Nike to increase dividend by 12%ahead of sales growth forecast
Nike has revealed it plans a double-digit increase in its quarterly dividend as it forecasts a sales bounce due to the Covid-19 pandemic. The sportswear giant, which is in the process of a transformation scheme that will see it become more of a direct-to-consumer retailer through its own websites and stores rather than as a wholesaler, said it would increase its dividend pay out by 12 per cent – or 3 cents per share. It marks Nike’s 19th consecutive year of increasing dividend payouts, and comes as many retailers either cut or pause shareholder payouts due to Covid-19 crisis. A cash dividend of $0.275 per share on Nike’s outstanding class A and class B stock is payable on December 29. In September, Nike said it expects sales in its second half ending May next year to be “up significantly”, as it bounces back from a slump earlier this year due to Covid-19 lockdowns in multiple markets. Nike’s shares have also more than doubled since its March low as it slashed costs by cutting corporate jobs and targeted online investments as part of its transformation scheme.
PS5 scalpers used bots to buy up more stock than most UK retailers
PlayStation 5 “scalper” groups used bots to buy up thousands of consoles seeing them amass more stock than most of the UK’s major retailers.
The launch of Sony’s next-gen console descended into chaos last week as it officially went on sale in the UK, seeing stock sell out in minutes and websites crash at nearly every leading retailer.
This chaos, according to a new report from Business Insider, was largely driven by “scalper” groups who competed to see how many units they could buy up before reselling the units for exorbitant prices.
One group called ‘CrepChiefNotify’ managed to secure nearly 3500 units after using bots to amass as much stock as possible both at pre-order and when the console officially launched last week.
The group is one of many which uses these bots to monitor retail sites to determine when stock will drop, then buy up as much stock as possible faster than any human would be able to.
Not only is the group able to resell the most sought after stock, including high-demand fashion items and limited edition ranges, but they also sell subscriptions to their service which offers “botting guidance and access to our in-house bot-slots”.
This fairly new phenomenon shows no signs of slowing down and is expected to see the next batch of PS5 stock, due to be released in December, be largely inaccessible to those buying manually.
Some consoles have been re-sold from multiple thousands of pounds on websites like StockX, while numerous units can be found on Ebay for over £1000.
While scalpers have played a major role in limiting stock levels available to the general public, the console’s manufacturer is also partially to blame.
Sony Interactive Entertainment’s head Jim Ryan told Russian news agency TASS: “Everything is sold. Absolutely everything is sold.
“I’ve spent much of the last year trying to be sure that we can generate enough demand for the product.
“And now in terms of my executive bandwidth, I’m spending a lot more time on trying to increase supply to meet that demand.”
Halfords recruiting 1100 temporary jobs for Christmas
A surge in demand for bicycles means Halfords is recruiting 1100 temporary jobs for the festive season. The temporary vacancies are in addition to a recruitment drive for a wide range of permanent positions across Halford’s stores. “With the public turning to alternatives to public transport, this has led to extra demand for bikes and essential motoring services,” Halford head of resourcing Andy McBride said. Cycling director Paul Tomlinson said: “There has been huge interest in cycling this year as the public seek alternatives to public transport and as a way of keeping fit. “As a result we’ve seen a massive surge in demand and sales of bikes and cycling products. “We have had tens of thousands of customers on waiting lists for deliveries and this has continued beyond the traditional summer peak, particularly for adult bikes as lockdown continues. “Kids’ and junior bikes also appear to be one of the most wanted Christmas presents this year.” The news comes as Halfords last week announced a 116 per cent increase in underlying profits to £56 million in the 26 weeks to October 2. The cycling and car specialist said retail like-for-likes rose 8.1 per cent to £524 million in the half year results.
