Monthly Archives: March 2013
Donnybrook Fair will open its fifth fine food store in Dublin, creating up to 20 new jobs in May.
The new shop will be located at Gallery Quay in Dublin and will create up to 20 new jobs, bringing the total number employed by Donnybrook Fair to over 280.
The new store will be managed by Stephen Doyle, son of Joe Doyle, owner of Donnybrook Fair.
Donnybrook Fair owner Joe Doyle said “Our customers know that the Donnybrook Fair brand extends beyond Dublin 4 and our aim, as people who are passionate about food, is to make great quality, seasonal local and handmade products as accessible as possible to as wide an audience as possible.”
Deira City Centre is set to become the latest of Dubai’s older malls to receive a multimillion dirham upgrade.
The Dh22 million (US$5.9m) project will revamp the centre court to make it more airy, create easier metro access and upgrade the food court.
“This announcement is in line with Deira City Centre’s vision to transform itself as a new, modern lifestyle destination,” said Fuad Mansoor Sharaf, the senior director of property management at Majid Al Futtaim Properties.
“We’re pleased to introduce the redevelopment milestones to shoppers as they accompany us on this exciting journey that will ultimately enhance visitor experience across a number of key areas within the mall.”
Developments will be unveiled in stages, starting with a more open floor plan for the centre court in late May.
A direct access ramp will be added to the Dubai Metro entrance by June, and in August extra dining options will be revealed, in addition to more comfortable seating.
Deira City Centre was Majid Al Futtaim Properties’ first mall, but remains one of the emirate’s most visited destinations, attracting more than 20 million visitors a year.
The centre has more than 370 stores including its anchors Carrefour, Debenhams, Iconic, Sharaf DG, Virgin Megastore and Paris Gallery.
It is one of several older malls in Dubai to undergo an upgrade to compete with the so-called destination shopping centres such as Mall of the Emirates or Dubai Mall.
A Dh2bn project to double the retail space at Dubai’s oldest mall, Al Ghurair Centre, and add an entertainment centre featuring an indoor roller coaster and ice rink, will be completed in the summer.
The mall currently features a retail area of 480,000 square feet, with about 200 stores, 20 food and beverage outlets and an eight-screen cinema. The extension will add 375,000 sq ft of total leasable retail space.
Work has also started on a project to revamp BurJuman and expand the mix of entertainment and retail outlets on offer.
The mall will feature a Carrefour hypermarket and a 14-screen Vox Cinema after its redevelopment, which will also double the food court’s size. The project is expected to take 18 months.
[Cape Town, 21 March 2013] As part of its strategic expansion into Africa Pick n Pay will open its sixth Zambian store in Luanshya – in the country’s Copper Belt Province. This is a signal of confidence in Zambia’s economic future and takes the total number of Pick n Pay stores outside of South Africa to 95, across eight countries.
The first Zambian store opened in 2010 signalling the South African retailer’s plan to expand and grow its business in the SADC region. Pick n Pay now operates 95 stores outside of South Africa’s borders in countries including Zambia, Mozambique, Zimbabwe, Botswana, Mauritius, and Namibia.
The Luanshya store is the first small neighbourhood Pick n Pay in Zambia. It is 1 250m², and will create employment for 80 people ranging from managers to permanent, and part-time employees.
“The focus of this store will be on groceries, perishables, and fresh foods. There will be a butchery, bakery, hot food section, and fruit and vegetable department. The range of products have been chosen to satisfy the needs of the local Luanshya market and will carry 4 500 lines,” said Pick n Pay Head of Group Enterprises for Africa, Dallas Langman at the opening of the store.
“One of the most gratifying features of our presence in Zambia has been the extent to which we have been able to source much of our produce from local suppliers.
“When we first ventured into the Zambian market, we gave an undertaking to government that we would procure 50% of our goods from local suppliers, as part of our commitment to developing indigenous enterprises and entrepreneurs. In fact, we have considerably exceeded this target and are now sourcing 75% of our stores’ goods from Zambian manufacturers, agents, and importers,” Langman said.
Pick n Pay undertook to source 50% of its fruit and vegetables for the Zambian store from local producers – today this proportion of fresh produce is between 60% and 70%, depending on the season. “We are confident that in time our reliance on Zambian producers will rise above 70% and also prove a valuable source for our stores elsewhere.
“We also committed ourselves to the creation of 1 000 jobs within five years and this target, too, will be exceeded after we open this store and the Ndola store later in the year.” Pick n Pay has also upheld its commitment to promoting Zambian nationals to senior management positions in their operations in the country.
“Our goal in Zambia is to provide local communities with food and household items in a first-world shopping environment, at the lowest prices, and in doing so, to stimulate sustainable local economies and create new economic opportunities for local small-scale enterprises,” Langman said.
“While Pick n Pay may have its head office in South Africa, it is becoming obvious that we are a truly African company.
“Beyond the boundaries of South Africa, there is a rapidly developing community of consumers who are seeking a new shopping experience that offers value, convenience, choice, and exceptional service, Langman said.”
Pick n Pay will continue to grow critical mass in the countries in which it currently operates, while looking at further countries for expansion.
Majid Al Futtaim Properties, the Dubai-based mall developer, announced on Wednesday that its $350m Beirut City Centre will open on April 4.
Beirut City Centre is Majid Al Futtaim’s first mall to open in the Levant region and is spread over 60,000 sq m.
The flagship mall will feature more than 200 specialty stores including 40 new brands opening in Lebanon for the first time, the company said in a statement.
This will include the country’s first Carrefour hypermarket, the first multi-screen VOX Cinemas, and the first Magic Planet family entertainment centre.
Waddah Al Solh, country head of Majid Al Futtaim Properties in the Levant region, said: “Beirut City Centre demonstrates Majid Al Futtaim’s commitment to investing in the long-term future of Lebanon.
“Not only will the $350m shopping mall enrich the local retail offering with dozens of new international brands, it will also have a strong impact on the local economy.
“In addition to more than 2,500 jobs generated during the construction phase, Beirut City Centre will provide more than 1,200 permanent job opportunities, once opened.”
Beirut City Centre will also bring the first Marks & Spencer store to the Lebanese market, along with the largest H&M.
The mall will include over 40 international restaurants and cafés, including a food court with 16 diners and an open-air rooftop terrace with 12 destination restaurants.
Waddah added: “We are committed to bringing a truly unique shopping and lifestyle destination to the Beirut community.”
MAF Properties said in January that it is also planning to expand into Georgia, Kazakhstan, Armenia and Azerbaijan in the near future, starting with Georgia as early as this year.
MAF Fashion says store confirmed for 2014 opening
Majid Al Futtaim (MAF) Fashion has signed an agreement with Abercrombie & Fitch Co. to see iconic American lifestyle brand make its Middle East debut.
Hot on the heels of its recent announcement to bring Hollister to the region, Majid Al Futtaim Fashion, the retail arm of Majid Al Futtaim Ventures, has finalised joint-venture agreement with Abercrombie & Fitch Co., to bring Abercrombie & Fitch to Dubai. The first store is set to open in 2014.
North American brands are the most global, according to a recent retail industry report released by CB Richard Ellis, with 73 per cent present in all three major retail markets – Europe, Asia Pacific and Middle East & Africa.
The report also found that 61.2 per cent of American brands operate at least one store in Dubai, making it the second most targeted city for international retailers, falling closely behind London.
Reaffirming Dubai’s appeal as an international launch pad for global brands, Abercrombie & Fitch will further diversify the city’s rapidly expanding retail offer.
For the first time, those wanting to snap up Victoria’s Beckham’s creations will be able to do so directly from the designer herself from today.
Victoriabeckham.com has evolved from an online Lookbook to an e-commerce site housing the Spice Girl-turned-designer’s handbags, denim, sunglasses and Victoria, Victoria Beckham line.
The site will be t he only place offering the 38-year-old’s ICON line, a capsule collection of five of Beckham’s most timeless dresses, ranging from £1,050 to £1,650, however it does not currently hold her mainline collection, which she shows biannually during New York Fashion Week.
Mother-of-four Victoria, who relocated from Los Angeles to London so she could be near her studio headquarters in south London, said: “My new website has been in the making for a very long time. It was so important that the concept, tone and look of it were true to me and my aesthetic and that the shopping experience was the very best that it could be for me
Users are invited to ‘Shop’ and ‘Look’, with the latter offering a platform to view short exclusive behind-the-scenes clips, photos of models during fittings and as Victoria says, “insights into my world”. The ‘Shop’ function will serve the UK, USA and Europe before rolling out across select additional countries in the future. Beckham has also hired a team of multilingual client service associates to assist customers from around the world and offer style advice over the phone, while a same-day delivery service is available in London and New York.
Beckham presented her first collection at New York Fashion Week in September 2008 and has earned critical acclaim as a designer, winning Designer Brand of the Year at the 2011 British Fashion Awards.
American fast-fashion retailer Forever 21 has unveiled is latest UK store on one of Scotland’s busiest shopping streets in Glasgow. Located within the new 70 million pounds retail development, Buchanan Quarter on Buchanan Street in Glasgow, Forever 21 has opened a 61,000 square foot store to mark the largest-ever letting on the street.
The store will feature the brand’s mainline apparel and accessories lines, as well as the retailer’s other labels including its contemporary women’s line, Love21, its 21Men, offering fast fashion to men, and its Forever21+, its plus size range. In addition, the flagship will also house the brand’s lingerie and footwear collections and its cosmetic line, Love & Beauty.
Linda Chang, global marketing director for Forever 21, said: “Glasgow is known for being fashion forward and serves as a great location for our first flagship store in Scotland and further expansion in the UK.”
This store marks the Californian-based retailer’s seventh store in the UK, Forever 21 has previously opened stores in Birmingham’s Bullring, Westfield Stratford City, Bluewater, Lakeside, Trafford Centre, as well as on London’s Oxford Street.
Other retailers joining Forever 21 in the Buchanan Quarter development are Gap, Office, Skechers, and Fat Face, as well as the debut Scottish store for sports brand Vans.
Developed by Land Securities, this is the firm’s second major shopping development in a week, as it also launched Trinity Leeds, a one million square foot shopping centre that cost 350 million pounds last Thursday.
Commenting on the launch, Robert Noel, Chief Executive of Land Securities, said: “The opening of 185-221 Buchanan Street in Scotland’s No.1 retail City is further evidence of the strength of our confidence in the Scottish market.
“We are delighted to have introduced new brands to Scotland and are confident that Buchanan Street will further enhance the City’s retail credentials.”
Super-fast network 4G could boost the UK retail sector by £1.8 billion, new research released today reveals.
Representing a 113 per cent year-on-year rise in mobile shopping, the introduction of 4G will compliment changing consumer behaviour, according to online marketplace eBay, which commissioned analyst firm Conlumino to conduct the survey.
