High street fashion giant Next is to further expand its online and mail order Directory business overseas as it aims to quadruple international sales in the next two years.
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Next is eyeing the Asian market for growth and will launch its Directory in Pakistan and India in the first half of its 2011 financial year, and will debut in China, Japan, and Russia in the second half.
Next Directory overseas contributed £4.7m in sales and £1.7m in trading profit in its year ending January 2011. It aims to grow sales to £10m in its 2011 financial year and £20m in 2012.
Next chief executive Lord Wolfson said: “The numbers are small at the moment, but there’s strong growth [internationally].”
The retailer is also adding more Home stores this year as it seeks new sources of revenue growth.
Wolfson said: “We are not capital constrained, we will be investing in new retail space, especially in Home.”
The retailer will open 15 Next Home stores - an extra 240,000 sq ft - in 2011, growing its portfolio to 44.
It is also trialling a new home and garden concept store in Shoreham-by-Sea, West Sussex. Opening in August, it will have a garden centre attached and will sell garden and light DIY products.
Wolfson added that the relaxation of planning laws unveiled in last week’s Budget could help its expansion plans and were likely to make more space available.
He said: “It’s a sea change in attitude. Next will invest as much as it can in profitable new space.”
Investec analyst Katherine Wynne said the expansion of Next Home was a sensible move for the retailer.
She said: “Next is making very good returns on its Home stores, equivalent to its mainstream stores. Homewares is a fragmented market and Next has identified a clear opportunity there which it has tested and it has worked.”
Next posted a 9% increase in full-year pre-tax profits to £551m on sales of £3.45bn.
Its like-for-like sales were down 4% but its Directory sales offset the decline and rose 7.1% year on year.