At its peak, it was the clear greetings card market leader with over 1,000 stores and a presence in almost every major British town, but an influx of internet rivals alongside the growing popularity of Card Factory’s value offer resulted in the retailer losing its grip on the industry.

Clintons may be battered and bruised but the cards retailer refuses to fold, despite two administrations in the 2010s and mass store closures. However, new owner Cardzone admits it faces a challenge to get it back on track.

“We weren’t optimistic as to what we would find or the condition the business would be in, but we underestimated the task to turn it around,” admits Cardzone trading director James Taylor.

However, he and Cardzone know how to navigate the UK greetings market. He works under his dad Paul Taylor, who opened the first Cardzone in 2005. It’s a true family affair as his sister Alex looks after the marketing.

The family business has around 175 stores across the UK, the bulk of which trade as Cardzone shops, however, it also operates Hallmark, Yankee Candle, Mooch, Paper Kisses and Card Centre.

James Taylor explains the business’ growth – which reported a 28% surge in pre-tax profit to £6.48m last year against sales of £51.9m –  has come mostly through acquisitions, with Cardzone acquiring the outlet business to most of its sister brands gradually over the years including Yankee Candle’s outlet business in 2020.

He says that buying Clintons seemed the next logical step.

“It was the biggest opportunity that was ever available to us over the years to really grow at a significant level and take on some really good stores,” explains Taylor, sharing that the business came close to securing a deal for the high street chain back in 2019 before the pandemic hit.

However, the family’s ties with Clintons runs a lot deeper.

Dad Paul sold his first greetings card retailer, an eight store chain The Greeting Card Group, to a venture capital-backed business before it was sold on to Clintons in the late ’90s.

“It’s quite fitting that coming up to our 20th anniversary, we’ve managed to do this acquisition of a very different Clintons, I might say, to what it was,” says Taylor.

The deal has seen the group’s store estate and turnover “effectively double”, which Taylor admits comes with a new challenges for the business.

“We’re going to need to strengthen our management team a bit, which is something that we’ve been working on, but it’s going to pose a different challenge for us, because we have been able to really micromanage effectively the business [until now].”

For now, Taylor says the two brands will sit alongside each other with the pair competing in very few locations.

Along with the differing locations, Taylor says the big difference between the two chains is the size of store, with the typical Clintons shop almost double the size of Cardzone at around 2,300 sq ft.

He adds that the product mix is also distinct, with Cardzone selling more gifting than Clintons.

‘A lot to sort out’

Taylor is cautious over celebrating its new acquisition yet.

“Until we’ve got it performing, we almost don’t want to celebrate because there’s a lot of work cut out and a lot to sort,” he says. “It’s in a worse position than what we’d anticipated.”

“One thing I can say is that we’re very confident that we can turn this around, but it needs to be run quite differently to how Clintons was running the business.”

The retailer’s troubles on the high street has been widely reported. It’s aggressive growth strategy in the 1990s saw the retailer grow from around 270 stores nationwide to over 670 in the space of four years.

Then in 2004 it snapped up rival chain Birthdays – which operated 500 stores, discount business Cards Direct, and a string of Partyland franchise outlets – for £46.4m in a deal which expanded the Clintons portfolio to around 1,250.

The retailer found itself grappling with an over-inflated rent bill and increasing competition from Card Factory and the supermarkets, which forced it to call in its first set of administrators in May 2012. It was sold a few weeks later to a subsidiary of US card maker American Greetings in a rescue deal that saved 434 out of its 784 stores. Its Birthdays business was not included in the sale.

The high street chain faced collapse once more in 2019 – blaming business rates and weak consumer demand – after it failed to gain support from its landlords for a CVA. It was bought back by American Greetings in a pre-pack deal that safeguarded 2,500 jobs and 332 stores.

However, there was no return to form as Clintons hired restructuring advisers last year after racking up £5.4m in pre-tax losses as sales plunged 25% to £96.5m in the year to 27 May 2023.

Its store estate has shrunk from 232 to 160 stores nationwide as of June this year, as its previous owners sought to focus on profitable stores.

“It’s fair to say the business has struggled,” says Taylor. “Going from 1,000 stores and the processes, policies and procedures in a business of that scale, compared to one like this now – they’re very different things. I think it’s struggled as it’s downsized over the years.”

Despite that, he believes there’s still great value in the brand. “Clintons is a household name, isn’t it? People know Clintons and it’s been around for a very long time.”

Familiar with operating a greetings card business on a smaller scale, the Taylors are keen to apply their expertise to Clintons.

“Cardzone being an owner-led business, we’re very mindful and controlling of cost base,” says Taylor. “There are a lot of different products and services that Clintons over the years signed up for [such as] different facilities and financial systems.

“We’re quite simple, we keep things very basic, and that model has worked and it means that you can trade robustly on a high street that is difficult – it has its highs and lows.

“We’re an incredibly seasonal business like many retailers are, but being a greeting card specialist, without Christmas, we wouldn’t have a business it’s as simple as that.

“You have to be able to run a business all year round and you have to control your costs extremely well in the quiet times,” he says.

Taylor is anticipating a “challenging” golden quarter for Clintons as Cardzone honours the 2024 Christmas orders the high street chain placed before the acquisition.

With a difficult key trading period ahead, Taylor does not expect the high street chain to turn a profit until “post Christmas 2025 when hopefully we’ll have really traded well across that full year”.

What next?

Taylor admits that the family hasn’t fully decided on the finer details of its plan for Clintons, sharing that most of his time has been spent on trying to get the high street chain back on track.

“We don’t actually know exactly what direction we’re going to take some of these things in,” he admits.

“It’s hard to say because we’ve got so much to sort out within the business and that change is going on right now. At the moment, you’ve got two sets of everything and that model won’t work long term so we are making some changes in that way.”

He says that is “going to mean some pain this year” with its brand strategy and growth plan coming into force from 2025 onwards.

That pain may include some more Clintons store closures in the coming months, on top of the existing foreclosures of branches that were not included in the sale, “whilst we get the ship turned around”.

“The problem is that some of the Clinton stores are way too big for modern times on the high street so it’s downsizing and finding something more suitable.”

However, Taylor is cautious of how discussions with landlords will go “because of how the business was run previously”.

Rightsizing the store portfolio is only half of the problem.

“The Clintons stores aren’t the most easily shoppable and they can be quite claustrophobic,” says Taylor.

“We want to try and open things up a bit, showcase the high proportion of cards as we know that most customers come in for that. Then from a gift in perspective, we use quite low circular tables in Cardzone and that works effectively.”

“We see the most opportunity to grow sales on the gifting,” says Taylor, explaining that the business has introduced more giftable products to widen its appeal to shoppers.

Clintons has been seen as a more premium card shop on the high street when compared with Card Factory and Cardzone itself, but Taylor admits it will introduce more offers in store to align with Cardzone, which is “quite promotional driven because customers like a bargain”.

Clintons 3.0

Once Clintons is profitable again, Taylor says the team can begin to look at “the exciting stuff” such as launching “the future look of Clintons”.

“We want to have a concept that definitely holds on to the traditional key factors of Clintons but also introduces some newness and giftware and different ways of displaying products.”

He predicts this will likely start rolling out “either later this year or 2025”.

This will be the second brand refresh for Clintons, as its previous owner ditched the chain’s well-known orange branding in favour of its current red logo back in 2012 after it bought the brand out of administration – although Taylor hinted that it will stick with red.

He is also considering rebranding some of the existing Cardzone stores as Clintons once the rebrand is complete “because we know that the Clintons name does hold a lot of value”.

Part of the “big brand refresh” will also include opening more shops “because that’s what the high street needs”, he says.

Both him and his sister Alex are passionate about the role of card shops on the high street.

“People will go to supermarkets [for their cards] because they’re convenient, but if you’re on a high street, people will make that journey to go visit their favourite brands and see what’s new,” she says.

“The UK population loves buying and sending cards and people are living longer,” he adds. “There’s a larger elderly population out there, and they are predominantly our typical customer -, middle aged, female.”

