ASOS and Issa brothers emerge as surprise contenders for Topshop
Asos and Zuber and Mohsin Issa, the two brothers set to buy Asda, have emerged as the surprise contenders to acquire Arcadia’s Topshop. The online fashion retailer is thought to be in the running to buy Arcadia’s biggest brand from administrators, according to a report by Sky News. Asos is said to the in ‘pole position’ to buy the brand for more than £250 million, according to Sky News. On Friday Next announced it had pulled out of the race, stating that it was “unable to meet the price expectations of the vendor”, and clearing the way at the time for Authentic Brands, G-III Apparel and Shein to place their final offers. Asos already sells Topshop items on its online-only platform and it’s believed the ecommerce giant is not in talks about buying any Topshop stores. If a bid were successful, it would likely raise concerns over the future of Topshop’s stores and possible redundancies for its thousands of staff. According to insiders speaking to Sky News the pure-play retailer is also thought to be keen to acquire stablemate brands Miss Selfridge as well as Topshop and Topman. A source close to Asos cautioned Sky News on Saturday that a deal had not been struck and that there was no certainty that an agreement would be reached. Elsewhere, the billionaire Issa brothers were also linked to a possible bid for Topshop, according to This Is Money. Zuber and Mohsin Issa have reportedly been holding secret talks to buy the fashion brand for the past fortnight and are believed to have launched a late bid last week. According to This Is Money, the Issa brothers have drawn up plans to put the fashion label into their Asda superstores alongside its George At Asda range. ‘The brothers have big plans for Asda and Topshop would be a great way of attracting in new customers that aren’t natural George shoppers or haven’t been in Asda for a while,’ said one source with knowledge of the auction process cited by This Is Money. Administrators Deloitte have been looking for buyers for some or all of Arcadia, after a slump in sales caused by the Covid-19 pandemic resulted in its collapse. The demise of the empire comes after the collapse of retailers such as Cath Kidston, Oasis and Warehouse and Debenhams. Topshop is considered Arcadia’s flagship brand, and a sale could fetch about £200 million.
Boohoo buys Debenhams brand and website for £55m
However, it will not take on any of the firm's remaining 118 High Street stores or its workforce.
Boohoo said it was a "transformational deal" and a "huge step". But the deal means that up to 12,000 jobs at the department store chain are at risk.
The 242-year-old Debenhams chain is already in the process of closing down, after administrators failed to secure a rescue deal for the business.
A closing-down sale at 124 Debenhams stores began in December, as the administrators continued to seek offers for all or parts of the business.
The company announced recently that six shops would not reopen after lockdown, including its flagship department store on London's Oxford Street.
The administrators of Debenhams UK, FRP Advisory, said they had undertaken a "thorough and robust process" to achieve "the best outcome for Debenhams' stakeholders".
"This transaction will allow a new Debenhams-branded business to emerge under strong new ownership, including an online operation and the opportunity to secure an international franchise network that will operate under licence using the Debenhams name," they added.
Boohoo has already bought a number of High Street brands out of administration. It snapped up Oasis, Coast and Karen Millen, but not the associated stores.
Its executive chairman, Mahmud Kamani, said: "This is a transformational deal for the group, which allows us to capture the fantastic opportunity as ecommerce continues to grow. Our ambition is to create the UK's largest marketplace.
"Our acquisition of the Debenhams brand is strategically significant as it represents a huge step which accelerates our ambition to be a leader, not just in fashion ecommerce, but in new categories including beauty, sport and homeware."
Boohoo said Debenhams was expected to relaunch on Boohoo's web platform in early 2022.
Feelunique delivers sales growth in transformational year
Feelunique has recorded strong sales growth across its retail and marketplace channels during the Christmas period. For the 12-week period to January 3, 2021, Feelunique saw its overall sales grow 39 per cent to £28 million, while active customers over the period rose 41 per cent to 1.3 million. Sales of skincare products boosted the overall company’s growth, with sales up 57 per cent, while sales through Feelunique’s third-party marketplace channel increased tenfold year on year. Feelunique continued to expand in its target international markets during the quarter with US sales increasing by 168 per cent. Gifting items performed particularly well during the quarter, in particular the Feelunique advent calendar which sold 10,000 editions in the lead up to Christmas. “We’re delighted to report a very strong sales performance during the quarter, capping what was a transformational 2020 for Feelunique,” chief executive Sarah Miles said. “We have achieved rapid growth in revenue and new customers over the past 12 months. This progress has been supported by investments in our technology and our focus on expanding the number of brands available through our platform. “As a result of this continued momentum, Feelunique is on track to exceed £100 million in sales and achieve positive EBITDA for its financial year ended March 31, 2021. “Over the Christmas period we continued to achieve great success with our gifting options. Make up sales delivered double-digit sales growth despite the cancellation of Christmas parties and consumers staying home. “For the same reason skincare sales surged, with consumers prioritising self-care during the period. “We have very exciting plans for 2021, which include adding even more brands and exclusive ranges to our platform, driving sales through our growing marketplace channel and expanding further in our target international markets.”