Using your mobile to shop is increasingly popular with 55 per cent of over 2,000 respondents saying they use their smartphone more now to shop online than the same time last year, though only one in 10 use their phone to complete the customer journey and make a purchase.
“Consumers today want convenience and speed,” said Olivier Ropars, Senior Director of m-Commerce at eBay Europe.
“The arrival of universal 4G will bring with it a more immersive, instant and intimate shopping experience than ever before – putting the most exciting features of mobile retail as we know it into high definition.
“It won’t just turbo-charge the way we shop. It will truly give us the ability to shop anytime, anywhere.
“That means an extra £1.8 billion of consumer spending up for grabs.
“Retailers must act now and think about the virtual shop window, to turn this huge opportunity into an exciting reality.”
eBay’s global forecast for mobile sales this year is $20 billion (£13 billion) while currently, an item is bought every second in the UK via a mobile device and experts are warning of the importance of being 4G-ready.
“Retailers today must take every chance to engage consumers, inspiring them and giving them every possible opportunity to buy and interact with their brands”, said Neil Saunders, Managing Director of Conlumino.
“An omnichannel approach is key to making this happen and with universal 4G on the horizon, retailers can’t afford to stand still.”
Fashion and homewares retailer Cath Kidston is to expand into Spain as it looks to roll out concessions across the El Corte Ingles chain of department stores. The move represents the retailer’s first entry into continental Europe.
According to The Telegraph, the retailer is in talks to extend its concessions to around 80 El Corte stores in the country following the success of pilot concessions launched before Christmas in stores in Madrid and Mallorca.
Chief executive Kenny Wilson told the newspaper that the Madrid concession would now be permanent. He added: “The owners of El Corte Ingles in Spain approached us and said they’d seen our brand in Selfridges in London and thought it works brilliantly in a shop-in shop department store format.
“They wanted to try it in Spain so we’ve done a test in Madrid in the number one El Corte Ingles store. It’s been very, very successful… Clearly, if we can make the brand work in a pretty tough Spanish economy that gives us confidence that it can work across Western Europe.”
Founder Cath Kidston opened her first shop in London’s Notting Hill in 1993. The company now operates 61 stores in the UK and 58 mostly franchised stores in Asia.
More than 2,500 people queued for over 12 hours for the opening of H&M’s first store in Chile at the weekend.
The 2,600 sq ft flagship store in Santiago’s Costanera Center carries H&M’s complete range of fashion and accessories for women, men, and children as well an exclusive collection created for the Chilean market.
Macu Alfaro, H&M’s country manager for Chile, said: “We have had an amazing response from our customers here in Santiago today and we look forward to bringing H&M’s concept of fashion and quality at the best price to Chile. We are also excited to finally be expanding our business concept here within South America and also in the Southern Hemisphere.”
Following its debut in Chile, H&M plans to open new stores in Serbia, Estonia, Lithuania and Indonesia during 2013.
Apple’s retail strategy has been one of its great successes. In fact Apple has done to retail what it did to mobile – shown other companies the way. In total, they now have around 400 stores, the majority of them in the USA, and they are wildly successful. But is it enough?
Phones, the actual smart devices, are now of less importance as a differentiator than in the recent past. Everyone makes a great phone, and that’s why BlackBerry saw its share price sink, Friday. Nice phone but what else do you excel at?
Apple and Samsung excel at phones, have equally phenomenal supply chains, great marketing and equally good innovation capabilities. What matters also is how you sell. Hence retail could be the next significant battleground between these two.
In 2012 Apple opened 41 new stores. It is using its store openings to help develop new markets and gradually the number of international retail stores has grown – 82% of 2012 openings were international last year. But let’s be clear, that’s only about 32 stores.
A recent study showed that “The percentage of sales from Apple Stores (compared to all sales) has actually dropped from 17 percent in 2007 to 12 percent in 2012.” The conclusion you can draw from that is stores don’t matter because Apple has such a great distribution network, or Apple ‘s retail strategy is lagging its overall development.
Analysts Asymco point out that as sales have increased in the past five years, store openings have slowed proportionally. Yet when Apple doubled its stores in China it also doubled sales.
Still Apple’s own retail presence in China is negligible (3% of stores) and in India non-existent, as yet, though Apple has added two distributors there and offers an iPhone for $98 down payment.
Let’s look at arch competitor, Samsung, and evidence that you cannot afford to slouch for one minute. All this activity comes from a six month period in 2012.
Samsung announced the opening of its first “Samsung Mobile Brand Store” in Delhi, in April 2012, April
They launched their first concept store in Pakistan also in April. The Samsung Concept Shop is a One-Stop venue for all Samsung products – Samsung 3D Smart TV’s, LED and LCD TV’s, Monitors, Plasma Display Panels, IT products, Cameras, Mobile phones, and Home Appliances.
In March 2012 they partnered with mobile operator MTS in Russia to sell handsets and tablet computers on contract in MTS’s 2,000 shops. They also announced they will open 10 of their own stores in Russia’s biggest cities,
In July they opened their first North American retail store, and a very Apple-like experience, in Vancouver, Canada. The store was “flooded with clean, bright lighting, a minimalist layout of products and even blue-clad Samsung “geniuses” on deck to help out customers”.
Also in 2012 they began an own store strategy in China aiming to develop in the second and third tier cities with a strategy of hiring local Chinese managers.
In addition, they opened the first China Samsung Experience “shop-in-shop” with retailer Suning in, Pudong, Shanghai, August 2012.
In regards to the future cooperation of the two parties, Suning plans to set up no less than 100 Samsung Experience Shops in its flagship stores across China. At present, the Chinese retailer is planning Samsung Experience Shops in nearly 30 outlets in Shanghai, Beijing, Nanjing, Guangzhou, Shenzhen, and Chongqing.
They also opened a concept store in Sydney, Australia, in August 2012 just down the road from Apple.
They announced a partnership with Singapore’s Challenger, the leading IT retailer, to open “experience corners” in Challenger outlets. The first one opened in October 2012 and has 1500 square feet dedicated to Samsung phones, computing, and cameras.
They partnered with Tesco[/entity] in Malaysia in March 2012 with a shop-in-shop concept called “Samsung World”. And with Phones4Us in the UK – began a “store-in-store” program in March 2012
Apple is not standing entirely on its laurels.
(Distribution) Outlets in China selling the iPhone rose to 17,000 in the period that ended Dec. 29, from 7,000 a year earlier, Apple Chief Executive Officer Tim Cook said on a conference call yesterday. That helped Apple boost sales in the Greater China region to $6.83 billion, from $4.08 billion a year earlier.
When Samsung opened its first store in North America the tech press accused it of copying the Apple way. And there is some truth in that. But the Korean company has a diversified strategy.
It has an own-store program in key markets like India and China, and of course North America. And it has at least two different store-in-store concepts that it is pushing with major retail outlets in key growth markets.
What it gets up to in North America is not its central retail strategy. Yes, it will do concept stores but its bigger push is into volume – hundreds of in-store corners and concept areas to push the Samsung brand and product quickly
Samsung’s objective is to increase sales competitively, as soon as possible. Will we see Apple,, with its higher concept retail approach, accelerate its store openings in response?
AS PART of its expansion into Africa, Pick n Pay on Thursday said it had opened a store in Luanshya, Zambia. This is the group’s sixth Zambian store and takes the total of outlets outside South Africa to 95 across eight countries.
Retailers are increasingly expanding their operations in African countries in the hopes of tapping into an emerging middle class whose disposable income and demand for modern goods is growing. Underdeveloped retail markets and regulation and bureaucracy hurdles have not deterred South Africa’s retailers‚ who have been among the quickest to snap up northern opportunities.
At 1,250m² in size, the Luanshya store is the first small neighbourhood Pick n Pay in Zambia. “The range of products have been chosen to satisfy the needs of the local Luanshya market and will carry 4,500 lines,” said Dallas Langman, Pick n Pay head of group enterprises for Africa.
Luanshya is located in the country’s Copper belt Province.
Asset-management firm Imara expects the Zambian economy to grow 7% this year.
Pick n Pay’s first Zambian store was opened in 2010, which signalled the grocer’s plan to expand its business in the Southern African Development Community region.
Shoprite is also forging ahead with its African expansion. The retailer will open 13 new stores before June, and a further 24 more are confirmed for the following 12 months, as it eyes fast-growing, oil-rich markets such as Nigeria and Angola.
Woolworths, which is present in 12 African countries, including South Africa, said its African expansion plan was on track to reach 100 stores by next year.
In terms of the product mix in Woolworths’ African stores, about 90% is clothing and the rest food.
Local fashion retailers such as Mr Price, Truworths and Foschini are also pushing into Africa.
Global retail and wholesale growth and gains in footwear and leather goods lifted Salvatore Ferragamo SpA’s net profit 30 percent in 2012 to 106 million euros, or $135.7 million, compared with 81 million euros, or $112.6 million, in the previous year. The Florence-based company also attributed the improvement to a 10 percent reduction in the minority interest last year compared with 2011, as a consequence of the buyback of the stakes in distribution companies in South Korea and Southeast Asia.
Including a minority interest profit of 20 million euros, or $25.6 million, profits rose more than 21 percent to 125 million euros, or $160 million, compared with 103 million euros, or $143.2 million, in 2011.
In the 12 months ended Dec. 31, Ferragamo reported revenues of 1.15 billion euros, or $1.47 billion, up 17 percent compared with 986 million euros, or $1.37 billion, in 2011.
Operating profit climbed 24 percent to 194 million euros, or $248.3 million, compared with 157 million euros, or $218.2 million.
Dollar figures were converted at average exchange rates for the periods to which they refer.
Chief executive officer Michele Norsa said during a conference call with analysts that, in 2012, “luxury has proven again to be very resilient and the top brands even stronger. The name of the game is the ability to capture new consumers not only at home but around the world.”
The Asia-Pacific area remains the group’s core market, accounting for 36.3 percent of total sales and up 17.5 percent compared with the previous year. The retail channel in the region contributed to the growth, showing a 20 percent jump. Lifted by tourists, Europe posted a 21.4 percent sales increase. North America grew 16.1 percent, almost entirely achieved on a like-for-like basis.
Sales rose 5 percent in Japan, supported by a favorable exchange rate, but fell 2 percent in local currency. The Central and South America region was also strong, showing a 26.9 percent increase.
Norsa said that China in the fourth quarter last year “definitely restarted at a very good pace,” and also remarked on the flow of “hundreds of thousands of Chinese tourists around the world” traveling to countries from Canada to Indonesia.
The UAE’s Landmark Group is looking to boost its online sales by introducing more of its brands and shops to the Middle East e-commerce market.
The company, which in December launched e-commerce sites for three of its retail brands, Emax, Babyshop and Splash, is focusing on the online world to drive growth.