Taylor suggests that previous owners have made “mistakes trying to revolutionise the brand” in launching new products and add-ons to reach a new consumer, all while forgetting about its core customers – the middle-aged female.

Keeping in line with its self-proclaimed simpler operations, his sister Alex says it is unlikely that Clintons will relaunch its online shop anytime soon.

“We’ve got enough on our plate looking at the physical stores but it could be something that we’re looking to in the future. We just need to get all of the physical stores into a really good place [first],” she says.

“The growth in online in my opinion, and from looking at Moonpig and Funky Pigeon, is all around personalisation. That would be a completely new remit for us because we’re very much traditional cards.”

It’s a model that has served well for the rest of the Cardzone business, which has focused on building a reputation within the local community instead of on national scale. Perhaps a dose of family values could be just what Clintons needs to get back on its feet.

Click here to sign up to Retail Gazette‘s free daily email newsletter

The team leading this push for the Somerset-headquartered firm has a distinctly international feel. French footwear veteran Olivier Motteau leads the retailer’s European business and comes with spades of experience having led New Balance across Europe. Prior to this, he worked at Reebok and Timberland in his French homeland.

Meanwhile, American Tara McCrae returned to Clarks as chief marketing and digital officer after an 18 month stint at fitness and wellness brand TB12, also holding a decade of experience at sporting retailer Puma.

Founded in Street, Somerset back in 1825, Clarks first began making sheepskin rugs and slippers before transitioning into producing sheepskin-lined shoes.

Today it sells more than 50m pairs of shoes each year.

Throughout its history, the heritage British business has become synonymous with quality footwear, known for its comfort, durability, and stylish designs.

But there have been a range of changes along the way. Back in 2021, private equity firm LionRock Capital Partners acquired Clarks for £100m, and trading has been hit.

Since then, the retailer has undergone a period of transformation in its stores, products and marketing alongside a refreshed website as it dedicated more data and research into finding and targeting its customer groups.

To attract these new shoppers, Clarks has turned to innovative design and exclusive collaborations, all while maintaining its appeal to its loyal “timeless consumers”.

After recently celebrating its first-ever Wallabee Day on 26 April in honour of one of its famous shoe silhouette, Retail Gazette caught up with Matteau and McRae to discuss how exactly the retailer plans to put its best foot forward.

Trading during tough times

It’s no secret that the world of retail has been rocked in recent years with consumer trends changing faster than the weather and global events making life no easier.

Despite the current challenges, McRae is excited for what the future brings.

“Consumers are looking for quality, authenticity and comfort, with brands and products they can trust,” she says. “I don’t think that there’s another brand out there, that really checks all of those boxes.”

She points out that when shoppers are spending their hard earned cash, “they’re going to spend it on something that really excites them”.

McRae says that Clarks’ latest collaborations with Martine Rose and Kith founder Ronnie Feig have “really excited” consumers.

Motteau adds that the durability of Clarks’ shoes have helped the retailer remain an attractive option for a range of shoppers.

“You have a big chunk of the market that have been really used to sneakers, almost all their life and I can tell you, the life expectancy of a pair of sneakers is one and a half, two years max.

“But when you buy a pair of good quality leather shoes, you can hold onto them for much longer,” he explains.

“From a consumer standpoint, it’s quite rational to look and consider brands like Clarks because there are not many where you can truly get the most out of your money.”

In such a fiercely competitive market, McRae believes that Clarks’ positive brand perception has helped it to stand out.

“Shoppers return time and again due to a trust in quality and authenticity.” However, she adds: “It’s only going to be viewed in that way if we continue to deliver on that.”

“We’ve been working heavily on really strong and effective product marketing to educate the consumers.”

Changing shopping trends

With 2024 well underway, McRae says that much like last year, the in-store experience plays a pivotal role for Clarks.

She emphasises the importance of digital in-store “because everything starts there”.

The retailer has been very focused lately on evolving its store experience and shop fit, says McRae.

Clarks opened its first immersive Modern Workshop concept at its Kingston store in December 2022, which featured a contemporary new look showcasing Clarks’ innovation and paid homage to its craftsmanship.

Shoppers can access in-store activations and events, as well as sustainable services such as repair and customisation.

McRae says the modern workshop concept is one the team will be “constantly evolving” as it “brings to life” the retailer’s brand story.

Since opening the new fit out, Clarks has expanded the concept over the last year, opening a Paris flagship and most recently its new Birmingham location. It is in the process of rolling out the modern workshop shop fit across its global portfolio.

It also launched new UK and US ecommerce sites last year as the business “pushes for an elevated journey”, explains McRae.

“We’re going to be continuing to enhance that, to ensure that our consumer can stay connected. However they want to shop, whether it’s social, ecommerce or in store, its vital that they get that full brand experience.”

Powerful collaborations

Clarks has released numerous notable collaborations in recent years, partnering with various designers and artists to create unique collections that keep everyone talking.

It has teamed up with the likes of Wu-Tang Clan, streetwear brand Supreme, singer Jorja Smith, and Jamaican DJ Popcaan. McRae says: “Its so refreshing that people are calling us wanting to do stuff with us.”

“We’re a very authentic brand, so we’ll only work with people that have a shared love for the brand, as we obviously do for our own.

“It’s not a ‘pay to play’. We bring in people that have a passion, a love and respect for the brand and partner with them.”

She calls the past couple of years “a wild ride”, teasing the team is “excited about what we have coming in the second half of 2024 and then, of course, for our 200 year anniversary”.

The popularity of some of its Wallabee collaborations have taken the internet by storm, with the silhouette becoming a hot trend for everyday consumers and influencer alike, despite Clarks introducing the model way back in the 1960s.

To celebrate the popular style, Clarks held its first-ever Wallabee Day this year which will take place every year on 26 April.

 

View this post on Instagram

 

A post shared by Clarks Originals (@clarksoriginals)

Throughout the month, the retailer will be celebrating through a series of activations, customisations and content releases.

“It’s such an iconic shoe loved by people across the world and has served as a blank canvas to artists, creators and cultures over many generations,” says McRae.

“Wallabee Day allows us to celebrate not just the shoe, but also all of the collaborators who help us reinvent the story, year after year.”

Balancing heritage with innovation

While being a heritage brand holds value, every retailer must innovate and adapt to the current times to ensure survival.

Motteau says that “Clarks has always been at the forefront of innovation”, pointing out a history rooted in innovation, exemplified by its creation and launch of the first-ever casual shoe, the Desert Boot, in 1950.

He explains that this tradition of innovation continues today with the introduction of new designs like the Torhill, which he says “has had very strong global success”.

The retailer launched the new boot model last February in a bid to target Gen Z consumers on TikTok

In recent years, the retailer has used emerging technology to capture consumers attention. Back in 2022 it entered the metaverse, tying up with online gaming platform Roblox. A year later, it returned to the metaverse for a virtual concert with Nigerian superstar Fireboy DML.

McRae says that “Clarks has really been pushing the boundaries with innovation and reinventing itself” as she teases some “exciting projects” coming out later this year.

Growth opportunities

Click here to sign up to Retail Gazette‘s free daily email newsletter

The self-made billionaire had planned to keep the retailer online only but quickly shifted gears following a nationwide campaign for the brand to return to the high street.

“I was amazed at the love for the Wilko brand…especially in the north, it was like a bloody national outcry.  I’m pleased to own it and I’m quite proud to make it work again,” he tells Retail Gazette at the retailer’s latest store opening in Poole.

“It would be an absolutely cardinal sin to not keep this brand alive,” he affirms.

But, as Dawson says, it is now “well and truly alive” and is “getting all the investment”.

Now with six stores under its belt, and the first five turning a profit, the blueprint for Wilko 2.0 is now firmly in place. Dawson says “it’s all systems go now” and has grand ambitions, with plans to open up to 300 Wilko stores over the next five years.

What does Wilko 2.0 look like?

The retailer has taken a somewhat cautious approach to reopening the Wilko brand on the high street, with Dawson sharing that the team “purposefully held back” while rival discount chains such as Poundland that acquired former Wilko outlets rushed to reopen them.

