Department store group Debenhams is planning to cut 320 store management jobs as it tries to drive down costs.

The retailer said last month it was stepping up cost-cutting plans after it issued a profit warning following disappointing trading over Christmas.

Many traditional retailers are struggling to cope the challenge of the shift towards shopping online.

Debenhams said a review had identified “significant cost savings” by reducing the complexity of management roles.

The 320 posts affected account for a quarter of Debenhams’ store management jobs.

“We are currently consulting with individuals affected and will seek redeployment opportunities where possible,” Debenhams said in a statement. “We envisage our new structure being fully in place by the end of March.”

The news comes shortly after three of the UK’s biggest supermarket chains – Tesco, Sainsbury’s and Morrisons – announced plans to cut thousands of jobs, including stripping out layers of middle management.

Analysis: Emma Simpson, BBC business correspondent

Who’d want to be a manager on the shop floor in retail right now? Judging by the spate of announcements from some of our biggest retailers in the last few weeks, these posts are now on the chopping block.

First it was the supermarkets, with all the big established grocers restructuring their businesses as the old supermarket model is under strain, from rising costs, increased competition and the relentless shift to online.

Now it’s the turn of Debenhams. It’s not surprising given the pressures on its department store business. It already said it would have to find £10m of savings this year. In the world of retail, there’s much more change to come.

‘Year of distress’

Shares in Debenhams fell sharply in January after it said its UK like-for-like sales – which strip out the impact of store openings and closures – fell 2.6% in the 17 weeks to 30 December amid a “volatile and competitive” market.

As a result, it cut its full-year profit forecast to between £55m and £65m this year, against analysts’ expectations of about £83m.

Debenhams – which operates out of more than 240 stories in 27 countries – is by no means the only High Street retailer to have struggled recently.

The whole retail sector is undergoing huge change as traditional stores seek ways of coping with the rapid rise of online shopping.

Marks and Spencer, House of Fraser and Mothercare were among other retailers to report disappointing sales in the run-up to Christmas, whereas online specialists such as Asos and BooHoo saw rapid growth in revenues.

Richard Lim from research consultancy Retail Economics said: “2018 is looking like a year of distress for the UK retail industry.

“The major challenge facing bricks-and-mortar retailers is the continued pincer movement of rising operating and sourcing costs against a backdrop of shifting shopper behaviour.

“Many retail business models are incompatible with the relentless shift towards online spending and the emergence of the experience economy. Put simply, department stores are incredibly expensive to operate while they are also burdened with inflexible leases, high rents and too many properties.”

The last time H&M was this low global financial markets were in crisis, Angelina Jolie was popularizing the maxi dress, and Zara didn’t even sell clothing online.

Shares fell as much as 9.1 percent to a nine-year low Wednesday in Stockholm. Hennes & Mauritz AB have lost more than a quarter of its value in the past three months. The slump brings H&M’s market value to 235 billion kronor ($29.9 billion), equivalent to about a quarter of what Zara owner Inditex SA is worth.

“There is little in the statement to suggest that H&M can reignite its top line anytime soon,” wrote Richard Chamberlain, an analyst at RBC Capital Markets.

A 1 percent increase in December and January sales implied a “mid-single digit” drop in like-for-like revenue, according to RBC analysts, bearing out comments by chief executive officer Karl-Johan Persson that the first quarter started weaker than expected. That follows the biggest drop in quarterly sales in at least a decade.

The Swedish company plans to shut 170 stores this year, even as its adds a format called Afound, which joins the main H&M chain and other recent additions like Arket. The retailer said it would invest more in online sales and digital inventory-tracking technology, while adding shops in markets that are still growing.

As online shopping has soared, fewer people are visiting H&M’s vast network of physical stores. The company has struggled to cut inventory, which ended the year higher than planned, and H&M said it will increase markdowns by as much as 2 percent in the first quarter to clear that out.

The sales woes have forced Persson to retract a target of 10 percent to 15 percent annual sales growth for this year after setting that long-term target 12 months ago. The goal still stands for the future, but could take several years to reach, he said in an interview.

Strategy shift

“We’re working toward it, we believe in what we’re doing, but since we haven’t reached the goal we set this year I don’t want to say we’ll reach them for 2019, 2020,” Persson said.

Some investors have sold shares amid fears the company is being too slow in responding to the industry’s digital shift. Didner & Gerge Fonder AB, one of H&M’s top shareholders, has called for a management shake-up. At a news conference Wednesday, Persson said he believes he has the board’s confidence as CEO and declined to comment further on calls for new management.

The company plans 390 new stores. About a quarter of the new shops will be formats other than the flagship H&M, such as COS, Monki, and Afound. The latter, the company’s ninth format overall, will consist of stores and websites that offer deals on the company’s own goods as well as merchandise from third parties.