“The plan is to put all our retail businesses online,” said Savitar Jagtiani, the business head of e-commerce at the Landmark Group on the sidelines of the Arabnet Digital Summit in Beirut.
“We are in it for the long run. It is about growing the online side in parallel with the offline. We have 17 retail businesses and 25 customer facing brands in total and we’ve taken the first three online right now.” Landmark Group has 1,500 stores across 19 territories with brands such as Centrepoint, Iconic and Home Centre under its umbrella.
About 20 per cent of the traffic to the chain’s three websites comes via Facebook and the company is keen to integrate social media into its online strategy.
The conversion rate – that is, the number of people who visit the site and buy a product – is still low for Landmark Group.
“The most successful internet retailers have a conversion rate of 3.22 per cent for 2012-2013 and that is definitely an aspirational conversion rate to work towards to over time,” Mr Jagtiani said.
Currently the three websites are available only to customers in the UAE, but the group has plans to open them up to a wider regional audience.
“One of the pan-regional challenges is methods of payment. Online payment in some countries is not as popular and cash on delivery is more dominant, which has its own risks,” Mr Jagtiani said.
Return rates for goods bought through an online transaction are about 2 per cent at the moment, whereas return rates for cash-on-delivery items can be as high as 20 per cent.
Hermès International said net profits shot up 24.6 percent last year thanks to robust demand for its leather goods, silk scarves and perfumes.
The luxury firm said net income totaled 740 million euros, or $951.5 million, versus 594 million euros, or $827.1 million, in the year-ago period.
Hermès also noted its operating margin, which widened to 32.1 percent of sales, attained its highest level since the company went public in 1993.
Operating profits for the 12 months ended Dec. 31 rose 26.4 percent to 1.12 billion euros, $1.44 billion, versus 885 million euros, or $1.23 billion, in 2011.
Dollar figures are converted from euros at average exchange rates for the periods in question.
The company said it would propose a per-share dividend of 2.50 euros, or $3.24 at current exchange, at its general meeting on June 4. An interim dividend of 1.50 euros, or $1.94, was already paid out on March 1.
In a statement, Hermès gave no sales or earnings guidance, and said its cash pile stood at 686 million euros, or $882.1 million, at the end of last year.
Management had previously stated it was sticking to its long-term forecast of 10 percent annual sales growth in 2013.
The firm invested 370 million euros, or $475.7 million, last year, primarily to burnish its store network and production capacity. Hermès opened two new branches, renovated or enlarged a dozen other boutiques, and purchased the property for its unit in Beverly Hills, Calif.
As reported, sales last year rose 22.6 percent to 3.48 billion euros, or $4.48 billion. Stripping out currency fluctuations, sales were up 16.4 percent, exceeding the company’s most recent target of 13 percent consolidated annual sales growth.
While some of its luxury competitors had reported ebbing demand in China, Hermès said sales in Greater China rose 34 percent in the fourth quarter and were up 28 percent in 2012 as a whole.
Google Shopping Express helps local retail stores sell products online and have the items delivered to shoppers the same day, according to a person familiar with the test.
Google arranges for third parties, such as couriers, to pick the products up from local stores and deliver the items to shoppers. Neither the stores nor Google handle the deliveries, the person explained on condition of anonymity because the service is still in the early development stage.
Tom Fallows, a Google product management director with over a decade of e-commerce experience, is running Google Shopping Express. The test is focused on the San Francisco Bay Area and has been going for at least a month, the person added.
Google has not yet decided how to charge for the service. It is considering an annual subscription, similar to Amazon, which charges $79 a year for free two-day delivery of many items purchased on Amazon.com. However, Google may also charge a small fee each time a shopper orders through the service, the person said.
Google Shopping Express is the latest sign that the company is expanding from its online search roots into e-commerce. It also suggests that Google may be building an online marketplace that connects merchants and consumers, a business model that has made Amazon and eBay Inc successful in the United States.
“Google needs to become a marketplace,” said Scot Wingo, chief executive of ChannelAdvisor, which helps merchants sell more online. “This is another step.” EBay is an investor in ChannelAdvisor.
Amazon’s marketplace business, which lets other merchants sell through its website, has grown rapidly in recent years and has been a big driver of Amazon’s revenue and profit growth.
This success has encouraged more shoppers to search for products on Amazon.com, rather than going to Google – a potential threat to Google’s search dominance online.
In the past, consumers would search for an item on Google.com, an Amazon sponsored link would pop up, the shopper would click through, Google would get paid for the ad and Amazon got the sale.
“Everyone was happy. At least they used to be,” said Tom Allason, founder of Shutl, a startup that provides same-day delivery for retailers’ online orders. “Today Google needs a new play because increasingly consumers are cutting out Google and going direct to Amazon for their product search.”
Last year, Google changed its free product search offering to a paid service called Product Listing Ads, a move aimed at generating more revenue and profit from e-commerce.
In February, Google acquired Channel Intelligence, a $125 million deal that brought the search giant lots of data on e-commerce transactions. Longer-term, that could help Google build a product catalog, a crucial ingredient for an online marketplace that would compete with Amazon and eBay, according to Wingo.
“We view Google Shopping Express as another step in the evolution of Google Shopping and potential move to a full-blown marketplace,” Shawn Milne, an analyst at Janney Montgomery Scott, wrote in a note to investors on Tuesday.
Amazon has an advantage because it already has a network of large distribution warehouses, known as fulfillment centers, to deliver goods sold through its online marketplace, according to Wingo.
Google is likely taking a different approach, building a network of loosely affiliated local retail stores that, in effect, act like small fulfillment centers, Wingo explained.
EBay took a similar approach when it acquired Milo in late 2010. Milo let shoppers search for products available to buy in retail stores nearby.
The business formed the foundation of eBay’s Local Shopping business and is a crucial part of eBay Now, a same-day delivery service that the company began testing in San Francisco and New York last year.
© Thomson Reuters 2013
Lord Wolfson, the chief executive of Next, has accused local councils of “Luddite intransigence and incompetence” for rejecting planning permission for new stores and threatening Britain’s economic recovery.
Lord Wolfson warned that 2013 had so far been “quiet” with Next’s sales “at the bottom of our target range”
He said planning “remains a problem” for the FTSE 100 company and that it cannot open stores as quickly as it wants to because of delays in discussions with local councils.
More than half of the company’s new space over the next three years is scheduled to come from larger out-of-town department store-style units. But Lord Wolfson said: “There are some pro-growth councils but others are slow and don’t want change.”
The Next boss made the comments as the fashion retailer posted 3pc growth in annual sales, despite tumultuous conditions on the high street.
The rise in sales in the 12 months to January 2013 was entirely due to a 9.5pc rise in sales from Next’s Directory business, which includes online sales. The retailer’s high street stores reported flat sales. However, given that sales from new stores added 3.2pc, this means that like-for-like sales in each store – which Next does not report – fell.
Lord Wolfson warned that 2013 had so far been “quiet” with Next’s sales “at the bottom of our target range”.
The Next boss said “people are getting poorer” due to minimal growth in wages but that the retailer was “walking up the down escalator” and in the past 12 months has “performed well in a difficult year”.
For the year to January 2013, revenues rose to £3.56bn, of which £1.19bn came from the Next Directory business.
Pre-tax profits rose from £579.5m to £666.5m.
Lord Wolfson said pre-tax profits for the new financial year are likely to be between £615m and £665m, with Next sales rising between 1pc and 4pc.
Saks Fifth Avenue is accelerating the rollout of its men’s private label.
Starting this fall, the line will have a new name, three subbrands and devoted shops in key markets. And the retailer did not rule out the possibility that it would wholesale the collection in the near future.
“We are a brand,” said Richard Cohen, vice president of business development for Saks, who came on board last year to spearhead the development of the label. Called the Saks Fifth Avenue Men’s Collection, the line was launched in 2009 and has grown into the retailer’s largest-selling men’s wear brand. That success has spawned the development of a women’s private brand collection as well.
The men’s line will now be called simply Saks Fifth Avenue New York, but within that will be Black, White and Platinum subbrands that will be differentiated by the color of their interior labels. Black and Platinum product are being designed by Kim Herring, who had worked with Cohen at Ermenegildo Zegna, while the White label is being designed by Rhett Bonnett, a fledgling men’s wear designer who also produces a line under his own name.
“We created three different labels,” Cohen said. “Black is our international line; White is our modern, younger line, and Platinum is our top-of-the-line.” The idea behind separating the labels is to take the Saks customer “on his journey, from a twentysomething all the way up till he becomes ceo.”
The Black component offers suits, furnishings, sportswear, outerwear and shoes. White is more firmly rooted in sportswear, and Platinum offers premium outerwear.
But while the color of their labels may be different, the subbrands are designed to work together and also will complement the multibrand assortment on the floor.
“We feel comfortable that this can sit easily with the other people we buy from,” Cohen said.
Ron Frasch, Saks Inc. president and chief merchant, said the journey for Saks started just more than three years ago when Peter Rizzo, who now heads creative merchandising for the company’s Off 5th division, told him that the store had every great men’s label but one — its own. “He got me thinking that there’s a place for us. We have a distinctive and desirable fashionable point of view. And it also fulfilled our need to increase exclusives within our men’s offer,” Frasch said.
Rizzo worked with the existing team to create the first collections, and “very quickly it became a very significant business for us,” Frasch said. Rizzo then moved to the discount division and Saks hired Cohen. In order to elevate the brand further, “we realized we needed true design talent,” and Herring came on board, Frasch said. “This is his first fully developed collection, and we’re really proud of it.”
To show it off, Saks knew it had to enhance the presentation in stores. “If we want to play with the big boys in the men’s business, we have to present it in the same way,” Frasch said.
Freemans Sporting Club is headed east � Far East.
The trendy New York City-based retailer will open a flagship in Tokyo next month and two additional stores in Japan over the next two years. Freemans, a favorite of hipsters since opening on the Lower East Side seven years ago, currently operates two stores in New York and one in San Francisco and also has a wholesale collection. In addition to its men�s wear line, Freemans operates a barber shop, restaurant and bespoke suit department at its Rivington Street store, a concept that it will be bringing to Japan.
The Tokyo store is being billed as the first Freemans Lifestyle Compound outside the U.S., and the 6,500-square-foot space will be located in the Minami-Aoyama retail district. Thom Browne opened a store in that area last week.
The Freemans store was designed by company founder and architect Taavo Somer and is intended to be reminiscent of a New York City brownstone. It is opening in partnership with Yagi Tsusho Ltd., which licenses and distributes the FSC brand in Japan along with other American and European labels including Moncler, Mackintosh, Barbour and Woolrich. Urban Research is a sublicensee and the retail partner. Under the terms of the deal, Urban Research will also open a yet-to-be-determined number of FSC in-store shops at its 104 stores in Asia.
