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  • Online fashion retailer Boohoo ready to buy Karen Millen and Coast

    Online fashion retailer Boohoo ready to buy Karen Millen and Coast

    Fast-growing pure-play online fashion retailer Boohoo is preparing to acquire the Karen Millan and Coast brands.

    According to sources quoted by Sky News, Karen Millen will be placed in administration as early as today, UK time, in what is termed a “pre-pack administration” where the new buyer acquires the assets relatively unencumbered.

    The deal – assuming it proceeds – is remarkable in that it reflects the power of new-generation online retailers being in a place to pounce on struggling brands like Karen Millen, itself an icon of the high-street fashion scene.

    Boohoo Group, listed on AIM, a subsidiary of the London Stock Exchange, owns a controlling share in PrettyLittleThing. Last month, thanks to an association with reality TV series Love Island and high-profile celebrity endorsements, Boohoo overtook Asos as the most valuable online fashion retailer in the UK, its valuation touching £2.35 billion. Its share price has surged 29 percent this calendar year.

    According to Sky News’ sources, Karen Millen is about to appoint Deloitte as administrator of the business, preparing the way for Boohoo to proceed with the purchase.

    The two fashion labels have been on the market for six weeks during which management attempted to secure a sale of the business while it remained solvent. Karen Millen bought Coast out of administration last October. Karen Millen and Coast were both previously owned by Icelandic bank Kaupthing.

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  • Double-digit leap for General Vietnam retail sales

    Double-digit leap for General Vietnam retail sales

    Vietnam retail sales surged by 11.6 percent in the first seven months of this year, according to figures from the nation’s government.

    According to the General Statistics Office of Vietnam, sales of goods and services reached US$120.57 billion from January through July, with 76.1 percent of that figure ($91.76 billion) spent on goods – 12.5 percent up year on year.

    In July alone, according to the government estimates, sales of retail goods and services reached $17.84 billion, 1.7 percent up on June and 12.4 percent ahead of July last year.

    By category, Vietnam retail sales of food and foodstuffs rose by 12.8 percent year to date, with clothing and textiles up by 10.7 percent.

    Accommodation and restaurant services grew 10 percent year on year to $14.51 billion. Travel services rose 12.5 percent to $1.1 billion.

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  • Amazon in talks over Reliance Retail

    Amazon in talks over Reliance Retail

    Amazon is in talks with Reliance Industries Ltd’s retail unit to buy a stake in India’s biggest brick-and-mortar retailer, two sources with knowledge of the talks told Reuters.

    Amazon’s massive online presence could help bolster Reliance’s consumer and private labels business. More importantly, a partnership would help the duo counter Walmart, which last year invested US$16 billion in India’s Flipkart, in the battle for a bigger share of India’s fast-growing e-commerce market.

    In late December, India modified rules around foreign direct investment (FDI) in e-commerce, creating additional hurdles for companies such as Amazon and Flipkart, and giving companies such as Reliance an edge.

    Amazon had made the proposal to Reliance – controlled by Mukesh Ambani, India’s richest man – for the partnership, but it was not clear whether a deal would materialize, said one of the sources.

    The second source said Amazon had been pondering a proposal to purchase an up to 26 percent stake in the Reliance unit since at least February.

    “For Amazon, it is about neutralizing a major rival and allowing itself to grow,” said the second source, who added the company envisions helping Reliance’s roughly 40 brands and grocery products go online.

    Further details of the possible deal, first reported by India’s Economic Times newspaper last week, were not immediately clear.

    Amazon did not immediately respond to request for comment while Reliance said it would make any disclosures to stock exchanges as and when necessary.

    Reliance could potentially leverage Amazon’s global experience in technology, supply chain and logistics as it aims to connect grocery stores across the country digitally through its Jio telecoms network – the biggest in India by subscribers.

    For Amazon, picking up a stake in a Reliance unit could mean getting access to the Jio telecoms platform and its vast retail footprint of more than 10,600 stores across India. It might also add more firepower to their lobbying efforts, as the Ambani family is viewed as being well-connected politically.

