Introduction
Verdict Research: UK Value Clothing Retailers 2009 examines the top 10 value clothing retailers, providing key operating statistics, clothing and value clothing market share data and individual retailer outlooks. It analyses the key issues that value clothing retailers face, both now and in the future and also includes forecasts for sector growth in 2010.
Scope
Comprehensive profiles and outlooks for the 10 largest operators in value clothing including key operating statistics and store and space data Size of the UK value clothing market 1999-2009e, distribution channels, category share, store numbers and space. Clothing and value clothing market forecasts for 2010. Key issues and outlook for the sector including online, market growth by value, mid market and premium and international opportunities.
Highlights
The value clothing sector has been one of the main beneficiaries of the recession as consumers have approached spending on discretionary items with increased caution. Though Verdict forecasts a 0.6% decline in overall UK clothing spend in 2009, we estimate that value clothing sales will grow by 5.0%.
We expect grocers to make further gains in 2009, increasing their share of the value clothing market to 34.2%. Long term we believe grocers will prove a further threat to value clothing specialists with gains to be made by improving store environments and fully exploiting multichannel capabilities.
Primark has held on to the top position as the retailer with the highest value clothing market share in 2009 of 18.2%, up 0.5 percentage points from 2008. As well as benefitting from trading down, it enjoys a relatively young customer base which has been least impacted by the economic downturn because of fewer financial responsibilities.
Reasons to Purchase
Use Verdict's practical and actionable analysis to shape future business strategy. Identify the key issues in the market and plan accordingly in order to reduce risk and maximise growth opportunities. Benchmark your performance against the 10 leading value clothing retailers' key operating statistics and growth plans.
Scope
Highlights
Reasons to Purchase
CHAPTER 1 EXECUTIVE SUMMARY
Key findings
Main conclusions
Value sector grows despite overall clothing declining
After several high profile casualties the market begins to stablilise
Larger retailers have gained scale through space expansion
However it is not just about price
Value clothing now accounts for over a third of childrenswear sales
Grocers quickly gain headway ...
... and will prove an even bigger threat
Primark outperforms - and holds on to number one position
Younger consumers look a lucrative target, but competition is intense
Online developments boost value clothing retailers' sales
2010 SHOULD BE ANOTHER GOOD YEAR FOR VALUE PLAYERS ...
... but long term the market will be more challenging
Therefore value retailers will need post-recession strategies
As UK growth opportunities lessen - international will be a target
CHAPTER 2 MARKET ANALYSIS
Clothing market trends
Value clothing definition & market trends
Value market channels of distribution and sales mix
Space and store numbers
CHAPTER 3 COMPANY DATA ANALYSIS
Clothing market shares
Grocers continue to grow share
Value clothing market shares
Sainsbury new biggest gainer of value clothing market share
Winners and losers
Larger players gain the most share in the value clothing market
Key operating statistics
Operating margins
Clothing sales densities
Space allocation
Advertising media expenditure
CHAPTER 4 OUTLOOK
Changing spending patterns
Value clothing market benefits from recession ...
Signs that consumers were favouring premium retailers pre-recession
But recession has forced consumers to trade down
Loss of capacity in the market
Inflation returns in 2009 and will become more prevalent in 2010
Perception of value changes with premium re-emerging
Impact on value retailers
... but shopping habits vary by age
Desire for value clothing fades ...
... though appeal remains for young
Value retailers head in the same direction
Value fashion market increasingly saturated
Value clothing share rises ...
... at the expense of midmarket ...
... and - for the past three years - premium
Changing price architectures
Online presence is vital
Services and funtionality to improve online presence
Returns a major deterrent of online shopping
Free deliveries and returns - double edged sword for value retailers
International deliveries are not widely available from value clothing retailers
Value retailers slow on the uptake of mobile phone technology
Importance of social media
Opportunity for absent value clothing players to come online still
High online sales volumes essential
Standing out from the crowd
Differentiation in the market
Small changes to make a difference
International expansion
As UK opportunities lessen - potential for expansion abroad
Building an international presence
Franchises allow for international expansion without high initial costs
Expanding internationally is highly challenging ...
