Singing in The Rain

The retailers in the UK bounding into 2019 with a spring in their step

We couldn’t even get from Christmas to New Year without another national chain calling in the administrators, topping off a disastrous and existentially threatening year for so many retailers and their employees and their supply chains and their supply chain’s employees.

But as we all need to start 2019 feeling and thinking positive, it doesn’t take much digging to cite companies whose performance contradicts the narrative of unrelenting misery – these retailers are not merely keeping their heads above the water but are leaping majestically upstream. And these are not disparate random results either – a few patterns are evident even in this cursory aggregation of news stories:

High rollers

Selfridges has enjoyed a 12th year of record growth and Fortnum & Mason a 6th year of double-digit growth. Harrods pre-tax profits were up 9%, while Harvey Nichols doubled their EBITA and Burberry's half-year profits were up despite a drop in sales. And with all the swift, wise and decisive actions being taken by the government vis-à-vis EU autodefenestration, the unvalue of the pound will no doubt further leverage the buying power of sheiks, oligarchs and party-members on shopping sprees, to the additional benefit of these stores.

Clicks to Bricks

There is a widely reported trend for retailers that started in mail-order or online getting into physical spaces. For example, strong performance by Joe Brown emboldened the brand to follow this path down which Boden and Joules have travelled far along. Even the DIY e-commerce platform Shopify is helping its fledgling tycoons get physical. At the opposite end of the scale to Shopify is Amazon of course, but unlike the preceding brands that have focused offerings to build store identities around, Amazon sells pretty much everything, so other than a general notion that having achieved dominance online they probably ought to conquer the physical world too (not to mention Space), they are still essentially piloting perhaps unnecessarily technocratic answers to Why and How and What.

Glad Rags

H&M's sales were up, and they opened a new concept store in Hammersmith. Uniqlo made record profits, and will open a northern flagship store filling the space vacated by BHS in Manchester in the Spring. JD Sports also achieved record results and innovated by integrating a music and entertainment platform into its app, elevating it from just another piece of phone-detritus into something more compelling.

Supermarket Sweep

Co-Op has had 18 consecutive quarters of sales growth and 2019 is set to be its 4th consecutive year of opening 100 stores, with a focus on smaller stores for smaller shopping trips, reflecting changing behaviour in their target market. Along with opening a new distribution centre, this is creating thousands of jobs, and makes it the fastest growing grocer, ahead of discounter rivals.

Speaking of which, Aldi had a record opening of 8 stores in one day - part of its plan to open 130 new stores over the next two years, creating 5000 jobs.

Tesco, like Co-Op has put its financial scandals in the rear-view mirror, and its shares are now widely tipped as a BUY by stock market pundits. Half-year sales and profits were up on the previous year, and as for those pesky discounters, the Jack's brand was launched to take the fight to them. Greeted with some scepticism by the press (warning: that last link is so Guardian you may need a flat screwdriver handy to unjam your rolled eyeballs) it will be interesting to see how it pans out. I idly speculate that if there is a niche for Jack's in low-rent urban areas then perhaps there is another niche in the high-rent areas for a premium Tesco Finest+ type offering. What shall we call it - Teresa? Then again, branding is not my specialty.

Carrion-eaters and detritivores

Sports Direct and Poundstretcher have descended like vultures on dead and dying retailers, picking over valuable stock and the best locations for a song (well, less than a Euromillions win). No doubt there will be more carrion too soon, and it is vital for a functioning ecosystem to have organisms capable of cleaning up the mess and repurposing the nutrients for something stronger and evolutionarily adapted to the current climate, or the bodies just lie there causing infection and a bad smell. Still, it is worth trying to understand what they died of before taking a bite though.

JR Heart-warming

Casting my line further, Angling Direct has been... making a splash, having whale of a time, achieving a net profit... with a market capitalization now approaching that of Debenhams. Fishing Republic on the other hand nearly got reeled in, but happily was let off the hook at the last moment.