2/3 of retailers face legal action in July over £2.9bn in unpaid rents
Two-thirds of retailers face legal action once the rent moratorium ends in July, as the sector sits on £2.9 billion worth of unpaid rents, new research has shown. At the end of June, the moratorium on aggressive debt collection from commercial landlords will end, which the BRC said would open up thousands of retailers to legal action. With non-essential retailers closed due to lockdowns for eight of the last 15 months, many have accrued huge debts that they are only just beginning to be able to pay. According to the BRC, total rent debt is estimated to be £2.9 billion due to the Covid-19 pandemic. The most recent BRC-Local Data Company Vacancy Monitor for the first quarter of the year showed that one in seven shops currently lie empty, and this number is expected to rise. A new survey by the BRC shows that two-thirds of retailers have been told by landlords that they would be subject to legal measures from July, once the moratorium on aggressive debt enforcement ends. Almost one third (30 per cent) of retailers said they have already faced County Court Judgements (CCJs) from commercial landlords. Furthermore, 80 perm cent of retailers said some landlords have given them less than a year to pay back rent arrears accrued during the pandemic. The government introduced a Code of Practice last year to address the outstanding debt issues, but the BRC said that two thirds of retailers surveyed described the Code as “ineffective” due to its voluntary nature. The retail lobby group urged the government to give the code greater weight and take other measures to support tenants and landlords. To resolve the rent debt in “a fair and equitable manner”, the BRC suggested that the government ringfence the rent arrears built up during the pandemic and extend the moratorium on repayment of these debts to the end of the year. It also suggested to extend the protections on these debts to include CCCJs, and to introduce compulsory arbitration from January 1 next year using the Code of Practice to give teeth to this “otherwise weak process”. The BRC said that without action, and where agreement between landlords and retailers cannot be reached by July 1, thousands of shops will be at risk of shutting down. “Many retailers have taken a battering over the pandemic, but they are now getting back on their feet and playing their part in reinvigorating the economy,” BRC chief executive Helen Dickinson said. “The unpaid rents accrued during the pandemic, when most shops were shut, are a £2.9 billion ball and chain that hold back growth and investment and could result in a tsunami of closures. “Government must ringfence the rent debts built up during the pandemic, giving retailers breathing space as they wait for footfall and cash flows to return. “With this in place, all parties can work on a sustainable long-term solution, one that shares the pain wrought by the pandemic more equally between landlords and tenants. “Without action, it will be our city centres, our high streets and our shopping centres that suffer the consequences, holding back the wider economic recovery.”
Klarna suffers severe bug logging users into random shoppers accounts
Klarna was forced to shut down its app yesterday after a severe technical issue enabled users to log into other customers’ accounts and access their personal information.
The ‘buy now, pay later’ giant was hit by major technical troubles yesterday, seeing users who tried to log in be signed in to other members’ accounts seemingly at random, allowing them to edit details and access personal information.
This is understood to have included postal addresses, purchases, payment methods and even partial bank details.
Klarna has denied that any “card or bank details” were disclosed to users during the technical issues, but a number of customers took to social media to refute this.
The Swedish payments giant, which has been fighting hard to rebuild its public image amid a growing disquiet about its services, was forced to shut down the app completely.
For a number of hours yesterday, anyone who tried to log into the app was presented with a message stating “Sorry, the Klarna app is currently down for maintenance”.
In a statement issued by Klarna, it sought to assure customers this was not due to an attack from outside sources, but rather was a self-inflicted error which took place after a system update.
“Trust is at the very core of Klarna and banking,” it said in a statement.
“This is why we are sad and frustrated to inform you of a self-inflicted incident, that for 31 min affected not more than 9,500 of our app users. The bug led to random user data being exposed to the wrong user when accessing our user interfaces.
“It is important to note that the access to data has been entirely random and not showing any data containing card or bank details (obfuscated data was visible). Even though GDPR would classify the information visible as “non-sensitive”, for Klarna all data is important. We are taking this incident very seriously and we will work tirelessly to regain the affected consumers’ trust.”
Klarna later reduced this figure to 9500 of its users.