    Seattle-based Amazon is keen to get a bigger share of India’s e-commerce market, which Deloitte expects to more than treble to $84 billion between 2017 and 2021.

    Reliance was previously in talks with China’s Alibaba to sell a stake in Reliance Retail, but a deal could not be sealed due to differences in valuation, according to a person familiar with the matter.

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  • NomadX adds more provision shops

    NomadX adds more provision shops

    Multi-label concept store NomadX has updated and expanded its space, adding new stores.  Technology has also been rolled out: along with a touchscreen directory, interactive screens and “game stations” that help customers to find their style, there are mirrors that offer automated store assistance. Customers can also scan the product QR code to add any products to their digital cart for purchases.

    Among the new brands at NomadX is The Lucky Shop (by Zha Huo Dian), a boutique offering ‘old-school’ and vintage fashion for men and women.

    Another is a faux ‘supermarket’ M*Art which displays apparel and accessories in neon-pink repurposed refrigerators.

    Other newcomers include homegrown fashion and accessories brands Qlothe, The Sophia Label, Ans.ein and Studio Emoi. Mrphy’s home decor range and French beauty company Melvita are making their Singapore debut there.

    More brands will be popping up at the store, including sustainable-swimwear label August Society, Pleatation and Love SG.

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  • Singapore retail store rents ease in second quarter

    Singapore retail store rents ease in second quarter

    Central Singapore retail rents eased by 1.5 percent in the second quarter of this year, according to data from the Urban Redevelopment Authority.

    That followed a smaller quarter-on-quarter decline of 0.2 percent in the three months to March 31.

    At the end of the June quarter, there were 320,000sqm of space in the pipeline, down from 364,000sqm three months earlier.

    Singapore retail space occupied by tenants rose by 74,000sqm in the quarter, more than reversing a 14,000sqm decline in the prior period.

    That contributed to a fall in the vacancy rate across the city from 8.7 percent to 7.7 percent.

    Singapore retail rents ease in second quarter

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  • Musee flagship in Beijing Designed by Studio8

    Musee flagship in Beijing Designed by Studio8

    Shanghai design and development studio Studio8 has recently completed the design of Musee’s flagship store in Beijing.

    A store for consignment luxury goods, Musee delivers an open platform for luxury accessories – a point that inspired the designers to create a flexible space with “soft boundaries” and a diverse colour palette.

    The firm’s “soft boundary” design leaves no clear boundaries in the functional division of the entire retail space for Musee, which is translated into two main features: the mobile multi-functional counters and the central consignment room.

    “Every accessory that people possess is an abstract object that serves a certain function or purpose,” said principal designer Shirley Dong. “This changes when people place more importance and value on the object, whether through the brand, colour, material, or handcrafting process. Luxury goods then become time travellers, with an ever-increasing value and preciousness while still maintaining their initial presence.”

    The idea of enriching the significance of an accessory stands behind the concept of Musee’s new flagship store, where shopping is envisaged as an unconventional experience that allows customers to know more about the item they are buying and re-evaluate it with the support of professional consultants.

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  • VF Corporation posts first results after Kontoor spinoff

    VF Corporation posts first results after Kontoor spinoff

    Apparel giant VF Corporation has reported a 9 percent increase in same-store sales on a currency-neutral basis in the June quarter, to US$2.3 billion.

    VF Corporation owns a portfolio of outdoor and activity-based lifestyle and workwear brands, including Vans, The North Face, Timberland and Dickies. In May it spun off its denim business, which includes Lee and Wrangler labels, in a new company called Kontoor Brands.

    The company said its gross margin increased by 140 basis points to 54.4 percent, driven by favorable mix and timing of foreign-currency transaction hedge gains.

    Operating income was $133 million.

    “Our first quarter represents a new chapter for VF following the spin-off of Kontoor Brands and our relocation to Denver, Colorado,” said Steve Rendle, chairman, president and CEO.

    “Our first-quarter results demonstrate the power of VF’s evolved portfolio and our progress along our journey to become a purpose-led, performance-driven, value-creating enterprise anchored in our commitment to be more consumer-minded and retail-centric in everything we do.”