JD Sports in exclusive talks with Debenhams over takeover
JD Sports is reportedly engaged in exclusive discussions with Debenhams over a deal to rescue the entire business from administration, according to The Times. It’s understood that the sportswear retailer is interested in acquiring all of Debenhams’ business, which would include 12,000 staff and 124 shops. The Times reported that JD Sports has begun exclusive talks with the beleaguered department store’s adviser Lazard and administrators at FRP Advisory. Earlier this month it was reported by The Telegraph that JD Sports was examining Debenhams’ finances in a secure data room, and has been granted increased access in the last fortnight. JD Sports executive chairman Peter Cowgill is said to be interested in the offer thanks to Debenhams’ incredibly popular website, and the fact a deal would mean acquiring relatively cheap property on the high street across the UK. If a deal were to go ahead, it would mean another blow for Mike Ashley’s Frasers Group, who made an offer of £125 million for Debenhams. Ashley dropped out of the running at the start of the month after failing to meet the £300 million asking price for the retailer. Should Debenhams’ administrators fail to find a buyer, the historic retailer could still fall into liquidation. Next and Marks & Spencer are also understood to be interested in buying some shops from the struggling chain but not the whole company, while online retailer The Hut Group has made an offer to buy Debenhams’ website.
AO world encouraged by 53% surge in H1 revenue
AO World on Tuesday revealed a 53.2 per cent rise in total revenue to £717 million for its interim results in the six months to September 30. The online electrical retailer said group profit before tax rose to £18.3 million from a loss of £5.9 million in the same period a year before. Against the backdrop of coronavirus, AO World praised its “resilient operation performance”. The Bolton-based retailer’s UK revenue rose 53.9 per cent for the first half of the year, to £616.4 million. “This has been a half year like no other. I believe our market has changed as a result, forever,” AO World chief executive John Roberts said. “Online is now the dominant retail channel for customers and manufacturers alike and I am delighted by how our AOers have risen to the challenge of this structural shift in behaviour. “We have grown share across all categories and the results we’re announcing today give huge confidence that our business is well set for the future to cement the changes. “Our growth rates have increased from Q2 to Q3 as we unlock capacity constraints. “Now really is our time and we are investing to win and cement the change.”
Lockdown Black Friday must be halted in its tracks to avoid delivery chaos and £1.3bn loss
Black Friday must be “halted in its tracks” to avoid retailers’ delivery networks completely collapsing under the weight of online orders.
This year’s annual shopping festival, due to take place this Friday and extend throughout the weekend, is expected to rake in a record £8.49 billion.
However, as the England remains in lockdown until December 2, this years Black Friday will take place almost entirely online placing immense pressure on the country’s already overstretched collective delivery network.
“Last year, 387 million of the 462 million Christmas peak deliveries were online shopping orders,” delivery expert ParcelHero’s David Jinks said.
“This year, retailers’ deliveries alone will put an estimated 592 million parcels in the system in the weeks before Christmas. Due to Black Friday, this Mount Everest of Christmas peaks will spike between 27-30 November – still inside the critical lockdown period in England.”
Jinks warns that this could push delivery networks to breaking point, risking a return to the chaos that ensued during the now notorious Black Friday 2014.
That year 45 per cent of shoppers experienced late deliveries or never received their goods at all, 49 per cent missed their deliveries due to overstretched companies’ erratic delivery patterns, while a further 31 per cent experienced fruther problems with their order.
“We believe Black Friday 2020 must either be halted in its tracks or spread through the first two weeks of December to give retailers’ delivery partners a fighting chance,” Jinks added.
Separate data from MRS Digital suggests that hosting Black Friday during lockdown could cost the UK retail industry a total of £1,261,497,936.
According to the company, which based its estimates on the latest ONS data: “If Wales, Scotland and Northern Ireland join England in the full national lockdown there is likely to be a deficit of £1.3 billion from the original £6 billion spend estimates”.