Wickes sales boom after Brits embrace DIY during lockdown
Wickes has recorded a sales increase for the six months to May 22, as Brits turned to DIY and home renovations during lockdown restrictions. The DIY retailer reported a like-for-like growth of 46 per cent on the same period in 2020. It is now expecting its full year adjusted pre-tax profit to come in at the top end of analysts’ expectations. The retailer said total like-for-like sales climbed by 45.7 per cent year-on-year during the period and by 23.1 per cent on a two-year basis against the equivalent period in 2019. Within its core sales categories, like-for-like sales were ahead by 53.1 per cent year-on-year and by 46.2 per cent on a two-year basis. Following the reopening of its Do It For Me showrooms on April 12, the retailer has been encouraged by its kitchen and bathroom leads, which it expects to deliver strong like-for-like sales growth in the second half of the year. Wickes now expects its half year adjusted pre-tax profit to come in at around £45 million and that its full year adjusted pre-tax profit will be within the top half of the range of analyst expectations, which is currently £55 million to £74 million. “At Wickes, we are here to help the nation feel house proud, and I am delighted with how the entire business has responded to the continued strong demand for our products and services,” Wickes chief executive David Wood said. “Availability constraints and inflationary pressures across some raw materials have been well-flagged, but we have strong supplier relationships and are working closely with them to ensure we continue to provide customers with the products they need at the best possible value.”
Deliveroo snubbed by investors 2 months after worst IPO in London's history
Deliveroo has failed to recover from its disastrous initial public offering (IPO) as investors continue to snub its shares over governance and labour concerns.
According to new data from Morningstar, just four out of 18,000 mutual funds on the continent have invested in Deliveroo since it went public in March, and only one in the UK.
This is reflected in Deliveroo’s share price, which nosedived 26 per cent in its first day of trading leading analysts to dub it the “worst IPO in London’s history”.
Since its highly anticipated public listing, its shares are still trading at around 251p per share, well below its listing price of 390p.
Despite emerging as a clear winner of the pandemic, investors have avoided Deliveroo’s stock over concerns that its gig-economy model could soon be shunned by the industry at large, as big players like Uber begin offering their drivers worker’s rights.
While just four mutual funds in the EU invested in the delivery giant, including two Europe domiciled funds from Morgan Stanley and Franklin Templeton, the vast majority of investors come from North America.
Independent economic charity Friends Provident Foundation’s investment engagement manager, Colin Baines, told the Financial Times that the pandemic has driven a rise in conscientious investing, placing a focus on workers rights and social issues.
He said: “Having Deliveroo in portfolios is a sure-fire way to flag to clients that perhaps they’re not integrating social issues (into investment decisions) that well.”
In March a damning report from the Bureau of Investigative Journalism, which analysed thousands of invoices from couriers across the UK, revealed that one in three Deliveroo riders made less than £8.72 an hour, the national minimum wage for workers over 25.
Just weeks earlier gig-economy pioneer Uber announced it would now consider all of its 70,000 UK drivers ‘workers’, allowing them increased rights and pay.
Deliveroo, which has so far never turned a profit, has previously said its model would struggle to function if it was required to class its riders as workers.
This frightened investors who predict its only a matter of time before similar legal challenges over workers rights are brought to Deliveroo.
