It was the start of a difficult year.
A ‘for sale’ sign went up above Hamleys as owner Landsbanki sold off assets. Frozen food chain Iceland was also up for sale as part of the Icelandic bank’s wind-up process.
It was the start of a difficult year. Retailers including HMV, Comet and New Look were faced with the effects of a disastrous Christmas, while brands across the board struggled to contend with terrible weather, rising unemployment, a VAT rise and increased costs. To add to their woes, they were staring at the risk that the Bank of England would raise interest rates to curb rising inflation. Fears that mortgage payments would increase and eat further into disposable incomes prompted retailers to speak out.
“While HMV has had a challenging year to date, it remains a profitable business”
The grocers responded to the difficult trading scene by slashing prices, while HMV scaled back its fashion ambitions after it decided not to roll out fashion lines. It was a sign of things to come in 2011 – it continued to struggle with structural changes in the entertainment market and announced plans to shut 60 stores over the next 12 months. Questions remain over whether chief executive Simon Fox has managed to adapt the business sufficiently.
In sunnier news, Ted Baker founder Ray Kelvin and Lush entrepreneurs Mark and Margaret Constantine were all recognised in the New Year Honours List, and former M&S executive chairman and chief executive Sir Stuart Rose was able to look back over a successful six years as he stepped down as chairman at M&S. Sir Philip Green revealed ambitious expansion plan for Topshop in Brazil and Australia, and Sainsbury’s started an own-brand investment drive after its like-for-likes rose 3.6% in the third quarter to January 8.
Themes from New York’s National Retail Federation conference set the tone for the year; home markets were facing a long list of problems, but international expansion and multichannel represented big opportunities. Even in the darkest months of winter there was hope. Customers were still happy to spend if given a good enough reason – product innovation, great service and cross-channel shopping all helped to determine the year’s winners.
People in the news
M&S executive chairman and chief executive Stuart Rose ended his six-year career at the retailer.
- BRC retail sales figures +2.3%