Retail news round-up December 10, 2013: TK Maxx accused of inflating prices, Boohoo.com full-year sales rise and Tesco acquires stake in Lazada.
TK Maxx accused of exaggerating original price on designer goods
TK Maxx has been accused of misleading shoppers with discounts. It is claimed that the US bargain department store has exaggerated the original retail price on some of its designer items to appear as if it sold for a higher price, according to Channel 4’s Dispatches – Secrets of the Discount Stores, screened last night.
TK Maxx offers designer items ‘up to 60% less’ and promises ‘big labels, small prices’. The retailer’s products are usually advertised with an RRP as well as its discounted price, the former of which is often far higher than it should be, the Channel 4 documentary claimed. TK Maxx responded saying that the RRPs were set after conferring with the seller.
Boohoo.com full-year sales soar 132%, profits up
Manchester-based fashion etailer Boohoo.com’s sales jumped by 132% to £67.2m in the year to February 28, Manchester Evening News reported.
During the year, the company’s profit increased to £3.2m from £249,000 in the prior year. Sales in the UK climbed 68% to £43.8m as international revenues edged up to £23.5m from £2.9m. International sales now account for 35% of all revenues, according to accounts filed by parent company Wasabi Frog.
Tesco buys stake in online retailer Lazada
Tesco has strengthened its international presence online with the acquisition of a minority stake in Lazada, a non-food goods seller in southeast Asia, Bloomberg reported. Multichannel director Robin Terrell said that the grocer has made an investment of ‘tens of millions’ of pounds in the online marketplace, declining to divulge more details.
Founded by German internet incubator Rocket Internet, Lazada sells products including electronic goods, books, clothing, toys, homeware and cameras in Thailand, Malaysia, Indonesia, Vietnam and the Philippines. Lazada also offers an eBay-like marketplace where third-party retailers can sell their services, which will provide Tesco with the opportunity to offer products in markets where it does not have stores or its own website.
Tesco is not concerned that the investment in Lazada will cannibalise existing general-merchandise sales internationally as ‘these markets are so early that there is more than enough room for multiple customer offers,’ Terrell said.