Waitrose Unpacked scheme expands to includes more products
Waitrose has taken more food items out of packaging, including loose tea for the first time, after demand at its Unpacked refillables scheme grew significantly over the past six months. The grocery chain said sales of refillables at its four Unpacked shops have grown by nearly nine per cent in the past six months, with a number of products proving particularly popular with shoppers. Sales of refillable frozen fruit and vegetables for the same period have increased by more than 50 per cent, detergent and washing-up liquid sales have grown by 24 per cent and pulses, pasta and grains have risen by almost eight per cent. The retailer said the Waitrose Unpacked concept has helped save hundreds of tonnes of unnecessary plastic and packaging since it was launched in summer 2019. In January, Waitrose became the first national supermarket to integrate unpacked items into its regular aisles within its shop in Wallingford, Oxfordshire, rather than having a single unpacked area. The test aims to understand whether customers would be more likely to shop “unpacked” by incorporating it into their normal routine shopping trips, rather than visiting a separate part of the shop. The move has helped sales of refillables at the shop increase by more than 20 per cent in the 10 weeks of the test to date. The grocer today confirmed that 13 new products will be taken out of their packaging for the refillables concept, building on those it added at the end of 2020 and with more to be added later this year. The new food items now available in refillables include five different varieties of loose tea, dried apricots, dried fruit mix, raisins, sultanas, currants, and popcorn. Later this month, frozen peas and frozen sweetcorn will sit alongside the selection of frozen fruit and vegetables already on offer. “We are really beginning to find some momentum with customers demonstrating that this is how they might be prepared to shop with us in the future and we are especially encouraged by the response to moving the concept in-aisle to make it more of the norm when visiting us,” Waitrose sustainability director Marija Rompani said. “We know there is much more work to do, but the reaction of customers right now is giving us the confidence to continue moving forward with Unpacked.” Waitrose Unpacked first launched in Waitrose Botley Road shop in Oxford in summer 2019 and was originally intended to be an 11-week test. However, following its success it has continued there and was added to a further three shops; Wallingford, Abingdon and Cheltenham. The selection of refillable products available to customers, includes frozen fruit and vegetables, store cupboard essentials such as rice, pasta and grains, cereals, dried fruit, snacking and coffee, as well as washing-up liquid and detergent.
Amazon will overtake Tesco to become the UK's largest retailer by 2025
Amazon is set to overtake supermarket giant Tesco to become the UK’s largest retailer in the next four years.
According to new research from Edge Retail Insight, Amazon’s gross sales are forecast to top £77 billion by 2025, outpacing the UK’s current largest retailer Tesco’s predicted £76.1 billion.
This would represent a dramatic rate of growth for the online giant, seeing total retail sales increase from £36.3 billion in 2020 compared to Tesco’s £64 billion.
In the five years to 2025 Amazon is expected to see a compound annual growth rate (CAGR) of 16.3 per cent, compared to Tesco’s 3.5 per cent, driven by a rapid rise in grocery sales.
While Amazon currently represents a relatively meagre portion of the UK’s edible grocery sales despite seeing 17.6 per cent growth last year, it is predicted to overtake Shell, McColls, BP and Wilko by 2025 to become the UK’s 15th largest seller of edible products.
The data report also predicts that a third of all UK chain retail sales will occur online by 2025, up from 26 per cent in 2020, helping ecommerce sales significantly outperform their physical counterpart.
Ecommerce sales are predicted to account for more than 57.4 per cent of added sales over the five-year period, which will see the UK retail market grow by £123.6 billion to hit £500 billion.
“Our data shows that ecommerce is expected to grow in the UK over the next few years, and this will be driven by digital marketplace giants like Amazon, and omnichannel marketplace giants like Tesco,” Edge by Ascential’s chief executive Deren Baker said.
“Over the past year, Amazon has grown its online retail footprint in the UK and expanded into the high street, with the launch of three Amazon Fresh shops in London and a high-tech hair salon, where it can trial technology and product innovation and increase brand presence in the fast-growing beauty sector.
“This is next-generation retail – Retail 5.0 – marketplaces mastering personalisation at scale. Consumer packaged goods (CPG) brands must focus investment on winning market share through the online platforms most relevant to them.”
Etsy has acquired Depop for $1.6bn in major bid to tap Gen Z market
Etsy is set to buy Depop in a deal worth $1.6 billion marking its largest acquisition to date as it seeks to attract ‘Gen Z’ shoppers.
Etsy, which purchased online musical instrument marketplace Reverb for $275 million in 2019, said it expects to finalise the acquisition in the third quarter of this year should it receive regulatory approval in the US and UK, where Depop is based.
Depop has seen staggering growth since its foundation in 2011, emerging as one of the pandemic’s few success stories last year enjoying over 100 per cent growth in both gross merchandise sales and revenues topping $650 million and $70 million respectively.
The platform, which specialises in unique second-hand fashion, is the 10th most visited shopping site among Gen Z consumers, and around 90 per cent of its active users are under 26.
Aside from fitting comfortably within Etsy’s roster of specialist online marketplaces, it will also give the group a significant foothold in both the increasingly prevalent fashion retail market and with younger shoppers.
In the US the second-hand market is expected to see compound annual growth rates of 39 per cent between 2019 and 2024, set to be worth a whopping $64 billion by then growing to twice the size of fast-fashion on a global basis.