Patisserie Valerie announces new Sainsbury's partnership in 250 stores
Patisserie Valerie will launch a range of cakes and patisseries in 250 Sainsbury’s stores as part of a new tie-up with the grocer, according to The Telegraph. The French-inspired chain headquartered in Birmingham will offer 14 of its best-selling cakes and patisseries in Sainsbury’s from next Wednesday. “Both Patisserie Valerie and Sainsbury’s are brands that are much loved and trusted by UK consumers. In bringing our range exclusively into Sainsbury’s stores and online to their customers, we are excited to build on that trust with our high quality, handmade cakes and patisserie,” Patisserie Valerie chief executive James Fleming said. It’s not the first time a partnership has been on the cards for the patisserie. Back in the summer of 2018 Sainsbury’s announced plans to roll out its Patisserie Valerie offerings to another 31 stores by the end of September, taking it to 70 in total – after a successful trial. The Big 4 grocer said bakery counter sales in the stores that took part in the initial trial saw strong incremental sales after stocking Patisserie Valerie cakes and patisseries. Later than year trading shares in parent company Patisserie Holdings were suspended following the discovery of potentially fraudulent accounting irregularities. An almost-£100 million hole was found in the retailer’s finances, and the business collapsed into administration in January 2019. Patisserie Valerie was then acquired by Causeway Capital Partners in February 2019 for a total of £13 million.
Abercrombie & Fitch to close Saville Row flagship
Abercrombie & Fitch will close its flagship London store by the end of January 2021, before its lease was set to expire, according to the Financial Times. The clothing chain said it will close seven of its global flagship stores in total, after a drop in visitors during the pandemic exacerbated difficulties from underperformance. The closures represent a combined loss of 200,000 square feet to Abercrombie’s store portfolio, or about 10 per cent of the brand’s total space. By closing the flagships, the company will remove USD 85 million (£64 million) of lease liabilities from its balance sheet. “Tourism has kind of ground to a halt” during the pandemic, Abercrombie & Fitch’s chief financial officer Scott Lipesky, said in an interview cited by The Financial Times. Lipesky added that decision is part of a “multiyear strategy of reducing dependence on tourist-driven locations”, and that the business “can reach these customers these days through social media and digital marketing”. The closures were announced on Tuesday as Abercrombie posted a 5 per cent drop in net sales of USD 820 million (£614 million) for its third quarter to November 2. Meanwhile digital net sales rose 43 per cent to USD 382 million (£386 million). “With these seven closures, we should end the year with eight operating flagships down from fifteen at the beginning of the year,” chief executive Fran Horowitz said as part of Abercrombie’s third quarter trading announcements. In November 2019 Abercrombie opened a new store in Westfield London, when the group at the time said that its Saville Row location would be repurposed as its EMEA Head Office.
B&Q owner buys home improvement services app for 10m euro amid major digital push
B&Q’s owner Kingfisher has bought tradesperson services marketplace NeedHelp for €10 million (£8.9 million) as it seeks to cash in on the home improvement lockdown boom.
Kingfisher, which also owns Screwfix, acquired an 80 per cent stake in the French digital marketplace and says it now plans to launch the service in the UK.
NeedHelp, founded in 2014, connects tradespeople and home improvement experts to homeowners looking for help renovating their homes.
It already provides its services to customers of more than 500 of Kingfisher’s stores in France, and currently operates in Switzerland, Germany, the Netherlands, Belgium and Austria.
Kingfisher said the move marked “an important step forward” in its digital transformation strategy helping it “build a mobile-first and service-orientated customer experience”.
“To serve customers effectively today, we need to be more digital and service orientated, while leveraging our strong store assets,” Kingfisher chief executive Thierry Garnier said.
“Online services marketplaces are key to the future of home improvement retail and NeedHelp is an established and fast-growing player in this arena.
“Its acquisition accelerates our digital capabilities and extends the services that we can provide our customers – two central components of our future growth strategy.”
NeedHelp will continue to function as an independent company offering its services to customers across the home improvement sector.
Kingfisher says it plans to “develop NeedHelp quickly in the UK and Poland” by using its well established network of stores and tradespeople.
