UK Retail Briefing - November 2019

ANALYST COMMENT – FASHION RETAILERS TAKE A STAND ON CLIMATE CHANGE
What we’ve seen
Fashion brands close stores for Climate Strike
Young Millennials choose brands that take a stand on issues
Figure 1: Most important factors when choosing clothing brands to buy, by generations, august 2019
Amazon makes climate pledge
Patagonia seen as third most ethical fashion brand
Figure 2: Patagonia's Action Works Cafe, London
What it means
UK RETAIL SALES
Key points
Retail sales
Figure 3: Retail sales trends, June 2018 – July 2019
BRC vs ONS
‘Small retailers’ versus ‘large retailers’
Figure 4: UK retail sales y/y growth, BRC vs ONS, July 2017 - October 2019
John Lewis
Figure 5: John Lewis Department Stores: Year-on-Year Growth, January 2018 – October 2019
Inflation
Figure 6: Annual percentage change in the consumer price index for selected product groups, October 2018 - October 2019
Inflation and wages
Figure 7: Real wages growth: Wages growth vs inflation, Jan 2016 – Oct 2019
Consumer confidence
Figure 8: Mintel Financial confidence tracker, January 2017 – September 2019
Looking forward
SECTOR FOCUS – HOUSEHOLD GOODS
The sector – what’s included
The sector in context
Figure 9: Major household goods categories, share of sales, 2018
Figure 10: Spending on household goods products, 2014-18
Figure 11: Household goods sectors year on year growth in sales, by quarter, 2015-Q2 2019
Inflation remains stable
Figure 12: Inflation in household goods, % change over 12 months, October 2018-October 2019
Consumer confidence have held up
Figure 13: Spending on the home, actions and intentions, September 2016-October 2019
Housing market is cooling
Figure 14: Number of residential housing transactions over £40,000, 2009-18
Household goods retail sector
Figure 15: Household goods retail sectors y/y growth, October 2018-October 2019
Where next?
LAUNCH ACTIVITY AND INNOVATIONS
UK: Costcutter and Uber Eats partner for grocery delivery deal
UK: Tesco trials cashier-less shopping
UK: Harrods opens standalone beauty store at Intu Lakeside
UK: HMV launches experiential store Vault
UK: Luxury etailer Xupes opens first retail store in City of London
HEADLINES FOR THE MONTH
Grocers
Clothing
Footwear
Mixed goods
Multi-sector
Department stores
DIY
Electrical
Furniture
NEWS ANALYSIS – FOOD AND DRINK
 GROCERS
UK: Aldi launches online toy shop
UK: Lidl
…to invest £15bn over the next five years in UK supply chain
…to roll out electric vehicle chargers to all new store
UK: Sainsbury’s
…grocery sales fall 0.1%
…to stop selling fireworks
UK: Tesco rumoured to be considering launching Finest pop-ups in the lead up to Christmas
UK: Waitrose to stop selling plastic toys in Christmas crackers from 2020
 OTHER FOOD SPECIALISTS
UK: Cake Box posts 6% rise in half-year sales
NEWS ANALYSIS – CLOTHING AND FOOTWEAR 
UK: All Saints sees topline growth thanks to product-focused strategy
UK: Bonmarché tumbles into administration placing thousands of jobs at risk
UK: Burberry launches its first video game
UK: Forever 21 to liquidate three remaining stores in £30m clearance sale
UK: Gap Global sees sales fall 7% year on year
UK: Gieves & Hawkes sees a 5.7% fall in turnover
UK: Khaadi to close stores in pre-pack deal
UK: Luke 1977 to expand stores estate
UK: Matalan sees profits rise 11.3% but profits fall 28.5%
UK: Next retail sales down 6.3% in Q3 results
UK: Oasis launches third-party brands online
UK: Primark sees profits jump by 8%