Wayfair investor in talks to buy Notonthehighstreet
A US-based investment firm is reportedly in advanced talks to acquire Notonthehighstreet, in a deal that could reach £150 million. Great Hill Partners, which backs homeware retailer Wayfair and digital travel group Momondo, is close to agreeing a deal to buy the company, Sky News reported. Notonthehighstreet has been up for sale for several months, when it hired bankers at Evercore to explore a transaction. It remains unclear as to whether Great Hill would take full ownership of the business, but is likely to pay around £150 million. Great Hill has backed mid-market companies in the US and Europe, previously raising a $2.5 billion fund in 2019 to invest in businesses showing annual earnings growth of at least 15 per cent. Meanwhile, London-based private equity firm Exponent has also placed a bid on Notonthehighstreet. In its latest annual report for the 2019 financial year, the company said it had served more than 2.5 million customers during the period, but seen total revenues flat compared to the year before at just over £35 million. Its next annual report is due to be published in March. Notonthehighstreet’s current backers include German publisher Hubert Burda Media, which became a shareholder in 2016 as part of a £21 million fundraising. Other investors include Index Ventures and an arm of the asset management giant Fidelity. In October, Notonthehighstreet said it was considering a sale of the business that could potentially see it valued it at more than £200 million. The online retailer was working with Evercore on an auction process, and a number of trade bidders and private equity groups had expressed an interest. Investors were hoping to secure a price as high as £250 million for Notonthehighstreet, but a buyer has still not been confirmed.
200 job cuts as Frasers Group shuts down Jenners store in Edinburgh
Frasers Group has announced that it will permanently shut down the iconic Jenners store in Edinburgh after it failed to reach an agreement with the landlord to continue the tenancy. The closure, slated for May 3, will lead to the loss of 200 jobs. A Frasers Group spokesperson said the decision came about because it was unable to reach an agreement with the owner of the Jenners building, Anders Povlsen, to continue their tenancy. “Despite the global pandemic, numerous lockdowns and the turbulence caused for British retail, the landlord hasn’t been able to work mutually on a fair agreement, therefore, resulting in the loss of 200 jobs and a vacant site for the foreseeable future with no immediate plans,” the Frasers Group spokesperson said. “Our commitment to our Frasers strategy remains but landlords and retailers need to work together in a fair manner, especially when all stores are closed.” Jenners has occupied the same Princes Street location in central Edinburgh for more than 180 years. In 2005, Jenners was sold to the Al-Fayed family, the then-owners of House of Fraser and also former owners of Harrods. Unlike other acquisitions that saw a rebrand and rename, Jenners managed to keep its identity – although it was still considered and traded as a House of Fraser site nonetheless. House of Fraser has been owned by Mike Ashley’s Frasers Group since August 2018, when it was acquired in a pre-pack administration deal. In 2019 speculation arose that Jenners could be forced to leave the Princes Street location after Povlsen unveiled plans to reinvent the heritage building. Povlsen himself is a retail and property tycoon. Alongside being the current owner of international retail chain Bestseller, he has significant stakes in Asos and Zalando and is regarded as the largest individual private landowner in the UK.
Westfield Stratford City opens major COVID-19 vaccination centre
Westfield’s Stratford City shopping centre has been transformed into a COVID-19 vaccination centre aiming to provide thousands of shots every day.
Westfield’s east London shopping hub opened six vaccination pods, an assessment area, a pharmacy area and a sluice area on Monday, which is now open to the public from 8am to 8pm every day.
The new site, which can reportedly expand rapidly to meet demand, was set up by the East London NHS Foundation Trust.
“It has been a mammoth project to get the Westfield COVID Vaccination Centre up and running in a matter of weeks but staff have come together to make it a success,” the trust’s chief medical officer Dr Paul Gilluley said.