�We�ve always had a relationship with the Japanese since we opened the store seven years ago,� said Somer.
�And we have a pretty passionate following of Japanese here,� added Kent Kilroe, Freemans managing director.
Somer said Freemans had been approached by several Japanese companies who sought to bring the brand to that country, �but we said it had to be whole package � the restaurant, bar, barber shop and store,� Somer said. �And these guys said they wanted to bring our vision to Japan.� Kilroe noted: �They appreciate how each element has to work together. That�s what separates us from the myriad of men�s wear brands out there.�
Greggs, the bakery chain which won a U-turn from George Osborne over his pasty tax in last year’s Budget, is to slow new store openings amid falling sales and footfall on the high street
Greggs has cut plans for new store openings this year after a dip in like-for-like sales Photo: PA
By Graham Ruddick12:21PM GMT 20 Mar 20135 Comments
The Newcastle-based company said that like-for-like sales fell by 2.7pc in the 52 weeks to December 29, 2012, sending pre-tax profits down from £60.4m to £53.3m.
The decline in like-for-like sales has accelerated since the turn of the year to 4pc, with sales in January down by 5.7pc as snow fell across the UK.
Greggs, which has 1,671 shops, relies on footfall in the high street to drive sales and is under pressure from cautious consumer spending.
Roger Whiteside, the former boss of Punch Taverns who took over from Ken McMeikan as chief executive last month, said the company plans to “reshape” its investment this year.
The amount of new store openings will halve compared to 2012 to 50, but refurbishments will double to 250 as Greggs rolls out its “food on the go” and “bakery” formats.
Mr Whiteside said Greggs also plans to spend more on promotions after the success of its meal deal offers. The company’s breakfast deal of a bacon or sausage roll with a hot drink for £2 was Greggs’ most popular product in 2012, with seven million sold.
However, despite the slowdown of new store openings, Mr Whiteside said he plans to press-ahead with the strategy laid out by his predecessor, which includes selling frozen Greggs products in Iceland.
“My impact will be on pace of delivery and the detail,” Mr Whiteside, who has served as a non-executive director at Greggs for the last five years, said.
Shares in the company fell 32.20, or 6pc, to 491.30p following the results.
Greggs will pay a final dividend of 13.5p, the same as last year, on May 24.
Paris Gallery eyes South Africa expansion
CEO Mohammed AR Al Fahim
Dubai-based luxury retailer Paris Gallery, well known for its perfumes, is close to signing a deal to open two stores in South Africa in what will be the company’s first move outside the Middle East.
Paris Gallery CEO Mohammed Abdul Rahim Al Fahim told Arabian Business his long-term plan was to expand the family business into every major city in the world, including Paris, London, Milan and New York.
However his short-term focus was on strengthening the company’s presence in the Middle East, with several new stores opening each year.
He said while Africa was not in the company’s official plan, he was taking seriously an offer by investors in South Africa, who initially approached the company in 2008.
They were still in negotiations and assessing the market but Al Fahim said he expected to finalise a deal this year to open stores in both Johannesburg and Cape Town.
“This is progressing well,” he said.
“We believe the format of Paris Gallery … here in this region is very much attractive to the consumer [in South Africa].”
Al Fahim said he had received multiple requests to set-up in South Africa since 2008 but the timing had not been right until now.
“We’ve had a lot of requests in the past. I’ve made a visit before but we preferred to wait a little longer; now it’s becoming more serious,” he said.
Paris Gallery, which turns over about US$1 billion worth of perfume, cosmetics and other products each year, already has nearly 30 stores and is planning to open more this year.
In October 2012, the company signed a deal allowing Al Handal Group to open five franchise stores in Iraq over the next three years in what was the first expansion outside of the GCC.
Al Fahim said he was regularly approached by investors seeking to franchise Paris Gallery in their country but the company was diligent about where it launched.
“In each country we want our partner there to be successful so it’s not like we open a shop, we open a story of success and a place where we can grow and expand,” he said.
“We do get a lot of enquiries and requests to open in lots of countries which we don’t have in our plan. That doesn’t mean we’re going to reject it totally. It’s worth looking at it, understanding those countries, how they’re developing and progressing when it comes to the economy, political stability, the economic structure and specifically [how the] cosmetics and perfumes sector is developing.
“There would be some countries that are not within the plan but are very much progressing and we take it seriously.
“We believe the company’s capabilities are increasing and [it’s] becoming more capable of competing in very competitive markets beyond the GCC and Middle East.
“We’re already leading in many sectors in our business in the GCC, so the next step is to move into the Middle East countries beyond the GCC and this is what we’re trying to do in the next 3-5 years.
“After that [we want] to be more international.”
When Helen Hunt stepped out onto the Oscars red carpet wearing eco-friendly H&M , the Swedish high-street brand promised us that similar celebrity-worthy pieces would be hitting stores soon – and they’ve kept their word.
Today the chain unveiled their Conscious Exclusive Collection, which will land in stores on April 4. As part of H&M’s Conscious initiative – which is fronted by Vanessa Paradis – all of the party-perfect pieces are made of entirely sustainable materials such as organic cotton, recycled polyester, recycled polyamide and Tencel.
From a dramatic prom-style dress to a chic cream three-piece suit (very Dior) and monochrome cocktail dress, the collection caters for both the girliest of girls and those who prefer a more classic, masculine cut. There’s even some suave tailoring for men, too.
“I love how this collection has pure glamour and style, and is made from more sustainable materials,” says Ann-Sofie Johansson, H&M’s Head of Design. “For us at H&M, it’s natural to think about sustainability, and to have it at the heart of our work.”
Whether it’s a spring wedding or chic cocktail party you need an outfit for, you’re bound to find something in this range. Actresses Chloë Moretz and Sophia Bush have managed to get their hands on a couple of the pieces already, and we have to say we’d never have guessed either of the gorgeous outfits were high street – consider us well and truly convinced.
Wahat Hili Mall, a new shopping mall project in Al Ain, will be completed and opened to the public in August, officials have announced.
Saeed Al Dhaheri, CEO of Wahat Hili Mall, said he expected 175,000 visitors per week to the shopping centre by the end of this year.
Wahat Hili Mall’s biggest anchor, Géant Hypermarket which will stretch out over 6,900 sq m, has begun fit-out works while all tenants will have possession of their leased units by the end of May, he said in a statement.
Al Dhaheri added: “Wahat Hili will be much more than a mall, in terms of shopping, dining, entertainment and convenience; rather, the shopping complex will be a catalyst for further economic growth in Al Ain.
“We expect it to draw in 175,000 weekly visitors by the end of 2013, which if achieved and probably exceeded, will mean a boost to the city’s stance as a must-see destination.”
He said August 28 has been set as the opening date for the mall which will feature a total of 160 stores and is located next to the five-star Hili Rayhaan by Rotana hotel.
Omer Kaddouri, executive vice president and COO of Rotana, said: “Wahat Hili Mall will be the one stop destination for visitors to Al Ain; drawing in people from all over the region… we are proud to partner with the modern-day retail complex that is set to become a ‘must see’ for guests of the city.”
Trinity Leeds, the £378m scheme developed by FTSE 100 property company Land Securities, will attract an estimated 23m visitors a year, and feature a large range of major retail names including Primark, Topshop, Mango, Next and Urban Outfitters.
The 1m sq ft centre is already 90pc let, with around 120 shops, restaurants, bars and coffee shops. It will bring 46 new names to the city and is expected to generate around £29.5m in annual rent for Land Securities.
“Before then it wasn’t the right time to start a major scheme, it has been a difficult market,” says Richard Akers, an executive director. “But we saw an opportunity in Leeds, we knew there was strong demand.”
Around 20pc of the development will be dedicated to leisure, which is a larger proportion compared with older centres.
Topshop has opened, while Primark will open during the autumn, as will Trinity Kitchen, a “street food” area which will feature changing brands.
Qatar’s sovereign wealth fund is eyeing UK retail chain Marks & Spencer in a GBP £8bn (US$12bn) deal, according to London’s The Sun newspaper.
Qatar Investment Authority (QIA) purchased London luxury store Harrods for GBP£1.5bn in 2010 and already owns a string of other assets in the UK, including a 26 percent stake in supermarket Sainsbury’s.
Marks & Spencer has about 1,000 locations worldwide, including in the UAE and Saudi Arabia, and employs about 80,000 people. In its latest set of financial results, the company reported a 9.7 percent decline in profit to the six months up to the end of September 2012 to GBP£290m, while group sales increase 0.9 percent to GBP £4.7bn.
The Sun did not specify its source on the reported takeover bid, but shares in the retail rose on Thursday and Friday amid speculation of a buy-out. Marks & Spencer, which was founded in 1884, is listed on the London Stock Exchange and is a constituent of the FTSE 100 index.
Neither QIA nor Marks & Spencer had responded to Arabian Business’s request for comment on the matter at the time of publication.
QIA’s other assets include an 8.7 percent stake in US jeweller Tiffany & Co, as well as a 3 percent stake in oil company Total, while it has also invested in British bank Barclays. The sovereign wealth fund also owns 17 percent of Volkswagen and 10 percent in Porsche.
The fund is believed to have assets in excess of more than US$100bn, positioning itself as the 12th world largest sovereign wealth fund by asset under management, according to the Sovereign Wealth Fund Institute.
JCPenney is on the brink, and now, all eyes are on the struggling retailer’s gigantic launch of a new shop.
Canadian fashion brand Joe Fresh will be entering a whopping 681 JCPenney stores simultaneously Friday morning.
When the deal was announced last July, it was just one of many moves CEO Ron Johnson was making to make his “shops” concept a reality. Joe Fresh would be coming in as part of a total overhaul of the brands JCPenney carried.
Months later, Joe Fresh has taken on a much greater significance.
“We are one of many new concepts being brought to JCPenney,” Joe Mimran, the founder of Joe Fresh, told Women’s Wear Daily. “But there is no question about it: There seems to be a bit more focus on our brand working.”
The retailer that has been on a terrible run. The last few weeks have been disastrous: it reported horrific Q4 earnings, went to court to fight Macy’s over Martha Stewart, and had a board member dump a chunk of his stake.
Joe Fresh will be an indicator for the effectiveness of Johnson’s overall turnaround plan, which is to transform the in-store shopping experience into his “shops” concept, and attract new customers to the store with his new assortment of brands. Johnson said that 61 percent of Joe Fresh buyers are first-timers at jcp.com.
But if it fails, it could all be over.
It would mean that Johnson’s entire concept has no future.
“If Joe Fresh doesn’t work, this could be the worst ides of March since Brutus greeted Caesar on the floor of the Senate,” Rick Snyder, an analyst at Maxim, told Bloomberg Businessweek. “[Joe Fresh] is kind of a microcosm of what they’re trying to do, and if it doesn’t work, I think it’s going to get really ugly.”