... but still provides many opportunities
Competitors in Europe: C&A
Competitors in Europe: H&M
Competitors in Europe: Kiabi
Future of grocers
Grocers: where are they now and where will they be?
The economy - looking ahead to 2010
Outlook for UK economy remains challenging
GDP recovery will be slow
Unemployment worst to come
Government spending cuts on the cards
Consumer confidence improves but remains fragile
Forecasts for 2010
Value clothing growth slows, but continues to outperform
Strategic summary
Value retailers will continue to benefit from trading down
However, young people are central to the value proposition
Midmarket retailers focus less on entry price point product
Value retailers cannot rely on price alone
Online uptake increases
As UK growth opportunities lessen - international will be a target
Grocers continue to threaten
A weak economy wil continue to support growth in 2010
CHAPTER 5 ASDA
Benefits from consumer focus on low prices
Recent key events
New initiatives support growth
George launches online
Coleen cut
Launches Asian range
Schemes to drive clothing sales
?30m to upgrade in line with M&S and Next
Opens George HQ and refreshes image
Social networking aims to improve business transparency
Store innovations will increase competitiveness
New CEO for Wal-Mart
Asda reshuffles with new COO
Comprehensive George team
Proposition
Every day value and convenience key
Financials
Sales growth accelerates during downturn
Growth picks up after slowing in mid decade
Space
Space expansion and rising densities both help growth
Sales densities start to recover
Space allocation
Sector performance - clothing
Sales performance slows but provides encouragement for 2009
Clothing market share continues to increase
Outlook
Further developments will improve George's value fashion credibility
Investment in product quality was overdue
George faces growing value clothing threat ...
... however George will continue to do well out of the downturn
Improvements still to be made to clothing shopfits
Online offer needs to stay one step ahead
Asda Living stores will benefit George sales
Enjoyable experience
Moda and Boston Crew launches were wise moves
CHAPTER 6 ETHEL AUSTIN
Driving the business forward in a challenging time
Recent key events
Increasing presence
Retailer enters administration
Au Naturale attracts new customers
Improved merchandising
Space expansion
Advertising spend cut
Proposition
Continues to focus on childrenswear
Financials
Sales continue to fall
Store closures affect sales growth
Space
Expansion on hold in 2009
Space allocation
Sector performance -clothing
Childrenswear drives growth
Market share drops
Outlook
Neighbourhood advantage?
Sales densities remain low
Competition in value is fierce
Brand image is confusing
Its location may be an advantage
CHAPTER 7 MATALAN
Renaissance for value pioneer
Recent key events
Business improvements attract new customers
Online attracts new customers as well as higher average spend
Extending sub brands widens target market
Home department attracts clothing shoppers
Advertising more low key
Improved store experience reaps rewards
Interesting visual experience
Improves customer service
Middle East offers low risk expansion opportunity
Reported ?1.5bn sale in 2010
Proposition
Financials
Like-for-like uplifts boost performance
Current trading highly encouraging
Higher sales, better margin
Space
Expansion on agenda once more
Space allocation
Sector performance - clothing
Sudden recovery in 2008/09 after stagnation
Constant need to drive footfall to stores
Gains market share once more
Outlook
Strategy delivers growth - boosted further by recession
Matalan profits from recession - and its own strategy
Womenswear will benefit from holistic improvements
Online offers further growth opportunities ...
... it needs more launches - in childrenswear for example - to add excitement instore
Fashionable range for young men would help, too ...
... making the shopping experience easier and more convenient
Driving footfall is key
CHAPTER 8 NEW LOOK
Strong value credentials maintain market resilience
Recent key events
Shapes up for global assault
Considers a ?1.7bn stockmarket flotation
Strengthens corporate structure
Global expansion priority
Invests in advertising
Engages online
High profile celebrities maintain fashion credentials
New brands widen customer base ...