“Everyone is proud to have been able to play their part in providing a central point for the public to get the Covid vaccine. It is another step along the way to protecting people from the virus and helping our local communities to get back on their feet.”
The site is one of hundreds springing up across the country and is currently only administering the vaccine to priority patients who have be contacted by the government.
Many retailers have come to the aid of the NHS to help roll out and administer the vaccine, offering everything from their logistics networks to their empty stores.
High street pharmacies including Boots, Superdrug and four others, which have been picked for their ability to deliver large volumes of the vaccine and allow social distancing, began administering the vaccine last week.
By the end of the month, it’s expected that more than 200 high street pharmacies with capacity for 1000 doses a week will be able to give vaccines, according to NHS England.
Tesco has offered the use of its considerable logistics network to help distribute the vaccine, while Morrisons has offered to transform its carparks into drive-through vaccination centres.
Earlier this month, Bensons for Beds also announced it was offering its store estate, which is closed amid the national lockdown, to act as make-shift vaccination centres.
Waitrose unveils latest rollout plans for refillables scheme
Waitrose has revealed the latest plans for its refillables scheme by becoming the first national supermarket to integrate unpacked items into its regular aisles. The news comes after the grocery chain topped the Environmental Investigation Agency (EIA) and Greenpeace table of UK supermarkets for efforts to reduce plastics across its shops and products for the second year in a row. The report said Waitrose had a plastic reduction of 6.1 per cent since 2017 across both its own-brand and branded ranges – the lowest plastic use per unit market share of the UK’s major supermarkets. The EIA and Greenpeace report also highlighted Waitrose’s refillable scheme, Waitrose Unpacked, which launched as a pilot in some of its shops in 2019 to test demand from consumers for packaging-free shopping. Waitrose confirmed today that it would take the scheme one step further by becoming the first national supermarket to integrate unpacked items into its regular aisles within its shop in Wallingford, Oxfordshire, rather than having a single unpacked fixture. Following the addition of 13 Unpacked options in December, the store will offer 51 lines, including frozen fruit, store cupboard essentials such as rice, pasta and grains, cereals, dried fruit, snacking and coffee, as well as washing detergent. Waitrose said the trial aims to understand whether customers could be persuaded to incorporate shopping for unpacked items into their routine “business as usual” shopping trips, rather than visiting a separate part of the shop. The grocer also confirmed plans to add more refillable products to the range later this year and its ambition to explore the potential to scale-up Unpacked in the future. When Unpacked launched in Waitrose Botley Road shop in Oxford in summer 2019 it was originally intended to be an 11 week test. However, since its success it has continued beyond that time frame and was added to a further three shops, including Wallingford, Abingdon and Cheltenham. Waitrose said customers were “overwhelmingly supportive” of its packing-free, refillable initiative and that nearly all single-use packaging was eliminated across Unpacked products. The retailer said that in the initial 11 weeks at Botley Road, it found that 98 per cent of single-use packaging was eliminated across Unpacked products and that all plastic packaging was reduced by 83 per cent. Waitrose also found that 80 per cent of customers said they would shop Unpacked again and that as the test went on, an increasing number customers were remembering to bring their own containers. Feedback suggested customers wanted to see a broader range of Unpacked products, including more brands, and that Unpacked also helped them do their bit for the environment and feel better about their purchases. “We are pleased that Greenpeace’s league table has recognised our efforts to decrease our plastic packaging and pioneer unpacked shopping, but we know there’s more to do,” Waitrose executive director James Bailey said. “We know this remains as important to our customers as it does to us so we have continued to explore ways we can do more. “Waitrose Unpacked requires a fundamental change in shopping behaviour that has been ingrained for years. “This next phase will help us to understand if we can make refillables a routine part of customers’ shopping trips that would allow us to roll out Unpacked further in the future.”
More high street staples likely to become online ghost brands experts warn
The UK’s biggest high street retailers are at risk of becoming online “ghost” brands experts have warned, following one of the hardest days for the high street in recent memory.
Yesterday online fast fashion giant Boohoo agreed to acquire Debenhams in a £55 million deal which would see its entire store estate close, but the brand continue to trade as an online-only entity.
Arcadia’s host of stores including Topshop, Topman and Miss Selfridge look likely to succumb to the same fate as Asos confirmed it was in talks to acquire the stable of brands.