Johnson is on a mission to get younger customers into his stores and Joe Fresh is at the center of that strategy. Not only could the brand grab those new customers, but perhaps convert some of the old JCPenney shoppers to newer styles.
Joe Fresh is a lifestyle brand and its line at JCPenney will feature everything from a $4 pair of flip flops to $39 silk tops. Nothing from Joe Fresh’s JCPenney shop will cost more than $69, according to Racked.
“The products will be the first true lifestyle offerings under JC Penney’s new pricing scheme,” Brian Sozzi, chief equities analyst at NBG Productions, told us. “Not only won’t pricing be an issue with Joe Fresh, but from what I can tell the company is putting its marketing dollars behind the brand quite strongly.”
It has been a long time coming. Johnson reached out to Mimran in early 2012 as JCPenney began its transformation.
“He shared with me his vision and the repositioning and transformation,” Mimran told Women’s Wear Daily last July. “For us, it looked like a great opportunity to get a very large footprint in the U.S. very quickly and to do it with someone who is visionary.”
Lately, JCPenney executives have been keen on mentioning Joe Fresh — over and over again.
JCPenney CFO Ken Hannah spoke at Bank of America’s 2013 Consumer & Retail Conference on Wednesday and mentioned Joe Fresh repeatedly. Johnson also devoted a chunk of time to Joe Fresh on his Q4 earnings call.
Now, Joe Fresh’s JCPenney launch has a ton of outside factors on its side. It’s set up to succeed in the short-term, so if it doesn’t, it will send a glaring signal that something is fundamentally wrong.
It’s Spring. Tax refunds will be taken to malls. JCPenney is advertising heavily. The brand is only launching in JCPenney’s bigger, better, more trafficked stores.
“This is a great moment to get the disenchanted JCPenney consumer re-engaged with the new JCPenney,” said Sozzi. “The stock market will view it as a complete failure of Ron Johnson to truly understand what the consumer wants.”
There’s also the matter of Johnson himself. Will he be able to survive one more crisis?
“Should the shops succeed, the turnaround story could still have legs,” Snyder wrote in a note.
“Should Joe Fresh launch with a thud … [Johnson] could be forced out prior to back to school,” Sozzi told us. “He will have wasted tons of capital on initiatives the consumer market wasn’t ready for yet and in the process, basically drove a 110 year old department store into a liquidity crisis.”
It’s enough of your challenge to get an existing customer to buy your products, but JCPenney has shed mass amounts of its core customer base. It has to bring back its old customers and find brand new ones.
H&M has a major presence in the U.S. market, but now that the brand is firmly embedded in the minds of Americans, it’s about to crank things up, Sharon Edelson at Women’s Wear Daily reported.
“We’ve established a strong brand,” said Daniel Kulle, U.S. president of H&M, told Women’s Wear Daily. “Now we can see that we can grow and expand in many markets in the U.S. There’s huge potential at the moment.”
Right now, the Swedish fast fashion retailer has 269 stores in the U.S., but Kulle didn’t tell WWD a target number for future growth. It opened 40 new stores last year and expects an even bigger number in 2013.
“This is just the beginning,” Kulle told WWD.
That’s not all. Kulle said that H&M’s sister brands, like & Other Stories and Cos, have big potential in the U.S. as well. Cos, in particular, is “for sure” coming to America.
H&M will be launching an e-commerce site this summer too. The initiative has been pushed back three times, but it looks like it’s finally going to happen.
UK supermarket chain Morrisons (LSE:MRW) announced today that it will start selling groceries online by the end of January 2014 in an effort to catch up with its rivals.
Tesco, Sainsbury’s and Asda have been selling over the Internet and delivering to customers for a number of years and the sector is growing fast.
Morrisons, the UK’s fourth largest supermarket group, said that it was in talks with online-only food retailer Ocado (LSE:OCDO) to help launch its web-based business. A deal between the parties could involve making use of Ocado’s technology and operating knowledge but the negotiations do not involve any discussion of Morrisons acquiring all or part of Ocado.
Separately, Ocado confirmed that any agreement with Morrisons would not affect its existing partnership with Waitrose.
Dalton Philips, chief executive of Morrisons, acknowledged that the group is a “late entrant” to the online food market but stressed that the company has learnt from its involvement with UK children’s products web retailer Kiddicare and US-based Fresh Direct.
In addition to expanding into online grocery retail, Morrisons is taking further steps in the convenience stores market. The company said today that it expects to have 100 “M local” outlets open by the end of the year and will be looking to increase that number in the future.
To accelerate the rollout of its convenience store operations, Morrisons recently acquired 62 sites from the administrators of Blockbuster, Jessops and HMV.
The announcement of Morrisons’ plans for online and convenience store retailing were announced alongside its full-year results, which illustrate the company’s need to make changes. Pre-tax profit for the year to 3 February 2013 dropped 7% to £879m, from £947m in 2011/12. Like-for-like sales for the year were down 2.1%.
Weekly customer numbers averaged 11.4 million, which is 0.4 million fewer than in the prior year on a like-for-like basis.
Within its annual report Morrisons noted that the UK’s online food market is currently growing at around 16% as consumers increasingly shop using different channels to manage their spend and time.
UK retailer Tesco Plc (LON:TSCO) said on Wednesday it had taken over restaurant chain operator Giraffe Concepts Ltd for £48.6m
Johannesburg – Truworths International Ltd. led a decline in South Africa’s consumer stocks, which fell the most in a month as spending contracted for the first time since 2009.
The FTSE/JSE Africa General Retailers Index dropped as much as 2.6 percent, the biggest intraday fall since February 14, and traded 1.4 percent lower at 62,886.01 at 4:18 p.m. in Johannesburg.
Truworths, South Africa’s biggest clothing retailer by market value, declined 2.6 percent.
Mr Price Group, a clothing and furniture chain, fell 1 percent.
Both have declined about 15 percent in the year to date.
Lewis Group, a furniture and appliance retailer, sank 0.3 percent.
South African retailers have suffered share price declines this year after trading updates showed slower sales growth amid rising unemployment and lower consumer spending.
Gross domestic demand fell an annualised 0.9 percent in the final three months of 2012, the first fall since 2009, compared with an expansion of 4.1 percent in the previous three months, the Reserve Bank said in its Quarterly Bulletin released in Pretoria today.
Growth in consumer spending, which accounts for about 60 percent of total spending in the economy, slowed to an annualised 2.4 percent in the final three months of last year from 2.7 percent in the third quarter, the bank said.
“Household consumption expenditure continued to be constrained by slower growth in disposable income of households and rising inflation,” the bank said. – Bloomberg News
Inditex SA, Europe’s largest clothing retailer, is charging full-steam ahead, expanding its physical stores as well as its online presence worldwide.
In tandem with reporting a 22 percent jump in 2012 net profits, the parent of the Zara chain said it would open between 440 and 480 new locations this year.
“There is room for growth in most geographies,” Inditex chief executive officer Pablo Isla said during a conference call with analysts, noting that “China will be the most relevant country because of its size.”
The fast-fashion giant registered net profits of 2.36 billion euros, or $2.96 billion. Net sales rose 16 percent to 15.95 billion euros, or $20.48 billion, in the year ended Jan. 31.
Dollar figures are converted at average exchange rates for the period to which they refer.
Inditex shows no signs of slowing. Sales in local currencies increased 12 percent between Feb. 1 and March 11 of this year, Inditex said, noting it adjusted the figure to account for an extra trading day in February 2012 due to the leap year.
Inditex’s results are the fruit of its strategy to offset weak consumer spending in austerity-hit Europe by thrusting into new markets. Isla was very specific about his strategy to spin a web of retail businesses over a mix of regions, instead of concentrating more on one or the other.
Founded by the world’s third-richest man, Amancio Ortega, who Forbes estimates is worth $57 billion, the group, which owns brands such as Zara and Massimo Dutti, opened 482 stores in 64 markets in 2012 — including debut launches in Armenia, Bosnia and Herzegovina, Ecuador, Georgia and Macedonia. Inditex now operates a total of 6,009 stores worldwide.
Milestones in Europe included a Zara flagship on the Champs-Elysées in Paris and a new Zara store on London’s Oxford Street, “of which we are especially proud,” Isla said.
In total, retail space grew 11.4 percent to 34.4 million square feet.
In 2012, Inditex devoted 1.4 billion euros, or $1.82 billion, in ordinary investments in renovating and upgrading stores, expanding its eco-efficiency program as well as modernizing its eight distribution centers.
Last year’s innovations included “Bershka’s launch of the first store in the world exclusively lit by LED technology,” the company stated.
“The investment plan guarantees the future of our company,” said Isla.
He stated that 2013 “will be a strong year of expansion.”
“Space growth will be in line with our long-term targets of 8 to 10 percent, [while] capital expenditure for the year will be around 1.25 billion euros [or $1.63 billion],” said Isla.
The group’s online store network grew to 23 markets, including new Zara online launches in China in December and in Canada last week, while Massimo Dutti and Zara Home online shops made their debut in the United States.
Russia, where 75 stores opened doors in 2012, will see Zara online go live in the second half of 2013.
“Zara has 2 million visits per day on its Web pages, the other brands combined an additional 1 million visits. It’s an incredible tool to communicate with our customers,” said Isla.
He noted that although “online penetration is much lower in Russia compared to the United States,” it is a significant project given “the number of people that are visiting our Web pages, with part of them buying online, but most of them continuing to our [physical] stores.”
Europe outside of Spain has remained the most important region, accounting for 45 percent of sales, while recession-battered Spain is down to 21 percent from 25 percent the previous year.
Italy’s tax police have confiscated real estate properties, including a site in Rome’s Via dei Condotti, life insurance policies and corporate investments traceable to Bulgari executives for a total value of 46 million euros, or $60 million at current exchange, according to a release issued by the Guardia di Finanza, an Italian police force under the authority of the national minister of economy and finance.
The investigations are focused on alleged fraudulent earnings’ declarations and evasion of tax payments of around 3 billion euros, or $4 billion, starting from the year 2006, through a system of allegedly fictitious companies in the Netherlands and Ireland, set up in order to avoid paying taxes in Italy. In the statement, the tax police said it has unearthed nine pages of documents Bulgari executives named “escape strategy,” to find alternatives to Italy’s high tax rate and, in particular, to a legislation introduced in 2006, “referred to taxes to be paid on dividends coming from countries with a privileged fiscality.”
A statement from Bulgari on the issue is expected in the afternoon.
Sprinkles Cupcakes, a Beverly Hills-based bakery said to be popular with Hollywood stars, has opened its first Gulf outlet in Kuwait.