UK: Quiz revenues fall 11% in H1 results
UK: Radley sees £92.9 million in turnover for full year results
UK: Seasalt posts 29% rise in turnover
UK: Select returns to operating profit but turnover falls 37.6%
UK: Superdry revenues drop 11.3%
UK: Thomas Pink sees operating losses widen to £23.5 million
UK: Topshop and Topman gets its own logistics warehouse
UK: Zara UK full year profits halved despite sales rise
 FOOTWEAR RETAILING
UK: Clarks group sales fall 4% to £1.46 billion
UK: Dune operating profits fall 21%
UK: Kurt Geiger revenues increase to £334.7 million
UK: LK Bennett to close founding store
UK: Schuh
…posts pre-tax loss of £6.1 million
…rolls out footwear recycling scheme
UK: Shoe Zone reports 0.8% rise in revenues despite profit warning
NEWS ANALYSIS – MIXED GOODS
UK: Home Bargain posts rising pre-tax profit to £233.3 million
UK: Mothercare to appoint administrators
UK: Poundland
…opens five Pep&Co shop-in-shops
…rolls out ‘simple’ pricing to all stores
UK: TK Maxx reports increased sales and profits
 MULTI-SECTOR
UK: M&S
…sales fall 2.1%
…launches new online payment service
…launches own brand halal range
…makes vegan wine pledge
 DEPARTMENT STORES
UK: Debenhams secures £50 million in funding to trade over Christmas
UK: Fenwick posts a loss of £17.3 million
UK: John Lewis
…opens click and collect network to third parties
…trials plastic bag-free stores
UK: Oxford Street House of Fraser is to be part-converted into offices
UK: Selfridges to open 45,000 sq ft of commercial space
UK: Watt Brothers files for administration
NEWS ANALYSIS – HOUSEHOLD GOODS
 DIY RETAILING
UK: Wickes results climb 8.3% in Q3
 ELECTRICAL RETAILING
UK: Richer Sounds posts 8.7% rise in sales to £171.2 million
 FURNITURE
UK: IKEA sees 8% year on year sales growth
 HOMEWARES
UK: Dunelm sales rise 5.8%
UK: H&M Home opens in Bullring centre
NEWS ANALYSIS – ONLINE
UK: Amazon rolls out AI-powered fashion search for UK app users
UK: ASOS ends the ASOS Magazine
UK: Boohoo collaborate with Coppafeel! in new lingerie collection
UK: Deliveroo expands its on-demand grocery service to over 200 convenience stores
UK: Feelunique launches new technology to improve product ingredient transparency
UK: N Brown returns to profit but sales down 5.4%
UK: Notonthehighstreet posts a marginal decline in revenues but operating profit nearly doubles
UK: Shop Direct
…moves Littlewoods campaign spend to digital-only
…posts a pre-tax loss of £185.5 million
UK: Sosandar expects revenues to hit £2.82 million in H1 trading update
UK: Vente-Privee closes UK business
UK: Yoox launches enhanced styling tool Yoox Mirror
NEWS ANALYSIS – OTHER RETAIL
 HEALTH & BEAUTY
UK: Lush launches conveyor belt for new in-store gifting service
UK: Superdrug launches 30-minute delivery service
 BOOK AND STATIONERY
UK: The Works record 5.4% rise in total revenue
UK: WHSmith reveals $400m acquisition of Marshall Retail
 JEWELLERS
UK: Links of London goes into administration
 SHOPPING CENTRES
UK: Intu remains confident in latest trade update
 TOYS AND GAMES
UK: FAO Schwarz opens at Selfridges
UK: The Entertainer defies high street gloom as sales and profits soar
 MISCELLANEOUS SPECIALIST
UK: Gear4Music posts 16% rise in sales
UK: Halfords registers a 2.5% fall in pre-tax profits
UK: Jessops puts jobs at risk as it looks for a rescue deal
NEWS ANALYSIS – ECONOMY
UK: BRC posts 0.1% increase in sales for October
UK: ONS September retail sales rise 3.6%