“Depop is a vibrant, two-sided marketplace with a passionate community, a highly-differentiated offering of unique items, and we believe significant potential to further scale,” Etsy’s chief executive Josh Silverman said.
“Depop’s world-class management team and employees have done a fantastic job nurturing this community and driving organic, authentic growth in a way that aligns well with Etsy’s DNA and mission of Keeping Commerce Human. We see significant opportunities for shared expertise and growth synergies across what will now be a tremendous ‘house of brands’ portfolio of individually distinct, and very special, ecommerce brands.”
Depop’s chief executive Maria Raga added: “We’re on an incredible journey building Depop into a place where the next generation comes to explore unique fashion and be part of a community that’s changing the way we shop.
“Our community is made up of people who are creating a new fashion system by establishing new trends and making new from old. They come to Depop for the clothes, but stay for the culture. We’ll now take an exciting leap forward as part of the Etsy family, benefiting from Josh’s and his team’s expertise, and the resources of a much larger company whose values are so aligned with ours here at Depop.”
Holland & Barrett launches on Chinese platform Tmall
The health and wellness retailer Holland & Barrett has announced it will be launching a flagship store on the Chinese ecommerce site Tmall as part of its global expansion plan. The retailer has already launched more than 40 of its most popular items on the site, including collagen and fish oils. To support marketing of the new store, Holland & Barrett has also launched three new social channels across the platforms Weibo, WeChat and RED. Holland & Barrett head of international business development Tom Pamment said: “We have been really encouraged by the initial performance and we’re excited by the potential for Holland & Barrett to become a destination for local Chinese customers who are seeking a trusted, high quality health and wellness brand with strong provenance, exciting innovation and offering great value.” The wellness retailer has already formed longstanding partnerships in South Korea, Singapore and Hong Kong where it takes part in popular sales promotions, including Chinese New Year and Singles’ Day. Holland & Barrett international marketing manager Katie Holloway said: “A key part of our launch plan was to increase our partnerships with influencers and key opinion leaders, who are incredibly important in this market.” “We are working with popular Chinese influencers on everything from posts to live stream events to bring to life how Holland & Barrett can help to navigate the world of wellness. This approach is helping us build trust and brand awareness with our Chinese customers.”
JD Sports becomes Love Islands official activewear brand
JD Sports has announced that it has become the official activewear brand for the seventh series of Love Island, in its biggest brand partnership of the year. The sports and fashion retailer will take over the villa and provide all the activewear for this year’s show. JD Sports has released a bespoke teaser video featuring ex Islanders Joanna Chimonides, Molly Smith, Michael Griffiths and Jack Fowler. As part of the partnership, JD Sports will own the exclusive Love Island TikTok hashtag challenge while gamified interactive content will run on a dedicated Snapchat portal as well as on the JD Sports app. The retailer will also be the official partner for the Love Island podcast and will launch a new YouTube content series featuring big names from previous series’ alongside other familiar faces. On jdsports.co.uk, there will be a dedicated Love Island hub where customers can shop the look and order personalised caps, backpacks, towels and face masks. JD Sports executive chairman Peter Cowgill, said: “Love Island is a cultural phenomenon and the must-see event of the summer.” “As a brand, we’re always looking for new and dynamic ways to connect with and entertain our audience and we know that Love Island will sit at the heart of their TV schedule for the coming months, so it’s absolutely a natural partnership fit.” “We’re proud to be partnering with ITV on this series of the show and look forward to seeing the response from our customers to the multitude of activities we have planned throughout the summer.”
