Blog: Leonie BarrieExpanding opportunities for growth

Leonie Barrie | 16 November 2009

US lingerie giant Victoria's Secret is mulling expansion in the UK and Japan to capitalise on the brand's world-wide appeal, but has declined to put a time-frame on the plan after admitting it needs to find the right location first.
 
Martin Waters, executive vice-president of international business at the chain's parent company Limited Brands, said the initiatives were likely within the next few years, and would focus on flagship stores in strategic markets.

He admitted other plans in the pipeline include a European online retail site offering sales in euros and next-day delivery, but that among the firm’s more pressing priorities are re-building the La Senza business in Canada.

Growth is also on the cards at Urban Outfitters, where strong sales at its Anthropologie chain combined with inventory and cost controls to lift third-quarter earnings by 5.2%. The results have prompted the company to suggest its store growth will get back on track to around 50 new stores next year – up from 33 this year.

Likewise, UK department stores group Debenhams Plc is making moves to build its presence in mainland Europe after last week revealing it is to buy Danish retailer Magasin du Nord for DKK101m (US$20.3m). Debenhams says the close fit between the two businesses will be “mutually beneficial” and that it plans to roll out its Designers at Debenhams line-up, which includes Jasper Conran, Betty Jackson, John Rocha and Matthew Williamson, at the Danish department store chain.

Supermarket group Sainsbury’s has also revealed ambitious plans for its non-food offer – which includes fashion and footwear – after sales continued to accelerate around two and a half times faster than food despite the difficult economic environment. The company last week posted a 5.7% jump in first-half like-for-like sales excluding fuel, lifting underlying pre-tax profits by 18.5%.

Speaking at an analyst meeting in London, chief executive Justin King said the retailer expects half of its space and one-third of its sales growth to come from non-food in the medium term, helped by new stores, online sales, and a move towards direct sourcing via the company's own supply chain.

And finally, struggling plastic clog maker Crocs is on a collision course with Porsche after the German car-maker sued it for alleged infringement of the ‘Cayman’ trademark – which not only appears on one of its sports cars but is also the name of Crocs’ best-known style of clogs.

Crocs says it intends to “vigorously defend itself against these claims” – but with sales and profits only just starting to recover from a $185m loss last year, this is likely to be an unwelcome and expensive diversion as it tries to steer a turnaround of its business.


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