Next is one of the UK’s largest fashion and home retailers, with typical annual sales of well over £4bn.

Impacted by the pandemic, group sales declined by 17% to £3.5bn on a statutory basis in the year to end January 2021 (FY2020) as a 10.9% increase in online sales to £2.3bn failed to offset a 48.5% slump in store sales to £955m.

Store sales had been on a long-established downward trend well ahead of the pandemic and Next has been investing in the infrastructure required to get back in front in ecommerce in an increasingly competitive online fashion marketplace.

Investment in warehousing and systems has been further accelerated from 2020 in response to the changing shopping behaviour resulting from the pandemic.

Recent online growth has been driven by the new branded Label site, while the overseas business has also been developing strongly. It will continue to invest in these growth areas, but the main focus is on upgrading the core UK online business in response to changes in the way customers are shopping.

Priorities include maximising the online value of its stores through increased integration, improving user experience across its channels, investing in targeted marketing and personalisation.

Keen to create new business opportunities, Next is also developing its ability to service third-party brands through the launch of its Total Platform in 2020.

This has seen Next taking a 25% stake in premium fashion retailer Reiss from March 2021, with scope to raise this to a majority holding, as part of a long-term strategic partnership.

Reiss will transition to the Total Platform from February 2022. It is one of five Total Platform partners, the others being Childsplay, Laura Ashley, Victoria’s Secret UK (in which Next has a 51% stake), and the newly relaunched Aubin menswear brand in which it has a 33% holding.

Innovation rating: 3.5

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