    VF Corporation recorded an after-tax net loss from discontinued operations was of $48 million in the first quarter of fiscal 2020, which reflects the operating results of the jeans business, including $59.5 million of separation costs related to the spin-off.

    Figures in the quarterly results above are compared with comparable trading period last year, after the removal of the discontinued (spun-off) business.

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  • Mainland China retail sales surge in June

    Mainland China retail sales surge in June

    Motor vehicles and the 6.18 shopping festival spurred a healthy increase in Mainland China retail sales in June.

    Official government figures show a 9.8 per cent year-on-year increase for the month, higher than the 8.6 per cent of May and 8.4 per cent for the first half year.

    Summer Wang, an equity analyst at Jefferies, said auto sales surged due to deep discounts on older models ahead of stricter State VI emission standards which took effect on July 1, and the 6.18 Shopping Festival  which drove cosmetics, jewellery and appliance sales. Small-ticket items like food and daily goods also outperformed.

    Urban Mainland China retail sales grew 9.8 per cent, ahead of the 8.3 per cent year-to-date figure, reaching RMB2.896 trillion (US$421 billion) in June, while rural retail sales grew by 10.1 per cent, ahead of 9.1 per cent for the half year.

    Cosmetics sales grew by 22.5 per cent, cars by 17.2 per cent and daily goods by 12.3 per cent.

    “We believe the beauty category is continuing to benefit from functional premiumisation, as consumers – both women and metrosexual men – are willing to pay a premium for a tangible improvement in appearance,” said Wang.

    “Most discretionary categories saw improvement as well, including gold and jewellery (up 7.8 per cent), home appliances (up 7.7 per cent) and apparel and footwear (up 5.2 per cent).”

    By channel, online retail goods sales kept momentum with a robust 21.6 per cent year-on-year growth during the first half of the year, accounting for 19.6 per cent of Mainland China retail sales.

  • Positive outlook for Singapore retail leasing sector

    Positive outlook for Singapore retail leasing sector

    Ongoing investment-sale activity for malls suggests a positive outlook for the Singapore retail leasing sector, reports Edmund Tie & Company – especially for properties well connected to public transport and offering experiential and activity-based retail options.

    In a report Q2 2019 Real Estate Times for the Singapore market, the property company projects islandwide rental growth will be mixed, ranging from a 2 per cent decline to a 2 per cent increase this year. The low supply pipeline from next year onwards is likely to provide some underlying support to occupancy rates and rental levels.

    Investment market 

    For the second consecutive quarter, investment transaction value (of properties valued above S$100 million) jumped more than 52 per cent quarter on quarter with two transactions totalling $961 million. The largest sale was Chinatown Point for $520 million to a foreign institutional investor.

    The net supply of space fell by about 78 per cent as fewer projects were completed. As such, islandwide occupancy declined slightly by 0.4 percentage points to 90.1 per cent in the first quarter, however, the opening of Funan mall with 325,000sqft net lettable area – with 95 per cent of space pre-leased – is not expected to significantly impact occupancy rates in the second quarter.

    Rental rates 

    Singapore retail leasing rates across the different market segments remained largely flat, as occupancy rates remained high for malls located in prime positions. Upper-storey retail in the Orchard Road/Scotts Road area likely fell slightly due to weakened tourist spending, while the prime malls in the suburban areas continue to attract major brand retailers and new-to-market brands.

    The net demand and supply for retail spaces in suburban areas slowed in the first quarter, with the occupancy rate down marginally.  Prime-located malls with easy transportation access and a diverse and well-managed tenant mix continued to perform relatively well.

    New openings included Cafe Amazon outlets at Jewel Changi and Jurong Point Shopping Centre, and Xing Fu Tang (a Taiwanese bubble tea chain) opened a permanent store at Century Square in the second quarter.

    New space supply pipeline 

    From the third quarter of this year through to 2022, some 1.1 million sqft of retail space is expected to come onstream, with the majority of that to be completed in the second half of this year. The largest will be the Paya Lebar Quarter mall of about 313,000sqft.