However, for The Range owner CDS – which stands for Chris Dawson Superstores – the first set of openings have acted as a trial for the Wilko team to test new store concepts, with group chief digital and marketing officer Ben Exall revealing the Poole opening marked the start of its rollout phase.

The team has been tweaking the product mix in store after and Dawson admits it didn’t have enough essentials in its first tranche of stores.

“Wilko was extremely famous for health and beauty, cleaning and toiletries, and your sort of bits and bobs DIY – you’re not expecting a full garden set,” he says.

The first three stores in Exeter, Plymouth and Luton boasted more branded products than ever before, a larger space dedicated to seasonal products, and a bulked out in-store home and DIY section.

Exall says: “The first five stores are all about test and learn, trialling new things, asking customers for feedback. Customers told us they wanted more health and beauty and more cleaning, and that’s what this [Poole] store has got.”

Its new owner has also brought back Wilko’s food-to-go range, which its previous management pulled over concerns it wasn’t able to compete with the top supermarkets, and has also introduced a new in-store partnership with Iceland.

Dawson says the team have now got the product mix right in store and adds that in six months “you’ll find 80% of your Wilko products again”.

Exall adds the business has also been expanding its arts and crafts ranges, and food and garden products, as well as investing in more peripheral services “to ensure that customers don’t split their wallet across multiple retailers”.

“We do insurance, we do tool hire, we do key cutting, we do lottery,” he says. However Exall emphasises: “They’re not the reason to come to us. The reason to come to us is your essential everyday product and that’s what we’ve been investing in and increasing our ranges.”

The group is also planning to expand its Café Eighty Nine concept to more of its stores following a successful trial in the Exeter branch.

Ready, steady, go

To help with the retailer’s expansion across the UK, the business recently hired Matalan’s property director Antony Darbyshire to head up the rollout.

Dawson shares “there’s a hell of a lot of stores in the pipeline”, adding that the team have hand-picked the locations and are “aware of what was good and bad for Wilko” previously.

He is tight-lipped on new store locations but he believes the new Wilko format will work far and wide. Dawson says it will target “all the obvious ones in Liverpool, Manchester and all the big cities but [the store concept] will do the Loughboroughs in this world too”.

London will also see the return of Wilko, he promises, as Dawson shares the brand has “already got a massive internet presence there”.

Online has a big role in CDS’s plans for reviving the brand and according to Dawson’s predictions, its ecommerce platform will soon “treble in size”.

The retailer recommenced trading online less than a month after it was snapped up by CDS Superstores, with a website featuring thousands of product lines across the home and garden.

It has quickly expanded to over 100,000 products in 10 months, boosted by Wilko’s first-ever kitchen range, which launched in April, followed by a bathroom range.

Exall says the site now turns over “double the amount” than it did before and its most recent home ranges are “performing strongly”.

The group has bolstered Wilko stores’ digital capabilities and installed self-service terminals points around the shopfloor to allow customers to browse and shop online.

The retailer has also piggybacked off sister brand The Range’s 200-plus store footprint to boost its click-and-collect reach, which is available across both retailers within an hour. The group is also selling Wilko-branded products in The Range’s stores, which Dawson says are “selling like hell”.

The owner shares there more developments on the brand’s click-and-collect service are in the pipeline, including its first collection truck at the upcoming Motocross GP festival this weekend.

“We’ve got lots of orders already,” he says, explaining the group will be bringing in back up stock as it has “one truck completely sold out”.

“They always forget things with their campers,” he notes, explaining the high demand for the service.

“We might be on to something big here,” says Dawson, as Exall jokes “watch out Glastonbury”.

Growing his empire

Larger-than-life self-made billionaire Dawson is known as Del Boy thanks to the distinctive DE11 BOY number plate on his Rolls-Royce, and shares a similar story to his Peckham-based idol.

He started off as a market trader before setting up The Range in his Plymouth hometown in 1989.

Dubbed the working man’s John Lewis, the home, garden and furniture specialist has grown to more than 200 stores across the UK and has netted Dawson a rumoured £2.5bn fortune in the process.

The Wilko acquisition has grown his retail empire, but does he see the opportunity for further expansion?

Last month, The Range owner was reported to have approached Homebase owner Hilco Capital about acquiring the up-for-sale DIY chain.

However, the retail entrepreneur shrugs off the speculation: “We look at every brand. We’re not looking at it no more than anybody else,” he says in his West Country accent.

“We’re looking at loads of things – any angle to open more stores and different brands,” he explains. However, he adds: “I think they put two and two together and made nine.”

That said, when asked where he sees an opportunity to expand his retail portfolio, Dawson identifies garden centres as a ripe area.

“Standalone garden centres, but we have our hands full rolling out [Wilko]. We’re not looking for more work, but garden centres will be the next obvious one for us.”

Watch this space to see if Dawson and his team can work their magic on another retail business. After all, he who dares wins.

Click here to sign up to Retail Gazette‘s free daily email newsletter

As the gymwear giant prepares to open its second store in Westfield Stratford this weekend, CEO Ben Francis speaks to Retail Gazette on his expansion plans as he looks to make Gymshark “a globally iconic brand”.

Learnings from its first store

Gymshark first entered the world of bricks and mortar back in 2022 when it opened the doors to its highly anticipated Regent Street store.

The much-hyped store has garnered results.

Francis says: “I’ve been blown away by how well it’s done, both in terms of the commercial performance of the store, but when you add on the events that we’ve run and the community that we’ve been able to build, and the people that have gone in and purchased in the store before purchasing online as well.”

Cracking the world of physical retail is no mean feat for the online specialist. “We hadn’t run a store before and we didn’t really know how it would go. It was very much ‘we’ll see how it goes’ and then hopefully we’ll be able to do more  – whereas now Regent Street has been incredibly successful.”

“We’ve learned that the customer loves events, and they love to be able to touch and feel the product and try the product on which is great as well.”

As the brand readies to open its Westfield Stratford City store this weekend, Francis explains that much like Gymshark Regent Street, its new store will house specific events in the space – from athlete meet and greets to activations.

“It’s a slightly different shopping experience to Regent Street. This is a smaller, more shopping focused and more product focused space”, which he says will enable it to highlight different product ranges.

Store expansion

It comes as no surprise that Gymshark is looking to open more stores on the back of the success of Regent Street – but Francis plans to be picky.

“I want great locations that are in places that our customers are, that really allow us to showcase the brand,” he says. “We are actively looking across the UK, the US, and Europe, but we are committed to finding the right units before we agree to anything.”

He explains that Gymshark will be “unit-led” rather than targeting store numbers or specific locations.

“Rather than saying, ‘We’re going to open a store in Manchester,’ we need a really great unit,” he says.

Internationally, the US is a big focus as it looks to double down on its biggest market.

“We’re actively looking around the world. But again, it’s all about finding that right location. The US is our biggest market and also our biggest opportunity,” Francis explains.

“It’s the biggest fitness market in the world, and our goal is to become a globally iconic British brand. We want to be known not just online but across all facets of the market, and that requires a strategic presence in key locations.”

Each new store will be designed to host specific events, and meet-and-greets, ensuring that Gymshark’s community-building efforts are consistent worldwide.

“We want to take learnings from our existing stores but also adapt to local nuances,” Francis says. “In the US, stores might look slightly different due to product or local preferences, but the core experience of community and high-quality products will remain the same.”

However, he says it is “still really focused on the UK”. “We’ve got two stores in the world, both here. Our headquarters is in the UK and there’s no plans on changing that at all. My dream is for us to be a globally iconic very British brand. I want it to be iconic all around the world”.

Digital pioneer Francis, who set up Gymshark as a 19-year old in 2012, is clearly a convert to the world of stores

He says they help to “really showcase the product”.

“It’s making the product more available, because there’s still a large proportion of customers that don’t shop online. The the fact that someone can walk through this shopping centre (Westfield Stratford) which is one of, if not the busiest shopping centres in the UK, and think ‘I’ve seen Gymshark online, let’s pop in have a look at the product’ – that’s where stores really worked for us.”