... and rebranding drives sales
Standalone footwear and accessories store
Drives kidswear and menswear
Proposition
Widens price architecture with sub brands
Financials
Trading performance continues to impress
Space expansion and online drive sales growth
Online visitors increase rapidly
Space
Expands faster than sales
New Look continues aggressive space expansion internationally
Space allocation
Sector performance -clothing
Menswear and childrenswear outperform
Value share oscillates
Outlook
Strong offer in an intensifying market
New Look needs to justify price points through quality and design content
Wider customer base
A family focus
Childrenswear challenge
Opportunity in boys teenagewear ...
... but needs a different approach
Office move could cause disruption
Exchange rates an increasing concern
CHAPTER 9 THE PEACOCK GROUP
Peacocks thrives and Bonmarch? survives in competitive market
Recent key events
Develops product offer
Restructures management to accommodate expansion
Expanding Peacocks UK store portfolio
Developing overseas markets
Peacocks launches first celebrity designer range
Peacocks improves website with outside help
Bonmarch? adds Outfit Ideas to its (non-transactional) website
New David Emanuel shopfits modernise Bonmarch? stores
Bonmarch? initiatives aim to improve customer loyalty
Propositions
Peacocks broad brand portfolio attracts a wide customer base
Broadening Bonmarch? product offer tries to increase target market
Financials
Peacocks sales growth remains consistently strong
Store expansion and like-for-likes add to growth
Bonmarch? sales growth picks up as space expansion slows
Sales growth remains in positive territory - just
Space
Peacocks space expansion continues to grow after bumper 2007/08
Peacocks space allocation
Bonmarch? defies the recession by opening seven new stores
Bonmarch? space allocation
Sector performance - clothing
Peacocks clothing sales continue to grow - albeit at a slower rate
Bonmarch? unplift in clothing is a relatively positive performance
Peacocks continues to grow share in 2009
Bonmarch? fails to grow share in the increasingly competitive value market
Outlooks
Differentiation key for Peacocks
Peacocks is a winner from the consumer downturn
Expansion plans could make it into a major force
Better product segmentation would improve shopping experience
Pearl Lowe range should attract younger shoppers
Childrenswear needs more destination appeal
Overseas and internet businesses will add marginal growth
Bonmarch? needs to target local customers and go transactional
Bonmarch? must focus its offer to a more specific target market ...
... while tailoring product and stores to suit local and regional needs
A transactional website is a necessary long term investment
Awareness of competitors is vital in differentiating product ranges
CHAPTER 10 PRIMARK
Opportunities remain abundant
Recent key events
Aims for more growth
Management change should cause minimal disruption
Reiterates ethical policy
Develops logistics
Proposition
Value fast fashion maintains appeal in recession
Financials
Strong growth continues into 2009 - albeit at slower rate
International space expansion continues to drive sales growth
Space
Primark continues with aggressive space expansion
Space allocation
Sector performance -clothing
Growth of clothing sales slows but is still commendable
Primark continues to gain market share
Outlook
Primark well prepared for future growth
Recession plays into its hands
It needs to prepare for changing shopping habits post-recession
Better segmentation would target its large customer base more effectively
Online poses a growth opportunity
Investment in ethical issues will prove worthwhile
There are still great opportunities for Primark in the UK
More opportunities in menswear
CHAPTER 11 SAINSBURY
Clothing continues to make rapid gains
Recent key events
Space expansion drives clothing growth
Non-food central to growth plans
Organisational changes highlight non-food focus
Non-food offer launched online ... except clothing
Targets expansion through convenience format
New voucher scheme to offer further incentive to customers
In support of Competition Commission recommendation
Proposition
Well presented range offers broad appeal
Financials
Improved value credentials central to success
Growth continues through 2009
Makes progress online, but clothing lags behind
Space
Expansion high on agenda
Clothing space allocation
Sector performance - clothing
Sales grow more than 500% over five years
Rapid market share growth set to continue
Outlook
Abundant opportunities
Force to be reckoned with
Focus on convenience
Realigns prices
Market conditions help expansion
Space expansion vital for clothing success
Value competitors up their game
TU would benefit from more publicity
Clothing online launch essential
Huge clothing potential if it can overcome space barriers
CHAPTER 12 TESCO
Making progress after strong online launch
Recent key events
Continuous initiatives to ride out of the recession on top
Investment in price cuts help sales recover
Launches ASOS-style website ...
