Mothercare’s Calver to drive online growth

Mothercare executive chairman Alan Parker aims to offset the impact of 111 store closures over the next three years via online growth and overseas expansion.

Parker said: “We’ve got to be at least as good as Amazon online. We’ve got the right man to bring [online] back into growth. We expect double-digit [online] growth by the second half.”

The retailer’s online sales declined 3.4% in its full year to March 31. Calver, who until this month led Amazon-owned DVD rental service Lovefilm, joins on April 30.

Mothercare, which has struggled to compete with supermarkets and online rivals, is to square up to Amazon on price. The retailer aims to gain efficiencies in its buying operation to enable it to slash prices.

Mothercare will also incur costs of £35m from the closure programme that forms part of its turnaround. The 311-store retailer has already closed 62 shops since last year.

Parker said: “We can have national coverage with 200 stores.”

The bulk of the closures will be Early Learning Centre stores. Parker said Early Learning Centre worked better as a wholesale brand.

Mothercare is to accelerate international expansion to offset the downsizing of its UK portfolio. Parker said it would open 200 stores internationally each year and was particularly excited about entering Brazil and Mexico.

Mothercare has started to reduce its overheads as part of its turnaround plan and aims to slash costs by £20m over the next three years. It has started a consultation, revealed last month by Retail-week.com, to cut head office payroll costs by 16%.

The maternity specialist’s full-year group sales edged up 0.7%. However, UK like-for-likes plunged 6.2%, worsening to an 8.2% decline in its fourth quarter.