Mixed fortunes for the UK's fashion retailers

AS THE weather slowly starts to improve, shoppers will be keeping an eye on the new summer fashion ranges lining the shelves of clothing stores.

AS THE weather slowly starts to improve, shoppers will be keeping an eye on the new summer fashion ranges lining the shelves of clothing stores.

Fashion is big business in the UK and a number of high street stores are well aware that a new season can sometimes mean a new wardrobe for customers.

However, with the austerity measures in the UK beginning to bite, shoppers are increasingly price aware and this has pushed retailers to become more competitive.

It is difficult to walk up Northumberland Street and not spot a shopper sporting the Superdry logo.

Indeed, Superdry clothing has offered something a little different, promoting a strong brand image and distinct identity.

The label is owned by UK fashion company SuperGroup and the brand is stocked at stand alone retail stores and also department stores, such as Fenwick.

Superdry is the company’s most recognised brand and is sold in 70 countries around the world. However, the group also owns the 77Breed and SurfCo California labels.

The company was floated on the London Stock Exchange in March 2010 and the shares experienced a very good start due to the strong growth potential of the business.

However, 2011 has, so far, been a rollercoaster ride for the group.

In a recent trading update, SuperGroup stated that progress has been made in the UK and International markets and a number of new stores have been opened.

It was noted that the unseasonably warm spring weather caught the business off guard, as it did not manage to fully capitalise on the demand for summer clothing.

The slowdown of retail sales growth over the period appeared out of place compared to the group’s recent track record. This struck a note of caution with investors and the shares have fallen since the announcement. Looking forward, SuperGroup remains positive about the business’ future prospects.

Elsewhere in the fashion industry, UK-listed Burberry Group has been moving from strength to strength. In a strategic shift the company moved away from its trademark check design, as it was believed to be devaluing the brand, and a new chic clothing range was introduced.

The group has certainly been in vogue and the main growth area has been the Far East.

China is a very important market for Burberry where the brand is associated with style and status. The group has opened a number of retail outlets in China and the roll-out of new stores is set to continue. Indeed, Burberry has launched flagship stores in a number of provincial capitals.

The new store in Beijing is said to showcase the group’s most advanced digital store technology to date. Although the business is aware of the current global economic challenges, Burberry remains confident that its core strategies are in place to support the business for the future.

:: Anthony Peart, Anthony.Peart@Brewin.co.uk


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