... with 20 brands
Tesco aims to strengthen its fashion credentials
Tesco wins a round of the supermarket price wars
Clubcard relaunch includes double value vouchers when spent on clothing
International expansion continues to be a focus despite economic setback
New weather team aims to match supply and demand
Proposition
Broad target market results in range lacking focus
Financials
Trading performance shows Tesco's ability to defy recession
Consistent sales and profit growth
Online sales growth is impressive despite hitting its lowest point
Space
Space growth slows
Clothing sales densities fail to impress
Clothing space allocation
Sector performance - clothing
Clothing sales trend hits bottom
Transactional clothing website improves Tesco's fashion offer
Value market share stabilises
Outlook
Online launch strong, but can it attract the right brands?
Online will help Tesco up its game in the value clothing market
New brands improve fashion credibility ...
... but few of them
Instore ranges need greater clarification
While the value market grows Tesco must keep up
Improvements in visual merchandising would boost sales
Key pieces need to be highlighted
Sainsbury is a looming threat
Inflation may not impact customers
CHAPTER 13 TJ HUGHES
Improvements pay off
Recent key events
Changes made to drive sales
Changes to management
Improved strategy...
... along with a larger advertising budget
Proposition
Value products appeal in recession
Financials
Performance improves in 2008/09
Space
Expansion plans restarted
Space allocation
Sector performance -clothing
Growth in clothing sales has returned
Market share remains level
Outlook
Sectors like electricals will provide footfall for clothing
Though it is benefitting from the recession ...
... it needs a post-recession strategy
Expanding geographically
Fierce competition in the value market
Profit margins will remain low
New locations drive higher footfalls
CHAPTER 14 TK MAXX
Buoyant through economic downturn
Recent key events
Building on strong foundations
Developing an infrastructure to support expansion
Central London targeted for new stores
Invests in technology to improve efficiency
Online presence eventually arrives
New face heads marketing
Proposition
Discounted brands appeal to price conscious customers in recession
Financials
Positive performance in a difficult climate
Operating margin improves despite new store investment
Space
As UK growth slows the Continent offers opportunities for expansion
Space allocation
Sector performance - clothing
Sales growth rises as recession hits
Market share continues to grow
Outlook
Growth opportunities remain for TK Maxx in the value market
Model and proposition are highly favourable throughout the economic downturn
E-commerce opportunities would increase growth and market share
But it needs to act quickly
Product could be arranged similarly to instore
More city centre stores could grow customer base ...
... and open new competitive avenues
Childrenswear potential not maximised
Expansion drive on Continent
CHAPTER 15 GLOSSARY
Financial Statistics - VAT
Trading Profile
Key Operating Ratios
Physical Development
Abbreviations
Key findings
Main conclusions
Value sector grows despite overall clothing declining
After several high profile casualties the market begins to stablilise
Larger retailers have gained scale through space expansion
However it is not just about price
Value clothing now accounts for over a third of childrenswear sales
Grocers quickly gain headway ...
... and will prove an even bigger threat
Primark outperforms - and holds on to number one position
Younger consumers look a lucrative target, but competition is intense
Online developments boost value clothing retailers' sales
2010 SHOULD BE ANOTHER GOOD YEAR FOR VALUE PLAYERS ...
... but long term the market will be more challenging
Therefore value retailers will need post-recession strategies
As UK growth opportunities lessen - international will be a target
CHAPTER 2 MARKET ANALYSIS
Clothing market trends
Value clothing definition & market trends
Value market channels of distribution and sales mix
Space and store numbers
CHAPTER 3 COMPANY DATA ANALYSIS
Clothing market shares
Grocers continue to grow share
Value clothing market shares
Sainsbury new biggest gainer of value clothing market share
Winners and losers
Larger players gain the most share in the value clothing market
Key operating statistics
Operating margins
Clothing sales densities
Space allocation
Advertising media expenditure
CHAPTER 4 OUTLOOK
Changing spending patterns
Value clothing market benefits from recession ...
