Weekly Retail & Leisure News - 02 May, 2016
Menswear retailer Austin Reed has entered
administration, putting almost 1,200 jobs at risk. The retailer began in 1900
as a tailoring business in the City of London. A statement from the
administrators blamed a "challenging" retail market and cash flow difficulties.
The company, which has 100 standalone stores and is stocked in a further 50
stores, has struggled to compete in an increasingly competitive market, after a
lack of investment in its stores, and has seen sales fall as result.
The menswear brand was the second UK retailer to enter administration in as
many days, following the failure of BHS. It was just over a year since the
88-year-old retailer had been sold by Sir Philip Green to a consortium of
unknown investors for £1. Damian Sumner, head of Retail Agency at JLL,
commented: “this will be good news for discounters such as Home & Bargains,
B&M, Poundworld as well as the discount grocery chains. Clothes retailers
such as Primark, H&M and Next have also been eyeing up some stores. They
will now be able to agree deals with landlords at affordable levels of rent and
some will be seeking to negotiate freehold deals.”
In other news, Home Retail Group has blamed consumer uncertainty for its final
sales performance as a standalone group, commenting that the retail industry is
being challenged. In the year to February 27, LFLs at Argos, whose stores are being
sold to Sainsbury's, fell 2.6%. LFLs at Homebase fell 5.2% in the same period;
Australian group Wesfarmers is buying the DIY chain. Overall Home Retail
Group’s profit before tax dropped 28% to £94.7m from £132.1m.
Read JLL’s view on the impact of BHS’s administration on its
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Director, Head of Retail Research (UK & EMEA)
+44 (0)20 3147 1155
Director, Head of UK Retail & Leisure
+44 (0)20 7318 7838
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