    The average annual pipeline of known projects from next year through to 2022 is less than 150,000sqft, which is substantially below the three- and five-year average.

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  • China boosts Uniqlo parent

    China boosts Uniqlo parent

    Uniqlo owner Fast Retailing’s healthy online sales and strong performance in overseas markets, particularly in China, have helped boost its third quarter results.

    The Japanese retailer said its online sales saw a 16.1 per cent year-on-year increase in the three months to May 31 to ¥19.0 billion (US$176.1 million), increasing their proportion of total sales from 7.8 per cent to 9.1 per cent.

    For the three months from March to May 2019, Uniqlo’s international segment reported strong results, with revenue expanding 15.3 per cent year-on-year and operating profit expanding 14.9 per cent year-on-year over that period.

    Uniqlo continued to achieve significant year-on-year growth in both revenue and profit in Mainland China, and achieved double-digit growth in both revenue and profit in Southeast Asia and Oceania on the back of strong sales of its summer range.

    But Fast Retailing’s less-than-stellar domestic sales have overshadowed the company’s strong performance in its e-commerce and international segments, indicating that Japan’s market still has a huge influence on the retailer’s results.

    The company’s domestic sales saw a 0.5 per cent decline brought about by shifting a sales event to June.

    On the profit front, the retailer’s operating profit declined by 7.5 per cent year-on-year on the back of a higher selling, general and administrative expense ratio, and a lower gross profit margin, which was dampened by its decision to bring forward discounting of leftover Spring Summer inventory.

    China continues to be one of the main engines driving overseas expansion, with sales in the country rising in the double digits.

    The retailer said Uniqlo so far hasn’t been hurt by the trade war between the US and China, and sales there were strong even in the face of a weaker yuan.

    Uniqlo Europe reported a decline in profit caused by unseasonal weather patterns and political uncertainty. However, within that region, Russia continued to perform strongly and report expanding revenue and profit.

    In terms of new-store activity, Uniqlo opened its first store in the Netherlands in Amsterdam in September 2018, as well as its biggest Southeast Asian global flagship store in Manila, Philippines in October 2018, and its first store in Denmark in Copenhagen in April 2019.

    Fast Retailing said it is planning to focus its efforts on expanding its global e-commerce operation and its Uniqlo international and GU casual fashion brands to meet its medium-term vision to become the world’s number one apparel retailer.

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  • Bonjour Holdings warns of loss ahead

    Bonjour Holdings warns of loss ahead

    Bonjour Holdings says it expects a loss in the half year to June as protests took their toll on the city’s retail sector.

    Last year, Bonjour Holdings reported a profit of HK$7.4 million in the six month period.

    In a stock-exchange filing, the company did not release an estimate of the level of loss it anticipates, with the preparation of final results still incomplete.

    Chairman and executive director Wilson Ip Chun Heng said the board believes the reversal of fortune is mainly attributable to the weak sales performance brought about by both local and global factors, including the US-China trade war, the depreciation of RMB, and the demonstrations and social unrest in Hong Kong which occurred in June.

    “Moreover, the implementation of the e-commerce law in China at the beginning of the year has severely hit the mainland “Daigou” (surrogate shopping) which has, to a certain extent, adversely affected our group’s turnover in the short-term.”

  • Hong Kong protests may drive retail-sales slump

    Hong Kong protests may drive retail-sales slump

    The ongoing Hong Kong protests are eroding the sales of the territory’s retailers according to the HKRMA.

    “Depending on the performance of different retail categories, most member companies said the turnover in the first week of June recorded an average [decline] of double digits,” said the Hong Kong Retail Management Association in a statement we have translated from Chinese.

    “Activities are spreading across districts, and members expect business to be greatly affected,” said the HKRMA, noting that July and August mark the traditional summer-holiday sales season, but recent large-scale demonstrations, including one in a Sha Tin shopping mall last Sunday, may deter manilanders from visiting the city.

    “Large-scale parade activities have caused individual stores to suspend business. Not only are the retail companies under pressure, so is the income of store employees.”

    The HKRMA said the industry is worried that the ongoing protests will impact on Hong Kong’s reputation as a safe city, a food capital, and a great place to shop.