With one store open so far, Francis admits that it accounts for a “very, very small” amount of the brand’s sales but he says “it will inevitably be a growing percentage over the next three or four years.”

However, he promises Gymshark is “not going to go and open 50 stores next year”.

The power of community

Since its inception, Gymshark has managed to develop a strong community and culture around its brand, almost reaching cult status.

Francis says events are key to growing that community as it expands, adding that “Gymshark is “really, really focused on the community and the purpose of our brand and our products”.

Last month it launched its new brand platform ‘We Do Gym’ in a bid to “deliberately position” the business as a gym brand first and foremost, setting itself apart from athleisure rivals.

The new platform acts as the foundation for all of its brand and marketing activity for the coming 12 months, specifically designed and named to tell everyone, including existing members of the community, what Gymshark is all about.

Francis explains: “I think the risk of losing that community becomes larger when we overexpand and try be something for everyone.

“‘We Do Gym’ is us saying, we’re not going to focus on sportswear, for example, we’re just going to do gym.”

The launch has been met with praise, which Francis calls incredible, because the campaign harks back to the roots of the brand.

“There’s so much temptation to over expand. Expand your product range, expand your brand, expand commercially and by putting these natural constraints on the business by saying this is what we need to be focused on one, it helps us in terms of our allocation of resources internally and focus on being really good at one thing rather than average at lots of things.”

He stresses that it also makes communication to the customer “really simple and really easy and people can know what Gymshark stands for within two seconds of seeing it”..

Expanding horizons

Earlier this year, Gymshark officially opened a permanent space in Selfridges in London and Manchester Trafford Centre as the department store became the activewear giant’s first-ever wholesale partner.

The Gymshark spaces, which appear in both the women’s and men’s departments, feature a selection of mainline products, popular best-sellers, and exclusive limited-edition ranges, including its first premium athleisure range.

Francis says: “I think Selfridges is an amazing business. I want this to be a globally iconic British brand and Selfridges is a globally iconic British brand. So partnering with a great brand like Selfridges is only beneficial to both parties”.

He adds that it also gives Gymshark an opportunity to showcase its brand to a slightly different consumer, which he says has “been incredibly successful”.

Earlier this year, the business appointed former Adidas global VP Hannah Mercer to the newly created role of general manager for wholesale and retail.

In her role, Mercer will be responsible for the growth of the business across all physical channels “to represent the best of the brand globally”.

Francis says her appointment ties into its international expansion plans.

“We see a big opportunity for Gymshark to be an omnichannel brand around the world and like I said before, being a globally iconic brand. Globally iconic brands don’t just exist online. They exist in all of the different facets of the market and that’s what we now need to do. Go from being an online brand to a true omnichannel and a global brand.”

Francis is clearly on the right track as the brand that he started in his bedroom at the age of 19 is now valued at $1.45bn. With more stores in more countries on the horizon, that hefty valuation may grow even higher.

Click here to sign up to Retail Gazette‘s free daily email newsletter

“We had a good Black Friday, but with two weeks left to run it’s all to play for and we could do without these storms turning up every Saturday, because that’s definitely not helping.”

He says the business is “coming from a position of strength” during the all important Golden Quarter thanks to its expanded footprint from partnerships with Tesco, Moonpig, M&S and Matalan, but admits that across its 160+ standalone stores “everything is hard won at the moment”.

Murphy concedes that the retailer is likely to introduce discount in the final days of pre-Christmas trading to bolster sales – but says that because the bulk of ranges are not seasonally dependent so “that pressure to sell just isn’t quite the same in our business as it would be in many others”.

This year will mark Murphy’s second Christmas at The Entertainer after joining the toy specialist from John Lewis last September.

He’s certainly had a busy year, rolling out toy shop concessions into Tesco stores nationwide, growing the business’ international footprint in central Europe and the Middle East, and launching the brand’s first Christmas campaign. Retail Gazette sat down with Murphy to find out more about what’s been keeping The Entertainer busy this year and what it has in store for 2025.

Growing the footprint

The Entertainer has more than quadrupled its UK footprint this year as it rolled out concessions across 861 Tesco stores nationwide and in the Republic of Ireland.

The move, Murphy explains, has added about 50% to 60% on top of its UK and Ireland business.

“It’s taken a huge amount out of us this year as a business to, if you like, to swallow that elephant,” he says, sharing the team were opening 30 concessions each week for about 25 weeks.

However, he believes The Entertainer has “not even scratched the surface of the potential [the partnership] has” and that it could “ultimately double our business” one day.

“The deal with Tesco was signed in mid-December last year, which meant that we didn’t have the opportunity to do planned, ranging and buying for the full national Tesco business until about September, October, because the lead time for those toys is so long,” says Murphy.

This meant the retailer traded the first three quarters of the year “just putting together the best ranges we could from the product that was available”, he explains.

Murphy says the business has learnt a lot of about trading in a grocery retail, explaining that “price and newness speaks really loudly” to customers in a supermarket.

As such, the business has had to shift its merchandising and supply chain approach to recognize the “slightly different rhythm” in a grocery setting, says Murphy.

He explains The Entertainer’s commercial teams have “genuinely a list of 20 things” to act on in the new year, including better range planning.

“We realised that we’ve probably gone in at too low an average selling price on average, which is not to say that some of the lower priced toys shouldn’t be there – but it’s more the balance of the whole range,” Murphy notes.

The Entertainer’s partnership with Tesco falls under its ‘Toy Box’ b2b service, which allows partner retailers to their tailor toy offerings using its bespoke sourcing, ranging, wholesale or retail execution.

Murphy explains he’s hoping to grow the service in the new year after finding success with its current tie-ups, which also includes concessions inside 34 M&S stores and 150 Matalan locations.

“Matalan is long established and is probably now the kind of size and shape that it’s going to be. With M&S, we are in the process of deciding together on what our long term shape is going to be. I expect that we’ll be in a position to talk more about that early next year”.

It welcomed Moonpig to the fold in September to launch a curated selection of 200 toys from across The Entertainer and Early Learning Centre businesses and is already performing “ahead of what we’d expected”, Murphy notes.

He explains the business is in active discussions with several other UK retailers, but is tight-lipped on who it’s looking to partner with next and whether his old employer John Lewis is a possibility.

Meet Ray

The Entertainer kicked off the crucial Christmas trading period with the launch of its first big marketing campaign last month, introducing the world to Ray, a colourful stuffed bear.

Murphy explains that this is the first Christmas campaign The Entertainer has run which has gone beyond “presenting a toy as a solution at a certain price in a certain place”.

Murphy knows a thing or two about the power of a impactful festive campaign from his former employer John Lewis. Indeed, the toy specialist worked with John Lewis’ former creative agency Adam&EveDDB for a tear-jerking spotlight on the fickle nature of children’s relationships with their toys for its Christmas advert.

“It’s just a huge opportunity for us to become better known and better understood. [The campaign] was very deliberately meant to be using creative that would be stand out, that wouldn’t just be run of the mill.”

Murphy says the Christmas campaign is reflective of the new approach The Entertainer’s has taken to marketing this year.

“We’re developing a tone of voice that is more playful. We’re more visible,” he explains.

The retailer playfully mocked John Lewis’s attempts to price match the retailer in September when it announced the return of Never Knowingly Undersold.

“We hope to get some return in terms of increased footfall and customer awareness, but it really is about elevating the brand over two to three years,” says Murphy.

He says that Ray will be a permanent fixture on The Entertainer’s shelves and is “selling really well – but he won’t become the retailer’s mascot in the way Kevin the Carrot has for Aldi.

Murphy shares that it’s just the beginning of The Entertainer’s new marketing approach.

“We’ve got so much more we can do through influencers and social media, and that will be our first half of the year focus,” he says, adding “we have some strong plans for doing things that we haven’t done before next year”.

While he is pretty tight lipped about what The Entertainer has up its sleeve, Murphy shares that some of the plans will be focused on the Early Learning Centre, which it bought from Mothercare in 2019 just before the nursery specialist’s collapse.

