retail Business news
How to spot The Next Big Thing
Multinationals spend a fortune trying to ascertain what future trends will be; great when bank balances are flush but harder to justify when profit and loss accounts are proof that past forecasted predictions, haven't beared any fruits.

William Higham, Founder of consultancy The Next Big Thing, has released his latest book which goes some way towards offering insights into identifying trends that can be profited from.

Named after his business, the 'how to' book shows you ways to uncover new trends before they reach the mainstream — enabling you to target customers more effectively, expand your markets and develop more desirable products and communications campaigns — boosting profits and driving you ahead of the competition.

In today’s volatile world, changing consumer behaviours have an increasing impact on global commerce. Consumer trends can affect every sector and every market. The success or failure of global brands from Dove to Apple, McDonalds to Coca-Cola, is increasingly recognized as being trend-driven.

Investigating everything from types of trends to trend drivers and prediction, and with a full explanation of the concept of trend marketing, The Next Big Thing will enable you to anticipate, prepare for and benefit financially from trends.

It features many examples of companies which have spotted trends and used them to their own advantage such as: Apple, Nintendo, Amazon, McDonald, L. Vuitton, Mercedes and Heineken.

It also offers many comments from industry insiders like Lisa Puolakka, Head of Brand Identity (Nokia), Mark Broughton, Research Insights & Knowledge Manager, Global Product Development (Boots), Tim Richards, CEO (Vue Cinemas), Dave Capper, President, Lifestyle Music & Media (Hasbro Toys) Gavin Emsden, Food & Beverage Insights Director (Nestle UK).

The Next Big Thing — Spotting and forecasting consumer trends for profit
is published on 25th September 2009. | Price: £19.99

Visit: Kogan Page [25 September 2009]

[9 September 2009]


  Consumers raise questions over 'Fast fashion'
The latest Clothing Retailing Market Report issued by Key Note today, examines consumers concerns over the ethical standards of high-fashion retailers, the impact high fashion has on the clothing market in the UK; and how the industry will fair in the next five years.

British supermarkets came under attack in February 2009, following a report by the Clean Clothes Campaign (CCC) — an alliance of trade unions and non-governmental organisations — which said that the supermarkets claim that their cut-price clothing is made under ethical standards is questionable. Researchers from the CCC also said that the supermarkets workplace standards auditors often know that they are being hoodwinked, but turn a blind eye to endorse the factory as compliant with the company’s code of conduct. According to Key Note estimates, supermarkets now account for more clothing sales than any other type of outlet, increasing their share of the market from around 10 per cent in 2000 to 23 per cent in 2008.

Ethical fashion, which involves participating companies paying fair wages, using sustainable fabrics and limiting their environmental impact, is gaining more support from consumers. An increasing number of retailers are now selling Fairtrade clothes and/or T-shirts made from organic cotton. However, Key Note’s report expects that the recession will mean that retailers will focus on value over the next five years as cash-strapped consumers become ever more cost conscious.

This should benefit the supermarkets and the fast-fashion shops that specialise in low-price but fashionable clothes. It is likely that innovation will suffer during the economic downturn as profit margins are squeezed, and retailers and suppliers are unlikely to wish to risk funds on too many new ideas, leading to a temporary focus on the safest styles and fashions.

Fast fashion has also been heavily influenced by the growth of celebrity culture, with clothing retailers hastily mimicking the latest fashion trends worn by well-known names in the media. However, other media reports have indicated that the fast-fashion trend is having an adverse effect on the environment, with approximately two million tonnes of clothing disposed of a year in Britain — a figure that is constantly increasing due to this trend, with consumers purchasing cheap items that can be worn once and then thrown away.

The recession is likely to result in very subdued sales growth in 2009, while an anaemic recovery is likely to continue to constrain sales in 2010. Key Note forecasts that value growth will also be depressed by intense competition and discounting among retailers. It remains to be seen how many consumers will prioritise their ethical concerns over their ability to purchase fashionable clothing on a restricted budget.