    “These large-scale parades have an impact on the life of the people and the business environment. If the situation persists, the association anticipates an annual decline of retail sales in the double digits.

    “The association appeals to the government to solve the problem peacefully at an early date and bring social order back on track.”

    The HKRMA called on employers and employees to maintain close communication during Hong Kong protests.

    “In the face of special circumstances, employee safety should be the most important consideration.

  • South Korean retail sales up as summer season arrives

    South Korean retail sales up as summer season arrives

    South Korean retail sales increased by 3.4 percent year on year in May.

    Online sales reportedly surged by 18.1 percent in May, far faster than offline sales, which increased buy just 1.9 percent.

    A government spokesperson said the increase in sales for the month was driven by growing demand for seasonal products such as air conditioners, as summer arrived.

    There was also strong demand for electronics and gifts for Parents’ Day and Children’s Day.

    May’s 3.4 percent rise in South Korean retail sales was below the mean average monthly rate of 3.9 percent recorded from 1996 until this year.

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  • Robinsons Retail favours pets over fashion

    Robinsons Retail favours pets over fashion

    Robinsons Retail is looking to shrink its fashion business as competition with cheaper chains gets tougher.

    “We are shrinking fashion, for it has become very difficult,” said the firm’s CEO Gokongwei-Pe. “There are other brands that came in who are more progressive and cheaper. We are already reducing the number of stores and we have to think if we move out altogether.”

    The firm is reporting stronger returns from pet, health and beauty products where there is growing demand.

    “Pets have become very big,” added Gokongwei-Pe. “Dogs now are very spoiled. Just look at Instagram and Facebook, it’s all about dogs. You should put money where the money is, which is food, drugstores, hardware, and growing businesses like pets and beauty.”

    The firm is also making moves into high-end groceries as well as growing its beauty and pet care franchises overseas. It is reportedly seeking 15 per cent annual revenue growth in these sectors within five years.

    Robinsons Retail is also investing PHP3–5 billion (US$58.59–97.65 million) on expanding its store network by 100–150 outlets per year from its current 1911 stores during the same period.

  • Hong Kong retail sales declined again in May

    Hong Kong retail sales declined again in May

    Hong Kong retail sales fell again in May, but the rate of decline was significantly less than in April.

    According to the Census and Statistics Department the value of retail sales in May, provisionally estimated at HK$40 billion (US$5.1 billion), decreased by 1.3 percent year on year, well below April’s 4.5 percent decline.

    For the first five months of this year, Hong Kong retail sales were down 1.8 per cent compared with the same period last year. After netting out the effect of price changes over the same period, sales for the five months were down 2.2 per cent.

    For the three months to May, sales fell by 0.8 per cent.

    For once, the jewelry, watches and valuable gifts category – which traditionally has the greatest effect on overall retail sales fluctuations – registered one of the lowest falls in May, down 2.7 percent.  Apparel sales fell 4.6 per cent, electrical goods by 14.8 per cent, optical shops by 11.3 per cent, furniture by 1.3 per cent and supermarket sales by 0.8 per cent.

    In contrast, sales of medicines and cosmetics rose 1 per cent, of food, drinks, alcohol and tobacco by 3.1 per cent, footwear and accessories by 1.6 per cent, Chinese medicines by 0.7 per cent and books, newspapers, stationery, and gifts by 0.1 per cent.

    A government spokesman said narrower decline of Hong Kong retail sales in May was partly due to the late timing of the Labour Day holidays in Mainland China this year, which had led to a visibly larger year-on-year rise in visitor arrivals during the month.

    “Overall, the performance of retail sales remained subdued in recent months.”

    Retailers will be waiting for the June figures, the month when the protests over the extradition bill stepped up, disrupting access to stores on Hong Kong Island at certain times and possibly dissuading overseas visitors.

    The spokesman said that in the near term, the outlook for retail sales will likely be clouded by the still-cautious consumption sentiment amid an uncertain global economic environment. “Nevertheless, the sustained expansion in inbound tourism and the largely stable local labor market should continue to provide some support.”

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