Monthly Archives: September 2013
New York — Yankee Candle has agreed to be acquired by global consumer products company Jarden Corp. for $1.75 billion in cash from its private equity owner Madison Dearborn Partners. Yankee Candle, based in South Deerfield, Mass., operates about 575 stores in the United States and Canada.
Madison Dearborn bought Yankee Candle in 2007 for $1.4 billion cash and the assumption of $300 million in debt.
“The iconic Yankee Candle brand is a natural extension of our existing portfolio and of our branded consumables business segment,” said Jarden founder and executive chairman Martin Franklin. “As a successful, well-managed and well-invested business, Yankee Candle is a solid platform for us to leverage our proven, time-tested and portable brand-building approach and to drive additional value through investments in brand equity, product development and innovation.”
Harlan M. Kent, Yankee Candle’s president and CEO, added: “This is a transformative milestone for Yankee Candle. Over the past 40 years, we have built a truly iconic brand with a deeply loyal customer base. Jarden is well known as a stable, long-term owner of businesses, and this will provide us with a perfect platform on which to grow. This acquisition provides us with the resources and scale necessary to drive our future success and will further strengthen our existing product development and distribution capabilities.”
Angela Ahrendts chief executive. Burberry said it wants to capitalise on the ‘significant opportunities’ available in the fragrance and beauty market.
Burberry has launched its first fragrance since taking the running of its beauty business in-house in April.
The luxury British brand, famous for its raincoats, gave Brit Rhythm, a perfume for men, a typically multimedia birth with a campaign embracing Twitter, live gigs and scented temporary tattoos available online.
The perfume will also be promoted via a dedicated website incorporating music, editorial and videos produced in partnership with Noisey, part of the hipster magazine group Vice Media.
Burberry paid €181m (£154m) to end its licence relationship with its previous partner, Interparfums, at the end of March as it said it wanted to capitalise on the “significant opportunities” available in the fragrance and beauty market by developing products more rapidly and linking them to the rest of its activities. The company earned £27m from fragrance and beauty royalties from Interparfums last year.
Angela Ahrendts, chief executive, said that future growth would come from “one consistent brand expression leveraged across all categories”.
Historically, Burberry led product design, packaging and marketing activities for its perfumes and beauty but will now oversee product development, sourcing and logistics, working with external distributors. Burberry already sells the Brit, London and Weekend fragrances for men and women and has several more for women only including Body and Sheer.
Al Asmakh Real Estate Development Company (Aredc) does not expect any major changes in occupancies and rents in Qatar’s malls in the near future.
“The proposed supply of new malls will be delivered over next two-five years and hence, no immediate impact is probable,” Aredc valuation and research wing said in its latest update.
Stabilised rental and inclination towards maintaining proven existing tenant mix are both at the affirmative stage, it said.
New malls offer better positioning, rents, and leasing terms which open choices for the occupants.
The highest demand for existing and new outlets has been coming from the garment segment and luxury brand stores. Restaurants and coffee shops come next, it found.
At least 10 new malls, four-five shopping centres and three-four hyper markets are planned within Doha and the neighbouring areas within the next four years, it said.
About 1.05mn sqm net leasable area can be delivered only in mall segment, which is nearly double the existing net leasable area within malls.
About 550,000 sqm net leasable area is expected to be delivered on and near Al Shamal Road which is 53% of the expected supply and 96% of existing net leasable area among 13 operational malls, it said.
Upon completion of all proposed mall projects, the total net leasable areas among all existing and upcoming malls would be 1.61mn sqm.
“This colossal supply may be compensated by prevailing and proposed alterations of unorganised retails within Doha downtown areas,” the report said.
Retail development, which has already entered the recovery cycle in the second quarter of this year, is the second largest construction activity after residential development.
Within a radius of 12km, Doha and connected areas of Al Rayyan and Umm Salal have 13 operational commercial malls, and 8-10 hyper markets in addition to the traditional souqs and scattered retails, it said.
“Owing to extraordinary per capita income and greater spending appetite, retail segment within Qatar has been experiencing significant growth over the past few years,” the report said.
Around 3.16mn sqm retails are available within Doha and in neighbouring areas of Al Rayyan and Umm Salal in order to cater to around 1mn population, it said.
The major contributors within retails segment remain traditional souqs and scattered shopping areas which dominates by around 75% of existing supply, it added.
However, the existing 13 malls offer nearly 569,000 sqm total leasable area, out of that Villaggio and City Center cover 43%, which is around 245,000 sqm leasable area.