“It’s only now that we honestly feel that we’ve got our feet planted steady enough that we could really do justice to Early Learning Centre from a product development, marketing and distribution perspective. We’ve got some big hopes for Early Learning Centre next year,” he says.

To infinity and beyond

While Murphy has big plans for the retailer in 2025, he admits that Labour’s Budget has “changed what we feel about our opportunities for growth and the viability of our own estate”.

He was hoping to grow the retailer’s own footprint after opening its first new stores in two years in Exeter and Milton Keynes this Autumn, but shares that its expansion plans are now being reviewed.

“We had at least six lined up for next year, arguably we could have got as far as 10. I don’t think there are 10 viable locations now because of the cost difference,” he explains.

“It’s not a straightforward answer, but I think the budget has reduced by at least half the number of viable locations that we would consider looking at.”

That said, he notes “most of our business development focus now needs to move internationally, simply because we are now so big in the UK, there’s just incrementally less for us to go after”.

“If I was to predict what 2025 will bring, I think we will announce some big new partnerships with retailers in the Middle East, and we’ll also do the same in Europe,” Murphy says, explaining “those are the two primary areas of focus at the moment”.

“I wouldn’t rule out the possibility of something in the Far East and something in America, but those are further out for us right now.”

The Entertainer is just one retailer that has its sights set on expanding in the Middle East, which Murphy notes has “a lot of similarities with consumer behavior” in the UK.

That’s not to say the retailer will ignore its home grown business, as Murphy explains own brand growth is another priority for the year.

“Between Addo product and Early Learning Centre, product will have grown this year from 18% of our participation to 25% of our sales.

“Next year, it’s a really stretching target but we’re going to try and get to 30%. The strength of the ranges and the value they offer, we think that’s possible.”

After a busy year laying the foundations, it seems as though The Entertainer is just getting started on its growth ambitions as it aims for infinity and beyond.

Click here to sign up to Retail Gazette‘s free daily email newsletter

The East Asian-inspired British retailer may only have a handful of standalone stores, but its wholesale partnerships with the likes of HMV and Clintons have given the brand a presence in almost every major town.

However, the Kenji name will soon spread a lot wider as the business, which turns 10 next year, is kicking off its anniversary by ramping up expansion across the UK and overseas as it plans to double its store numbers in the next 12 months.

Set on making a name for itself on the British high street, it has brought on new managing director, former Clintons CEO Eddie Shepherd, to spearhead its growth plans.

“The business has benefited in the last 10 years from being one of the only people in that category and sector,” Shepherd notes.

“However, there are other brands now biting into that a little bit with Miniso and Søstrene Grene expanding. We’re in a market that is competitive so it’s emboldened us to be as innovative and front of house as we can.”

So, how exactly is the plushie giant looking to stay ahead in this market?

Doubling Kenji’s estate

Shepherd explains Kenji has “big company aspirations” as it plans to more than double its store estate and staff numbers over the next 12 months.

At present, the retailer has 10 stores across the UK, the majority of which are in the north of England such as Manchester’s Trafford Centre and Arndale Centre, Sheffield’s Meadowhall and Birmingham’s Bullring.

This may seem relatively small in comparison to rivals like Flying Tiger Copenhagen’s 100 plus stores in Britain or Miniso’s 30 – however, Kenji’s UK presence also includes space within 118 HMV shops and dozens of Clintons stores nationwide.

The retailer, which turned over £15m last year, is planning to open a further 12 stores up and down the country as well as its first international store in the Netherlands as part of a £4m investment.

“The fact that you don’t know much about the brand doesn’t surprise me, because not many people do,” he says, “That’s a good thing and the aspiration for the brand in the next 12 to 18 months is to grow by another 10 stores as a minimum.”

Kenji store are mostly located in shopping centres and its expansion will see it open a mix of standard 2,500 sq ft stores alongside new 6,000 sq ft two-floor flagships.

At present, it only has a couple of larger stores following the unveiling of its newly upsized Trafford Centre shop and its upcoming Westfield White City store opening in December.

However, the 10 stores opening next year is just the start. Shepherd estimates total saturation of the brand could reach between 50 and 70 standalone stores.

“We’d like coverage across the country eventually,” he adds.

Better stores and better product

Kenji’s existing store network is also receiving an upgrade with its Warrington and Bury shops relocating into bigger units, as well as a design refresh in all stores.

“The business is 10 years old next year, and in that time, it has had five different retail concepts of one shape or another, going from the very basic first one to something that you’ll see when White City comes out,” Shepherd says.

“That’s been an evolving process of making sure that this is a premium shop fit…that gives the customers a reason to shop with us as opposed to people who exist on the same high streets.”

He adds: “It’s making sure that the experience matches the expectation of the customer.”

The store revamp and expansion will be underpinned by the development of Kenji’s product ranges and availability.

Shepherd says it is making “continued investment” in new product development and is “making sure we’re catering for a number of seasons and events,” he explains, referencing the makers markets it runs in store where local businesses host craft workshops for customers.

Kenji has built a loyal following in its almost 10 years with its plushies, key rings and snacks a firm bestseller for the brand.

“We’ve got a number of new product categories that we’re likely to enter into over the course the next 12 to 18 months, such as paper, cards, gift wrappings and beauty,” he says.

Seasonal ranges are another growth opportunity for the business which has focused more on “dealing with the everyday stuff”, says Shepherd.

He says its Halloween ranges were up around 400% to 500% year over year.

However, a wider product range and larger store estate requires “greater distribution facilities”, Shepherd notes, explaining the retailer will be moving into a new warehouse that’s “circa four times the facilities we’ve got at the minute”.

“With that comes an increase in staffing, an investment in systems, both in terms of products and branch merchandising, alongside general IT and everything else.”

A loyalty scheme and gaming app

Another priority for the business includes fostering a community with its customers. This includes the recent launch of Kenji Club, its first-ever loyalty scheme where customers can collect gems on their purchases to claim rewards.

Shepherd says the scheme has had a “strong start” in its first week and increased the average spend per customer by 75%.

“We think that loyalty gives us a couple of thing: firstly, it gives us differential to competition, which is never a bad thing; secondly, it gives our customers a direct benefit from shopping with us more frequently; and thirdly, it gives us the opportunity to target some promotions as we get better on the CRM side of things.”

Shepherd explains there will be a big push on Kenji Club during the final quarter of the year and “all our new store openings will have some focus around that”.

In the future, he hopes to extend the retailer’s loyalty scheme to include its wholesale partners with customers able to interact with the brand regardless of where they shop its products.

Kenji’s new loyalty scheme will soon be joined by a new gaming app, Kenjiland, which launches before the end of the year.

“There’s a clear resonance with our customer base and that gaming community,” Shepherd explains, adding that “for our brand and our target customer, I don’t think a traditional app, which is basically a scan and shop app, is anything that’s going to be either exciting or useful to them”.

The app will start off as a gaming-only space, but will at some point include a transactional element to bring it together with its retail business, Shepherd explains.

He says the team wanted to create a product that carried “a sense of belonging [and] that’s why it lent more into the gaming”.

The UK high street certainly needs ambitious young retailers that want to take on new space – and Kenji looks set to go full throttle. Expect it to become a more familiar name in the next few years.

Click here to sign up to Retail Gazette‘s free daily email newsletter

Operating profits edged up 4% from £1.8bn (€2.2bn) to £1.9bn (€2.3bn) in the year to 31 August at Inter Ikea, the owner of the Swedish furniture giant, despite a 9% drop in sales, as the retailer decided to cut prices in the face of the cost-of-living crisis.

“I am quite proud of the work that we have done during FY24,” he says, explaining the business chose to “really go in when it comes to affordability”.

Öncü notes that stengthening the retailer’s value offer, which has seen continuous price reductions across the year, has helped to reach more customers and “increase the amount of people coming to Ikea”.

“We did one of our biggest historic price reductions during the year, and we are seeing that there are possibilities for Ikea to continue – probably not with the same extent but to find our way back to where we were prior to the pandemic and the decades before.”