Ted Baker, Hobbs, Whistles, Jigsaw & other retailers join #SaveShops initiative
Several fashion retailers have joined the new #SaveShops movement, which aims to safeguard jobs and increase awareness of safe ways to shop amidst the second wave of the pandemic in the run-up to Christmas. The #SaveShops website promotes different multichannel services provided by fashion retailers, such as click-and-collect, home delivery and personal shopping appointments. Also running as a social media campaign, #SaveShops encourages people to “buy British products from British brands” to help both the local and national economy, and protect retail jobs and the high street. Sixteen fashion brands and retailers are listed on #SaveShop’s website already, including Ted Baker, Whistles, Hobbs, Crew Clothing, Jigsaw, Mint Velvet, Damsel in Distress, Jojo Maman Bébé, Me+Em, Intersport, Radley and Accessorize. The #SaveShops campaign was set up by OneStock, which provides order management systems for multichannel retailers. The news comes shortly after the government this week confirmed that non-essential retailers in England will be able to reopen when the four-week national lockdown ends mid next week. “As our industry continues to face challenges in the wake of the Covid-19 pandemic, it is important that British retailers come together to ensure our customers can shop safely and our stores can stay open,” Ted Baker group commercial director Helen Costello said. “Ted Baker fully supports the #SaveShops initiative. Working together, we can protect the high street and the livelihoods of those working directly in retail, as well as those employed in the wider economy that we all depend on.” Jigsaw consulting partner Beth Butterwick said: “This is a fantastic initiative in what has been an extremely disrupted year. “We are looking forward to welcoming customers back to each of our locations with open arms in December. “These are more than just places to shop, each one is an important part of a real community hub. “Let our doors open safely so we can listen, support, serve and add a little bit of Christmas joy.” Crew Cloithing brand director Georgina Clark said: “Our stores and the employees who work in them play an integral role in their local communities, and #SaveShops is an important opportunity to ensure this continues ahead of the Christmas season.” Helen Williamson, a retail advisor and former Whistles manager director said: I’m proud to support the #SaveShops movement. “Having enjoyed a lifetime working in retail myself, we must now come together to support our local shops and protect the livelihoods of all our shop workers.”
New Look, Dorothy Perkins and Superdry turn to Ebay to flog lockdown dead stock
New Look, Dorothy Perkins, Superdry and LK Bennett have all turned to Ebay to sell off their “dead stock” as they scramble to stem lockdown losses.
Each of these fashion retailers are understood to have launched Ebay stores to offload their unsold stock at majorly discounted prices, The Mirror reported.
Some of the items available are being listed at discounts of over 80 per cent, including an LK Bennett dress for £17 which usually retails for £125.
It comes as high street fashion brands struggle to deal with a backlog of unsold stock, often from past seasons, which has built up while their physical stores remained shut during lockdown.
“Excess inventory and how to handle it appropriately is probably one of, if not the biggest, sustainability challenges clothing brands have to face,” GlobalData’s apparel correspondent Hannah Abdulla said.
“Billions of dollars’ worth of orders were canceled by brands and retailers at the start of the coronavirus pandemic, while consumers cut back on shopping for clothes, leaving brands sitting on stock they couldn’t shift. With sustainability being top of mind for consumers, landfilling or burning unwanted stock is a no-go.
“Many retailers have turned to discounting to flog the excess, but there is concern it is feeding the habit of cheap clothing consumption or throwaway fashion.”
M&S reverses decision to keep stores open on Boxing Day
Marks & Spencer has decided to close stores on Boxing Day, having previously planned to open over 200 stores on the day. The decision came after the government’s announcement this week to temporarily relax restrictions over the Christmas period. M&S will now close all of its owned stores in the UK, as well as its Customer Contact centre and its Distribution Centre in Castle Donnington. This is so that as many colleagues as possible can spend time with family and friends across both December 25 and 26. “Throughout the pandemic, our colleagues have gone above and beyond to deliver for our customers and as we enter the busy festive season they are doubling down on their efforts once again to help our customers deliver the Christmas magic for their families and friends,” M&S chief executive Steve Rowe said. “2020 has been a uniquely challenging year for everyone and this Christmas, the celebrations we have, will be more precious than ever. “That’s why in the run up to Christmas we are opening longer hours and have accelerated the launch of new digital services such as Sparks Book & Shop to help our customers prepare, but it’s also why we have taken the decision to close our operations on Boxing Day, so that our colleagues can enjoy more special time with their loved ones. “This is a big decision, but it is absolutely the right one given the incredible effort everyone has made in the most challenging of circumstances.” Last week, the retailer announced it is operating its longest ever trading hours this Christmas, with around 400 of its owned stores open until midnight from December 21 to 23. This compares to just 15 stores operating until midnight last year. Ahead of Christmas, M&S has put in place a number of new initiatives to help its customers “shop with confidence”. M&S has also asked the government to consider the relaxation of current Sunday trading restrictions in December in an effort to ensure a safe shopping environment as it prepares for Christmas.
