Following Next’s downgraded profits forecast, experts have warned fashion retailers they must overhaul their retail models to suit customer demand.
Autumn’s balmy weather has sent fashion sales across the market tumbling as demand for winter warmers stalled. Retailers are being urged to realign their models to suit customer demands rather than focusing on fixed seasons.
Retail consultant Richard Hyman, who founded consultancy Verdict, said retailers must become more demand-driven and less focused on supply.
He said: “The days of retailers ruling the roost are gone. It’s all about the customer. Retailers have got to have a much clearer understanding of demand and build their business model accordingly.”
Hyman said clothing retailers need to end the cycle of introducing heavyweight garments such as coats, knitwear and boots in late August and instead stock more transitional products.
Verdict analyst Maureen Hinton believed retailers must break the model they have at the moment and bring in autumn and winter clothing later in the year. But she acknowledged: “Unfortunately that’s tough to do when the whole industry is like that.”
Hyman said that September and October had been an “absolute disaster” and estimated that £700m of clothing sales had been lost due to the weather.
Kantar Worldpanel’s fashion market share data revealed a slowdown in growth in the 12 weeks ending September 28, when sales increased 1% year on year to £7.93bn, compared with 6% growth in the 12 weeks to the end of August.
All the growth was driven by online over the most recent period, according to Kantar Worldpanel director of fashion Simon Horner.
Next cut its full-year central profit guidance by 3% from £795m to £770m after the warm autumn.
Earlier this year Next revealed it was moving to a four season buying system to counteract changing shopping patterns.
A Next spokesman said that the change had made the situation “less worse” over the third quarter but that introducing transitional products would not deal with extremes in the weather.
John Lewis’s fashion sales also dipped in September and boss Andy Street said this week “weather has a greater effect than economic numbers”.
Kurt Salmon senior manager Stephen Taylor said brands that have shortened lead times by moving production closer to home were better placed to limit the impact of the warm autumn.