These once prominent high street staples join the increasingly long list of retailers including Oasis and Warehouse, TM Lewin and Hawkins Bazaar which all shuttered their physical estates to trade solely online over the last year.
“As more high street brands succumb to an online-only existence, is anything left that captures their original spirit?” ParcelHero’s head of consumer research David Jinks said.
“The recent fate of several of these retail ghosts does not bode well for the latest crop that have switched to online only.”
Jinks points out that two high street titans Woolworths and BHS failed to survive online following efforts to keep the brands alive as their offerings simply did not translate to ecommerce.
Despite this, retail expert Dr Gordon Fletcher of the University of Salford Business School argued that these deals demonstrate brands are still very important to customers even if they are no longer represented on the high street.
“As the online fashion retailers begin to buy up the pieces of Debenhams and circle the failed Arcadia group’s iconic brands a very clear message is being broadcast,” Dr Fletcher said.
“Brands are still important. Brands have credibility and reputation.
“Consumers have strong emotional connections with brands. However, the importance of the bricks and mortar traditionally associated with retail brands has now fully waned.
“This is not a new realisation that has only been discovered during the pandemic. However, the current lockdown situation has forced us to cut the final ties between our favourite brands and the physical high street.
“Bricks and mortar are important but after the lockdown the brands that we will see will be very different. These will be the brands that bring peak experience and engagement – maximising the value of face-to-face contact – and they will not be fashion retailers.”
Landlords to pay up to £1bn in business rates on empty shops
Landlords may be forced to pay nearly £1 billion in business rates for empty shops during the Covid-19 pandemic. The collapse of both Debenhams and Arcadia group could see 14 million sq ft of retail space become vacant, according to research from real estate adviser Altus Group. Landlords may have to stump up a further £141 million annually in empty rates, after a short exemption period, if new tenants cannot be found. Department store chain Debenhams is set to shut down all of its stores permanently as part of the liquidation process, and the recent deal with Boohoo, which will see it relaunch online. Meanwhile, Arcadia Group is being eyed by fellow online retailer Asos, which also plans to take the brand online. However, Retail Week reported on Tuesday that Asos is interested in saving the Topshop flagship store in London if its exclusive talks to buy Arcadia Group brands out of administration succeeds. Through the business rates system, the government has provided financial support to businesses affected by the pandemic with £10.13 billion in business rates relief for retail, leisure and hospitality sectors in England – which is due to expire on March 31. However, these measures have not extended to those properties which are vacant and to let. Landlords have had to pay £924 million this current financial year in empty rates on their vacant retail properties. Those with empty properties are having to face the impact of the rent moratorium, measures which the UK Government put in place to prevent struggling companies from eviction. Meanwhile, the Centre for Retail Research said that around 358 retail stores each and every week will close in 2021 forecasting that a further 18,620 will close this year – an increase of 18.2 per cent on the 2020 calendar year.
Topshop flagship could be saved is ASOS - Arcadia deal succeeds
Asos is reportedly interested in saving the Topshop flagship store in London if its exclusive talks to buy Arcadia Group brands out of administration succeeds. According to Retail Week, Asos is considering whether the famous flagship on 214 Oxford Street could continue to be part of the business and is seeking to have a discussion with the building’s owners. However, it’s thought that even if Asos goes ahead to buy Arcadia out of administration and retains the Topshop flagship, the rest of Arcadia’s store estate would probably not be saved. The Topshop flagship is not part of the Arcadia assets being overseen by administrator Deloitte. It is controlled by a subsidiary, Redcastle Ltd, to which KPMG is the administrator and real estate agents Eastdil and Savills were recently appointed oversee the sale of the site. Arcadia’s pension fund is reportedly entitled to part of the proceeds from a sale of the flagship. The news comes after Asos confirmed yesterday that it was exclusive talks with administrators to buy Sir Philip Green’s retail empire. The online retailer said the ongoing discussions were about snapping up Arcadia’s brands including Topshop, Topman, Miss Selfridge and HIIT, sold via Burtons. Other retailers including Boohoo, Mike Ashley’s Frasers Group, and JD Sports in partnership with US retail giant Authentic Brands, and Asda billionaire owners the Issa brothers were also said to have been considering acquiring some or all of Arcadia’s stores. Next had also expressed interest but walked away from talks just before the weekend.
