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Weekly Winners in Retail

Weekly Winners in Retail – 20.07.20

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This week’s news has been dominated by the latest government initiatives to reignite the economy. This has included face masks becoming compulsory from the 24th of the July in shops and Rishi Sunak announcing VAT reducing to 5% for hospitality providers with immediate effect.

We believe there are still big questions despite the latest measures being announced.

Will these initiatives help to get the public out and spending more? Will the reduction be passed on to the consumers or be retained by brands to assist their recovery?

Whilst many brands and landlords continue to face challenging times; we have once again seen many good news stories which we want to shout about and celebrate. Here’s our top 5 winners of the week:

  1. Dunelm looks to invest in digital as lockdown sales soar

When: 15th July

What’s the news?

Dunelm has reported online sales increased by 85.2% in the 16 weeks from 8 March to 27 June (Q4 of FY20). Recognising the importance of a digital first approach, Dunelm has said that it will report heavily in digital this financial, projecting 8.1M in sales. Nick Wilkinson Chief Executive at Dunelm has said the “decisions we have made over the last few months have been guided by our principles and values and we are emerging from this unprecedented period as a stronger business. This has given us the confidence to accelerate our digital transition and introduce new ways of serving our customers. There is lots more to do and we are energised to evolve our customer proposition and operations at pace, as we continue to navigate an uncertain external environment.”

Online drives growth for Dunelm during lockdown

Source: Essential Retail

What do we expect to see?

At Retail Recovery, we applaud how Dunelm are reacting to the changing customer behaviour and trading restrictions, turning these into a positive.  Dunelm have already showed how they are understanding the changing needs of their customers, rolling out contactless click and collect across all stores and trialling a virtual shopping service for those who are shielding or are uncomfortable with returning to store. With more budget to invest, we wouldn’t be surprised if Dunelm look to invest more in video content and augmented reality, to facilitate the shopping experience.

  1. ASOS reports lockdown sales growth and pledges to pay back the government

When: 15th July

What’s the news?

Great news for ASOS.com, who has benefited from an increase in demand internationally, with a 10% growth in grow sales between March and June, achieving just over £1BN. Even though the growth hasn’t been driven by ASOS’ UK arm, with sales reported to be 1% down, they have also pledged to pay back the Government all furloughed costs as part of the announcement.

ASOS becomes the first brand to announce that they will repay furlough costs

Source: The Retail Bulletin

What do we expect to see?

At RetailRecovery we see this as a smart move for ASOS to generate positive PR for the brand. This decision firmly puts them in the camp that the government support should only be used for brands that really need it. Although many brands have traded better than expected during Covid-19 with sectors to include Health and Beauty, Garden and Electricals experiencing strong overall year on year growth, we do not expect many other brands follow suit.

  1. John Lewis make their products more accessible with Co-Op partnership

When: 17th July

What’s the news?

John Lewis moves quickly amid store closures and customers looking to buy locally, as they have today, announced that its fast track, Click & Collect delivery and returns service will be available in over 500 Co-op food stores by the end of the summer, offering customers access to John Lewis products in more convenient locations. This will take the amount of Click & Collect locations to nearly 900 in the UK.

Co-Op partnership strengthens John Lewis Click & Collect offering

Source: Retail Times

What do we expect to see?

In May we discussed in our Whitepaper how growing existing and establishing new partnerships was vital to the sustainability of all retailers. This has been especially the case for brands who have relied on high street footfall. Every retailer should have click and collect not just as an option for their own store but also be expanding their Click & Collect options with local outlets. We also expect to see more pure plays taking advantage of local Click & Collect options, to provide additional delivery options to their customers as some of the nation starts to return to work.

  1. Kurt Geiger owned ‘Shoeaholic’ takes first steps into high street retail

When: 17th July

What’s the news?

With many stores in the high street closing, Kurt Geiger owned Shoeaholic’s has announced that it will open its first physical stores across England and Scotland, following strong online lockdown trading results.

Shoeaholics takes first steps into high street retail

Source: The Retail Bulletin

What do we expect to see?

This is a brave move, based on consumer confidence in returning to the high street still being low and Year on Year footfall numbers reflecting this. It will be essential that Shoeaholic’s use their digital infrastructure to help shoppers easily buy in store, providing a seamless Click & Collect option. We would also recommend that they understand the role of the store in driving online purchases, to understand the true value of the stores.

  1. Wren Kitchens Group increases turnover by almost £100m in a year

When: 17th July

What’s the news?

At RetailRecovery we are always looking for fellow brands from our region who are performing well; that’s why it was great to read that Wren Kitchens Group, which includes Wren Kitchens and their pure play electrical brand Ebuyer have posted a strong trading year, with a significant increase in profits and turnover.

Stellar year for Wren Kitchen Group

Source: Retail Gazette

What do we expect to see?

Whilst these numbers are strong, the only flag is that this does not include any lockdown trading figures, with the financials reported up to 31st December 2019. As Wren Kitchens was a major contributor to this growth and trading will have been limited in lockdown with their 91-store retail estate closed, they will have a lot of making up to do to achieve the same levels by the end of 2020. Like Dunelm, we hope that Wren Kitchens have used this period to focus on how they can meet customer needs through an enhanced digital experience.

Want to be a retail winner?

Are you seeing demand decline after a fruitful lockdown? Do you need to get your retail strategy back on track? Our RetailEvaluator framework enables you to understand where you can improve your retail plan both today and in the future.

Alternatively, you can download our FREE Covid-19 retail strategy whitepaper, containing more than 110 practical recommendation, to help you navigate today’s current climate and plan for business growth.


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