These savings will mostly materialise from opportunities to “improve out operation, lower the material cost and improve the product design”, says Öncü.

Improving value will continue to be a big trend at Ikea in its current financial year as Öncü says consumers are still cautious on big purchases.

“Six months ago, we said that wallets are thinner than ever before, people are impacted by the inflation, the high interest rates, and if I look generally, not much has changed in that perspective,” he says.

However, he’s optimistic that “the second half of the year will be slightly better than what we have now”, adding that “we will start seeing some kind of movement towards a better situation starting from February and March”.

Marketplaces

Ikea has always been at the forefront of innovation and its latest development includes the launch of a peer-to-peer marketplace, which allows Ikea Family members to buy and sell used furniture.

Öncü points out that it made sense for the retailer to launch its own reselling platform given that the vast majority of home furnishings that are being sold between consumers on platforms like Facebook Marketplace are Ikea products.

“There is a big opportunity to help facilitate that, with easier access to Ikea data about those products,” he says, explaining that the retailer will populate listings with product information such as sizings and descriptions as well as “some inspiring pictures of that product in different environments next to your pictures”.

Users will also have access to repair kits, assembly instructions, and spare parts, which “no one else can do” and is currently offered to customers of its core retail business.

Öncü says the response to the new marketplace, which is currently being trialled in Madrid in Spain and Oslo in Norway, has been “tremendous” so far and is feeling optimistic about its future.

“Our job now is to measure, follow up, tweak and adjust the things that don’t work, and then by the end of this calendar year, to take the decision on how do we scale this now to all the markets where we operate.”

“I’m quite optimistic…it’s more that we find a way to do it right, as low cost as possible, and as good service as possible for the both seller and the buyer,” he says.

Betting big on sleep

Öncü shares Ikea’s big focus for its new financial year is sleep, which it kicked off in style by breaking the world record of the largest two-piece pyjama gathering at an event at the end of the summer.

The category is already its third biggest and with more customers prioritising quality sleep than ever before, it seemed like a no brainer for the retail giant.

“We see a big growth opportunity in sleep-related products,” he says, explaining this stretches beyond beds and bedding and into sofa beds and blinds.

“We have decided to focus on six sleep essentials, helping the many people out there with affordable and sustainable solutions to improve the pre-requisites to sleep better, focusing on comfort, colour, air quality, light, sound, and decluttering,” he says.

Öncü says there are many cultural differences to consumers’ sleep preferences.

“If I take Poland as an example, 41% of the Polish people are actually sleeping on a sofa bed in the living room,” he says.

“So when we say better sleep, it’s not only the bedroom, the bed mattress – it’s also sofa beds so that’s why we are introducing 10 new sofa beds to really cater for the different sizes of wallet, different sizes of space, different style groups, in order to serve the many people who are sleeping in their sofa bed.”

He also says that light is an important factor behind great sleep, with Ikea offering “window solutions” for shoppers.

The focus on sleep will come to life through new departments in store, Öncü shares, alongside improvements to its website, which represents almost 25% of Ikea’s turnover.

“We are on the journey to translate our Ikea knowledge of how we present the range the products in our stores to how can we translate that into the app and the web,” says Öncü.

Furniture lovers can sleep easy knowing that Ikea has its bedroom needs covered.

Click here to sign up to Retail Gazette‘s free daily email newsletter

It also took home Retail Gazette’s Fashion Game Changer award last month.

The retailer, which will turn 10 next year, is bringing eco-conscious fashion to the masses and is now sold in 200 stores worldwide, having doubled its bricks-and-mortar presence year on year.

“We’ve got incredible reach. We’re obviously on M&S,” says founder Andrew Xeni. “They dress half the nation in one way, shape, or form, so that gives us incredible exposure.”

The M&S connection

M&S first began its partnership with Nobody’s Child in 2020 when it became the first third-party brand sold on M&S.com. It helped kickstart what is a burgeoning part of M&S’ business, as the retailer now sells close to 100 brands online with partner sales up 40% year on year in its latest half year.

Nobody’s Child remains a top performer for the retailer. Earlier this year, when it revealed it would bring Nobody’s Child pop-ups to 60 M&S stores, the retail giant’s director of third party brands Nishi Mahajan said “they continue to be one of the most-loved by our customers”.

Majahan said that Nobody’s Child helped make M&S “the destination for dresses during the spring/summer season”.

She added: “Our partnership with Nobody’s Child is a proof point to the success of our Brands at M&S strategy – when we get the partnership right, everyone wins.”

It’s perhaps unsurprising that M&S sought to deepen the relationship between the pair when it acquired a 27% stake in the brand in May 2022, and a year later, injected further funding in Nobody’s Child.

This strategic investment was aimed at bolstering Nobody’s Child’s growth and sustainability efforts while allowing M&S to offer more eco-friendly fashion options to its customers.

On the investment, Xeni says: “What convinced me was the dedication of M&S’s leadership team to drive change; their commitment resonated deeply with our values at Nobody’s Child.”

It certainly seems like a harmonious relationship.

Xeni says the “collaboration isn’t just about expanding our footprint; it’s about mutual growth”.

“We constantly challenge each other to innovate and improve,” he says. “This dynamic pushes both teams to excel, offering customers a diverse and inclusive fashion experience. It’s a partnership where both brands are culturally aligned, focused on sustainability and inclusivity.”

“We’re both keeping each other on our toes, which is great for the customer.”

The closeness has led some to speculate that M&S could increase its stake in the brand. Xeni admits: “I think it’s fair to say that they probably would.”

However, he stresses there are no active discussions right now. “Everyone’s happy with the overall performance and impact on both businesses,” he says.

Nobody’s Child is certainly soaring right now, with revenue having more than quadrupled in its last two financial years to £26m, and net sales forecast to grow a further 50% this year.

Third party sales represents the bulk of revenue, and soared 87% to £14m in its last financial year.

Its relationship with M&S has not stopped Nobody’s Child’s partnering with other retailers.

Xeni says: “John Lewis is great for us, Next continues to grow. Asos we’ve been consistent on while N Brown as partners also do well, so in every channel we seem to perform well.”

“They’re all at different shapes and sizes. Obviously, M&S is only a minority shareholder, so we operate pretty independently, but they’ve got an amazing footprint to help us grow.”

Sustainable fashion

Xeni set up Nobody’s Child in 2015 to deliver stylish, affordable clothing with a strong commitment to ethical practices.

With fabric choice accounting for up to 80% of a product’s environmental footprint, that’s where its focus lies.

Nobody’s Child collaborates with manufacturers and factories across Europe to help sources new and innovative textiles.

Currently 90% of its clothing is made from responsible fabrics, and Xeni says it is working hard on the remaining 10%.

Another key part of its sustainability strategy is the introduction of its digital product passport  earlier this year, for which it picked up Retail Gazette’s Fashion Game Changer award last month.

The passport, launched ahead of upcoming EU product transparency legislation, offers shoppers full visibility into where their clothes come from.

Nobody’s Child works closely with suppliers to collate hundreds of data points to track each stage of a garment’s journey from the raw materials to its final arrival at the distribution centre.

By scanning a QR code on the label, customers can access this information. The passport also breaks down carbon emissions, provides practical care tips, and offers links to circular services for repairs, alterations, rentals, and pre-loved options.

“We have an ambition by the end of this year, to make sure that, at least in production, every product has passports embedded in it,” Xeni shares.

He adds that the digital product passports have been “well-received, creating a positive halo effect and increasing customer trust”.

“We invest as much as any other top one percentile in sustainability,” he adds. “We are quite happy to compromise a level of profitability to protect our credentials because we believe long term that’s what’s gonna give us our brand equity.”

And it seems like this is just the beginning for DPPs.

Tesco revealed over the summer that it would roll them out across its F&F clothing range in partnership with Xeni’s data and technology business Fabacus.

Although this is a big move forward for transparency in the fashion industry, it comes at a time where ultra-fast fashion giant Shein continues to soar, despite criticism over its opaque supply chain.