Visit: Keynote | Clean Clothes Campaign [9 September 2009]

[8 September 2009]

British Retail Consortium


The latest UK Retail sales figures have shed considerable light on the true state of consumer spending, reveals the British Retail Consortium and KPMG.

Value promotions and spending on essentials items have been the key spending drivers during the summer months.

The figures, summarized below, showed that food sales continue to grow whilst clothing and footwear sales have stalled. Other findings for the four weeks from the 2nd – 29th of August 2009 were:
— UK retail sales values fell 0.1 per cent on a like-for-like basis from August 2008, when sales had fallen, hit by very wet weather. On a total basis, sales rose 2.2 per cent against a 1.4 per cent gain in August 2008.
— This August, food sales continued to do better than non-food. Food sales growth edged up only slightly from July’s low. Clothing and footwear weakened further. Homewares and furniture sales fell back below year-earlier levels after July’s weather- and clearance-driven growth.
— Non-food non-store sales (internet, mail-order and phone sales) in August were 7.9 per cent higher than a year ago, the weakest since May.

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Stephen Robertson, Director General, British Retail Consortium, said: “The stronger figures of June and July haven't been sustained. It's clear the deceptively good sales growth of those months was due to summer sun and price cuts — not any major revival in how customers are feeling. What spending we now have is all about value and essentials.

“In August, food sales continued to do better than non-food. After two months of growth, clothing and footwear are well down. People are holding off buying autumn and winter clothing till they actually need it.

“Most people are still very reluctant to spend on expensive household items — unless they’re sufficiently discounted. As we head into autumn, we mustn't make too much of any positive sales growth because the comparison will be with very weak figures a year ago when total sales growth dipped below zero."

Helen Dickinson, Head of Retail, KPMG, said: “The improvement in home spending which boosted performance in July did not continue into August. Also, the timing of the bank holiday, which fell into August's results for 2008 but not in 2009, did not help the overall figures which are below those we have seen for the last couple of months. Like-for-like sales across most sectors, with exceptions such as food and children’s clothing, were negative in August.

“The results for the month and the rest of the year need to be considered in the light of the performance last year, which continued to weaken as the year progressed. Negative like-for-like sales on the back of the same situation last year is leaving many retailers with some serious challenges around controlling costs and generating cash.”

Non-Food Non-Store
Sharon Hardiman, Head of Non-Store Retailing (i.e. transactions which take place over the internet, or via mail order or via telesales), BRC, said: “This is the second weakest growth we've recorded in the eleven months this

Non-Store Sales
% change on a year ago

measure has been running and well down on July's figure. Customers are pulling back and it's clear the stronger sales of previous months were driven by seasonal factors and promotions not any widespread return of consumer confidence. “Non-store sales of non-food goods continue to outperform store sales but they are not immune from the impact of the recession on customers’ ability and willingness to spend.”

Visit: British Retail Consortium | KPMG [8 September 2009]

[8 September 2009]

Gap Inc.

  GAP SPONSORS forthcoming exhibition at the Met Museum
Gap Inc. [NYSE GPS] is to sponsor a forthcoming exhibition, at The Metropolitan Museum of Art’s Costume Institute entitled American Woman: Fashioning a National Identity, in Spring 2010. The exhibition, drawn exclusively from the newly established Brooklyn Museum Costume Collection at the Met, will feature approximately 75 ensembles — many of which have not been seen by the public in more than 30 years.

“As one of America’s most iconic brands, we’re proud to be included among the esteemed group of fashion brands that have participated before us,” said Marka Hansen, President of Gap brand North America

The sponsorship marks the fashion company's ongoing support of the arts, which it has endorsed throughout its 40-year history. Gap’s involvement will allow the public to see treasures from an important collection of historic American fashion that has not been seen by the public in many years.

Visit: Gap Inc. [8 September 2009]

[7 September 2009]

associated british foods plc.


Cheap and fashionable products continue to deliver profits at ABF's primark
Despite having to tighten purse strings, consumers wishing to update their wardrobe with cheap fashion fixes, are heading to Primark.

