Retail round up the Sunday papers
Wm Morrison plans to shake-up the UK baby products market by acquiring the "big box" stores being vacated by Best Buy and converting them into its Kiddicare brand. In its boldest move into non-food yet, the Yorkshire-based grocer is in advanced talks with electricals retailer Carphone Warehouse, which co-owns the Best Buy Europe chain, about taking on the sites. It is thought that all 11 Best Buy stores are under offer to Morrisons, although it could end up choosing only the best sites. The 11 sites, all of which are enormous "sheds" on out-of-town retail parks, are up for sale following Carphone Warehouse's decision late last year to pull its disastrous joint-venture with the American electrical goods giant, Best Buy.
Music retailer HMV will announce that it has seen like-for-like sales slide about 8pc during the Christmas period when it updates the market on trading on Monday. A bright spark amid continuing declines in music will be the jump in technology sales. More than 144 stores have been refitted to promote headphones and tablets, which have pushed technology like-for-like sales above 45pc growth in the five weeks to December 31. The trading update comes as Warner Music, Sony and private equity firm Exponent join a growing number of would-be buyers interested in HMV Live, which was put up for sale in December last year.
When Marc Bolland stands up to present Marks & Spencer's Christmas trading update on Tuesday, he may be forgiven if he takes a pristine handkerchief from his impeccable Autograph suit and wipes his brow in relief. He, like many fellow shopkeepers, appears to have escaped the catastrophe that was predicted by some high street watchers. Father Christmas arrived in the nick of time and filled – if sparingly – retailers' stockings. Analysts believe M&S will post good food figures and that its non-food sales might have fallen by no more than 2.5pc compared with last year. Some are predicting its clothing sales might even be steady with last year.
The UK's largest free-range egg farm has shelved plans to expand its £45m turnover business because of the row over egg production within the European Union. John Campbell, head of Glenrath Farms, said the UK will be flooded with unauthorised imported eggs unless the Department for Environment, Food and Rural Affairs (Defra) changes its stance on the enforcement of free-range rules introduced last week. The price of eggs could "crash" it is feared.
Mail on Sunday
A surge of Christmas trading announcements this week are expected to pinpoint the retailers that have failed to keep pace with online shopping. The City is braced for reports of a bleak midwinter on the High Street after consumers bought gifts on the internet rather than endure the crowds in shops. Britain has become one of the fastest-growing internet shopping markets in Europe with about ten per cent of the country’s annual £300billion retail sales going online.
Editor’s note: Don’t miss the Retail Bulletin’s Multichannel Retailing Summit 1st February 2012. Click here for details and registration.
Lloyds is set to restart the £25million sale of hardware store Robert Dyas, putting out a prospectus for potential buyers within weeks. The bank delayed the sale last October so buyers could evaluate how the High Street chain performed over Christmas. Like-for-like sales, including VAT, rose 7.4 per cent in the four weeks to December 24, the company said on Friday.
Online beauty retailer feelunique.com increased sales by 50 per cent last month despite holding off its Christmas sale until Boxing Day. Chief executive Aaron Chatterley said there was a ‘huge amount of discounting’ in the fragrances and beauty market, particularly among department stores. But he said the Jersey-based site resisted matching cuts, which would discredit it in the eyes of desirable labels that do not like to see their products discounted. Brands include Burberry, Bulgari and Elizabeth Arden.
Peacocks, the budget fashion retailer, is poised to offload its Bonmarché womenswear chain as part of a radical restructuring. The company is expected to sell Bonmarché in the coming weeks. The chain, aimed at older women, has nearly 400 stores and 4,000 employees.
As unemployment rises and austerity bites, more families are turning to rent-to-own companies that offer credit to buy household goods — washing machines, TVs, fridges — for those who cannot get it elsewhere. They charge dearly for the service. With extras such as insurance charges and interest rates as high as 49%, a £300 fridge freezer can end up costing nearly £1,100.
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