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Market Commentary

​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​Weekly Retail & Leisure News - 07​​​​​​​​​​​​​​​​​​​​​ September, 2015

​Halfords’ results hit by cycling slowdown

​​​​​​​Halfords announced a slowdown in Q2 trading last week, with LFLs down by 1.3%. The retailer has been hit by a wobble in bicycle sales after bad weather turned Britain’s cyclists off buying new bikes, in addition to discounting across the sector. LFL sales were down 11% in its cycling division in the eight weeks to August 28. While Halfords’ results are clearly disappointing, there are significant long term opportunities in the cycling market, especially as the retailer boasts a balanced product coverage for cyclists.

The Co-operative Group has reported half-year profits of £36m, in the six months to July 4. The group's core convenience business increased LFL sales by 3.3% while its total food business grew by 0.8%, reflecting the tough trading environment. The Co-operative Group wants to offload up to 300 of its larger supermarket stores but chief executive, Richard Pennycook, said that this would not be dumped in one asset package and expected to spend “many years working them out into the market when we can see a good demand”.

In other news, Poundland is taking the plunge into online retail with the launch of a trial e-commerce site offering around 2,000 products to UK customers. Customers will be charged a £4 delivery fee per order, except for orders over £50 which will be free. This shows the continued evolution of the rapidly growing UK online market, and follows Poundworld’s e-commerce launch in April this year. The move by fixed price discounters into the e-commerce space may increase the pressure on the supermarkets, as the wide product ranges of discounters become available to customers online.

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