As the leader of a brand that has sustainability at its core, Xeni says: “I don’t think value fashion and sustainability can necessarily go hand in hand.”

Nobody’s Child strives to deliver “as sustainable as possible fashion at value prices” with Xeni admitting its sweet spot for eco-friendly dresses is around £70.

He expresses his frustration with the UK government’s slow progress in implementing updated sustainability and ethical fashion regulation.

“It’s a little bit disappointing that the UK government is seemingly so far behind,” he remarks, contrasting it with the EU’s more sophisticated sustainability framework.

International ambitions

Nobody’s Child may have an expanding presence on the UK high street due to its M&S shop-in-shops and three stores – the largest of which opened in Covent Garden this summer – however, it is also growing overseas.

Through its M&S partnership it opened in Saudi Arabia, Kuwait and Dubai and it is stocked online with department stores Nordstrom and Von Maur.

Last year, it also launched in Canadian department store Hudson’s Bay, in Australian department store Myer, as well as in Europe and the Middle East.

“International for us has been really encouraging, the early indicators have been solid,” Xeni says.

However, there are no firm plans to open its own stores overseas yet.

Xeni says it will do this in a “very, very considered” manner and will ensure its decisions are informed and calculated.

He admits he has “a phobia about going backwards” and does not want to risk the retailer’s balance sheet while expanding.

The success of Nobody’s Child’s pop-up shops was a big learning experience in paving the way for permanent UK expansion and provided valuable customer feedback. It has also helped bolster the top line with its Carnaby Street pop up alone contributing £1.1m to sales over its last financial year.

Product expansion

It is not just physical space where Nobody’s Child is growing, it is also expanding its product range.

“Expanding categories has been a big focus right now,” Xeni says, stressing the need to demonstrate that the brand is more than just beautiful summer dresses.

In the last three years, it has launched casualwear, bags, knitwear, tailoring, swimwear, and denim, all of which have “seen strong success”.

The retailer has also teamed up with premium footwear brand Alohas and expanded into outerwear and partywear.

Xeni says: “We’ve obviously elevated the brand a lot. We’ve got some beautiful premium stuff coming out of India and these are categories and products that we’ve not ordinarily produced.”

With product, store and and digital expansion on the horizon, the future looks bright for Nobody’s Child as it looks to bring its ethical fashion to the masses.

Click here to sign up to Retail Gazette‘s free daily email newsletter

The Australian electricals and homewares retailer, which has over 300 stores worldwide, has had a lengthy period testing the waters in Northern Ireland for the last 15 years.

While the rural suburbs of Dudley may seem like an unusual launchpad for the retailer, which generated £4.6bn (AUS$8.86bn) in global sales last year, to make its English debut, there is method in the madness from one of Australia’s largest retailers.

“This has definitely been a market that we’ve wanted to get into for a little while,” notes Harvey Norman UK managing director Lachlan Roach as he takes Retail Gazette on a tour of the new 57,000 sq ft store inside the former Debenhams store.

He admits that that although it searched all across the country, “density for us was a big thing, and then diverse population was very important because it allows us to demonstrate a range of different products with different tastes”.

This has landed Harvey Norman in Dudley. Roach also points out that the West Midlands is “literally four hours” away from anywhere in the country “from a logistics standpoint”.

With a second store close to being signed, we find out more about Harvey Norman and its plans for the UK.

Helping shoppers create rooms

Founded in 1982, Harvey Norman has built its empire selling electricals, furniture, tech appliances and bedding across Australia.

Roach, who has worked his way up the ranks at the retailer since 2002, describes the retailer as “a little bit of John Lewis, a little bit of Currys, a little bit of Sofology, a little bit of Bensons or Dreams”.

“It’s a combination of a few of them, because no one does the four categories in Great Britain anymore in this way,” he adds.

The Merry Hill store – which Roach notes is one of the smallest of the brand’s eight global flagships – houses a range of furniture such as sofas, dining sets, bedroom suites and mattresses, alongside an assortment of home appliances, technology, and entertainment products from big brands including Miele, Samsung, Apple and Dyson.

Commenting on the wide range of goods available, which spans 115-inch TVs and Dolce & Gabbana toasters to Silentnight mattresses and linens, Roach explains the retailer “really tries and helps people create rooms”. He says people may come in for a mattress but can “walk out with the whole room”.

Harvey Norman prides itself on having an “offering for everybody”.

Roach says: “We build these stores…which definitely has a focus on that mid [price point] with a flare to the upper, but our best sellers, unsurprisingly, are always in that entry to midpoint where a lot of customers are comfortable to shop in.”

Harvey Norman has been careful not to overwhelm the customer with product by adding a partition in the store, which gives the effect of two separate home and technology stores within the one unit.

Standing in the quieter home furnishings side of the store, Roach explains: “We do intentionally create a different shopping environment out here, out of the sort of hustle and bustle of technology and entertainment.”

Best in brands

Harvey Norman is a big brand retailer and Roach explains there are “over 100 brands in store” and that goes up to “over 5,000 different SKUs” available online.

The retailer positions itself “on the forefront” of new technologies, pointing out LG’s new range of portable TVs and the Asko washer dryer stack that features a pull-out ironing board.

The store’s technology and appliances ranges have been organised by brands such as Smeg, Miele, Samsung and Siemens.

“We find people like to shop in different ways. Customers are doing more and more research so there’s less people coming in that don’t know what they’d like to buy in a certain category,” says Roach.

Small domestic appliances have also been categorised by purpose, divided into coffee and breakfast sections to separate the De’Longhi espresso machine from the Russell Hobbs toasters and kettles.

Harvey Norman seems to sell most things, but shoppers won’t find anything own-brand in the store.

“We don’t do any of our own brands. Everything is from a manufacturer,” says Roach. “We don’t build a thing…we build a great store to showcase what the brands do.

“These brands spend millions and millions of pounds in design, research, marketing and partnerships so we push the brands as hard as we can to come up with great new products to bring to the market.”

Roach points out that many of the store’s fixtures have been customised for the Merry Hill location, including its pull-out display that he “drew on whiteboard” designed to show off Smeg’s many fridge colour variations.

“Being a global brand, we’ve got close brand partnerships [and] we work with them to do in-store executions as well.”

“Smeg have got something like 13 or 14 different colours of fridges so instead of having 14 different fridges on the floor, we’ve been able to work with them on creating this display that’s got the multiple doors on.”

Harvey Norman’s UK plans

Harvey Norman has not just grown in Australia. It also trades in Malaysia, Singapore, Slovenia, New Zealand, Republic of Ireland, and Northern Ireland.

Roach explains the UK has “definitely been a market that we’ve wanted to get into for a little while”, but shares that factors such as a global pandemic put its plans on pause.

“Getting to Ireland was somewhat of a starting point, and then, for a number of different reasons along the way, the timing hasn’t been right,” he says.

The West Midlands seems like an unlikely place for an international giant to make its mark in the UK, but its all part of Harvey Norman’s plan to achieve success in the country.

“When we did our research on the area, the West Midlands stood out to us,” he says, explaining “we can get to a lot of people really quickly, which should help us with brand awareness and getting more people through the store”.

“If you think about the density of the West Midlands compared to New Zealand…the West Midlands region is around 5 million people. We’ve got 46 stores in New Zealand for about 5 million people and then in Ireland, we’ve got 16 stores to about 5.2 million people.”

However, Roach sees more opportunity in the West Midlands and admits Harvey Norman is close to securing its second location near its UK head office in Sutton Coldfield.

“Then, we ideally would like to have a look around the southern part of Birmingham for that triangle kind of effect,” he says.

However, not every store will be as grand as its one in Merry Hill. Roach says some of the retailer’s Northern Ireland stores “have been running just with furniture and bedding as an offering”.

Roach is pretty tight-lipped about the company’s plans for the rest of the UK and insists that Harvey Norman will not rush into any aggressive expansion plans any time soon.

However, the Austrailian retail giant’s first store in England will have certainly captured the attention of many shoppers – and retail rivals – in the UK.

