The news that House of Fraser’s boss Nigel Oddy is quitting underlines the apparent extent of boardroom issues at the department store chain.
Oddy’s departure, which will happen in the new year, comes off the back of the loss of Andy Harding as chief customer officer earlier this year and finance director Mark Gifford last year. Supply chain director Ray Kavanagh is also rumoured to be ready to leave.
Since 2014, the 167 year-old chain has been owned by China’s Sanpower Group. And bedding down under foreign ownership is never without its problems.
Having suffered from a prolonged period of financial uncertainty under the the Icelandic Baugur Group, House of Fraser is acutely aware of this.
Its acquisition by Sanpower was billed as securing the retailer’s future.
But there have been major frustrations since the Chinese group took control, with clashing management styles and an alleged failure by its new owners to deliver on their promised cash injection of £150m over the four years to 2018.
However, a source says that Sanpower has committed to support House of Fraser as “business development plans require them”.
The retailer has been ploughing on with its multichannel transformation, upgrading its stores and developing its online business to a point where it now accounts for over a fifth of sales.
Oddy has been a big proponent of the shift to multichannel, with an early organisational restructure to put customer insight at the heart of the business after he took the helm at the beginning of last year and an ongoing drive to improve personalisation.
The strategy is sound, but the balance sheet less so. In its last half-year profits slid to £1.1m.
After years of underinvestment, many of House of Fraser’s provincial stores far from reflect the premium image it wants to project – although those that have been converted are a credit to its forward-thinking approach.
The unexpected departure of Harding earlier this year flagged up issues within the digital department as well, with a raft of departures across the team over the first half of the year.
Its new website should have been launched in time for peak trading, but has now been pushed into next year.
An innovative move into small click-and-collect stores to drive multichannel development has been quietly pulled.
Sanpower has talked up Chinese expansion, but this has also been subject to major delays, with the first store now only due to open next month.
Against all this, latest half-year results showed that House of Fraser has taken its eye off the ball in terms of house brand development, which the department store group sees as a key USP.
Maria Hollins – recruited recently from Asos to the new role of executive director of buying and design – will have a key role to play in overhauling its house brands, especially womenswear.
Rumours have been circling for a while that Sanpower might sell the business.
Mike Ashley clearly has an interest and could move to build on Sports Direct’s current 11% share if it does come up for grabs.
It might be significantly smaller than John Lewis and Debenhams, but House of Fraser is a respected multichannel brand that deserves to flourish.
With many other established UK brands leveraging their potential on the international market, there is significant scope for the House of Fraser brand to develop along similar lines.
Wendy Massey is a senior analyst for Retail Week Prospect