The Retail Round up - The Sunday Papers
4 March 2012 | by The Retail Bulletin
The Mail on Sunday
Riddle of phantom shop jobs: Supermarkets fail to deliver 39,000 promised positions
Major supermarkets have failed to create the tens of thousands of jobs they promised, undermining Government hopes that the private sector is soaking up public sector employment cuts. Research by Financial Mail reveals that Tesco, Sainsbury’s and Asda collectively pledged to create 67,000 jobs between 2008 and 2010. But only a fraction of those have been added permanently as chains continue to shed staff through an ongoing cycle of ‘efficiency’.
Game Group on alert as fans are urged to switch
Britain's biggest video game retailer is braced for a new blow this weekend as gaming fans threaten to cash in gift vouchers and switch to online rivals.The Game Group said last week a supply agreement had broken down, cutting its access to Mass Effect 3, one of the year’s biggest releases. Other products supplied by EA Games could be also affected. Hundreds of gamers, some left in the lurch with unfulfilled orders, have taken to the internet, with some warning others to redeem gift vouchers as soon as possible in case of any further financial woes.
Friends wrest Iceland from under noses of country's biggest supermarkets.
Two of Britain’s best-known retail bosses have joined forces to pull off an audacious buyout of the Iceland chain from under the noses of the country’s biggest supermarkets. The £1.45billion deal could be finalised this week. Its founder Malcolm Walker will increase his stake in the business, while long-time friend and DFS Furniture founder Lord Kirkham will put in his own cash. Kirkham is set to take a seat on the board of the newly structured company.
High Street retailers braced for a grim set of sales figures
The temperature of the High Street will be tested next week as Britain’s battered retailers release a fresh raft of figures. Supermarket Morrisons, which has recorded strong growth in recent years, is expected to show recent sales performance has slowed, overshadowing annual profits which are expected to hit targets. Britain’s big four supermarket chains have been fighting pitched battles against each other to win hard-up shoppers, who have reined in spending on all but the most essential of items.
Restaurant owner Tragus in talks with its banks
Tragus, the owner of high street restaurant chains Cafe Rouge and Strada, is in crisis talks with its lenders to avert a looming covenant breach. The company, which is owned by private equity firm Blackstone, is due to meet its banks this Tuesday after admitting it is likely to fail a covenant test at the end of May. It will ask lenders to give it more headroom on its £230m of debts in exchange for a fee of around £10m and higher future interest payments. While Tragus has no immediate liquidity problems and £40m cash on its balance sheet, its current performance points to a covenant miss in May.
Tesco sales improve as discounts draw in shoppers
Tesco has seen a resurgence in sales after the beleaguered supermarket chain encouraged more customers to visit its shops with heavy discounting. Sales data suggest that a push by Tesco, which handed out millions of discount vouchers last month, has paid off, allowing it to finish its financial year on a brighter note than many feared. Last week industry figures indicated that Tesco’s market share had slipped further, taking it to the lowest level since 2005. Kantar Worldpanel data showed that its market share in the 12 weeks to February slipped to 29.7pc, compared with 30.3pc a year before.
John Lovering to chair hair straighener-maker GHD
John Lovering, the former chairman of Debenhams, is to take on the same role at the company that makes GHD hair straighteners as part of a boardroom shake-up. Mr Lovering, who has also been chairman of Mitchells & Butlers and Peacocks, has been drafted in as part of a reshuffle at GHD Group, which owns and markets the brand around the world and is majority-owned by Montagu Private Equity.
City Link failing to deliver for Rentokil
Pest controller is held back as parcels arm has 'major issue with productivity' The City Link parcel delivery business has become the albatross around the neck of Rentokil Initial– and even the Queen's pest controller is struggling to neutralise it. "We've got two stories," said Alan Brown, Rentokil's chief executive. "We're seeing increasing momentum in our pest, hygiene, textiles and facilities management businesses but there's a big but: City Link has continued to disappoint."
Supermarkets fear egg shortage as farms close over welfare rules
The cost of new EU regulations on hen cages is threatening to force many food manufacturers out of business. Britain's supermarket shelves could be empty of key products within a month as an acute shortage of eggs threatens to have serious consequences for the country's food chain. New EU rules banning the housing of hens in conventional cages are being blamed for what some in the industry are already labelling a "crisis", as competition among food manufacturers to source eggs sends prices rocketing. The price of eggs on the EU wholesale market has nearly quadrupled over the past week to more than four euros a kilo.
Tesco and rivals turn against huge stores as internet shopping takes over
Retailers from HMV to Comet have struggled to compete with the internet. Now the big supermarkets are changing strategy as customers begin to favour online shopping over hypermarkets. Has the behemoth had its day? After years of relentless expansion, the UK's biggest retailer, Tesco, last week saw its market share fall to the lowest level since 2005. The supermarket gained the upper hand over its rivals by ambitiously opening ever-larger stores across the country. That strategy may now be coming back to bite it.
The Sunday Times
Chinese trainers fit for float
A sports goods manufacturer is to become the first consumer brand from China to float in London. Naibu, which makes leisurewear and trainers, hopes to raise £50m in a listing on AIM, London’s junior market, valuing the company at about £110m. The float, being handled by Daniel Stewart, the stockbroker, is designed to raise international awareness of a business that is focused entirely on its home market but has long-term ambitions to establish a presence outside China.
Grocer lands fresh catch
Supermarket giant WM Morrison will announce it has bought an empty fish factory in Grimsby when it reveals full-year results on Thursday. The chain, which produces half the fresh goods it sells in stores, will revive the Lincolnshire plant and plans to produce 10,000 tonnes of seafood a year, including salmon, cod and surimi — a Japanese fish paste. Headed by Dalton Philips, Morrisons, the country’s fourth biggest supermarket chain, is ramping up its efforts to manufacture more of the fresh produce it sells instead of using suppliers.
Iceland tops best employer awards
Iceland, the frozen food retailer, is today named the Best Big Company to Work For in Britain. The high street supermarket chain, about to be bought back by its founder Malcolm Walker, triumphed in the 12th annual Sunday Times Best Companies competition. Iceland came top in a survey of more than 1,000 organisations. The study is conducted by Best Companies Ltd and The Sunday Times.
Welsh heritage? It’s in our jeans, just £230 a pair
The rhythmic thrum of sewing machines has returned to Cardigan. The west Wales town is making jeans again almost 10 years after Dewhirst Ladieswear shut down Britain’s biggest jeans factory. Elin Evans, a machinist, feared the worst that Thursday afternoon in July 2002 when workers were called to a meeting in the canteen. Those fears were soon confirmed. Marks & Spencer, one of Dewhirst’s biggest customers, announced it was ending more than 30 years of production there and moving it to Morocco.
Tesco cuts prices as it launches clothes line
The first woman to take charge of Tesco’s clothing sales has opted for something of a more-for-less policy in an attempt to win back shoppers. Jill Easterbrook is cutting prices on its clothing ranges and is introducing a new low-price brand. The F&F Basics range will include 70 items, making it 40 per cent bigger than the Tesco Value range it is replacing. Items will cost, on average, £3.30, with 40 per cent of kidswear priced under £5 for spring and summer, compared with 25 per cent last year.
Will this wild idea tarnish Cartier?
Its clientele has included tsars, queens and at least a couple of noteworthy duchesses. Now Cartier is to mix with the hoi polloi by taking to the television with a three-and-a-half minute advertisement.But the jeweller faced warnings from luxury goods experts yesterday that it risked tarnishing its allure if it was seen to “sell out” through commercials.
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