Kingfisher signs £550m credit deal linked to sustainability targets
Kingfisher has entered into a £550 million three-year revolving credit facility agreement with a group of its relationship banks. The new revolving credit facility is conditioned to its ambitious sustainable and community-based targets. The home and DIY giant, which owns UK fascias B&Q and Screwfix alongside Brico Depot and Castorama in mainland Europe, said the deal will last for three years but has the potential for two one-year extensions. Kingfisher will be given a lower interest rate if it achieves specific targets which are aligned with its responsible business plan. The three key areas Kingfisher are seeking to address are: to tackle climate change by reducing carbon emissions across the business and its scope 1 and 2 supply chain, delivering 1.5°C science-based carbon reduction targets by FY 2025/26; becoming forest positive by FY 2025/26 by creating more forests than it uses, including reaching 100 per cent sustainable wood and paper for all its products by the same year; and helping to fight bad housing by aiding two million people with the greatest housing needs by the same year. The new credit facility replaces two old ones which expire in March 2022 and August 2023 respectively. “This revolving credit facility shows our commitment to integrate our responsible business principles into all aspects of our business,” Kingfisher group chief financial officer Bernard Bot said. “Our responsible business plan is an integral part of our ‘Powered by Kingfisher’ strategy and this facility links our ambitious sustainability and community targets with our financing activities. “We are making great progress with our climate change and community programmes and I look forward to working with all our stakeholders on realising our commitments.”
B&M pre-tax profit more than doubles to £525m
B&M has warned investors to expect a drop in revenue in its current financial year as the company comes off an excellent performance during Covid-19. The discount retailer said it was already seeing signs of a slowdown compared to the frenzy a year ago in the midst of the pandemic. Since its financial year ended in late March, sales have been one per cent lower than this time last year. It therefore expects to see a decline in like-for-like revenue in the current financial year from B&M’s UK business, but believes it will still be ahead of where it was before the pandemic. It would be a long way to fall if B&M were to drop back to the performance it saw before Covid-19 hit. Meanwhile in the year to the end of March, B&M reported a doubling in pre-tax profit to £525 million, and it expanded its portfolio by an extra 43 shops. Its overall adjusted EBITDA (pre-IFRS16) increased by 83 per cent year-on-year to £626.4 million. Revenue rose 25.9 per cent year-on-year to £4.8 billion and the business said it had created around 7200 new jobs in the UK. In its UK market alone, B&M said full-year revenue was up 29.9 per cent, including like-for-like revenue growth of 23.8 per cent. The last week of March was the retailer’s best in history, helping to push its results above previous guidance. “The core B&M UK business, as an essential retailer, traded throughout the year and welcomed a number of new shoppers, with colleagues working tirelessly to maintain on-shelf availability and provide a safe shopping environment,” chief executive Simon Arora said. “We also made strong progress in France, despite many stores being closed for up to 10 weeks throughout the year.” He added: “Looking ahead, there are many uncertainties as society slowly emerges from lockdown and trading patterns are likely to be unpredictable for much of the year.”
Poundland launches online shopping for customers in the West Midlands
Poundland has officially launched its online service to the public offering more than 2500 products for home delivery.
Around 1.8 million shoppers living in Birmingham, Derby, Dudley, Stoke on Trent, Walsall and Wolverhampton will now have access to Poundland’s home delivery trial, which it has been testing on its 18,000 staff since February.
Shoppers within 113 postcodes surrounding its fulfilment centre in Cannock will now be able to order Poundland products across its gardening, homeware, DIY, household, stationery, heath and beauty and food ranges for home delivery.
Home deliveries will cost £4, but items will remain the same price as products sold in its 850 stores.
Its not yet clear when the service will be expanded to postcodes further away from its ‘dark store’ in Cannock, but the discount retailer confirmed plans to “open up the new service to more of the UK over the year.”
Its ecommerce expansion forms part of a wider transformation plan dubbed ‘Project Diamond’ announced in July, featuring changes to stores, pricing, and the overall breadth of its offerings which has seen its food range dramatically expanded over the past year.
The online delivery service utilises one of Poundland’s three stores in Cannock, which closed in July and has been converted into an online fulfilment centre.
In May, the retailer opened two new format Poundland Local stores in a bid to expand its operations outside of big-box retailing and large retail parks.
Poundland Local stores aim to be smaller than a typical Poundland and the compact design will allow it to open in small towns, residential and urban neighbourhoods.
