Edinburgh Woollen Mill acquired the Austin Reed and Country Casuals brands last week amid the wreckage of the 116-year-old fashion retailer’s collapse.
Administrators for Austin Reed, AlixPartners, failed to find a buyer for the retailer’s 120 stores, leading to the loss of 1,000 jobs.
“It is an opportunistic deal, I’m not sure there is a master plan.”
However, Edinburgh Woollen Mill, owned by entrepreneur Philip Day, clearly believes some value remains in the names Austin Reed and Country Casuals.
Day has also acquired five Austin Reed concessions.
The entrepreneur, who also owns Peacocks and Jane Norman, has stayed quiet on his plans for the Austin Reed brand so we asked industry experts what he should do to sustain it.
Opinion is split on whether the acquisition is a good move.
Retail Remedy’s Paul Thomas terms it “a fairly shrewd move”, arguing that without the exposure of Austin Reed’s 120-strong store estate the label is an asset.
But independent consultant Richard Hyman disagrees. “It is an opportunistic deal,” he says. “I’m not sure that there is a master plan. The future of the brand is still very uncertain.”
Brand power and customer
First and foremost on Day’s list should be reviving Austin Reed’s brand power. The label, once worn by Winston Churchill and Elizabeth Taylor, may still retain a heritage charm but has lost its way – and its customers.
And the male formalwear sector, while it has some standout players, is far from saturated.
“The main thing that Austin Reed lacks is differentiation,” says Kantar Retail’s Anusha Couttigane. “If it sticks to tailoring, this is already a staggered sector. Should it be competing with Moss Bros, Ted Baker or Savile Row?
“Redefining the target audience could make a difference to what Austin Reed products look and feel like. It’s the difference between being a worsted wool suit that’s worn every week to work and being a silk-lined smoking jacket that’s saved for private members’ clubs in Mayfair.”
She adds that brand values need to be identified, and from there quality, design and price points decided on.
Thomas agrees that Austin Reed’s prices need work.
“They need to show better value,” he says. “Prices do not necessarily have to be low, especially with their traditional customer, but at the moment the price is high and the quality sometimes isn’t there. If customers can see the quality they may well be happy to pay for it.”
Online vs stores
Where Day may go about selling Austin Reed’s new and improved designs is another matter.
“The idea of having Austin Reed in Peacocks doesn’t work. You would have to bring Austin Reed’s proposition down or Peacocks’ up”
The five Austin Reed concessions are all in Boundary Mill discount outlet parks in the north of England. Meanwhile, Austin Reed’s 120 high-street stores, including its flagship Regent Street store, are set to disappear.
Hyman believes that Day could not place Austin Reed into Peacocks. ”Peacocks is a downmarket discount retailer, even within the value sector,” he says.
“The idea of having Austin Reed in Peacocks doesn’t work. You would have to bring Austin Reed’s proposition down or Peacocks’ up. The latter would be the tail wagging the dog but I can’t see the former working either.”
Hyman doesn’t believe that Edinburgh Woollen Mill would support Austin Reed’s proposition either.
“There is also the opportunity to reset the Austin Reed business altogether, by establishing branches at out-of-town outlets”
Anusha Couttigane, Kantar Retail
“He could put it into Edinburgh Woollen Mill,” he says. “Whether it works or not is another matter. I think Edinburgh Woollen Mill is essentially about a certain type of mature woman and Austin Reed is about a certain type of mature man – and I am not sure they live together very often.”
Couttigane points to the major department stores. “Austin Reed could easily find a home at John Lewis, where many of its shoppers have been diverted,” she says. “Or at Debenhams, as part of its wedding hire service.
“There is also the opportunity to reset the Austin Reed business altogether, by establishing branches at out-of-town outlets.”
This may well be what Day had in mind by snapping up those five Boundary Mill concessions.
It seems more likely that Day will run Austin Reed with a bricks-and-mortar presence rather than online. Austin Reed’s core customer base arguably was not comfortable shopping for tailoring online.
“Austin Reed garments could be incorporated into existing channels,” says Thomas. “In terms of efficiency it would do well. But whether it would be successful is another matter.”
Although Hyman believes that aligning Austin Reed with Day’s current stable would be “the retail equivalent of a forced marriage”, Couttigane believes that Day has the credentials to turn Austin Reed around.
“By borrowing some lessons from Edinburgh Woollen Mill, he could very well turn Austin Reed into a fully fledged premium menswear label that sells everything from sharp suits and cashmere sweaters to gifts and leather accessories,” she says. “It needn’t be a one trick pony.”
Whichever route Day decides to take, it is clear he has his work cut out.