Signs that consumers were favouring premium retailers pre-recession
But recession has forced consumers to trade down
Loss of capacity in the market
Inflation returns in 2009 and will become more prevalent in 2010
Perception of value changes with premium re-emerging
Impact on value retailers
... but shopping habits vary by age
Desire for value clothing fades ...
... though appeal remains for young
Value retailers head in the same direction
Value fashion market increasingly saturated
Value clothing share rises ...
... at the expense of midmarket ...
... and - for the past three years - premium
Changing price architectures
Online presence is vital
Services and funtionality to improve online presence
Returns a major deterrent of online shopping
Free deliveries and returns - double edged sword for value retailers
International deliveries are not widely available from value clothing retailers
Value retailers slow on the uptake of mobile phone technology
Importance of social media
Opportunity for absent value clothing players to come online still
High online sales volumes essential
Standing out from the crowd
Differentiation in the market
Small changes to make a difference
International expansion
As UK opportunities lessen - potential for expansion abroad
Building an international presence
Franchises allow for international expansion without high initial costs
Expanding internationally is highly challenging ...
... but still provides many opportunities
Competitors in Europe: C&A
Competitors in Europe: H&M
Competitors in Europe: Kiabi
Future of grocers
Grocers: where are they now and where will they be?
The economy - looking ahead to 2010
Outlook for UK economy remains challenging
GDP recovery will be slow
Unemployment worst to come
Government spending cuts on the cards
Consumer confidence improves but remains fragile
Forecasts for 2010
Value clothing growth slows, but continues to outperform
Strategic summary
Value retailers will continue to benefit from trading down
However, young people are central to the value proposition
Midmarket retailers focus less on entry price point product
Value retailers cannot rely on price alone
Online uptake increases
As UK growth opportunities lessen - international will be a target
Grocers continue to threaten
A weak economy wil continue to support growth in 2010
CHAPTER 5 ASDA
Benefits from consumer focus on low prices
Recent key events
New initiatives support growth
George launches online
Coleen cut
Launches Asian range
Schemes to drive clothing sales
?30m to upgrade in line with M&S and Next
Opens George HQ and refreshes image
Social networking aims to improve business transparency
Store innovations will increase competitiveness
New CEO for Wal-Mart
Asda reshuffles with new COO
Comprehensive George team
Proposition
Every day value and convenience key
Financials
Sales growth accelerates during downturn
Growth picks up after slowing in mid decade
Space
Space expansion and rising densities both help growth
Sales densities start to recover
Space allocation
Sector performance - clothing
Sales performance slows but provides encouragement for 2009
Clothing market share continues to increase
Outlook
Further developments will improve George's value fashion credibility
Investment in product quality was overdue
George faces growing value clothing threat ...
... however George will continue to do well out of the downturn
Improvements still to be made to clothing shopfits
Online offer needs to stay one step ahead
Asda Living stores will benefit George sales
Enjoyable experience
Moda and Boston Crew launches were wise moves
CHAPTER 6 ETHEL AUSTIN
Driving the business forward in a challenging time
Recent key events
Increasing presence
Retailer enters administration
Au Naturale attracts new customers
Improved merchandising
Space expansion
Advertising spend cut
Proposition
Continues to focus on childrenswear
Financials
Sales continue to fall
Store closures affect sales growth
Space
Expansion on hold in 2009
Space allocation
Sector performance -clothing
Childrenswear drives growth
Market share drops
Outlook
Neighbourhood advantage?
