Sunday Retail News Roundup
Look out Santa, Net-A-Porter founder lined up for Farfetch, Retail boss enormous payout, Footsie heads for record high, Smooth Brexit, JD Sports warned three years ago, Super Saturday smashes Cyber Monday, Asda festive retail war, Frenzied Friday.
Mail on Sunday.
The takeaway business booms, even on Christmas Day, tens of thousands of Britons reach for the Just Eat app. Just Eat is the biggest and fastest growing online takeaway business. It doesn’t cook but its app allows users to choose from a huge range of restaurants and make their order. Just Eat takes a cut of the order price. 38,000 restaurants are signed up, an extra 1,000 added last week with its £200 million takeover of rival Hungryhouse. Annual revenues expect to exceed £350 million this year. The company, listed on the London stock market, has doubled in value in the past year to £3.9 billion. David Buttress, CEO, stake is currently worth about £30 million. Just Eat has 400 engineers working to keep the firm at the leading edge of commercial deployment of the latest technology, Earlier this month, it made its first delivery by robot, part of a partnership with robot delivery company Starship Technologies. The robots, fitted with nine cameras and a microphone, have driven over 15,000 miles in total and none have been vandalised.
Online fashion guru Dame Natalie Massenet has been linked to a role at luxury giant Farfetch which is preparing for a £1 billion stock market listing as soon as next year. Massenet was the founder of Net-A-Porter.com but made a shock exit from the London-based firm more than a year ago after it was acquired by Italian firm Yoox. Since then she launched her own advisory firm Imaginary Ventures. She was subject to a 12-month, non-compete agreement, which was lifted in September. It would be a boost for Farfetch as it prepares plans to list shares on the stock market and raise funds in a move that could value it at £1 billion. The company, run by founder Jose Neves, is understood to have met with advisers over a possible fundraising.
Millionaire Philip Day, owner of high street names including Austin Reed, Jane Norman and Edinburgh Woollen Mill, has landed a huge windfall after the business paid out £31 million in dividends. Day is expected to be main beneficiary of the payout from parent company Edinburgh Woollen Mill Holdings. It is a record for the business. The group tripled in size in four years, largely through a series of acquisitions including the purchase of 388-store chain Peacocks in 2012. Sales at Edinburgh Woollen Mill Holdings increased 2.4 per cent to £576 million in the year to March. Profit declined 15 per cent in the same period to £90 million.
Rising commodity prices and the fall of the pound sent the FTSE 100 soaring in 2016. Gold and diamond miner Anglo American, owner of De Beers business, topped the leaderboard with a 278 per cent rise. The FTSE 100 closed on Friday at 7,012, which is 12.3 per cent above its closing position on December 31, 2015. The FTSE 250 is up 2 per cent, while the FTSE SmallCap index is up 9.1 per cent. The FTSE’s all-time closing high came in April 2015, when the index finished at 7,103. Morrisons was the only non-miner in the top six, rising 54 per cent amid signs that the retailer’s recovery plan under chairman Andy Higginson was starting to turn the supermarket around. Dixons Carphone and Next were both down 31%. EasyJet shares were the second-worst performer, after the released of a Brexit profits warning in late June.
The detailed picture of share performance of companies listed in the FTSE 100 shows a clear and stark divergence between those companies really doing business in Britain and those who are just listed on the London stock market.
The question now is what is the best path for Britain outside the EU. There are opportunities for business in Brexit, but there are challenges and risks. Making the most of the one and minimising the other is essential. Most of Britain’s leading retailers have seen their shares fall by at least 10 per cent and often by 20 per cent or more. After Mike Ashley’s public drubbing for the employment practices at his Sports Direct business, cue JD Sports, where reports on Channel 4 last week appeared to show an oppressive working environment, the company has launched an investigation, as if it was as surprised as anyone. The JD site in Rochdale has faced criticism for its staff conditions before. The whole debacle follows oppressive working conditions at an Amazon distribution centre. As we enter the final week of shopping before Christmas and enjoy the marvels of the new taxi apps, digital shopping and home delivery revolution, we should wonder a little if our 21st Century shopping revolution also has a whiff of the 19th Century about it.
