SWL's Retail Radar - 18/09/24

Retail Radar, from SWL, provides you with a snapshot of the latest retail news from the UK and around the globe. These narratives highlight key events, emerging trends, and notable advancements, providing a deep dive into the dynamic retail landscape.

Retailers in the UK push for business rate reform in anticipation of the Autumn Budget

British Retail Consortium (BRC) has presented a detailed proposal to the government ahead of the Autumn Budget 2024, outlining key recommendations.

Employing over 5.7 million people and contributing more than ￡100 billion annually to the UK’s GDP, the retail sector is calling for urgent reforms to stimulate investment, boost economic growth, and tackle issues around sustainability and taxation.

The BRC draws attention to the heavy tax burden faced by retailers, who account for 21% of business rates despite generating just 7.4% of the UK’s economic output. This imbalance translates into an annual tax bill of ￡33 billion for the sector. The weight of these taxes, especially business rates, has contributed to the closure of 6,000 shops over the last five years. The BRC warns that if no action is taken, a further 17,300 shops could close by 2034.

To address this, the BRC is advocating for a “Retail Rates Corrector” that would reduce business rates by 20% across all retail properties. Such an adjustment would help create a fairer tax environment and encourage investment in better-paying jobs, decarbonisation initiatives, and technological advancements that could improve productivity.

The proposal also highlights increasing regulatory costs, including the upcoming Extended Producer Responsibility (EPR) and Deposit Return Scheme (DRS), which are projected to add ￡4 billion annually to retail sector expenses. Although the retail industry backs the intentions of these environmental schemes, concerns remain over their sequencing and the efficiency of their implementation.

BRC has called on the government to collaborate closely with businesses to ensure these policies deliver on their environmental objectives without imposing excessive financial burdens on retailers.

Tesco unveils plans to cut food waste by transforming it into animal feed at a new facility

特易购公司 is set to launch a new facility designed to transform surplus food into animal feed, with the capability to process up to 1,000 tonnes of excess food each week.

This initiative is part of the supermarket's broader strategy to rethink how the food industry manages waste, positioning itself at the forefront of efforts to reduce unnecessary food disposal.

The announcement follows Tesco's collaboration with over 30 food businesses earlier this year, calling for stronger government measures to address the issue of food waste.

Engineering firm RenEco has been hired to build the facility in Northamptonshire, which will focus on converting surplus food, particularly fresh produce and baked goods, into pulp or crumb feed for animals. Excess meat and fish will be processed separately for pet food, ensuring no part of the waste goes unused.

With Tesco's operations expected to fill 40% of the facility's capacity, the site will also be able to accept food waste from other retailers and manufacturers, offering a wider industry solution.

Claire Lorains , Tesco's Group Quality and Sustainability Director, emphasised the need for collective action, encouraging other businesses to take advantage of the facility to reduce waste across the supply chain.

Tesco also reaffirmed its commitment to ensuring that any food suitable for human consumption is prioritised for redistribution before being repurposed for animal feed.

Waitrose cuts prices on 250 premium products as part of a ￡10 million investment initiative

Waitrose & Partners has allocated an additional ￡10 million to reduce prices on nearly 250 products from its No.1 and Duchy organic ranges, marking the first stage of its latest price reduction initiative.

This brings the supermarket’s total investment in price cuts to ￡140 million over the past 18 months. It also represents the sixth round of price reductions on hundreds of items since February 2023.

In April, Waitrose reduced the cost of over 200 essential items as part of its ongoing commitment to delivering value for money. A similar reduction took place in February, with over 200 own-brand products seeing price cuts. So far, the retailer’s new ‘Lower Prices’ campaign has led to reductions on nearly 1,400 items.

Waitrose’s Commercial Director, Charlotte Di Cello , mentioned that this latest round of cuts includes many popular items from the No.1 and Organic Duchy ranges. With September marking Organic Month, she noted, it is an ideal time for customers to explore the Organic Duchy food and drink selection.

Primark expands Click & Collect service to an additional 54 stores across the UK

Primark has announced plans to extend its Click & Collect service to an additional 54 stores across Great Britain by the end of 2024. This expansion coincides with the retailer celebrating 50 years on the British high street, following the opening of its first store in Derby in September 1974.

The rollout is scheduled to begin in autumn 2024, with new locations including Derby and Birmingham, home to the world’s largest Primark. This follows Primark’s earlier commitment, made in April 2024, to introduce the service across stores in England, Scotland, and Wales by the end of 2025.

In addition to expanding its store coverage, Primark has also broadened the Click & Collect range to include menswear and homeware, alongside the existing women’s and kidswear options. These new ranges are already available in the 57 stores currently offering the service.