Owners Associated British Foods plc issued an update (prior to entering the close period for its full year results to the 12th of September 2009 — which are scheduled to be announced on 3rd of November 2009) revealed Sales and profits at Primark will be well ahead of last year.

The company expects to have opened six new stores in the second half of the year, two in Spain, one each in Germany and Portugal, and two in the UK — bringing the total number of stores to 191 by the year end.

Primarks like-for-like sales is expected to grow by 7 per cent for the full year, driven by a very strong performance in the UK. This performance was achieved through Primark’s strong competitive position, replicating key fashion trends in its merchandise and better weather than last year. Overseas, Primark stores, in Continental Europe, have performed well although assessing how well stores in Germany and Portugal have done is premature in light of their recent opening.

The company altos reported that its Operating profit margin is expected to be lower than last year, impacted by the increased fixed overhead of the new UK distribution centre, as was the case in the first half, but also by lower gross margins as a result of the effect of sterling weakness on the cost of goods priced in US dollars.

Visit: Associated British Foods [7 September 2009]

[4 september 2009]

Quiksliver, inc.


Quiksilver adapts to challenging times
Quiksilver, Inc. [NYSE: ZQK] announced a decrease in consolidated Net revenues from $564.9 million to $501.4 million for the third quarter of fiscal 2009. Adjusting for changes in foreign currency as compared to the U.S. dollar, this represented a decline of 5 per cent in constant currency. Consolidated pro-forma income from continuing operations for the third quarter of fiscal 2009 was $3.7 million, or $0.03 per share, compared to $33.1 million, or $0.25 per share, for the third quarter of fiscal 2008.

Robert B. McKnight, Jr., Chairman of the Board, Chief Executive Officer and President of Quiksilver, Inc., commented, "The fiscal third quarter was a very important period for our company as we delivered on the financial expectations we set a quarter ago and secured our global refinancing plan. In doing so, we have returned our focus to the continuing development of our core businesses. The retail environment remains very challenging and we will continue to adapt our cost structure to this trend as we go forward."

Visit: Quiksilver [4 September 2009]

[4 September 2009]

Saks Incorporated


Saks Store Sales weakened by economic downturn
Retailer Saks Incorporated [NYSE: SKS] announced that owned sales declined 18.2 per cent from a total of $196.4 million in 2008 to $160.8 million for the four weeks ending on the 29th of August 2009. Comparable store sales decreased 19.6 per cent for the month.

On a year-to-date basis, for the seven months ending on the 29th of August 2009, owned sales totalled $1,331.8 million compared to $1,689.9 million, a 21.2 per cent decrease. Comparable store sales decreased 22.0 per cent for the seven-month period.

The Saks Fifth Avenue stores experienced continued weakness across all merchandise categories during the month. Saks Direct and Saks Off 5th showed relative strength in August.

Management continues to estimate that comparable store sales will decline in the mid-to-high single digit range for the second half of fiscal 2009 (with the third quarter weaker than the fourth quarter).

Saks Incorporated operates 53 Saks Fifth Avenue stores, 54 Saks Off 5th stores and

Visit: Saks [4 September 2009]

[3 September 2009]

Tiffany & Co.


Tiffany's rides out the challenging times
Tiffany & Co. [NYSE: TIF] Net sales declined 16 per cent to $612.5 million for the second quarter ending on the 31st of July 2009. Net sales in the six-month (first half) declined 19 per cent to $1,130.1 million. Net earnings from (continuing operations) were $56.7 million, compared with $82.6 million, in the prior year. Both sales and net earnings were below last year but exceeded expectations as a result, management increased its outlook for the full year accordingly.

Michael J. Kowalski, Chairman and Chief Executive Officer, said, "While economic and retail conditions remain challenging, we were encouraged to see many stores achieving either smaller year-over-year rates of sales declines or modest sales growth compared with the past two quarters. More importantly, Tiffany's strong financial and operating position allows us to continue to expand our global presence in pursuit of robust, long-term growth."