Sportswear giant JD Sports is facing renewed pressure over staff conditions after it was warned about harsh treatment of workers more than three years ago. The multi-billion pound company, which has 800 stores across the UK, was exposed in TV reports last week comparing it to ‘a prison’ and showing staff at its main distribution centre in Rochdale exposed to draconian rules. But the company was first warned over its treatment of staff in 2013. The Department for Work and Pensions confirmed yesterday it had barred JD Sports from hiring staff for the Rochdale site at job centres pending an investigation into its treatment of employees. At the same time, some current and former local politicians in Rochdale said they are shocked that staff conditions are still an issue after receiving reassurances from the company three years ago. The main shareholders of JD Sports, Andy and Steve Rubin, have amassed a personal fortune in excess of £2 billion.
Thousands of Brits hit the high street to do their Christmas shopping on a day dubbed Sales Saturday. Eight out of 10 stores offered discounts of up to 85 per cent and people flocked to Oxford Street in London to take advantage of the bargains. Spending was predicted to top £3.5billion on Saturday which equates to £450,000 a minute, as some stores open at 9am and close at 10pm. The sales frenzy is expected to bring a rise of 27 per cent in the number of shoppers compared to a normal Saturday. It tops Black Friday and Cyber Monday. Estimates suggested more than £1.2billion was spent on online on Black Friday on November 25, as shoppers rushed to snap up heavily discounted goods. Experts believe the total online spend over the Black Friday ‘peak period’ between Monday 21 November and ‘Cyber Monday’ on November 28 was almost £6.5billion.
The humble Brussels sprout has become the weapon of choice for Asda as it seeks to win back festive shoppers who have been deserting in droves for Aldi and Lidl. The Walmart-owned grocer is slashing the price of Christmas vegetables including sprouts, carrots, parsnips and broccoli to 20p, a 57pc reduction on the cost of last year’s vegetables. The move is part of a plan by Asda boss Sean Clarke to go head-to-head with the discounters on a limited range of fresh produce. By doing this and avoiding all-out price warfare, the supermarket chain will attempt to protect profitability, which is sacrosanct to its American owners.
Fenzied Friday, 23 December, is set to be the busiest food shopping day of the year in the UK, with an estimated 10 million people expected to hit supermarket aisles. Calculations are that shopping is set to peak on the day when many receive their December pay cheque. It is estimated shoppers will spend £894m, or £865,158 a minute, on food, drink and gifts that day. Spending in Britain is set to make up 25% of total expenditure that Friday across Europe. The average British family spends £800 on its Christmas shopping (including food, drink and gifts) almost double the European average. Bosses at Asda and Waitrose expect Friday to be the most frenetic day. Waitrose anticipates its till takings will be three and a half times higher than normal Friday trading. Tesco, along with Sainsbury’s, expects shopping to be more spread out over the week while the Co-op convenience store chain, which has 2,800 shops across the UK, has earmarked its busiest day as Christmas Eve. Many retailers make more than half of their sales and profits in the three months before Christmas. Waitrose opened the Christmas delivery slots for online shopping on 22 September this year due to customer demand, 93 days before the day itself. Marks & Spencer expects to sell more than 6.5 million pigs in blankets and over 720 tonnes of stuffing. M&S was the first retailer to launch ready-made fresh gravy 20 years ago and expects to sell 500,000 litres in December. Despite shoppers having the chance to stock up in advance with wine, beers and spirits, Asda says that on Friday alone it expects to sell more than 620,000 litres of Budweiser. Aldi has prepared for peak shopping on Friday by organising 1,000 extra trucks on the road to meet increased demand.
Email this article to a friend
You need to be logged in to use this feature.
Please log in here