The first Afound store will be in Stockholm, and the site will go online in Sweden this year. H&M is building a format where it can funnel off excess inventory and is entering part of the market that discount retailers such as Primark and supermarkets have proven can be successful. Afound is a shift in strategy following the last new format, Arket, which sells higher-priced general merchandise, including houseware, purses, and coffee.

There’s a risk the new chain may cannibalize H&M’s existing business, according to Michelle Wilson, an analyst at Berenberg. But Afound may not be the end of the new formats from H&M.

“We’re looking at two new business models that really aren’t like anything else we have,” Persson said in the interview.

The Stockholm-based company’s image was also tarnished by accusations of racism after an advertisement featuring a black child wearing a hoodie with the text “coolest monkey in the jungle” sparked a social-media storm and protests in South Africa earlier this month. H&M has apologized for the ad.

Despite speculation among some analysts that H&M would be forced to cut its dividend for the first time since it was listed in 1974, the company kept its payout for 2017 unchanged at 9.75 kronor ($1.24) a share. The company plans to offer shareholders the option to reinvest in new H&M shares instead of receiving the dividend in cash, which analysts said would dilute the stock. Members of the Persson family, collectively H&M’s biggest shareholders, plan to follow that option.

An apology from international retail giant H&M was not enough to quell the widespread anger over a promotional image that many have described as racist because it shows a black child wearing a sweatshirt with the words, “Coolest monkey in the jungle.”

Groups of protesters in South Africa answered the call from an opposition party to demonstrate at six H&M stores in the country. Many of the protesters were dressed in red that is the signature of the Economic Freedom Fighters as they proceeded to ransack some of the stores, tearing down displays and throwing clothes around in the process.

Apple’s first ever retail store in Korea, close to Samsung’s HQ, said to open on Dec 30

Ben Lovejoy

Apple confirmed back in January plans to open its first ever retail store in Samsung’s home city of Seoul, South Korea – close to the headquarters of Samsung.

A new report from Korea says that the store will open on December 30, with retail head Angela Ahrendts in attendance …

ETNews quotes the construction company saying that work on the store is all but complete.

“We have finished all the major interior decorations of the Apple Store and left only a simple task,” he said […] Apple has decided to open the Apple store Seoul Gangnam store (first store) on Saturday, December 30, in consultation with the construction company. Unless there are special problems at the final stage of the construction, it will open from 10 am to 11 am on the day.

The report says that Apple had originally targeted a completion date of November 30, with construction continuing through both nights and weekends to ensure that the new date is hit. Staff recruitment and training is also said to be complete.

The store reportedly spans ground and basement levels, with a total of 1297 square meters.

The busy Gangnam district of Seoul, above, is known for upmarket shopping and interesting architecture.

Smartphone sales in South Korea are currently dominated by local companies Samsung and LG, so it will be interesting to see how much help a retail presence is going to be in growing iPhone sales in the country.

Starbucks is going venti in China.

The Seattle-based coffee company opened a 30,000-square-foot store in Shanghai on Tuesday. It’s the first Starbucks Reserve Roastery — the company’s new retail offering — outside the U.S.

It’s also the largest Starbucks in the world, spanning an area nearly twice as large as the next biggest, a Roastery in Seattle that opened three years ago.

Executive Chairman Howard Schultz said the store would blend the company’s 46-year history in the coffee shop business with “China’s rich, diverse culture.”

The Starbucks Reserve Roastery opened Tuesday in Shanghai, China’s most populous city.

Could India be the next optimal market for investors?

Explore the answers at this month’s UBS Investor Forum.

China is a vital market for Starbucks (SBUX), according to John Gordon, a restaurant analyst at Pacific Management Consulting.

The company’s latest quarterly earnings were pretty gloomy, showing disappointing sales growth in a tough retail environment.

The one bright spot was China, which stood out as Starbucks’ fastest growing market. Sales there were up 8% compared with the same quarter last year.

The company is riding that wave and expanding aggressively in China, opening a new Starbucks store every 15 hours on average.

Even though Chinese are traditionally tea guzzlers and less hooked on coffee than Americans, the country’s growing ranks of upwardly mobile consumers still view Starbucks as an attractive, aspirational brand.

The company is playing to that perception with its new Shanghai shop.

“This is a show store,” Gordon said. “The point is to be in a highly, highly visible, touristy [area] where there’s foot traffic, offices and urban housing in order to promote the brand.

The new store will roast beans on site in a massive copper cask. There is also a special emphasis on tea, with a dedicated bar offering items like nitrogen cold brew tea.

In a sign of the times, Starbucks partnered with Chinese tech giant Alibaba (BABA, Tech30) to aggressively promote the Shanghai store opening online. Customers can book coffee tasting experiences on Alibaba’s e-commerce site and also buy special Starbucks Reserve coffee and related products tied to the store’s launch.