Sales densities remain low
Competition in value is fierce
Brand image is confusing
Its location may be an advantage
CHAPTER 7 MATALAN
Renaissance for value pioneer
Recent key events
Business improvements attract new customers
Online attracts new customers as well as higher average spend
Extending sub brands widens target market
Home department attracts clothing shoppers
Advertising more low key
Improved store experience reaps rewards
Interesting visual experience
Improves customer service
Middle East offers low risk expansion opportunity
Reported ?1.5bn sale in 2010
Proposition
Financials
Like-for-like uplifts boost performance
Current trading highly encouraging
Higher sales, better margin
Space
Expansion on agenda once more
Space allocation
Sector performance - clothing
Sudden recovery in 2008/09 after stagnation
Constant need to drive footfall to stores
Gains market share once more
Outlook
Strategy delivers growth - boosted further by recession
Matalan profits from recession - and its own strategy
Womenswear will benefit from holistic improvements
Online offers further growth opportunities ...
... it needs more launches - in childrenswear for example - to add excitement instore
Fashionable range for young men would help, too ...
... making the shopping experience easier and more convenient
Driving footfall is key
CHAPTER 8 NEW LOOK
Strong value credentials maintain market resilience
Recent key events
Shapes up for global assault
Considers a ?1.7bn stockmarket flotation
Strengthens corporate structure
Global expansion priority
Invests in advertising
Engages online
High profile celebrities maintain fashion credentials
New brands widen customer base ...
... and rebranding drives sales
Standalone footwear and accessories store
Drives kidswear and menswear
Proposition
Widens price architecture with sub brands
Financials
Trading performance continues to impress
Space expansion and online drive sales growth
Online visitors increase rapidly
Space
Expands faster than sales
New Look continues aggressive space expansion internationally
Space allocation
Sector performance -clothing
Menswear and childrenswear outperform
Value share oscillates
Outlook
Strong offer in an intensifying market
New Look needs to justify price points through quality and design content
Wider customer base
A family focus
Childrenswear challenge
Opportunity in boys teenagewear ...
... but needs a different approach
Office move could cause disruption
Exchange rates an increasing concern
CHAPTER 9 THE PEACOCK GROUP
Peacocks thrives and Bonmarch? survives in competitive market
Recent key events
Develops product offer
Restructures management to accommodate expansion
Expanding Peacocks UK store portfolio
Developing overseas markets
Peacocks launches first celebrity designer range
Peacocks improves website with outside help
Bonmarch? adds Outfit Ideas to its (non-transactional) website
New David Emanuel shopfits modernise Bonmarch? stores
Bonmarch? initiatives aim to improve customer loyalty
Propositions
Peacocks broad brand portfolio attracts a wide customer base
Broadening Bonmarch? product offer tries to increase target market
Financials
Peacocks sales growth remains consistently strong
Store expansion and like-for-likes add to growth
Bonmarch? sales growth picks up as space expansion slows
Sales growth remains in positive territory - just
Space
Peacocks space expansion continues to grow after bumper 2007/08
Peacocks space allocation
Bonmarch? defies the recession by opening seven new stores
Bonmarch? space allocation
Sector performance - clothing
Peacocks clothing sales continue to grow - albeit at a slower rate
Bonmarch? unplift in clothing is a relatively positive performance
Peacocks continues to grow share in 2009
Bonmarch? fails to grow share in the increasingly competitive value market
Outlooks
Differentiation key for Peacocks
Peacocks is a winner from the consumer downturn
Expansion plans could make it into a major force
Better product segmentation would improve shopping experience
Pearl Lowe range should attract younger shoppers
Childrenswear needs more destination appeal
Overseas and internet businesses will add marginal growth
Bonmarch? needs to target local customers and go transactional
Bonmarch? must focus its offer to a more specific target market ...
