House of Fraser is to launch a second high street format in response to changing shopping habits.

In November the retailer will convert its three-floor 80,000 sq ft department store in Swindon’s Brunel Centre to House of Fraser Outlet. It will house all categories at a discount of up to 70 per cent.

Commercial director Colin Porter said the initiative was an extension of House of Fraser’s multichannel strategy. It will enable it to drive the main department store business further upmarket, while capitalising on sales from customers who are trading down.

“Our drive is to move the business more aspirational and to drive newness,” said Porter. “In the current climate people are moving up and want better value for money, or moving down to the value end. It is the guys in the middle that have problems.”

The decision will give House of Fraser and its brand partners an avenue to clear excess stock. It is also likely to provoke questions about the mix of brands in its 60 full-line stores and the future of its more mid-level labels.

Porter said the retailer will introduce new brands to House of Fraser Outlet that already have a “good outlet model”. The fascia will change but the interior will “still look and feel like a department store”, he said.

Terminal stock levels at House of Fraser are down 20 per cent year on year and have “never been cleaner”, he added.

The Swindon conversion is a trial, but the retailer is considering converting more of its stores in secondary locations and has not ruled out opening new stores using the format.

House of Fraser has drafted in Jo Skilton, who developed The Outlet at Bridgewater Park, Belfast, as a consultant and promoted its Oxford Street store manager Peter Doherty to general manager for retail business development to oversee its success.

- House of Fraser unveiled its revamped home and menswear floors at Oxford Street this week, at a cost of£2 million a floor.