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Tag: river island

  • China is Ted Baker’s savior

    China is Ted Baker’s savior

    China has helped drive a solid half year for men’s fashion retailer Ted Baker.

    The UK-based chain has been rolling out concessions in the mainland with a local partner. That helped the company’s average retail square footage to rise by 8.5 per cent over the period to reach 386,252 sqft. Store openings in Indonesia – and its newest market, Bahrain – also helped.

    Additionally Ted Baker’s website now delivers to over 200 countries with the retailer rolling out language specific websites – helping to drive impressive online growth and broaden its global reach.

    Fiona Paton, an analyst with Verdict Retail, describes Ted Baker as a go-to destination for Christmas gifting and self-treating due to its stylish designs, distinctive collection of partywear and its range of high-quality accessories and leather goods which appeal to aspirational shoppers. “It is therefore no surprise that Ted Baker has reported another impressive performance this Christmas.”

    UK retail sales will benefit from Ted Baker’s increasing international brand awareness, as the retailer becomes front of mind among tourists wanting to take advantage of the weaker pound and buy into British brands and premium goods while visiting the UK, says Paton.

    “Over the next five years menswear is going to be the fastest-growing clothing sector in the UK. Ted Baker benefits from a unisex brand appeal so should capitalise on this and invest in its menswear proposition to increase its appeal among new 25-34 year old shoppers looking to graduate from Topman and River Island, and who are prepared to spend more on their clothing.”

    She says refreshing its designs and increasing the frequency of newness in collections will also help protect Ted Baker against emerging competitors, such as Superdry, which launched a premium menswear collection with Idris Elba in 2016, Whistles and Jigsaw.

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  • Tough road for New Look

    Tough road for New Look

    Following a robust few years of market outperformance and share gains, the start of New Look’s 2016-17 financial year is a major disappointment.

    While weakened consumer confidence and unseasonal weather dampened shopper appetite to spend on clothing & footwear, New Look has underperformed the market and lost share over the period.

    Despite a 35.5 per cent fall in underlying operating profit to £30.5 million, the retailer has continued to invest in its strategic growth areas, namely menswear and China. Menswear sales growth of 21 per cent dramatically outperformed following further rollout of the men’s standalone format. Moreover, as it builds a bigger customer following New Look is able to improve its menswear proposition via insight gained on most browsed and shopped styles and customer feedback – ensuring its collection is continually enhanced and better targeted to its core audience.

    While New Look has the opportunity to grow its share of the UK menswear market organically, given that it is a less saturated and outperforming segment of the clothing market, it should also be targeting share from rivals such as River Island, Burton, Blue Inc and Topman.

    Verdict forecasts a more challenging couple of years for the clothing market than what we had forecast back in January. While Brexit will impact spend across the home sectors more so than in clothing, the likelihood of squeezed disposable incomes, rising food & grocery prices and price inflation in clothing will restrict consumer’s ability to purchase higher volumes of discretionary clothing purchases.

    Retailers will therefore have to work that much harder to stimulate spend. However, New Look’s value positioning and go-to appeal for both essentials and fashion will put it at an advantage over some of its mid-market competitors.