Blog: Leonie BarrieNew Year, bad news

Leonie Barrie | 5 January 2009

We’re less than a week into the New Year and already there’s another slew of bad news from the high street – confirming fears that disastrous holiday sales will spark a domino effect of store closures and bankruptcy filings over the next couple of months.

Maternity wear retailer Blooming Marvellous was this weekend reported to be on the verge of collapse, and Adams Childrenswear today shut 111 stores with the loss of around 850 jobs, just five days after calling in the administrators.

The next fortnight will also see trading updates from the likes of Marks & Spencer, Next, Debenhams, Ted Baker and JD Sports, and there are fears that the recent stampede of shoppers taking advantage of unprecedented discounts still won’t have boosted sales enough to help margins. After all, the logic says, if you cut prices in half then you’ll have to sell twice as much to make up the difference. And with the best will in the world, that’s unlikely to have happened.

M&S, which reports results on Wednesday, is widely expected to announce one of its worst ever Christmas trading performances accompanied by another profit warning. The retailer is one of the UK high street barometers, so its performance will be keenly watched. It was also one of the most high profile discounters over the festive season with several one-day sales in which it cut prices on all clothing items by 20% in an effort to stimulate flagging sales.

But industry observers believe the move is unlikely to have had the desired effect – and are expecting an 8.5% drop in sales of general merchandise (which includes clothing and footwear) in the 13 weeks to 27 December.

 


BLOG

Trump and Brexit generate more confusion

Over the past month, Donald Trump and his team failed to offer any clear plan to ensure Americans would "Buy American, Hire American" - while the British government's attempts to clarify the specifics...

BLOG

Bangladesh works to resolve labour activist issues

The Bangladesh government was forced to respond late last week to pressure over its crackdown on labour activists after a number of global brands and retailers, including H&M and Inditex announced pla...

BLOG

US border tax a contentious issue

Fresh from their disappointment at seeing the Trans-Pacific Partnership (TPP) free trade deal abandoned last month with an executive order by President Donald Trump, the US apparel and footwear sector...

BLOG

Primark's sustainable cotton programme takes shape

With the ultimate aim of ensuring all the cotton in its products is sourced sustainably, value clothing retailer Primark is adamant that having a business model focused on offering the lowest prices o...

just-style homepage



Forgot your password?