Hawes & Curtis listens to customers by launching loungewear as Brits stay home
Hawes & Curtis has launched a loungewear collection for the first time in response to consumer demand during the Covid-19 pandemic. The retailer, which is recognised for its formalwear, said customers are now more likely to purchase casual apparel, given that many are working from home due to restrictions. The collection, which launched earlier this week, includes hooded sweatshirts, crewneck sweatshirts, sweatpants and T-shirts. “During this difficult time, we listened to our customers. We know how important it is to be adaptable and to understand the changing needs of our customers,” Hawes & Curtis chief executive and owner Touker Suleyman said.“Made from environmentally-friendly organic cotton, our loungewear collection offers great design, great quality and great value.” The millionaire owner and Dragon’s Den star said in late 2017 that Hawes & Curtis was set to close its London stores in High Street Kensington and Oxford Street.Despite margins being battered by rising rent and business rates prices, Hawes & Curtis opened a store on London’s Tottenham Court Road in the same year. Hawes & Curtis currently has 25 stores in the UK – all of which remain shut due to lockdown – and one store in Germany.
Knomo snapped up by marketnig agency inc & co
Marketing agency Inc & Co has acquired accessories retailer Knomo after announcing the launch of a new division Inc Retail Group. Inc & Co said it is on track with its growth and development plans with the launch of a new division that will see the Manchester-founded business collective expand into the retail arena for the first time. The business said Knomo will be “instrumental in developing the retail operation arm”. “As part of our three-year growth and development plan, we are proud to be continuing to diversify our operations, and we’re incredibly excited to be moving into the world of retail,” Inc & Co chief executive Jack Mason said. “Acquiring Knomo was a natural move for us, with the brand’s exquisite range of backpacks, briefcases, and laptop bags already well-loved across the UK, making it the perfect brand to blend into the Inc Retail offering.”
Arcadia collapsed under debts of £750m
New documents prepared for Arcadia Group administrators Deloitte have reportedly found that Topshop and Topman have failed with gross liabilities of more than £550 million. Sir Philip Green’s retail empire fell into administration under the weight of debts totalling £750 million, The Telegraph reported. Reports prepared by Deloitte at the end of November have revealed the financial state of the retail group. Topshop and Topman failed with gross liabilities of more than £550 million, while Arcadia’s discount brand Outfit owed £80 million, according to the filings. However, the documents were unclear as to whether the weight of debts would affect the 9000 members of its pension scheme. A detailed listing “does not capture” unsecured amounts owed to the Arcadia retirement fund and unpaid VAT due to HMRC. It also excludes “a number of intercompany creditors, amounts due under guarantees crystallised by the insolvency” – believed to include amounts owed to companies owned by Green. Deloitte said it would update creditors, including landlords and suppliers, as it found information, but warned the total amount was expected to be “materially higher” than its current figures. Creditors to Topshop and Topman are currently £82.2 million out of pocket, with overseas suppliers and property owners hit the hardest. At least 22 firms are owed between £1 million to £3 million each, including Savills and the owner of Westfield White City. Green paid his wife Lady Tina Green a £1.2 billion dividend in 2005, three years after buying Arcadia for £850 million. Lady Green was the ultimate owner of the business pre-administration. Moreover, online retailer Asos confirmed on Monday it was in exclusive talks to buy the Topshop, Topman, Miss Selfridge and HIIT brands, but has no plans to acquire the stores. Asos does not have a high street presence, prompting speculation that any deal is unlikely to include saving Arcadia’s vast store estate, leaving the brands trading online only. In addition, Asos already sells Topshop items on its ecommerce platform. Administrators have already begun winding down the stores, with more branches expected to shutter by the end of the month.
GameStop stock jumps 92% overnight
GameStop has seen its share prices nearly double overnight after it became the focal point of a battle between Wall Street and smaller independent investors.
GameStop’s stocks shot up over 92 per cent from $76.74 to $147.98 throughout Tuesday as thanks to an army of small day traders who congregate on Reddit.
The Redditors sought to drive up the stock price of GameSpot in hopes of ruining Wall Street bets against the retailer, which recently reported plans to close 450 of its stores after a difficult year.
Prominent short-seller Citron Research announced last week that it had shorted GameStop stock, stating that the company was “pretty much in terminal decline”.
This sparked the David and Goliath battle, with one Reddit user stating in an open letter to CNBC: “We don’t have billionaires to bail us out when we mess up our portfolio risk and a position goes against us.
“We can’t go on TV and make attempts to manipulate millions to take our side of the trade. If we mess up as bad as they (Citron Research) did, we’re wiped out, we have to start from scratch…”
They added “I sincerely hope they suffer. We want to see the loss porn”.