Kari Rodgers , Primark’s UK Retail Director, stated that the expansion of Click & Collect marks another step in enhancing the shopping experience on the high street, giving customers greater convenience and access to a wider product range. The new stores will be operational ahead of the busy Christmas period.

This move comes as part of a broader ￡100 million investment in Primark’s UK stores throughout 2024.

adidas unveils two new flagship stores in Los Angeles, California

阿迪达斯 has strengthened its presence in the US market by opening two flagship stores in Los Angeles, California.

The new locations include the Melrose store in West Hollywood and the Originals Downtown Los Angeles (DTLA) store, both designed to embody the brand’s focus on creativity, inclusivity, and sustainability.

Spanning 5,390 square feet, the Melrose store was developed by adidas’ in-house creative team and opened its doors on 11th August 2024. It features collections from Y-3, Stella McCartney, and adidas Originals, as well as performance products tailored to the needs of the local market. The space is divided into two rooms and includes The Lab, which highlights the brand’s key stories and collaborations. adidas envisions this design as the future of the retail experience, positioning the store as a hub for storytelling and customer interaction.

The Originals DTLA store, spread across two levels, is designed to serve as a community space. Opened on 12th September 2024, it will host events, workshops, and collaborations with local artists, fostering connections with the city’s creative scene.

Both stores aim to elevate the retail experience while connecting with the diverse communities in Los Angeles, promoting inclusivity and engagement.

John Miller, President of adidas North America, emphasised that Los Angeles, as a global centre for culture, sport, and the arts, inspires the brand to innovate. The flagship stores reflect adidas’ commitment to the city, blending creativity, performance, and sustainability to offer products and experiences that resonate with the local culture.

S?strene Grene celebrates its most profitable financial year to date

Sostrene Grene has achieved its most profitable financial year yet as it accelerates its expansion throughout the UK. For the year ending 30th April, the Danish homewares retailer saw a 22% increase in turnover, reaching ￡247 million, and a 15% boost in pre-tax profit, which rose to ￡24 million.

Mikkel Grene, the company's CEO and Co-Owner, highlighted that this remarkable financial performance underscores the success of the company’s strategic initiatives in innovation and expansion. He noted that the results affirm the value of their investments and reflect the continued consumer demand for quality, sustainable, and stylish products at competitive prices. Despite broader economic uncertainties, S?strene Grene's ability to cater to customer preferences has been a significant factor in its success.

The company’s financial achievements have set a solid groundwork for its ambitious growth objectives. S?strene Grene is investing ￡11 million in initiatives such as implementing a new SAP system, automating warehouses with robotics, and enhancing digital and marketing strategies. The brand plans to open 60 new stores by the end of 2024 and aims to reach a total of 500 stores by 2027.

In response to rising freight costs, S?strene Grene has absorbed these expenses to keep prices affordable for customers, rather than passing the costs on. Grene acknowledged that while this approach might impact profit margins slightly, the company remains optimistic about achieving even better results in the coming year.

With over 25 stores already in the UK and plans to launch in Wales this autumn, S?strene Grene is expanding rapidly, at times opening up to two stores a week, sometimes even on the same day. Currently operating more than 300 stores across 16 countries and running online shops in 14 markets, the company is targeting 100 UK stores by 2030.

Pret A Manger's international expansion drives increased sales

Pret A Manger has reported a 10% rise in sales for the first half of the year, reaching ￡569 million across its company-owned and franchise locations, with this growth largely attributed to its ongoing international expansion.

This announcement follows the company’s filing of its 2023 accounts with Companies House, revealing a 12% increase in adjusted EBITDA, which reached ￡166 million for the year.

In September 2021, Pret aimed to double its business size within five years, having achieved system sales of ￡412 million in 2020 and ￡512 million in 2021. The 2023 results indicate that Pret has met this goal three years ahead of schedule, with global system sales rising by 22% to ￡1.1 billion.

Throughout the year, Pret opened a record 81 new stores worldwide, with over half of these locations established outside the UK in markets such as the US, Canada, India, Greece, and Spain.

India has been the company’s fastest-growing market, with 15 new shops launched in Mumbai and Delhi within just 12 months.

Pano Christou , CEO of Pret A Manger, expressed pride in the company’s achievements over the past three years. He highlighted the successful attainment of their ambitious targets post-pandemic and extended gratitude to the team for their role in spreading the Pret experience. Looking ahead, Christou is excited about expanding Pret’s reach even further in the coming year.

#retailnews #retailradar #retailproductivity #continuousimprovement

Discover how SWL can help your retail organisation

W: www.swlgroup.com

E: Click here to contact the SWL Team