Click here to sign up to Retail Gazette‘s free daily email newsletter

The Mike Ashley-controlled business raised eyebrows when it snapped up a majority share in Flannels back in 2012 when it was a six store retailer, before buying the entire business five years later. Many baulked at the prospect of the Sports Direct owner taking on luxury fashion.

Since then, it has expanded the business into the largest multi-brand premium fashion retailer in the UK as it vies to “extend luxury to every corner of the country”.

Flannels, which accounts for the bulk of Frasers Group’s £1.2bn premium lifestyle sales, has found its niche in an overcrowded market by targeting the regional consumer, explains the group’s managing director of premium and luxury David Epstein.

He says the retailer, which he describes as “the jewel in the crown for Frasers”, has been “completely changing the state of luxury retail for the regions” over the last seven years.

This has been driven by a “significant investment” in upgrading and expanding the Flannels store network of 70 plus “boutique” 20,000 sq ft stores and handful of 50,000 plus sq ft flagships, as well as forging new exclusive partnerships with some of the most coveted upmarket brands.

Fraser’s big bet on luxury comes as the wider market has struggled in the last couple of years with high inflation resulting in plummeting sales.

However, Epstein shakes off concerns about the current downward trend: “Everything we build is medium to long term. We have confidence those brands are going to come back stronger.”

Re-imagining luxury

The retailer’s most recent investment is the multi-million pound transformation of the former Debenhams store in Leeds to open its latest – and sixth – flagship store. It’s one of the 12 units the group has taken over from the department store chain since it’s collapse.

The site, which spans a whopping six floors and 70,000 sq ft, is described as one of its “biggest and boldest” store to date and it’s clear to see why.

Epstein says its stores are not “a copy and paste” job, explaining the team have sought to “move the dial” with every flagship and think, “how can we be even more disruptive?”.

In the case of the Leeds store, which will soon be home to a gym and café, several activations are located on every level as part of exclusive tie-ups with big brands such as Prada, Off-White and Valentino.

“All these activations keep the store fresh…making it like a living store that isn’t the same every month,” says Epstein.

The ground floor features a concession from pre-loved specialist Sellier, an accessories department, and its new Flannels Beauty concept.

“Everything we do within beauty has to be through the lens of luxury fashion. Every time I’m thinking: ‘how does our luxury fashion consumer want to shop and what brand mix do they want?’

“When we were building the strategy for Flannels Beauty, we had to think ‘what’s going to bring that digital beauty customer back into the physical space?’

He explains that most of the brands are “widely accessible” online, so the focus has been on “giving [customers] that immersive experience to understand the brand”.

The department, which stocks the likes of Prada Beauty, Hermès, Pat McGrath, Givenchy and Dior, features a beauty bar activation space where brands can host masterclasses as well as a beauty changing room, where customers can try out new products in privacy.

An unfamiliar sight in many stores is that more space is given to menswear, with womenswear and women’s shoes sitting on one floor, while mens occupies two.

“With the breadth of brands that we’re working with on streetwear and the premium brands, we felt it made sense to have two floors for men,” says Epstein.

Introducing new concepts

Flannels’ strategy of how to “move the dial” with each flagship has allowed the retailer to trial new design features, categories and services as it opens store after store.

“What’s been developed out of the flagship strategy is beauty, homewares, kidswear. We’ve been developing tailoring, [personal shopping], active and then the other components, where we bring in a food and beverage partner and the wellness gym partner.”

The lower ground floor of the Leeds flagship is dedicated to Flannels’ new activewear department that houses collections from the likes of On and Lululemon, its Sneakerboy concept, and a gym, set to open Spring next year.

“Flannels active…is a real growth category for us. It’s understanding that regional shopper. For them wellness, keeping fit and going to the gym is such a key part of their life.”

There is also lingerie department in store.

Epstein says: “The easiest thing to do is say, ‘don’t put it in’. I said, ‘let’s bring it in, develop it and understand how our consumer wants to shop and what brands’.”

He points out that was how the retailer’s beauty offer started. “Beauty started with fragrance and we’ve now got seven beauty halls.”

Catering to regional customers

While large luxury department stores such as Selfridges and Harvey Nichols have flocked to the big cities, Flannels has chosen to target the regional consumer.

“They have a ‘wear your wealth’ culture…they’ll buy that statement Bottega handbag, they’ll buy those Gucci eyewear sunglasses or a Burberry trench coat. They’ll wear it with Anine Bing or Ganni so they’re also cross-dressing different types of brands,” Epstein notes.

The support Flannels has received from the big luxury brands including conglomerates LVMH and Kering is something Epstein is proud of.

“We’ve only been able to open the number of stores we have because the brands believe in what we’re doing, and they understand the importance of that regional consumer outside of London.

“Too often, brands always felt the UK was London, but there’s a whole country outside of [the capital] and we’ve obsessed over that regional consumer.”

“No one else in this industry is opening up a flagship on this scale.

Epstein says this expansion is possible due to the support of major luxury brands, including Gucci, Prada, Miu Miu, Balenciaga, Valentino, and Bottega Veneta.

He points out that Mulberry are still a proud brand partner, despite the recent abandoned takeover attempt, that saw the British brand’s largest shareholder refuse to sell to Frasers.

When making its bid, the Mike Ashley-owned brand had criticised the “governance of Mulberry, the apparent lack of a commercial plan against a backdrop of increasing market headwinds, and critically, the financial position in which Mulberry currently finds itself”. It also said it wanted to avoid “another Debenhams situation”.

Epstein says: “I can’t really comment. They are a brand partner. They’re very supportive of this strategy.”

“Similar to how the luxury brands work with Flannels to engage those young regional consumers, Mulberry is no different.”

The Mulberry battle is not the only controversy Frasers has been embroiled in within the luxury world.

The group made headlines earlier this year when it put Matches into administration weeks after buying it.

It was a similar story at Sunderland-based indie Aphrodite, which Frasers closed earlier this year just two months after buying. These moves sparked concerns that the group was looking to take its competitors out of the market.

However, its latest acquisition of Coggles is unlikely to meet the same fate with Epstein confirming it will “continue as a digital platform with a separate team in Manchester”.

The group has taken over the luxury platform’s stand-alone store in Alderley Edge and transformed it into a new Flannels boutique, which opened on 31 October.

Adapting to the market

Flannels has been in expansion mode for the last several years in its quest to “be the number one luxury destination”, says Epstein.

However, the group is nearing the end of its store rollout plans for Flannels, he says, and will soon enter its next phase of growth.

“We’ve invested heavily over the six years in building the network…there’s another five regional stores opening over the next 12 months,” he says, quickly caveating “unless other opportunities come our way”.

“The existing stores got a refurbishment during Covid, so the previous concept stores all got brought up to the same standard. There’s one or two that are still outstanding, but they’re subject to being relocated.”

Flannels has deliberately steered clear of the capital and Epstein refers to its Flannels X flagship on London’s Oxford Street as “more of a marketing vehicle“.

“We do events in there and brands see huge value. It’s also become a very important platform and creates a huge halo effect across all our regional stores.

“Whatever event we do in London; you’ll then see a version of that in all the flagships and mini version in the regional stores.”

Epstein notes the next phase of growth for Flannels will be “a very different mentality”.

“It’s going be sustainable growth…you won’t see another 20,30 store openings,” he adds.

“We’ve got to adapt the industry. You’ll see categories [in the stores] that weren’t in the business two to three years ago,” he says, referencing the new activewear assortment in store and its Flannels Home collection that launched last November.

He highlights the Sellier concession that became a permanent partnership across several of its stores in June following the rising demand for pre-loved goods.

“We’ve got different trends in the industry, and we’ve got to work out how does Flannels adapt whilst keeping the luxury business. We will not deviate away from these key luxury brands.”

However, given the current weakened luxury market, Epstein admits that in the shorter term, “that’s also why we have to adapt to bring new trends in and new brands in but we will never move away from those anchor luxury brands”.

Click here to sign up to Retail Gazette‘s free daily email newsletter