But the Shanghai roastery won’t hold the title of largest Starbucks for too long. The company has already inked a deal for an enormous 43,000-square-foot Reserve Roastery in Chicago that’s set to open in 2019.

The company said the “retail, exhibition, screening and listening space” will open its doors to the public on 16 November.

Situated in London’s Seven Dials, the store has been designed to replicate the home environment. Inspired by Sonos’ flagship store in New York, it features state-of-the-art listening rooms where guests will be able to stream their personal music to one or both rooms.

In addition, every space within the store had been sonically tuned by Sonos sound engineers who are overseen by Sonos sound experience leader, Giles Martin.

Sonos said the store will play host to an ongoing line-up of listening events, screenings, cultural talks and installations. The first of these events will celebrate David Bowie.

During the opening weekend, NTS Radio will be broadcasting live from the store. This will include a full 16 hour programme co-curated by DJ’s Ross Allen, Charlie Bones, Nabihah Iqbal and Bullion with friends and special guests and will feature mixes, interviews and interesting conversations inspired by and celebrating the life of Bowie.

Whitney Walker, general store manager at Sonos, said “The entire store experience is based on the idea of being in a really comfortable and inspiring environment. We’re proud to be opening our first European concept store in London, providing a dedicated space for music fans to create, connect and ultimately discover the best ways to listen to music out loud.”

Sonos is also planning to open more concepts stores in Europe including Berlin in 2018.

Commenting on the UK debut at Seven Dials, Sam Bain-Mollison, head of group retail strategy and leasing at Shaftesbury, said: “Sonos is one of the most exciting brands in the world and we are thrilled they selected Earlham Street for their UK debut. It is a significant launch for Seven Dials that adds to the authentic, cultural appeal of the destination.”

Huawei announced the opening of its first ‘Experience Store’ at Dubai Mall in the United Arab Emirates. The store offers consumers a full retail experience, which includes access to Huawei’s latest products and services under one roof. All new products will now be available for pre-booking and sale at the same time as its global launch.

We spoke to David Wang, UAE Country Manager at the launch and he told TechRadar that the reason behind the store was to give Huawei fans a better experience of Huawei products as well as a place to communicate with fans of the brand.

According to Wang, the strategy of opening the store is a long-term one and the Dubai Mall store is the first of the five stores that Huawei plans to open across the UAE. More stores are planned in the GCC with Saudi Arabia likely being the next country. Mr. Wang also mentioned that for this store in Dubai Mall, Huawei has partnered with Axiom.

When we asked Wang if the Huawei Experience Store will carry any exclusive products, he said that it won’t. He did mention that the store will carry the full range of Huawei products that will be released in the UAE but the idea behind it is for consumers to learn more about Huawei’s brand and products and not create competition with local partners and retailers.

The Huawei Experience Store is open daily from 10am – 11pm, Sunday to Saturday, and is located next to the metro link corridor on Level 2 of The Dubai Mall. It is currently taking preorders for the Mate 10 Pro which will be available from the 13th of November in the store.

Amazon closes two UK Whole Foods stores just two months after completing its £10.7bn takeover

Amazon is shutting two Whole Foods shops in the UK just two months after completing its £10.7bn takeover of the upmarket grocery chain. The company is closing down its stores in Cheltenham, Gloucestershire and Giffnock, East Renfrewshire meaning that there will be just seven UK shops remaining, all of which are in London.

Industry sources said that the decision to shut the stores made sense as neither shop could be serviced by Amazon’s online grocery service. Amazon Fresh has only recently been expanded from London to include Hertfordshire and Bedfordshire.

“It makes perfect sense for Whole Foods to close both stores from a business standpoint, the logistics must be nonsensical,” commented Steve Dresser from Grocery Insight.

“I think it marks the new age from Amazon where the balance sheet is scrutinised and sacred cows in Gloucester and Scotland aren’t permissible just to ‘spread the brand’.”

In contrast to the US – where Whole Foods’ 440 shops help to boost Amazon’s grocery distribution network – in the UK Amazon is largely using its Whole Foods acquisition to broaden the range of groceries available on its Amazon Fresh and Prime Now services by including items such as organic baba ganoush, crostini and fillet steak.

It has also attempted to widen the Whole Foods appeal by slashing prices on some staple goods, such as apples, to become more competitive. However, the overwhelming majority of Whole Foods goods are still much more expensive than rival supermarkets.

“A decision on the future of the stores will be made after the company has consulted with team members to discuss the proposal,” a company spokesperson said. “In the event that the decision is taken to close the stores, we will work with team members to explore alternative employment opportunities.”

Around 150 people are currently employed at the two Whole Foods shops.

Click here to see

Click here to view