Blog: UK retail sector under pressure
Leonie Barrie | 12 December 2011
In the same week that figures showed UK retailers achieved their weakest sales performance for six months in November, news also broke that thousands of jobs are at risk after several clothing and footwear chains were put up for sale.
Nearly 4,000 jobs are threatened after the owner of the Barratts and Priceless Shoes stores collapsed into administration after a downturn in trading. And Blacks Leisure, the UK's largest outdoor clothing and equipment retailer, has appealed for a buyer for the firm or one of its brands. Irisa plans to close a number of stores as part of its restructuring efforts, and rumours are circulating that discount fashion chain Peacocks may close some 200 stores.
While a mild autumn has hurt sales of cold-weather items, the sector is also being buffeted by the ongoing eurozone crisis, high inflation and stagnant wages - all of which will continue to put pressure on consumers.
Supermarket giant Tesco has also admitted that clothing sales were "difficult" during its third quarter as it struggled to move winter lines due to warmer weather. The comments came as the retailer recorded another quarter of falling revenues in the UK and a "sharp" slowdown in its operations in Asia.
And struggling US women's wear chain Talbots has received an unsolicited takeover bid from one of its leading shareholders, which is concerned by the company's "rapidly deteriorating performance." The offer from private equity firm Sycamore Partners came after Talbots said it was seeking a successor for president and CEO Trudy Sullivan. Less than week before it had revealed plans to cut 9% of its corporate headcount and close stores after third quarter loss widened to $22m on a 6.6% drop in sales.
While another victim of the tough retail environment, Pacific Sunwear of California, is to close up to 200 under-performing stores after securing new credit agreements designed to help turn around the ailing business. The announcement came as the US company posted wider third quarter losses and falling sales.
And India has backtracked on its decision to allow more foreign investment in the country's multi-brand retail sector. However, it is thought the government still plans to relax single-brand foreign direct ownership rules, which would allow brands like Marks & Spencer, Ikea, Gap and Armani to own their operations in the country.
Apparel and footwear brands and retailers should be benefiting from tumbling commodity prices, especially for oil and cotton – but many are missing out on significant savings by failing to truly under...
It seems Adidas has been caught napping after Skechers passed the German sporting giant to take its second place in the sports footwear market in the US....
Apparel imports into the US surged in March, as retailers ramped up their imports of spring/summer merchandise and cargo volumes at West Coast ports started to clear. The top three supplier countries ...
Interest in sourcing apparel from sub-Saharan Africa might be on the rise, yet the results of a new survey suggest few players currently have concrete plans to tap into its potential....
- When will Gap get back on track?
- Software solutions enhance speed and visibility
- Portugal footwear makers underpin industry growth
- Supply chain weighs on Kering's green footprint
- Bangladesh factory safety progressing slowly
- Q1 apparel results in brief: Brown Shoe Co, Belk
- China to reduce apparel import taxes
- Indonesian textile sector sees 6,000 lay-offs
- Vietnam garment staff return after faintings
- New black dye meets sustainability standards