Construction begins for new Sainsburys flagship in Hendon
Construction has commenced on the new Sainsbury’s and St George development in Hendon, which is expected to support over 500 jobs during the total 10-year programme. The Silk Park development in north west London involves a new 43,000sq ft Sainsbury’s flagship store with undercover parking for over 250 customers, 1309 new homes, and a 1.5-acre public park. The partnership will also deliver 10,000sq ft of flexible commercial space for cafés, restaurants, office space or a gym. Creating a new green corridor for Hendon, the historic Silk Stream will be opened up to deliver a biodiversity net gain for existing and future residents. Pedestrians will also benefit from wider footpaths and landscaping on Edgware Road. Over the past six months enabling work has taken place to prepare the site for the major development, including creating a new access road, installing a new decked car park, demolition of the petrol filling station and extensive drainage diversion works. The existing Sainsbury’s store has remained open to customers, with minor alterations including changes to the store layout and new pedestrian entrance and exit. “This partnership gives us a once-in-a-generation opportunity to play our part and work with the Hendon community to ensure it thrives,” Sainsbury’s property director Patrick Dunne said. “We’re proud of investing in the local area to deliver parks and green space, more housing and amenities. “This new development is supporting new and ongoing jobs, and will give our customers and colleagues a new and modern flagship store. “We have an ambitious property agenda and continue to partner with developers to regenerate local communities and invest in state-of-the-art stores to best serve our customers. “Our mixed use development plans set communities up for the future, and mean we can extract value to reinvest into our business. We’re proud of our over 150 year history, and we’re investing to ensure we’re well-placed to deliver for generations to come. “Our current Hendon supermarket will continue to serve customers right up until we open the doors to our new store, and we’re committed to minimising disruption to customers, colleagues and the wider community.” Since 2009, Sainsbury’s has been redeveloping sites of existing stores into mixed use schemes to create new homes and regenerate local communities. The Big 4 grocer said that almost 2000 homes have been delivered in recent years, including at Nine Elms and Fulham, with future plans for up to 7000 more homes across London. Sainsbury’s has had a store in Hendon for over 25 years and currently employs over 1000 people in the Barnet Borough. St George is a member of the Berkeley Group, which regenerates brownfield land for communities to use.
M&S extends refill concept Fill Your Own to 8 stores
Marks & Spencer has extended its packaging-free refillable grocery concept Fill Your Own to eight additional stores – bringing the offering to 11 stores across the country. The latest stores to feature Fill Your Own include Lisburn in Northern Ireland, Stratford City in London, Sears Solihull in the West Midlands, Gyle in Edinburgh, Vangarde Monks in York, and Wolstanton Stoke in Staffordshire. M&S has three existing stores in Manchester, Hedge End in Southampton and Staines Two Rivers in Surrey. By mid-June, Fill Your Own will also be introduced to M&S stores in Aintree in Liverpool and Meadowhall in Sheffield. Fill Your Own, which first launched in December 2019, offers more than 60 lines of refillable groceries – including pasta, rice, cereal, nuts, frozen fruit and a range of bake-at-home items, such as all-butter croissants, pain au chocolats, and apricot twists. “Fill Your Own has been hugely popular with our customers since it launched,” M&S head of sustainable business, Carmel McQuaid said. “They’ve told us that it’s easy to understand, offers a huge variety of the high-quality, great value M&S products they love, and supports with portion control. “Importantly, Fill Your Own is helping our customers – and our business – to reduce and reuse plastic and this initiative has the potential to save thousands of units each year. “As our customers have navigated this completely new way of shopping, we’ve continued to test, learn and adapt the scheme based on their feedback and now we’re ready to expand it to more locations and introduce new product lines.” M&S is planning to extend the Fill Your Own product range by Autumn with new lines including wasabi peas, dried mango and apple, and cashew nuts – bringing the range to nearly 100 lines in total. M&S chief executive Steve Rowe said: “In the face of unprecedented crisis, we did not lose sight of the goal of our transformation; to return M&S to sustainable, profitable growth and deliver long-term value for all our stakeholders. “It is through Plan A – our multi-year sustainability action plan – that we address the risks and opportunities that environmental and societal issues present to us as a business. “It drives us to make better choices to ensure M&S, and the precious resources and planet we rely on, are in better shape for the future.”
Westfield sues Victoria's Secret for £32m over unpaid rent
Victoria’s Secret is being sued for $32 million by shopping centre giant Westfield amid accusations it wrongfully terminated its lease and refused to pay rent.