The brand, which was founded in 2005 and has 11 bakeries across the US, has been brought to the region via a franchise agreement with MH Alshaya Co.
Sprinkles claims it was the original cupcake bakery and is the inspiration for many other similar chains. The company’s Kuwait outlet is located in Avenues Mall.
“We are very excited about opening our very first bakery outside the US here in Kuwait. I am delighted to begin our global expansion from the Middle East through our partnership with Alshaya, a company which has a remarkable legacy of retail leadership,” said Sprinkles co-founder Charles Nelson.
“I am sure that our hand-crafted cupcakes will delight our new customers in Kuwait,” he added.
There are several cupcake bakery brands already present in the Gulf, including Sugardaddy’s, Hey Sugar, Hummingbird and Magnolia.
Morrisons opens discussions with Ocado and speeds up small store openings as it reveals 7pc profits fall
Morrisons admitted today that its performance fell short of expectations after reporting a 7% drop in full-year profits to £879 million.
The supermarket, which generated sales of £18.1 billion in the year, said it had not done enough to communicate its promotions and suffered because it still lacked a meaningful presence in the two fastest growing sectors of the market.
It will attempt to rectify this shortfall by accelerating the roll-out of its M Local smaller store format to 100 sites by the end of the year and has confirmed it will launch its online food offer by January next year.
As part of the internet push, it is in discussions with online grocer Ocado about an agreement to share its operating knowledge.
The UK’s fourth-biggest grocer, which employs 129,000 staff at 498 stores, said like-for-like sales dropped 2.1% in the year, while the average of 11.4 million customers in its stores each week was down on the prior year.
Chief executive Dalton Philips said: “2012/13 has been a challenging year for the company during which we did not perform as well as we would have wished.
“We are implementing a comprehensive range of plans to address these trading issues.”
He said food quality, provenance and trust were at the forefront of consumers’ minds following the horse meat scandal.
Half of Morrisons’ fresh products are processed through its own factories and, as part of a £200 million investment plan announced in 2010, it has recently established a seafood processing facility in Grimsby and expanded its Colne abattoir to enable further pork processing.
Mr Philips added: “Recent events have underlined why it’s so important that we tell our customers how and why we’re different and what our vertical integration really means for them.”
Morrisons said its first 12 M Local convenience stores were performing well and that the acquisition of 60 sites in recent weeks, including 49 former Blockbuster stores, increased its store openings target by 40% this year.
As part of its planning for an online grocery operation, Morrisons has sent a team to New York in order to learn from US food delivery business Fresh Direct, in which it acquired a 10% stake last year.
It recently launched its online Morrisons Cellar wine range and also bought the Kiddicare online clothing business in 2011.
The company said: “We have completed that evaluation and are now confident that we have identified a model that will enable us to provide food online in a distinctive, customer-focused way that reinforces Morrisons leadership in fresh food by putting fresh food at the heart of its offer.”
Plans for the use of Ocado’s knowledge fuelled speculation that the two companies will forge closer ties, although Ocado stressed that there were no talks about Morrisons acquiring all or part of the company.
Ocado shares were more than 20% higher today, while Morrisons rose by 3%.
Dan Coen, a director at advisory and restructuring firm Zolfo Cooper, said that while it has been slower than others to keep pace with changing consumer habits, 2013 will prove an important year for Morrisons to gain a competitive advantage and return to previous profit levels.
He added: “Morrisons’ results may be disappointing, but a comeback could be on the horizon.”
Tesco’s acquisition of Giraffe follows its purchase of a near-50% stake in Harris + Hoole coffee shops and an investment in Euphorium Bakery. Photograph: Alamy
For two decades, supermarket chains Tesco and Asda have set Britain’s shopping agenda, attracting hordes of customers to huge out-of-town stores to stock up on weekly groceries at unbeatable prices. But all that is changing, according to rattled industry leaders, who are scrabbling to win back customers increasingly buying online or defecting to smaller outlets.
As part of its efforts to restore its fortunes, Tesco on Wednesday paid nearly £50m for Giraffe, a family-friendly chain of restaurants with just 48 outlets, mainly in upmarket London suburbs. It claims to have brought brunch to the high street, serves mojitos alongside baby breakfasts and there is always ample parking for Bugaboo prams.
Yesterday, the impact of being gobbled up by the UK’s biggest grocer was immediate: its website crashed and was simply displaying a message explaining that it was out of action “due to today’s Tesco announcement”.
For a retailer that accounts for more than one in every £8 spent in UK shops, with UK sales of £47.3bn, the deal is pocket change. But added to the grocer’s recent 49% investment in artisan coffee shop Harris + Hoole, the group’s Dobbies garden centre business, and a stake in the embryonic, luxury bakery Euphorium, and the beginnings of a bold strategic shift begin to emerge.
Asda, meanwhile, is believed to be in discussions with the administrators of high street chain HMV in a move that could see the 90-year-old music and DVD brand salvaged and stores opened inside Asdas. Talks are tentative, but the aspiration to transform is clear. Chief executive Andy Clarke yesterday talked of creating “mini high streets” in Asda’s largest stores as it battles with shoppers’ shift to the internet.
For the Asda boss, part of way to win back customers is to experiment with bringing in, for example, respected local butchers to run sections of its meat departments. “The principle of concession retail in big stores is not new but we are going to see an acceleration of that,” he explained at a retail conference in London yesterday. Asda already hosts concessions from the likes of cobblers Timpson and Disney.
For much of the past decade the priority for Tesco and Asda superstores has been the race beyond core grocery retailing, expanding into ever-larger stores with new aisles given over to clothes, electricals, toys, home furnishings, pharmacy products and more. Now the rise of Amazon, eBay – and the supermarkets’ own websites – is eating away at the shopping patterns on which the out-of-town model was built. Market analysis firm IGD put it starkly – predicting that supermarket stores over 25,000 sq ft will see just 6.4% sales growth in the five years to 2017. Out-of-town superstores are some 40,000sq ft. In contrast, online grocery sales are expected to almost double in that period.
Tesco has already been tweaking the look of stores – putting more prices on chalk boards, adding wood fittings and specialists butcher and bakery counters – but the addition of satellite dining is part of a plan to make out-of-town shopping less of a chore.
Tesco is determined to keep on Russel Joffe, co-founder of Giraffe, to run the business, with the first restaurant alongside a Tesco store expected to open later this year. Started by Joffe and his wife Juliette in Hampstead in 1998, Giraffe will open its 49th restaurant in Leeds later this month.
Juliette Joffe said: “When we opened we wanted somewhere that families would feel welcome. When our kids were growing up there was really nowhere to take them.” With ample buggy storage capacity, stacks of high chairs, balloons and crayons, Giraffe hit on a formula that won over a generation of well-heeled young families.
Among the first to see its potential was serial restaurant entrepreneur Luke Johnson, the former chairman of Channel 4, who made an early fortune expanding Pizza Express into a national chain. He invested in Giraffe, as did venture capital group 3i. Stepping down as chairman of Giraffe he predicted yesterday the supermarket group could build Giraffe into a 200-strong chain in five years. “For middle-class families with children it is the next step up from fast food,” he said.
“Russel was one of the pioneers in bringing brunch to the high street — he brings a buzz and verve which is at the heart of Giraffe’s success.
“There are not that many casual dining options out of town. And those that are there are dull, down market and not very good quality… It is always a challenge for a big company buying a smaller business to keep the espirt de corps that makes a business different.”
But Neil Saunders, of retail research firm Conlumino, said: “Giraffe is a small and friendly brand and there is just a nice feel about it. There is a danger that could be lost if Tesco imposes too many of its corporate processes.” The Cafe Rouge chain was acquired by FTSE 100 leisure group Whitbread in the mid 1990s and was quickly suffocated within the larger group.
Chris Wade, chief executive of national charity Action for Market Towns warned that Asda’s plan to create in-store high streets could be a further blow to town centres. “It could be a case of giving a thin slice of what’s on offer in a vibrant town centre and splitting the footfall so the real and the pretend high street are in competition. With free parking this might offer convenience but ultimately will only reduce real choice,” he said.
French Connection was founded by Stephen Marks in 1972 but endured a torrid 2012
French Connection has slumped to a £10.5m loss after suffering “very difficult” trading particularly at Christmas.
Stephen Marks, the fashion chain’s chairman and chief executive, hoped the company would return to profit by 2015 having lost £1m in the festive season alone. Marks said customers’ perception of French Connection, which was well known for its FCUK brand, was “not too bad”.
The £10.5m loss in the year to the end of January compares to a £5m profit a year earlier. Sales dropped from £215.4m to £197.3m.
Marks, who owns 42% of the company’s shares, said the chain’s UK stores were the worst performing, and UK sales dropped 7%. To spark a turnaround, Marks “changed the design team” and “changed the staff in the shops” because “they weren’t performing”, he added.
The company has been trying to offload 15 of its underperforming UK stores, but has so far only been able to lose three so far due to difficulty negotiating with landlords. Closing the stores cost the chain £1.3m. French Connection said it was in the process of closing one more store and six concessions and expects to close another two stores in the year.
Marks said the company’s Toast and YMC brands were trading “very well” and that YMC was a “very niche part of the marketplace, [but] expanding slowly but surely”.
French Connection shares, which have lost 46% of their value over the past year, closed up 10.5% to 27p. The shares peaked at £4.87 in 2004.
David Fitzsimons of Retail Excellence Ireland says unsustainable ‘Celtic tiger rents’ are causing a problem for many retailers, including Monsoon and Accessorize.
Monsoon Accessorize, the women’s clothing and accessories store, is seeking to be put into examinership by the High Court so it can continue as a going concern. The company employs 270 staff and has 18 stores in Ireland.
Retail Excellence Ireland said that it was disappointed but not surprised to hear that the retailer had applied to go into examinership.
David Fitzsimons, CEO, Retail Excellence Ireland, said: “It is disappointing to hear that Monsoon Accessorize Ireland Ltd has applied to go into examinership, but not surprising. The fashion market in Ireland has been very challenging in the past 12 months – as evident by our quarterly retail figures released. Additionally, demand in the fashion industry has dissipated over the past few months.”
“The fact that landlords are still charging Celtic tiger rents which are not sustainable is a huge problem for many retailers including Monsoon and Accessorize. Unfortunately, this company is not the only retailer taking this route and we are likely to see many international retailers do the same over the coming months, if the government doesn’t address the problems experienced by retailers at present.”
French fashion house Dior will take over iconic London department store Harrods for one month with a series of spectacular in-store exhibitions, events and exclusive products.
French fashion house Dior will take over famed Knightsbridge department store Harrods this Saturday until April 14.