As a standard rule, well tenant-mixed established malls generally command premium over new malls in terms of higher occupancy and rents. The same principle can be applied in malls in Qatar as well: City Center, Landmark, Centrepoint, The Mall, Royal Plaza, and Villaggio have occupancies up to 90%, whereas, the average occupancy in remaining malls is about 65%.
City Center, Landmark, and Villaggio malls command higher rents owing to popularity – the average monthly rent in these three malls is QR280 per sqm. However, other malls may fetch monthly rents within the range of QR200 to QR270 per sqm depending upon footfalls and existing tenant mix.
According to the survey, malls attract annual 85.5mn footfalls. Apart from Villaggio, which has attractions for visitors, footfalls in other malls are in proportionate with their food courts, it said.
City Center commands the highest footfalls over others because it has the maximum amount of food outlets, the research wing said, adding changing habits and increasing expatriate population affect the way of looking towards a mall; now malls are no longer limited to shopping but are extended for the dining experience as well.
In fact, new advertisements of malls contain food court details along with shopping outlets, it observed.
Barwa Commercial Avenue, a large mixed use development, has started a new trend of pre-segmented retail spaces. It offers nearly 600 retail shops and a commercial mall, it said.
Japanese high street retailer Uniqlo, which operates in the UK, France and Russia in Europe, is to open its first flagship store in Germany in spring 2014.
The chain, part of Fast Retailing that also includes Comptoir des Cotonniers, Helmut Lang, Princesse tam.tam, Theory and J Brand, will open in Berlin’s popular Tauentzienstrasse shopping area, which is home to many international fashion and lifestyle brands.
First established in Japan in 1984, Uniqlo currently has more than 1,200 stores in 14 countries, and in Europe the retailer operates 15 locations in three countries. The group first launched in Europe in the UK in 2001, followed by France in 2007, and Russia in 2010. The addition of Germany marks the latest step in Uniqlo’s expansion plan across Europe.
Berndt Hauptkorn, Fast Retailing Group Officer and Uniqlo Europe CEO, said, “Uniqlo is a giant globally, but we are still a challenger brand in Europe. We have been focusing our presence in Paris, London and Moscow, and we are enjoying attractive growth rates despite a commercially demanding environment.
“The opening of our Berlin store marks a step-change for us. The German-speaking market will offer great opportunities for Uniqlo, as well as other major markets and cities we are considering across Europe including Barcelona and Milan.”
The Berlin store will offer three floors of retail space and will house the brand’s full line of men’s, women’s and kid’s clothing.
The government of the north Indian state of Haryana has assured its full support to Swedish home furnishing retailer IKEA for setting up its stores in the state.
During a meeting with IKEA Services India CEO Juvenicio Maeztu, Haryana Chief Minister Bhupinder Singh Hooda said his government would extend full support to the company for setting up retail stores in the state.
Mr. Maeztu said IKEA is keen on setting up home furnishing stores in Haryana, which is one of the few states that the company is currently concentrating on, according to a statement.
He added that IKEA currently deals with home furnishing appliances, but the company would also explore venturing into textile retail business in near future.
He urged the Chief Minister to provide adequate land for setting up its venture in Haryana, preferably in the National Capital Region (NCR). In addition to retail stores, the company would also set up a factory and warehouse, Mr. Maeztu said.
Mr. Hooda said Haryana was the first state to support the Central Government’s foreign direct investment (FDI) policy, and due to its industry-friendly policies, the state has become the first choice of several multinational companies for setting up their ventures.
Surfwear retailer plans to open five stores in the GCC by 2015 even as internationally, the retailer closed 158 stores
Dubai: Billabong International is expanding in the GCC after recording huge losses internationally. The Australian surfwear retailer suffered a net loss of A$859.5 million in the six months ending June 2013, which is triple its market value of about A$240 million and higher than last year’s loss of A$275.6 million.
But in the UAE and the rest of the GCC, “Billabong is doing very well,” says Samantha Warrayat, marketing manager at Royal Sporting House, the brand’s UAE franchise partner.
Sales in the UAE are up “13 per cent” over last year, Warrayat said, adding that it is expected to grow by ”7 per cent” next year.
The retailer plans to open five stores in the GCC by 2015.
It has five standalone stores and seven stores within stores in the UAE, and hopes to open two more stores by next year. So far, one is confirmed, which will be at Yas Mall in Abu Dhabi. It also plans to open three stores in Saudi Arabia and Qatar.
Aside from Yas Mall, some of the GCC locations it is looking at include: “Burjuman, Mall of Arabia, Al Salam Mall, Al Othaim Mall , Granada Centre, and Doha Festival City,” Warrayat said.