Around $4.66 billion worth of GameStop stock, representing around 71.66 million shares, is currently shorted.
These bets have now cost Wall Street a total of $6.12 billion, including $2.79 billion on Monday.
In response, Citron Research’s Andrew Left told Reuters: “If I had never been involved in GameStop and came to this right now, would I still short this stock? 100 per cent,”
“This is an old school, failing mall-based video retailer and investors can’t change the perception of that.”
Lidl crowned supermarket of the year
Lidl GB has been named Supermarket of the Year at the 2020 Retail Industry Awards, beating like of Iceland, Sainsbury’s, Tesco and main rival Aldi. Judges praised Lidl’s continued drive to provide affordable fresh produce to families across the Britain and encouraging children to eat healthy food, while also championing its networks of suppliers. In addition to the most coveted award, Lidl GB also won Most Sustainable Retailer for the second year running, Fresh Produce Retailer of the Year for the third year in a row, and Fresh Flower retailer of the Year for the fourth consecutive year. “To be named Supermarket of the Year for 2020 on top of our four other wins is an incredible achievement, and one we’re very proud of in this a year like no other,” Lidl GB chief executive Christian Härtnagel said. “It wouldn’t have been possible without our incredible colleagues who have done a phenomenal job over the past 12 months and truly are the backbone of our business. “I would also like to take this opportunity to thank our customers for choosing to do their shop with us. “Since opening our first stores over 25 years ago, we’ve been passionate about providing fresh, high quality products at the lowest prices on the market. “This is more important now than ever before, with events of the past year leading to tightening of household budgets. “As we continue into 2021 we hope to welcome even more customers across the country through our doors.”
Tesco & Deliveroo customers' data found for sale on the dark web
Tesco and Deliveroo customers’ stolen details have been found for sale on the dark web for less than 50p an account.
According to a new study conducted by consumer watchdog Which? and security specialists Red Maple Technologies, huge databases of customer data are available to purchase for just a few pounds.
One seller claimed to have hundreds of thousands of Tesco Clubcard holders accounts for sale, including their accounts, usernames, passwords and loyalty card balances.
While the seller’s claims could not be verified, they were offering the details in tranches of 2000, which would value each person’s details at just 42p.
The research also uncovered Deliveroo customer accounts advertised for sale for just £4.30.
This information could be used to access the customers accounts, or clone their identities and passwords on online platforms.
“The ICO must be prepared to issue heavy fines against companies that leave customers’ personal data exposed to cybercriminals and breach data protection law, so that they are incentivised to prevent breaches,” Which? computing editor Kate Bevan said.
“Which? is also calling for consumers to have an easier route to redress when they suffer from data breaches. The government must allow for an opt-out collective redress regime which would mean that affected victims would be automatically included in the action and be represented by a body bringing the claim on behalf of those affected.”
Tesco responded to the report stating: “Over the past year we’ve introduced additional measures to better protect customer accounts, after we became aware of some fraudulent activity around the redemption of a small proportion of our customers’ Clubcard vouchers in March last year.
“Our priority is protecting our customers and we have strict security measures in place, and at no point was any customer’s financial data accessed.”
A Deliveroo spokesperson added: “We have strict and robust anti-fraud measures in place to combat fraudsters and to track patterns of criminal activity and to block fraudsters.
“We also partner with anti-fraud companies to address misuse of card information and we regularly remind customers to use new, strong, unique passwords to protect their Deliveroo accounts.”