The invasion will consists of nine separate pop-up shops-in-shop, exclusive products and a 50-seat café which will serve Dior-doodled cupcakes and lobster club sandwiches, reports WWD . All 33 of the store’s windows will be transformed by Dior to feature “showers” of J’adore perfume bottles, “Dior-ized” London telephone boxes other Dior mascots.
Inside the store, visitors will be able to view miniaturised couture dresses created by the seamstresses in Dior’s Avenue Montaigne ateliers, gowns worn by Dior’s many celebrity followers, as well as contemporary artwork by young British artists asked to interpret the Lady Dior bag, for which Jennifer Lawrence is the face.
By Graham Ruddick9:45AM GMT 12 Mar 20135 Comments
HMV collapsed into administration in January and more than 100 stores are set to be closed.
Restructuring specialist Hilco has bought HMV’s debt and is in pole position to acquire the retailer, however, Asda could now launch a late bid to try to take control of HMV.
Asda is understood to have held talks with Deloitte, the administrators to HMV, about a deal and is interested in buying the brand and business, rather than simply converting the stores into convenience food shops
When HMV collapsed into administration, the company had 223 UK sites and employed 4,123 staff. However, Deloitte is closing more than 100 locations and plans to leave the retailer with a “residual portfolio” of 116 stores.
The 92-year-old music chain fell into administration in January after seeing its sales eroded by competition from
So far, the company’s flagship shop on Oxford Street has survived the cull of shops but Deloitte is considering bids for the location.
Hilco, which owns HMV Canada, has said it believes there is a “viable underlying business” in the company. It has been holding talks with HMV’s suppliers, including record labels and film studios, whose support is vital for the future of the company.
Michael Buckner / Getty Images
Forever 21 is growing like crazy, and the fast fashion retailer is becoming a major threat to the rest of the industry.
Analysts Lorraine Hutchinson, Paul Alexander, and Jessica A. Lebo at Bank of America warned that competitors need to start paying attention to the privately-held retailer right now.
They declared Forever 21 “the most transformative retail concept” in a note to clients.
“Forever 21 is becoming too big for the specialty retailers to ignore,” the analysts wrote. “At this size, rapid growth could have ripple effects on the other retailers as Forever 21 takes more share.”
Back in 2008, Forever 21 SVP Christopher Lee told the Los Angeles Times that the company’s goal is to become a “global retail conglomerate.”
And it’s well on its way.
Forever 21 has expanded to more than 450 stores in the U.S. and nearly 100 locations internationally. It charged into Europe, put its foot into China, and now has its sights on Latin America. Bank of America estimates the company’s sales at upwards of $3.5 billion — in line with many big teen retailers.
The big players in teen retail, like Abercrombie & Fitch, Aeropostale, and American Eagle, will feel the pressure. Gap has also been squeezed by Forever 21, as it sees revenues and margins getting eaten away, according to ACM Partners’ Margaret Bogenrief.
Why should they be worried?
Forever 21 is faster and cheaper — It uses the fast fashion model, getting new fashion trends to stores as quickly as it possibly can, then selling at a low price. Traditional retailers try to establish a brand with a signature look, so it’s very unlikely that others will try to copy Forever 21 after spending so much time and effort building their own brands.
And it simply sells clothing for less than its rivals do. “Forever 21 sells jeans for as low as $15, where teen retailers generally start at $30 for this important category,” noted the Bank of America analysts.
Forever 21 is expanding its customer base — Forever 21 is becoming a fashion department store that caters to all members of the family — not just teens.
That means a broader set of customers are being gobbled up by the retailer as it releases new lines targeting men and older demographics. Yet, at its core, Forever 21 still has a similar target as the big teen retailers – 18- to 24-year-olds.
Forever 21 is fighting its competitors head-on — The retailer used to settle for second-tier malls and mediocre space in the big malls. But now, Forever 21 is done being timid.
“We have seen Forever 21 take on much better located spaces and often larger sized stores,” wrote the analysts. It even has a Times Square flagship directly across the street from both Aeropostale and American Eagle.
WOOLWORTHS has big plans for the Witchery and Mimco brands in South Africa, according to group director of planning for clothing and general merchandise, Paula Disberry.
“You’ll see us doing similar things that we’ve done with Country Road and Trenery. We are excited, in particular about Witchery in SA, as well as Australia. It’s becoming more fashion forward, targeting a younger customer, somebody who is looking for a slightly smarter, sexier, more glamorous look. We think that fits well in our portfolio because we don’t have any meaningful offer of that type of merchandise at this point and at those price points.
“We think it will get particular traction with the Gauteng customer, and in particular the younger black customer,” said Ms Disberry.
Country Road‚ Woolworths’ 88%-owned subsidiary, concluded the acquisition of 40-year-old fashion retailer Witchery Group from Gresham Private Equity for A$172m (R1.6bn) in October.
“You will see us putting them in Woolworths ‘big white box’ as we do with Country Road and hopefully stand-alone stores,” Ms Disberry said. It is expected that Woolworths will launch the brands in South Africa in a year. Over the past five years Woolworths has made big shifts in its clothing business in a bid to get the right product, in the right place, at the right time and at the right price.
The company has invested a significant amount of money in an end-to-end suite of systems, and has built functional skill in its business by establishing a merchant academy where its buyers, planners, technologists and designers are trained. It also uses customer data to segment merchandise and plan the layout of its stores.
“Customers are seeing a very different product from us, but at the same time it’s driving profitability,” said Ms Disberry.
The firm’s procurement strategy has allowed it to shorten lead times, as it focuses on a fast-response model — amid international retailers such as Zara expanding in South Africa.
The group head of design, sourcing and technology for clothing at Woolworths, Darren Todd, said: “We still have a very strong presence here in SA from a manufacturing perspective, but what we’ve done is identify centres of excellence in China, Bangladesh, India, Madagascar and Mauritius — our journey offshore has been about identifying innovation and differential product.”
Rent the Runway closed on its third round of financing, raising $24.4 million.
The round was led by Advance Publications Inc., the parent company of Condé Nast and Fairchild Fashion Media, parent of WWD, and includes American Express and Novel TMT Ventures. Previous investors — Bain Capital Ventures, Highland Capital Partners and Kleiner Perkins Caufield & Byers — also participated in the latest round. Following the closing of the latest round, Rent the Runway thus far has raised an aggregate of $55.4 million.
According to Jennifer Hyman, cofounder and chief executive officer, “The business is continuing to expand very quickly. We are investing in people, marketing and scaling our operation to make sure we are delivering incredible customer experiences. Over the next year, we have plans to expand our showrooms.”
The showrooms are physical retail spaces where customers can try on dresses and accessories as well as book appointments with Rent the Runway’s stylists to discuss fit and style needs. It has one so far, at its New York City headquarters in the West Village.
Hyman said at some point the company will need to decide whether to move out of its New Jersey warehouse and build a larger facility or have multiple distribution centers. A top priority is hiring engineers to improve operations and logistics.
It was a company engineer who had the idea for the firm’s social shopping platform launched in October that enables renters to see outfits on other women with similar height and weight measurements, Hyman said.
As for investments in logistics and technology, Scott Friend, managing director at Bain Capital, said the company has needed continued investment to grow because it is “more expensive than other start-ups. Really good systems and processes help to make the [business operations] less expensive. Rent the Runway builds its core operating systems in-house” rather than buying software off the shelf. Friend explained that expense is required because of the need to tailor the programs to the complexities of the business.
“In [this] business, 100 percent of what we send out comes back four days later on purpose. We have to make it look brand new all over again so we can ship it out again on Thursday, knowing it comes back on Monday. That involves seamstresses and dry cleaning….We’ve learned that certain materials wear and tear better than others. Certain lengths of dresses wear and tear better, helping the inventory last longer….This management team hired a guy who ran a dry cleaning chain to run their warehouse facility. He implemented processes and systems. All this takes a lot of capital to build the business the right way [in order to] scale the business,” Friend said.
Hyman said at some point an initial public offering is likely, but there’s still more to do to build the brand and platform so it continues to be a “huge marketing engine” for designer brands and retailers.
According to Hyman, the firm is really an “experiential marketing engine” for brand vendors and retailers because it allows consumers to learn about designers they’ve never heard about before.
Shiseido Co. Ltd. said Monday that president and chief executive Hisayuki Suekawa is stepping down as of at the end of the month for health reasons.
Shiseido said that chairman Shinzo Maeda will resume his role as president of the company as of April 1. Maeda, 66, was president and chief executive prior to Suekawa’s appointment in January 2011 as the company put into action its succession plan. This management shake-up marks the end of Suekawa’s two-year tenure at a difficult time for the Japanese company, which is currently underperforming both in its native Japan and abroad, particularly in China.
Speaking at a press conference here, Maeda said he will take the company’s helm on an interim basis until the company finds a suitable successor. He declined to give a precise timetable for how long the executive search could take, but said he expected to be president for less than four years.
“I don’t have an exact timespan,” Maeda told journalists.
Suekawa said that his job was a strenuous one and he started worrying about his health last month, at which point he decided it was better for him to step down. He said that the decision to bring Maeda back as interim chief executive was made because possible successors within the company were not yet fully prepared to take on the role.
Maeda praised the work Suekawa has done over the past few years, noting that it has been a very difficult time to lead the company due to issues stemming from the 2011 earthquake, the formerly strong yen, a global economic downturn, and political tensions between Japan and China stemming from a territorial dispute.
“Suekawa is excellent at his job and has worked very hard, with many early mornings, late nights and overseas trips, always applying himself completely,” Maeda said. He went on to state that Suekawa needs a break but that he remains a strong person with a strong spirit. Maeda declined to divulge specifics on Suekawa’s illness, which he said was “private.”
American Golf, which has 100 stores in the UK, said sales rose 3pc to £133m in the year to January 31.
The profile of the sport was boosted last year by British golfers Mcllory and Donald battling between each other for the status of world number one and Europe winning the Ryder Cup against the US in dramatic circumstances at the Medinah Country Club near Chicago.
For American Golf, this helped to offset a 13pc fall in the number of rounds of golf played in the UK as golfers stayed away from the course due to the adverse weather and the uncertain economic environment.
The retailer, which is owned by private equity group Sun Capital Partners, said it now plans to open 30 new stores over the next three years, which will create 250 new jobs.
American Golf is also planning to launch new ladies stores within its locations, which will include 11 “centres of excellence”. Female golfers represent around 15pc of all players.
Despite the sales rise, earnings before interest, taxes, depreciation, and amortisation fell below £7.5m in the year to January 31, compared with £8m last year, due to investment in new shops.
Kevin Styles, chief executive, said: “Last year was a game-changing one for the business. We delivered record sales and, more importantly, made some major improvements and investments to get the platform right for our next growth phase.
He said this included “strengthening our e-commerce business” and developing the retail store format.
