The North wind won’t blow. And never mind snow, there’s barely a sign of autumnal crispness in the air. It’s tough for fashion retailers.
The North wind won’t blow. And never mind snow, there’s barely a sign of autumnal crispness in the air.
The Indian summer put the City heat on the entire fashion retail sector after bellwether Next revealed that a balmy September held back sales.
The result is that revenues in quarter-three to date are ahead by 6% rather than the 10% anticipated.
If the climate doesn’t cool in October then the retailer will probably have to rein back its full-year profit guidance range.
But Next is more advanced than some of its peers in its ability to adapt to the weather, the vagaries of which present a frequent headache to apparel specialists.
At the time of its interim results Next highlighted changes to its buying processes. The retailer moved from two to four buying seasons.
Chief executive Lord Wolfson said at the time that the change would ensure “more weather-appropriate” ranges in the transitional spring and autumn periods.
The likelihood is probably that had it not made such changes Next would not have weathered trading conditions as well as it has, despite the September slowdown, and is testament once again to the strength of the retailer’s management.
Next’s statement was not a profit warning. It was made only because there were meetings with investors scheduled when questions would inevitably be asked about the weather, which has been a fashion talking point for weeks as flagged in John Lewis numbers.
The likelihood must be that some other fashion retailers with less room for manoeuvre than Next will suffer from the heats to a greater extent.