Westfield is suing the lingerie retailer after it invoked a clause in its contract last year, allowing it to cancel its lease early if Westfield failed to keep 75 per cent of its stores open in its mall for 12 consecutive months.
According to Business Insider, Westfield provided evidence that the Downtown Manhattan shopping centre had not breached this clause, meaning Victoria’s Secret “had no right” to end its lease early.
“Nonetheless, Victoria’s Secret refused to pay rent and abandoned its leased premises with years remaining, all in breach of its lease, ” the suit said.
“As a result of Victoria’s Secret’s breaches, Westfield has been damaged in an amount that exceeds $30 million.”
Victoria’s Secret has undergone a significant overhaul over the past year due to financial woes that started long before the pandemic.
Earlier this month its owner L Brands announced plans to spin off the lingerie brand into a separate company, rather than continue to run it alongside the more financially resilient Bath & Body Works.
While Victoria’s Secret has seen sales improve in the first quarter of 2021, 2020 proved a difficult year for the brand which continued to rely largely on physical stores.
In February 2020 L Brands agreed to sell a 55 per cent stake in the brand to Sycamore for $1.1 billion, however the deal fell through when Victoria’s Secret began shutting stores and furloughing staff during the pandemic.
CBI urges gov't to extend rent moratorium for struggling retailers
UK footfall increased in May as Covid-19 restrictions continue to ease, but they’re still not at the same levels as they were before the pandemic. According to the latest BRC-Sensormatic Footfall Monitor, total UK footfall decreased by 27.7 per cent in May when compared to the same month in 2019, but it enjoyed a 12.3 percentage point improvement from April as it marked the first full month since all UK nations lifted lockdown for non-essential retail. The BRC stated that because 2020 was a turbulent year in which much of UK retail “bounced between being open and closed” and footfall was impacted significantly, its year-on-year figures are compared with those in 2019 pre-pandemic. The BRC said that compared to 2019, footfall on high streets declined by 34.6 per cent in May, while retail parks saw footfall decrease by 19.9 per cent and shopping centre footfall declined by 41.3 per cent. Northern Ireland saw the shallowest footfall decline of all UK nations at 14.9 per cent, followed by Scotland at 24.7 per cent, England at 28.5 per cent, and then Wales at 30.1 per cent. “May saw footfall levels improve across the UK’s high streets, retail parks and shopping centres,” BRC chief executive Helen Dickinson said. “This was in part due to the further easing of Covid restrictions, including the reopening of indoor hospitality, which enticed consumers back to shopping locations knowing they could grab a drink or something to eat whilst enjoying a spot of retail therapy. “The successful vaccination roll-out has also boosted consumer confidence and contributed to the improvement in footfall. “However, restrictions on travel have denied many businesses, particularly those in our larger town and city centres, of vital overseas tourist spending. “Nonetheless, footfall levels are still significantly down on two years ago. Many high streets have an increasing number of vacant shops, and many retailers still face significant and mounting debts, and with £2.9 billion in unpaid rents built up over the pandemic. “The government should ringfence these lockdown rent debts to provide the breathing space for footfall and cash flows to recover, and enable landlords and tenants to work on equitable and long-term solutions for the future and avert terminal decline in many communities.”
Superdry: 59% Brits prefer sustainability to fast fashion
Superdry has found that an increased number of shoppers, particularly Gen Z consumers, are leaving fast fashion behind for more sustainable choices. According to a new survey from Superdry, which surveyed 1000 people across the UK, 59 per cent preferred sustainably-made clothing. Over a third of women and a fifth of men said most of their clothes are still categorised as fast fashion. However, lockdowns have affected purchasing habits, with 21 per cent of Brits saying they had purchased more fast fashion items since the start of the pandemic, rising to 42% among 16-24 year-olds. Meanwhile, 74 per cent are purchasing either the same amount or fewer clothes than they usually would have done over the past year. Some 62 per cent of those surveyed reported recycling their old clothes, 43 per cent said they actively look for ways to refresh their old clothes before buying new items and 34 per cent reported wearing sustainably made clothing. Moreover, 46 per cent said they’d purchased sustainable clothing, and they were the most likely to agree that their purchases are affected by the working practices involved in the production of their clothes. Superdry said it is “encouraging” to see that consumers are becoming increasingly more mindful about sustainability.