American Golf stores employ professional golfers who help to coach customers and advise them on what clubs to buy. “It’s all about saving our customers more shots,” said Mr Styles. “Performance is our proposition and this is backed up by the expertise of our team.”
The ancient city of Petra is the region’s biggest tourist draw
A $1bn 475-room luxury hotel operated by Hilton Hotels, will be co-developed by Onix Investments and Koni Konsultants, both from Singapore and Koni Group of Orlando, in Jordan, the Jordan times reported.
The hotel will be located at the southeast corner of the airport highway in the capital Amman and the first phase of construction will cost around $350m, the newspaper reported.
Construction of the hotel will create about 5,600 jobs in the kingdom, according to the newspaper. No information on how the project will be financed was provided.
Jordan’s tourism industry which accounts for about 7 percent of gross domestic product has suffered as a result of the protests that have swept the Arab world over the past two years and in particulr the violent conflict in neighbouring Syria.
Though the total number of visitors to the country fell by 7.3 percent in 2012 to 6.3m, total receipts increased 15.3 percent in the year from 2011, adding US$3.47bn to the economy, according to official government figures. The kingdom aims to increase tourism revenue to JD4.2bn annually by 2015.
Jordan’s economy is projected to expand to about 3.5 percent this year from 3 percent last year, according to International Monetary Fund estimates.
Jordan’s new Queen Alia International Airport terminal, being built by a group of companies that include Airport International Group (AIG), will start operating on March 21, and increase capacity almost threefold, CEO Kjeld Binger told Arabian Business last month.
The kingdom’s new terminal will increase capacity from an annual 3.5m passengers to 9m and with next phase of expansion climb to 12m, Binger said.
KOCHI // The Abu Dhabi-based retail group Lulu is aiming to expand across India, after opening its first mall in the subcontinent.
The group yesterday launched its 16 billion rupee (Dh1.08bn) shopping centre in Kochi, a port city on the Arabian Sea in the state of Kerala.
“The chief minister [of Kerala] has requested me to make more malls,” said Yusuff Ali, the managing director of Emke Group, which owns the Lulu brand. The group is targeting projects “first in Kerala, then I will expand to other states”, Mr Ali added, without providing further details.
The shopping centre has attracted a host of global brands, including Nike, Levi’s and McDonald’s, which all have stores in the development.
The mall, which is one of India’s largest, covers 7 hectares and includes an ice rink, a multiplex cinema, food court, a Lulu hypermarket and a bowling alley.
Emke is also building a Marriott hotel, which is expected to open later this year, as part of the complex.
Mr Ali, a native of Kerala, said he was “really happy” to be opening the project there, revelling in the attention as he drove local dignitaries on a tour of the mall in a golf buggy. The launch was a highly awaited event following delays to the project.
Mr Ali launched the Lulu Hypermarket chain in the UAE after joining Emke Group, which was founded by his uncle, MK Abdulla, in Abu Dhabi more than four decades ago. The chain has expanded across the Arabian Gulf region and to Egypt. Just this month Mr Ali was added to Forbesmagazine’s list of billionaires, with an estimated net worth of US$1.5 billion (Dh5.51bn).
The opening comes at a time of slowing economic growth and weaker consumer spending in India, but retailers remain confident.
Shamlal Ahamed, the managing director of international operations at the Indian jeweller Malabar Gold & Diamonds, which has a large store in the mall, explained that rents were higher than it paid elsewhere in Kerala, but added that the group was confident of a return on its investment.
“We’re expecting a lot of customers from all over Kerala, not just Kochi,” said Mr Ahamed. “We’re expecting a lot of new customers.”
The mall is expected to directly create about 8,000 jobs.
“This project is good and healthy for the economy of Kerala and India,” said Abdullah Ahmed Al Saleh, the undersecretary at the UAE’s Ministry of Foreign Trade. “Any growth, any development in India, we will be benefiting from this [in the UAE].
“The businessmen and the investors are connected. We have investors in this market. At the same time, also, any growth in the UAE, India will benefit because we have a lot of investors from India in the UAE.”
The links between the UAE and Kerala are particularly strong, with Keralites estimated to account for about half of all Indians in the Emirates. Dubai’s Tecom Investments is developing a vast business park in Kochi, while DP World has invested substantially and operates a major container terminal in the city. Emke is also developing a Grand Hyatt hotel and convention centre in Kochi, with work on the project expected to start soon.
Non-oil trade between the two countries reached a record $70bn last year, Mr Al Saleh said. “That puts India as the first trade partner for the UAE … and there is a big gap between the first trade partner, which is India, and the second, which is China. Most of the trade is in gold, diamonds, food, meat, other kinds of products, petrochemicals.”
A joint government committee for investment between the UAE and India last month discussed opportunities for investment into the subcontinent in different sectors including infrastructure and oil and gas.
“The committee will meet twice a year to follow up the projects and facilitate the business,” Mr Al Saleh said. “Government to government, it’s good to meet with each other. Our role is to communicate with the private sector if they have any challenges, any obstacles.”
UAE’s Tejuri launches new online retail venture
A new online retail venture selling more than 150 international and local brands has been launched in the UAE.
Tejuri.com, an e-shopping mall, has been endorsed by the Department of Economic Development (DED) and features DED accredited retailers across many retail sectors.
These include Sharaf DG, Reebok, Marina Exotic Home Interiors, Jumbo, Eros, THEFACESHOP, Al Jaber Opticals, National Stores, Grand Optics, Springfield, Triumph, Sanrio, Al Motahajiba, and Al Thawb Al Watani.
Mohammed Sharaf, chairman, Tejuri, said: “Retail drives a large percentage of the Dubai’s economic growth… By taking the offerings of our malls and retail spaces online, we are taking consumer engagement to an advanced, global level and opening up a new avenue not just for established retailers but also for small and middle-sized local business looking to break into the retail arena.”
With internet usage within the region growing by 1,500 percent over the last decade, eCommerce has been steadily on the rise in the GCC.
With one of the highest global per capita internet penetration levels, the GCC’s online spending potential is quickly emerging as one of the highest in the world.
In 2012, $3.2bn was spent by online shoppers in the GCC.
Ayaz Maqbool, managing director, Tejuri, added: “Tejuri.com is a natural extension of Dubai’s world-class retail industry. People flock to our malls as we offer a large selection of products in a variety of brands and Tejuri allows consumers to tap into the same products and services, with the click of a button.”
He said Tejuri is fully supported by Dubai’s Department of Economic Development and all Tejuri retailers are DED registered and comply with the Consumer Code of Rights issued by the Ministry of Economy.
Tejuri currently has signed up with over 40 international and local retailers that represent over 150 brands.
VOX Cinemas has continued its ambitious 2013 expansion plan after opening its newest cinema in Mercato Mall, Dubai this week.
The renovated seven-screen cinema at Jumeirah’s shopping destination is the second opened this year after Fujairah City Centre and is VOX’s seventh in the UAE, said Ahmed Galal Ismail, CEO of Majid Al Futtaim Ventures, which owns VOX Cinemas.
VOX Cinemas, formerly CineStar Cinemas, said last year that it is set to launch a total of five new locations in 2013, doubling the company’s screen count.
“We are delighted for Mercato to be the next step in our expansion plan as VOX Cinemas more than doubles our screen count in 2013,” said Ismail.
“It’s a very exciting time for the Majid Al Futtaim Ventures family and Mercato has been an incredibly supportive partner in helping VOX Cinemas fulfil this vision.”
Cameron Mitchell, CEO of Majid Al Futtaim Cinemas, added: “VOX Cinemas has invested heavily in renovating the entire complex and in ensuring that all cinemas are 3D equipped, feature brand new Christie digital projectors, large VIP seats, coupled with Dolby 7.1 surround sound in every cinema.
“VOX Cinemas is doubling our company size in 2013, opening cinemas in the UAE, Lebanon and Oman, making us the largest Middle Eastern cinema exhibitor, and we are delighted that VOX Cinemas, Mercato is the next step in this exciting journey,” he added.
IRELAND’S 300 wealthiest people now have a combined fortune valued at more than the entire state of Ecuador. The Sunday Independent Rich List 2013 reveals that the country’s billionaires and multi-millionaires have a net worth of more than €66bn, which is larger than the South American country’s GDP.
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That is almost as large as the entire Slovakian economy.
Our richest 300 saw their wealth grow by almost 6.3 per cent, or €3.9bn, last year. The rebound in global stock markets was the biggest contributor to this rise. The first Sunday Independent Rich List in 2010 showed that the wealthy elite had fortunes worth less than €50bn.
The country has 11 billionaires, topped by Indian-born industrialist Pallonji Mistry with a fortune of €8.07bn. He became an Irish citizen a decade ago. Telecoms tycoon Denis O’Brien is the richest Irish-born man on the list with a net worth of €3.8bn. There’s a new billionaire this year, as Ardagh’s Paul Coulson zooms up the rankings. His giant tin can and glass bottle maker Ardagh is heading for US stock markets later this year and could be worth up to €3bn. Coulson holds a 36 per cent stake in the business.
The Sunday Independent Rich List 2013 has also found that there are 105 people in this country with net assets or fortunes of more than €100m each.
The economic devastation of recent years has claimed many scalps and seen fortunes lost, but it has also opened the door for new entrants to the list. New entrepreneurs are taking the place of those who have fallen. There are 38 newcomers this year, including Limerick’s Collison brothers who sold their first company as teenagers for €3m. Their latest venture, Stripe.com, based in Silicon Valley, could be worth close to $500m (€385m).
Green energy, technology and high-end manufacturing and engineering are hot sectors this year, with the likes of C&F Tooling’s John Flaherty and Jones Engineering’s Eric Kinsella new to our list. Retail, property, leisure and private equity fortunes were hit hardest by the downturn.
The Gucci flagship store on Sloane Street in London was open for trading on Thursday after it was the victim of a ram-raid shortly before 10 p.m. GMT on Wednesday night.
According to the Metropolitan Police, the thieves used a stolen black Mercedes to reverse into the store, smashing the doors. It is believed that three assailants stole a number of handbags before making off in a waiting blue Audi.
Police said that no arrests have been made and that they were still waiting on confirmation from the brand on the exact number and value of goods stolen. However, it is known that the thieves entered through the handbag department and, given the area’s wealthy clientele, the shop is thought to have stocked several one-off handbags, made from exotic skins like crocodile or ostrich, that would have retailed for about 20,000 pounds (about $30,200).
Gucci has not released a formal statement but a representative said that they collaborating with local authorities to identify the perpetrators.
Crime gangs have targeted high-end designer stores on the prestigious street a number of times in recent years. Most recently, the Roger Vivier shop on Sloane Street was attacked in June 2012, while the Fendi boutique was raided in 2008. There have also been incidents of ram-raiding on Bond Street, at the Anya Hindmarch, Chanel and Dolce & Gabbana boutiques.