... while tailoring product and stores to suit local and regional needs
A transactional website is a necessary long term investment
Awareness of competitors is vital in differentiating product ranges
CHAPTER 10 PRIMARK
Opportunities remain abundant
Recent key events
Aims for more growth
Management change should cause minimal disruption
Reiterates ethical policy
Develops logistics
Proposition
Value fast fashion maintains appeal in recession
Financials
Strong growth continues into 2009 - albeit at slower rate
International space expansion continues to drive sales growth
Space
Primark continues with aggressive space expansion
Space allocation
Sector performance -clothing
Growth of clothing sales slows but is still commendable
Primark continues to gain market share
Outlook
Primark well prepared for future growth
Recession plays into its hands
It needs to prepare for changing shopping habits post-recession
Better segmentation would target its large customer base more effectively
Online poses a growth opportunity
Investment in ethical issues will prove worthwhile
There are still great opportunities for Primark in the UK
More opportunities in menswear
CHAPTER 11 SAINSBURY
Clothing continues to make rapid gains
Recent key events
Space expansion drives clothing growth
Non-food central to growth plans
Organisational changes highlight non-food focus
Non-food offer launched online ... except clothing
Targets expansion through convenience format
New voucher scheme to offer further incentive to customers
In support of Competition Commission recommendation
Proposition
Well presented range offers broad appeal
Financials
Improved value credentials central to success
Growth continues through 2009
Makes progress online, but clothing lags behind
Space
Expansion high on agenda
Clothing space allocation
Sector performance - clothing
Sales grow more than 500% over five years
Rapid market share growth set to continue
Outlook
Abundant opportunities
Force to be reckoned with
Focus on convenience
Realigns prices
Market conditions help expansion
Space expansion vital for clothing success
Value competitors up their game
TU would benefit from more publicity
Clothing online launch essential
Huge clothing potential if it can overcome space barriers
CHAPTER 12 TESCO
Making progress after strong online launch
Recent key events
Continuous initiatives to ride out of the recession on top
Investment in price cuts help sales recover
Launches ASOS-style website ...
... with 20 brands
Tesco aims to strengthen its fashion credentials
Tesco wins a round of the supermarket price wars
Clubcard relaunch includes double value vouchers when spent on clothing
International expansion continues to be a focus despite economic setback
New weather team aims to match supply and demand
Proposition
Broad target market results in range lacking focus
Financials
Trading performance shows Tesco's ability to defy recession
Consistent sales and profit growth
Online sales growth is impressive despite hitting its lowest point
Space
Space growth slows
Clothing sales densities fail to impress
Clothing space allocation
Sector performance - clothing
Clothing sales trend hits bottom
Transactional clothing website improves Tesco's fashion offer
Value market share stabilises
Outlook
Online launch strong, but can it attract the right brands?
Online will help Tesco up its game in the value clothing market
New brands improve fashion credibility ...
... but few of them
Instore ranges need greater clarification
While the value market grows Tesco must keep up
Improvements in visual merchandising would boost sales
Key pieces need to be highlighted
Sainsbury is a looming threat
Inflation may not impact customers
CHAPTER 13 TJ HUGHES
Improvements pay off
Recent key events
Changes made to drive sales
Changes to management
Improved strategy...
... along with a larger advertising budget
Proposition
Value products appeal in recession
Financials
Performance improves in 2008/09
Space
Expansion plans restarted
Space allocation
Sector performance -clothing
Growth in clothing sales has returned
Market share remains level
Outlook
Sectors like electricals will provide footfall for clothing
Though it is benefitting from the recession ...
... it needs a post-recession strategy
Expanding geographically
Fierce competition in the value market
Profit margins will remain low
New locations drive higher footfalls
CHAPTER 14 TK MAXX
Buoyant through economic downturn
Recent key events
Building on strong foundations
Developing an infrastructure to support expansion
Central London targeted for new stores
Invests in technology to improve efficiency
Online presence eventually arrives
New face heads marketing
Proposition
Discounted brands appeal to price conscious customers in recession
Financials
Positive performance in a difficult climate
Operating margin improves despite new store investment
Space
As UK growth slows the Continent offers opportunities for expansion
Space allocation
Sector performance - clothing
Sales growth rises as recession hits
Market share continues to grow
Outlook
Growth opportunities remain for TK Maxx in the value market
Model and proposition are highly favourable throughout the economic downturn
E-commerce opportunities would increase growth and market share
But it needs to act quickly
Product could be arranged similarly to instore
More city centre stores could grow customer base ...
... and open new competitive avenues
Childrenswear potential not maximised
Expansion drive on Continent
CHAPTER 15 GLOSSARY
Financial Statistics - VAT
Trading Profile
Key Operating Ratios
Physical Development
Abbreviations