Visit: Tiffany & Co. [3 September 2009]

[3 September 2009]

TJK Companies inc.



The TJX Companies, Inc. Reports Strong August 2009 Sales
The TJX Companies, Inc. [NYSE: TJX] reported a 6 per cent increase in sales in August 2009, pushing further past the one billion mark to $1.6 billion from $1.5 billion last year.

For the 30 weeks ending on the 29th of August 2009, sales reached $10.7 billion, up 3 per cent over the $10.4 billion achieved during the 30-week period last year. Consolidated comparable store sales increased 5 per cent compared to last year whilst consolidated comparable store sales increased 3 per cent for the same period.

Carol Meyrowitz, President and Chief Executive Officer of The TJX Companies, Inc., stated, Our strong sales momentum continued in August, with consolidated comparable store sales up 5 per cent for the month, which was better than we had planned. Despite the tough economy, customer traffic counts remain extremely high. The marketplace is full of exciting merchandise and our stores continue to offer fresh selections of great brands and values for the back-to-school selling season. While still early, September is off to a solid start and merchandise margins continue to be strong. We are excited about our opportunities for the back half of the year and remain focused on the execution of our flexible, off-price business model.

Visit: The TJX Companies, Inc. [3 September 2009]

[3 September 2009]

Abercrombie & fitch



Abercrombie & Fitch Reports August Sales Results
Abercrombie & Fitch [ANF] net sales dived by nearly a quarter (23 per cent) from $405.5 million to $313.9 million for the four-week period ending on the 29th of August 2009.

Other August 2009 Developments included:
— Total Company net sales decreased 23 per cent
— Total Company direct-to-consumer net merchandise sales increased 1 per cent
— Total Company comparable store sales decreased 29 per cent
— Abercrombie & Fitch comparable store sales decreased 26 per cent
— abercrombie comparable store sales decreased 26 per cent
— Hollister Co. comparable store sales decreased 32 per cent
— RUEHL comparable store sales decreased 37 per cent

Year-to-date, the Company reported a net sales decrease of 23 per cent to $1.574 billion from $2.051 billion last year. Comparable store sales decreased 29 per cent for the year-to-date period. Year-to-date, total Company direct-to-consumer net merchandise sales decreased 15 per cent to $116.9 million.

Visit: Abercrombie & Fitch [3 September 2009]

[3 September 2009]

Gap Inc.

  In Store promotions improve Old Navy's Performance
Gap Inc. [NYSE: GPS] has capitalized on students need for new clothing for the forthcoming school term, by improving merchandise offered to accommodate the demand. The move, which has improved the company's Old Navy brand performance, has gone some way in stemming the decline in sales. For the four-week period ending on the 29th of August 2009, net sales were $1.12 billion which represents a 2 per cent decrease compared with net sales of $1.14 billion for the four-week period ending on the 30th of August 2008. The company’s comparable store sales for August 2009 were down 3 per cent compared with an 8 per cent decrease in August 2008.

Comparable store sales by division for August 2009 were as follows:
— Gap North America: negative 7 per cent versus negative 5 per cent last year
— Banana Republic North America: negative 8 per cent versus negative 14 per cent last year
— Old Navy North America: positive 4 per cent versus negative 9 per cent last year
— International: negative 12 per cent versus negative 2 per cent last year

“During August, customers responded well to our denim collections at Gap and Old Navy,” said Sabrina Simmons, Chief Financial Officer of Gap Inc.

“We were especially pleased by the progress at Old Navy and its strong back to school performance, which helped support total company merchandise margins significantly above last year.”

Year-to-date net sales were $7.49 billion for the thirty weeks ending on the same date, a decrease of 7 per cent compared with net sales of $8.02 billion last year. The company’s year-to-date comparable store sales decreased 7 per cent compared with a 10 per cent decrease last year.

The company will report September sales on the 8th of October 2009.

Visit: Gap Inc. [3 September 2009]


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