an annual award of shares under the company's Performance Share Plan. In 2010/11 this will be an exceptional award worth 400% of his salary.
Additionally, the company will also compensate Mr Bolland in lieu of a number of awards forfeited by his departure from Morrisons. This comprises £1.6 million in cash and £1 million worth of shares to compensate for loss of bonus and shares that would have vested in 2010; and a Restricted Share Award worth £1 million and a Performance Share Plan worth £3.9 million to compensate for shares that would have vested in 2011 and 2012.

Freedom of city for Greggs

The Appointment Magazine — Tue, 2 Feb 2010 09:11:46 GMT

Tyneside-based Greggs has been awarded the honorary freedom of the city of Newcastle. The company, which was founded in Newcastle in the 1930s, is being recognised for its contribution to the region's economy and its charity work.
In 1987 Greggs started supporting local communities after Ian Gregg established the Greggs Trust (now the Greggs Foundation), which has gone on to donate more than £10 million to good causes across the UK. In addition, more than £3 million has been raised for children's cancer research through the company's sponsorship of the North East Children's Cancer Run. Former chief executive Sir Michael Darrington also introduced Greggs Breakfast Clubs, which provides breakfasts for 6,000 primary school children.
Speaking to the BBC, The Lord Mayor of Newcastle, Mike Cookson, said: "Greggs continues to be a fantastic asset for the whole region and their generosity has helped so many good causes here and around the country.
"I would like to congratulate everyone at the company on receiving this award, which not only reflects the important contribution they have made to charity but also celebrates their commercial success".
Kennedy McMeikan, Greggs current chief executive, said: "We are all proud to be part of a business that has never lost its North East values of caring about people, taking pride in our products, working hard and always trying to enjoy what we do".
The freedom of Newcastle has been previously awarded to the late Sir Bobby Robson, Alan Shearer and Nelson Mandela.

New Look to float on stock exchange

The Appointment Magazine — Tue, 2 Feb 2010 09:11:06 GMT

Privately owned fashion retailer New Look has announced that it intends to float on the London stock exchange. The company, owned by Permira and Apax, said that the £650 million it plans to raise from the long-awaited initial public offering (IPO) would be used to pay down debt to allow future expansion.
Commenting on today's announcement, Carl McPhail, chief executive officer of New Look, said: "We are delighted that the significant transformation of New Look over recent years has positioned us as a leading UK fast fashion value retailer. Today's announcement is the latest exciting stage in our development and we look forward to growing our business, both in the UK and internationally.
"The board and I welcome John Gildersleeve to the group as non-executive chairman and Stella David, Carolyn McCall and Henry Staunton as non-executive directors. Their experience will be extremely valuable as the group continues to implement its strategy for growth and explores further opportunities".
Commenting on today's announcement, Mr Gildersleeve said: "New Look has doubled its space since 2004 and the group continues to perform strongly, underlined by both the strong management team and the significant investment made under private ownership. The group is extremely well positioned to continue this growth as a public company".