Long queues may suppress Christmas demand - can technology help?
Long queues may suppress Christmas demand - can technology help? (retailgazette.co.uk)
Tesco to implement 24-hour opening times in over 300 stores
Tesco has reportedly said it will implement a 24-hour opening time at over 300 of its stores in the run-up to Christmas. The Big 4 grocer will have over 300 of its largest-format stores trade for 24 hours a day from December 14 to Christmas Eve, while the remainder of stores extend opening hours an hour early from 5am until 11pm, Retail Week reported. Tesco previously operated a number of both Superstore and Extra format stores around the clock, but has been reducing opening hours across its estate since 2016. Meanwhile, Morrisons will also be looking to extend hours in the lead-up to Christmas with an announcement on the stores and date set to come. Most recently, Sainsbury’s said it would be extending opening hours from 6am until midnight in “the vast majority” of its stores from December 21 to 23. On Christmas Eve, most Sainsbury’s stores will be open from 6am to 7pm as it made the decision to extend opening hours to give “customers more time to shop safely with us”. Aldi, M&S and Waitrose are all also extending trading hours, while Asda said it is not planning widescale changes to opening hours due to licensing restrictions in certain regions it operates in. Moreover, non-essential retailers such as Primark is looking at extending store opening hours from December 2 to maximise footfall in the three weeks before Christmas.
Boots poaches TSB marketing boss for newly-created CMO role
Boots has reportedly poached TSB chief marketing officer Pete Markey to lead in the same role and accelerate its digital transformation. Markey will join as Boots chief marketing officer in the new year and lead marketing across its UK and Ireland businesses, Marketing Week reported. He will be responsible for the vision, leadership, strategic direction and performance of Boots’ marketing. He will report into Boots owner Walgreens Boots Alliance’s global chief marketing officer Vineet Mehra. The UK chief marketing officer role is new for Boots, which previously had a marketing director position held by Helen Normoyle. Normoyle is stepping down from Boots after three years at the retailer, with her future plans undisclosed. Boots brand and communications director Adam Zavalis is also departing. Mehra said Markey’s “deep understanding of consumer analytics and innovative approach to engaging with customers” will help take the Boots marketing approach to the next level. Prior to TSB, Markey held a number of senior marketing roles mainly in the financial services sector. He was previously brand communications and marketing director at Aviva and chief marketing officer at the Post Office and RSA. He has also held roles at More Than, Onetel and The AA, having started his career at British Gas. At TSB, he was responsible for brand, data, analytics, communications, digital, content and sponsorship. He is also focused on diversity and inclusion and is an executive sponsor for TSB’s inclusion network. He joins Boots at a time when the retailer is trading through the Covid-19 pandemic and deals with the change in shopping habits. The retailer is focused on its digital transformation and creating a single view of its customers across channels, with the aim of improving customer experiences.
Hammerson hires first ever chief operating officer
Hammerson has appointed Grégoire Peureux to the newly created role of chief operating officer. Peureux will join the group executive committee and will focus on the delivery of strategic initiatives at a group level. He has over 17 years of experience in the real estate industry, and joins Hammerson from real estate investment advisor Rove Capital Partners, where he was a founding partner. He had previously worked at Ivanhoe Cambridge for more than 13 years, initially as chief financial officer for Europe, before being promoted to acting head of Europe. “Grégoire’s extensive experience and new perspective will ensure we become more agile and are in the best possible position to respond to this period of extraordinary change and disruption,” Hammerson chief executive Rita-Rose Gagné said. Peureux added: “I am really looking forward to being part of the Hammerson team, getting under the skin of the business and the assets and identifying and leveraging the opportunities we have with the future make-up of the portfolio and the breadth of Hammerson’s proposition.” Gagné joined Hammerson in September from Ivanhoé Cambridge where she oversaw real estate assets across Asia Pacific and Latin America. The former Canadian president of growth markets at the real estate firm had also worked in various property markets across the world, including the UK, France and Germany. Gagné succeeded chief executive David Atkins to take the helm at the embattled owner of the Bullring shopping centre.
