Next chief executive Simon Wolfson said that its Westfield London shop has so far performed below expectations and that the scheme has had less of an impact on its West End shops than it anticipated.
Wolfson said Next, which this week reported like-for-like sales down 6.5 per cent in the full year to January 2009, is still in “amicable” talks with Westfield after disputing some of the additional service charges it deemed “unreasonable”.
He also defended Next’s policy not to discount despite the weak economic climate, and after a 14 per cent drop in pre-tax profits to £428.8m. “We want customers to come out of this recession trusting our pricing. We are not running this business for market share,” he said.
Wolfson said that as the downturn continued to bite the best thing the Government could do to help retailers was to try and encourage consumer confidence. He said bailing out the industry will only undermine confidence.
“The whole economy is in difficulty, no one sector can claim special treatment,” he said. “This is not the end of the world, it is a recession.”
Next Directory continued to generate strong growth for the group, with sales at the top end of expectations, and up 2.1 per cent over the year.
The retailer admitted that its branded online venture Brand Directory had been less successful.
Wolfson remained optimistic about opportunities, particularly in the property market. He said: “There are interesting opportunities both in and out of town. The terms on new space are far better than a year ago.”
Despite homewares suffering the biggest like-for-like decline across all Next’s categories, Wolfson said it would still expand. The retailer will open 10 home stores this year in out-of-town locations.
A spokeswoman for Westfield said: “Westfield London is on target to achieve its anticipated 20 million visitors in the first year.” She added that the centre draws far more widely than just from the West End and it is in the early stages of establishing trading patterns.