Meanwhile, internationally, the retailer closed 158 stores, after which annual sales dropped 13.5 per cent to A$1.34 billion.
Colin Beaton, managing director of Limelight Creative Services, said that the expansion move can help the business grow.
“They need to grow the business and increase revenue, and the Middle East has a lot of growth in retail — the industry is growing at a significant pace,” said Beaton.
He also said that when large numbers of tourists come to the UAE and build a connection with the brand, they are “likely to go to it in their countries.”
Cath Kidston, the global lifestyle brand, is planning a flagship store in China, to be located in the retail heart of Shanghai, Huai Hai Road. This opening recognises the importance of Greater China to the Cath Kidston brand as it continues to perform strongly in that territory, the company said.
Re-enforcing the brand’s positioning – The Home of Modern Vintage – the flagship store will be located in what was a 1930s residential house. The building spans over three storeys, with a retail space measuring a total 6,165sq ft/573 sq m. Situated in a prime location adjacent to other international brand flagship stores, shoppers will have an ideal environment in which to experience the full Cath Kidston range across homeware, accessories, clothing and childrenswear.
Cath Kidston said it has been extremely successful in Asia to date. First entering into the market in 2006, it has grown its retail portfolio to 63 stores across China, Japan, Taiwan, Thailand, South Korea, Hong Kong and is due to launch in Singapore on 5 September 2013. The portfolio of stores in Asia is now larger than that of the UK. Sales in China since launching in January have been very encouraging, according to Kenny Wilson, CEO Cath Kidston.
“The potential for Cath Kidston in China is huge. This is a really significant milestone for us,” he said. “Greater China is an extremely important territory for the Cath Kidston brand, and there is a real possibility that it could become our biggest market one day. The new flagship store will be a great brand showcase and is a really exciting milestone in our 20th year. The building was carefully chosen to bring to life the style and unique character at the heart of our brand and to further communicate the brand’s Home of Modern Vintage positioning. The Huai Hai Road is a fantastic location where we will sit alongside other international brand flagship stores.”
A spokesperson from Shanghai Leadman Co, said: “We are delighted to welcome Cath Kidston to Huai Hai Road, the retail heart of Shanghai and one of China’s best known shopping destinations. Cath Kidston’s unique British style and cheerful products will create an exciting new offering to the current brand mix.”
OVER the next three years, Foschini Group plans to double its African footprint from its spread of 104 stores, CEO Doug Murray said at the group’s annual general meeting on Tuesday.
Political stability and strong economic growth has seen the rest of the continent lure retailers in search of higher yield, with consumer acing industries turning their attention to next hot ticket — the often-quoted 1-billion African consumers ripe for the picking.
Consumer spending in Africa is projected by McKinsey Global Institute to reach $1.4-trillion in 2020, from about $860bn in 2008. Foschini, which also operates American Swiss and Totalsports is not alone in its endeavours to expand into the rest of Africa with listed players like Mr Price, Woolworths and Truworths also setting up shop.
Locally, Foschini Group said sales since the beginning of July had strengthened with growth up by 13%. This follows challenging trading conditions for the first five months of the financial year in which total sales were up 9.1% and same-store sales growth up 4.1%.
“Economic conditions in South Africa will remain difficult in the year ahead with the credit environment likely to deteriorate further due to current levels of consumer indebtedness,” Mr Murray said.
Although there are indications that borrowing for consumption in South Africa has slowed as lending criteria have been tightened, concern remains about the ability of consumers to repay loans and accounts.
Stanlib chief economist Kevin Lings said consumer income growth was slowing reflecting the lack of job growth as well as some moderation in salary adjustments. Also, consumers are still having to cope with a range of cost increases that have systematically eroded their retail spending power. These include higher energy costs, transport costs, education fees, medical service costs and water costs.
“Households cannot avoid these increases, as they relate to necessities or essential goods. While the rapid growth in unsecured credit provided some support to retail activity during 2012, it has slowed significantly in recent months, albeit off a relatively high base,” Mr Lings said.
For Cape Town-based Foschini, the second half is heavily dependent on Christmas trading. Despite the challenging credit environment, the group said its debtors’ book was performing “within management expectations”.
Grimsey retail review: key recommendations
As big retail chains move to more lucrative out-of-town sites they are ‘hollowing out the high street’, said Bill Grimsey. Photograph: Fabio De Paola
• Establish a commission for each town centre to build a 20-year vision supported by a broad business plan in five-year chunks, with updates at an annual public meeting.
• Create a full time high streets minister to replace the part time position tagged on the duties of housing minister.
• Prepare for a “wired town” that puts libraries and public spaces at the centre based on current and future technology.
