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.
A tentative agreement on a new five-year contract has been agreed for some 20,000 dockworkers at 29 US West Coast ports, ending nine months of discussions. The Pacific Maritime Association (PMA) and I...
As the threat of a US West Coast port shutdown looms, analysts already estimate the ongoing disruption could add an eye-watering US$36.9bn to costs over the next 24 months. ...
Do you have any burning questions you’d like to ask a renowned global garment industry expert? For free....
Apparel shipments from Bangladesh to the US bounced back in December, posting their first rise since January last year. ...
- Low labour cost countries linked to highest risks
- Why should brands care about China cotton?
- UK reshoring hub hit by sweatshop claims
- New fibre and fabric innovations for outdoor wear
- China cotton: implications and opportunities
- South Africa to grow grass for recyclable textiles
- US West Coast port contract reached
- 30% of Adidas cotton from sustainable sources
- Activewear driving US apparel spend
- Benetton to embark on living wage roadmap
- Outdoor performance apparel: peaks, valleys, and green fields
- Myanmar's Garment Sector - Opportunities & Challenges in 2015
- Global market review of swimwear - forecasts to 2019
- Management briefing: Outlook 2015: Apparel industry issues in the year ahead
- Apparel Retail: Top 5 Emerging Markets Industry Guide