Frasers plans more stores, some consolidation, after record trading year
With Frasers Group riding high on “robust trading” after a “record-breaking year”, don’t expect the business to rest on its laurels.
The Flannels, Sports Direct, House of Fraser and Jack Wills owner wants to buy more businesses and open more stores after annual sales rose by almost a third and pre-tax profits leapt.
New chief executive Michael Murray talked of “significant momentum” and “strong strategic progress” in its Elevation Strategy to The Guardian newspaper after delivering its strong set of trading numbers.
“We are confident of a record year… that has got the headwinds baked in,” he said.
And that confidence will include a plan to almost double the size of the its high-end fashion brand Flannels to 100 stores across the UK and Ireland, from 55 now. It also wants to expand the label to mainland European cities too.
More immediately, those plans include its first Flannels stores in Ireland, in Dublin, Blanchardstown and Cork.
But that Elevation Strategy also means some consolidation to its physical retail portfolio. While its long-time anchor business Sports Direct expects to see a continuation of its upgrading plan for the brand with another flagship store in Manchester in the year ahead, it will aim to operate fewer but larger Sports Direct stores, after closing 12 during the year, aiming to offer a “better experience” for shoppers.
And House of Fraser? Despite trading improvements over the last year, Murray said longer term he wanted only 20 to 30 House of Fraser units, which would include some new stores and the closure of others.
Four more department stores closed during the year (including Cwmbran in Wales, and Epsom in Surrey) taking the total to 39 in April, compared with 59 when the chain was first acquired by Mike Ashley’s retail group in 2018. The Huddersfield store will close in August.
“Some of the stores in smaller locations are too big,[business] rates are very high or store sales are not [sufficiently] productive to invest in the store or we cannot come to a reasonable compromise on rents,” Murray also told the newspaper.
He added that the business has “extensive ambitions to grow the business outside of the UK and will be exploring the potential for further international expansion through acquisitions, joint ventures and organic openings”.
It has already begun to expand its operational capabilities in Europe, with a new site in Bitburg, Germany, being developed. This will “support growth across continental Europe”.
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