Lidl swings to £25.2m annual loss
Lidl has revealed hefty losses for its UK business after investing heavily in stores and expanding its workforce. The German-owned discounter said it slumped to a £25.2 million pre-tax loss for the year to February 29 2020, just before the pandemic struck. It reported profits of £19 million the previous year, but said this was not a like-for-like comparison given an administrative reorganisation last March which saw previously separate divisions of Lidl UK combined into one business. The losses came after Lidl spent £654 million adding another 51 stores and a new warehouse in Motherwell, Scotland, while it also increased its UK workforce by eight per cent to 23,249 as it hired nearly another 1800 employees. Since then, the group has continued its hiring spree to beef up its operations in the face of surging demand during the coronavirus crisis, taking on another 8000 employees. It also opened more than a further 50 new stores in the past year as it targets a network of 1000 by 2023 under a £1.3 million investment programme. Lidl now has more than 800 stores and 13 distribution centres across the UK and is on track to open a new £70 million headquarters in Tolworth, Surrey, by the end of the year. “Whilst the world has changed considerably since this financial period (full year 2019-20), our driving focus remains on offering customers the best quality products at the lowest prices in the market,” Lidl GB chief executive Christian Hartnagel said. “We will continue to focus on providing customers up and down the country with this, as we grow our store estate, logistics and operations. “We are confident in our strategy and see huge potential in the market long-term and will continue to hire more colleagues, invest in British suppliers, open more stores and become an integral part of more communities.” Lidl recently posted a record 17.9 per cent surge in total sales year-on-year over the four weeks to December 27. Supermarkets have reported soaring sales in recent months as repeated lockdowns have forced the closure of non-essential stores, pubs and restaurants while food retailers have been allowed to remain open. Lidl revealed plans earlier this week to pay more than 25,000 UK staff a bonus for their hard work amid the pandemic, while it has also pledged to repay more than £100 million in business rates relief. The grocery chain, part of Europe’s largest retailer Schwarz Group, said in November that it would increase staff entry-level wages from March to £9.50 an hour outside the M25 and £10.85 within the M25.
John Lewis Partnership to confirm 1500 head office job cuts this week
John Lewis Partnership is expected to confirm 1500 job cuts as soon as this week in an effort to save costs. The parent company of John Lewis department stores and Waitrose supermarkets is due to formally announce the redundancies after completing a consultation process with staff. The process was first announced in early November, when the Partnership revealed the latest phase in its five-year turnaround scheme. John Lewis Partnership is said to have contacted individual workers on Wednesday to tell them if they are risk of redundancy, as it seeks to save £50 million as part of a wider £300 million cost-saving target. The job cuts will affect staff at its head office sites in Victoria, London, and Bracknell, Berkshire. The retailer said the “difficult but necessary” changes will support it in delivering its five-year Partnership Plan. John Lewis Partnership added that the company will seek to redeploy workers affected by the cuts and will provide redundancy support and funding for retraining for those staff unable to be offered new roles within the group. Those cuts come on top of plans to close eight John Lewis stores with the loss of 1300 jobs and the further closure of four Waitrose stores, affecting 124 staff. The redundancies are due to take place despite John Lewis Partnership’s Black Friday and Christmas sales holding up “better than anticipated”. The company said on Friday it now expected its profits to be ahead of guidance provided in September when it forecast a small loss or a small profit for the 2020/21 period. The group also said it had decided to repay a Covid-19 loan of £300 million to the government two months early as it believes it has sufficient liquidity for the future.
Screwfix hits £2bn annual sales milestones
Screwfix has hit the £2 billion milestone in annual sales for the first time – 15 years after it opened its first shop and despite the pandemic wreaking havoc on the high street. The milestone was achieved for the year to January 2021, during which Screwfix also opened 30 new stores – taking its total number of stores across the UK and Ireland to 725. The news comes after the fourth quarter trading update of parent company Kingfisher, published earlier this month, included a forecast that Screwfix would hit £2 billion in sales for the financial year. Screwfix has enjoyed the benefits of being classed as an “essential” retailer in the UK, meaning it has been able to keep its shops open throughout the pandemic, even during lockdowns. The retailer has also reaped the rewards of people undertaking home renovations due to prolonged stay-at-home orders. Screwfix said its new stores have brought the business closer to its tradespeople, “many of whom have played a crucial role in keeping homes warm, safe and with power throughout these difficult times”. The retailer added that its growth has led to a significant recruitment drive, including over 1000 new staff aged under 24. Screwfix said the overall growth brings the number of new jobs created in the past five years to 4000, during which time it has opened, on average, a new store every week and doubled annual sales from £1 billion to £2 billion. In addition to recruitment, Screwfix more than 800 staff have been promoted internally, including many who have completed apprenticeships this year. Meanwhile, the Screwfix Foundation raised £2 million during the financial year, supporting over 400 charities and not-for-profit organisations to help fix, repair, maintain and improve their facilities for people in need across the UK. “I’m incredibly proud of what our colleagues have achieved this year,” Screwfix chief executive John Mewett said. “We have continued to keep our customers supplied safely whilst creating opportunities for our colleagues. “We have also been able to give back to our communities when they have needed support the most. “I’d like to thank all of our colleagues and customers for their incredible support during what has been an extremely challenging year.”