• Enable the change of use process to convert entire sub-high streets to residential or other uses and relocate successful independent retailers to the main commercial centre.
• Immediately reintroduce 2015 business rates revaluation to realign property values and freeze rates from 2014. Any future increases should be based on annualised CPI inflation.
• Reduce mandatory rate relief for charities from 80% to 70%, with that extra 10% payment going to a ringfenced local authority fund for community projects.
• Any business occupying a retail property in the retail core of a town centre that has been vacant for 12 months should receive 50% rate relief for two years.
• Landlords of empty shop units should be required to apply for change of use to housing, health, leisure, cultural or education facilities in line with the town plan.
• Make it compulsory for national retail and leisure chains to invest 0.25% of 2014 sales into a local economic development fund.
• Local authorities to use a portion of their reserves to offer loans to small businesses.
Cars and out-of-town retail
• Business plans should include two hours of free high street and town centre parking. Car parking charges to be frozen for at least 12 months.
• Make it compulsory for all mega mall developments to create a percentage of affordable space for traders and market stall pitches.
Asda’s fashion label George is set to open its first store in Singapore this week through a franchise deal with the Al-Futtaim Group.
The store will be located within retailer John Little’s 38,000 square foot store in the Plaza Singapura. The 8,000 square foot store-within-a-store will create 15 new jobs for George. We’re pleased with the performance of our international franchises,” said George retail and international director Jo Whitfield.
“When we opened our Malta store earlier this year, demand was so high that over half of stock was sold in the first two weeks and we had to replenish very quickly to meet customer demand.
“Singapore is an exciting market for us. We’re confident that the Plaza Singapura shoppers will love the style and quality of our ranges and be amazed at the excellent value for money.”
Dixons Retail is opening a new concept store for its travel brand, Dixons Travel, at Heathrow Terminal 5. A further store is planned for Heathrow Terminal 2, scheduled to open in June 2014.
The new space in Terminal 5 will offer the latest tech alongside holiday essentials in a future-facing layout which is more interactive and free-flowing, allowing travellers to shop with ease, the retailer claims. The store will also feature digital signage, a KNOWHOW service bar (giving shoppers the added benefit of expert technical advice and support on-site) and ‘floating screens’, designed to enhance the customer’s shopping experience.
Digital signage will display new products and the latest offers; while 32in rear projection ‘floating screens’ will be placed over themed product tables. This includes express pods, which are all controlled centrally, allowing Dixons to update messaging when new and exclusive products are on display. Digital signage is also placed at the front of the store, allowing travellers to shop even when the store is closed.
The store offers a shelf space where shoppers can store their luggage whilst they shop and customers can also reserve and collect products by calling the store up to seven days before they travel.
Jeremy Fennell, managing director for Dixons Travel, said: “We have designed this store with the aim of offering an amazing customer experience in such a fast-paced environment. We are committed to being innovative at Dixons and are continually trialling new technologies, so we are excited to roll out this new travel store design.”
To mark the launch of the Terminal 5 store, Dixons Travel has partnered with Monster to deliver a live and intimate concert by boy band sensations Union J of X Factor fame. The boys will be performing on Thursday 29thAugust, 11am, and holding an exclusive meet and greet with fans after the show.
HMV is to be integrated into 26 Xtravision stores nationwide by the end of September, according to restructuring specialist Hilco Capital, which bought the DVD rental chain out of receivership earlier this summer.
The stores are to be dual-branded, bringing together the two retail names, and introducing HMV to areas of the country it wasn’t in before, Hilco Capital chief executive Larry Howard said.
“We have now reached agreement with a number of landlords and will therefore be dual branding some of our stores with Xtravision and HMV,” he said.
Mr Howard added that negotiations with other landlords were ongoing and the company hoped to make a further announcement in the coming weeks if negotiations came to a satisfactory conclusion.
The stores to be dual-branded include Athlone, Ballina, Blackpool, Douglas, Carlow, Drogheda, Dundalk, Ennis, and Galway.
As part of the plan to return HMV to Ireland, Hilco is opening four standalone HMV stores in the coming weeks.
The first three stores at Henry Street and Liffey Valley shopping centre in Dublin and at the Crescent shopping centre in Limerick will open their doors next week, while the store in the Dundrum Centre in Dublin will open in the week ending September 14th.
Last April, Hilco bought HMV in the UK and Republic, where it was going through separate insolvency procedures. Xtravision appointed Luke Charleton and Colin Farquharson of Ernst & Young as receivers to the business in April after a downturn in rentals and a withdrawal of credit insurance left it with difficulty meeting liabilities.