Weekly Winners in Retail

Weekly Winners in Retail – 29.06.20

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The last week has been another busy one in retail, as the phased reopening of stores continued across England, non-essential stores in Wales are now open for business and Scotland carried out their final preparation. There have also been many challenges reported, with landlords only receiving 15% of their rent during rent week for the forthcoming coming quarter and Intu subsequently entering into administration.

However, with every Monday, RetailRecovery looks to start the week positively, looking at the winners in retail this week.

  1. THG supports beauty brands with Direct to Consumer move

When: 22nd June

What’s the news?

The Hut Group (THG) Ingenuity technology and eCommerce division has taken advantage of the rise in brands wanting to sell Direct to Consumer (D2C), as they announce that they have won contracts worth £100M. This includes enabling brands such as PZ Cussons Beauty, Nuxe, By Terry and Revolution Beauty to go Direct to Consumer, across all aspects of retailing such as Website Development, Payment and Fulfilment.

Source: Internet Retailing

THG continues to grow, with a potential float option worth £4bn to £5bn

What do we expect to see?

Although we expect more brands to take advantage of THG Ingenuity’s D2C offering in the coming months, we do also see one possible resistance from Health and Beauty brands … are we creating a new Amazon in THG? With retail outlets such as Look Fantastic amongst many retailer brands under the THG umbrella, we expect to see that some brands will be nervous about joining. There will be others who will also prefer not to go down the Ingenuity standard platform, seeing this as an opportunity to differentiate.

  1. Amazon launches new initiative to support small business’

When: 23rd June

What’s the news?

Amazon launches ‘Amazon Small Business Accelerator’ in collaboration with Enterprise Nation providing 200,000 retailers with training programmes, discount on office supplies and PPE equipment. More information on the training programme and business support can be found at the Enterprise Nation site.

Source: Charged Retail

The launch of Small Business Accelerator by Amazon and Enterprise Nation.

What do we expect to see?

With the increase in Amazon usage over Covid-19, the training resource and support access is highly recommended for brands who are either already live with Amazon or looking to use Amazon as a new sales channel. In a week which also saw Google Ad Credits being applied back into many AdWords advertisers account, don’t be too surprised if Facebook also announce something similar.

  1. GO Outdoors future secured by JD Sports Buy Back

When: 24th June

What’s the news?

In what has been seen by some as a controversial process, JD Sports has bought back GO Outdoors LTD in a pre-pack deal, stating that it intends to retain the majority of their retail estate and preserve as many jobs as possible.

Source: The Retail Bulletin

GO Outdoors future saved however how many stores will remain?

What do we expect to see?

Although it’s great news for the GO Outdoors brand, we expect that there will need to be some significant transformation to get the brand back on track, with less stores on the horizon and move to a digital-first approach required. Fingers crossed for all staff that there can be flexibility in store leases, which will help to preserve jobs.

  1. Matalan announce full year trading results

When: 25th June

What’s the news?

Matalan report an increase in revenue by 2.3% over the last year, supported by a growth in online by 24%. Although the growth is a significant one, Matalan acknowledge the tough trading period that the business has operated in, including the political un-certainty and heavy discounting by its competition.

Source: The Industry .Fashion

Online drives business growth for Matalan

What do we expect to see?

With a 24% growth in online sales and the current reduction in footfall driven by Covid-19, we would expect that Matalan would focus their efforts more towards the eCommerce side of the business, including the roles store in supporting online orders and more fulfilment options to meet the local needs of consumers. Matalan’s Chief Executive has also highlighted the rationalisation of their supply chain as a focus area.

  1. Oliver Bonas secure 3.5M funding

When: 27th June

What’s the news?

Oliver Bonas has secured £3.5 million of additional funding from HSBC UK as part of the Coronavirus Business Interruption Loan Scheme (CBILS), to support the short term cashflow challenges which store closures has brought. The scheme has also enabled Oliver Bonas to spend the money required to reopen their stores (currently 50% of their stores are now open)

Source: Retail Gazette

Government funding supports the reopening of Oliver Bonas stores

What do we expect to see?

Whilst the Business Interruption Loan Scheme is providing much needed support for many business’, the funding should be used wisely to create a sustainable future. Our fear is that these are just a short term stop gap for failing business’ which will not survive post peak.

Want to be a retail winner?

Are you looking for support on how you spend your Business Interruption Load? 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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