15'000 jobs at risk as Sir Philip Green's Arcadia group faces collapse
Arcadia Group is on the verge of becoming the latest Covid pandemic-induced high street causality, with reports suggesting it is about to go into administration – a move that could put 15,000 jobs at risk. According to Sky News, Green’s retail empire is preparing to appoint administrators from Deloitte as early as next week, after talks with a number of lenders about an emergency £30 million loan hit a dead end. While it’s not clear whether a plan has been finalised, an Arcadia Group spokesperson confirmed that it was “working on a number of contingency options” to secure the future of its stable or retail fascias, which includes Topshop, Topman, Dorothy Perkins, Burton, Wallis, Evans and Miss Selfridge. “We are aware of the recent media speculation surrounding the future of Arcadia,” the spokesperson said. “The forced closure of our stores for sustained periods as a result of the Covid-19 pandemic has had a material impact on trading across our businesses. “As a result, the Arcadia boards have been working on a number of contingency options to secure the future of the group’s brands. “The brands continue to trade and our stores will be opening again in England and ROI as soon as the government Covid-19 restrictions are lifted next week.” If an administration is confirmed, Arcadia Group’s assets – including stores and online operations – would be up for grabs. The retail empire employs around 15,000 and operates around 500 standalone stores. Its stores were all shut for three months during the UK-wide lockdown over the spring, and the majority closed again because of the second and four-week lockdown in England – as well as its stores in Ireland which has been in lockdown for six weeks. There is a chance Arcadia Group’s stable of fashion retailers could become online-only, in the same vein as Oasis & Warehouse after it went into administration and was bought out by Boohoo Group. Sky News also said Boohoo Group could be one of the prospective suitors for Green’s retail empire, should it collapse. However, among its creditors, Arcadia Group’s pension scheme is likely to have the biggest claim on proceeds generated by Deloitte. Green himself is also reportedly unlikely to express interest in buying back any of Arcadia Group’s trading operations or retail fascias from administrators. Should an administration be confirmed, it would follow an eventful few years for the business. Arcadia Group announced 500 head office job cuts earlier thus year, and in September the former London headquarter for Burton was put up for sale in a bid to seek fresh funds for the company. In addition, last year the firm launched a CVA which saw it close down several stores – including Topshop sites the US. However, Green was only able to secure that CVA after he pledged a package of assets worth more than £400 million to Arcadia Group’s pension scheme. Should an administration go ahead, some of that funding could be jeopardised. Speculation of another restructure at Arcadia Group has been circulating for months, but earlier this month news emerged that its directors were intensifying preparations for the appointment of administrators – although Arcadia Group said at the time that there was no imminent plan to appoint administrators.
Shopworkers deserve Boxing Day off, urges union
Major retailers are being urged to close their stores on Boxing Day to give workers a decent break this Christmas. The shopworkers’ union Usdaw has written to retail bosses pointing out how hard store staff have been working this year as a result of the coronavirus crisis. The move followed an announcements by Marks & Spencer, Pets at Home and Wickes that they will keep all of their stores closed on Boxing Day this year. “With the country facing a crisis unlike any in our lifetime, retail and distribution workers have stepped up and kept food on all of our tables,” Usdaw general secretary Paddy Lillis said in the letter. “The extraordinary response of essential retailers to the crisis has been rightly praised, and that response is down to the hard work and efforts of shopworkers on the front line. “When others stay safe at home, they go out to work. They have faced increased levels of violence and abuse, as well as huge worries about their health and that of their families.” Lillis said the easing of restrictions on households meeting for a short period over Christmas would be “little comfort” to retail workers, with many feeling under pressure to work on Boxing Day, even where it is supposed to be voluntary. “The only way they will be guaranteed a decent break at Christmas is if food retailers close for Boxing Day,” he said. “For key workers, who have done so much this year, asking for shops to close on Boxing Day, so that they can have some quality time with their families, is really not too much to ask for. 2020 has been a year like no other, so let’s ensure that retail workers get a decent break at Christmas.”