Value womenswear retailer Bonmarché might have had a tough time of it lately, but there are plenty of ways incoming chief executive Helen Connolly can grow the business.
The retailer, which targets the over-fifties, announced last week that Connolly will join later this year, replacing Beth Butterwick when she moves to Karen Millen. Butterwick has been credited with making improvements at the retailer, leaving Connolly with big shoes to fill.
Connolly has been senior buying director for George at Asda since 2008 and has previously held buying roles at Next and Dorothy Perkins. Her appointment came as something of a surprise, as Connolly is not as well known as some of the names that had been mooted for the role.
However, a supplier who has worked with Connolly in the past says it makes a lot of sense.
“Connolly has lots of experience and has worked for some of the UK’s biggest brands,” she told Drapers. ”She is good at product, she makes things happen and her time at Asda – which is also value – will work for Bonmarché.”
Another well-placed source agreed. “It’s a great move for Helen. She was a very capable and talented director at George and her experience in womenswear and the value market will set her up well for her role at Bonmarché.”
Helen Connolly’s CV
- Joined Next in 1995 as a buyer, later becoming head of sourcing for womenswear and girlswear from China, Thailand, India and Sri Lanka.
- Moved to George at Asda in 2003 as buying manager for three years.
- Joined Arcadia’s Dorothy Perkins in 2006, where she was head of buying for two years.
- In 2008 returned to George as senior director of buying.
Bonmarché chairman John Coleman says Connolly’s buying, merchandising, sourcing, product and business development experience make her a perfect fit, as does her focus on delivering a high-quality customer experience.
However, Connolly will face challenges in the role. Bonmarché has had a turbulent few months: in December the retailer lowered its full-year profit expectations to between £10.5m and £12m for the year to the end of March 2016. It said trading over the autumn had been “volatile” and this was likely to continue.
In January it revealed like-for-like sales were down 1.3% across its 312 stores for the 13 weeks to December 26. However, total sales for the quarter were up 3.4%, buoyed by a 3.9% uplift online.
Its performance over winter could be viewed as a blip. After all, most retailers struggled with the mild weather and the months of heavy discounting that followed.
Looking back over the past two years, Bonmarché has enjoyed steady growth. Profit before tax increased by £3.2m to £8m for the year to March 29 2014, and by another £4.4m to £12.4m the following year. Last October, reflecting this growth, it moved from AIM to the main stock market.
Much of the credit for this improvement goes to Butterwick, who took the reins at the end of 2011, just eight weeks before Bonmarché collapsed into administration in January 2012 and was acquired by private equity firm Sun European Partners in a pre-pack deal.
Since then, she has spearheaded a transformation, rationalising the number of stores it operates and making sure the product is more relevant. Butterwick was named Drapers’ Fashion Retailing Personality of the Year at the Drapers Awards in 2015.
“Beth Butterwick has done an amazing job at turning Bonmarché around. She puts the customer at the heart of everything, and that has been crucial to its success,” says Honor Westnedge, lead analyst for clothing and footwear at Verdict Retail.
But the profit warning last December demonstrated how vulnerable it is to the weather and other external factors – perhaps more so than other businesses.
“Fast fashion players can be more responsive,” points out Westnedge. “When you’re targeting a more mature customer, it’s more difficult – you’re not refreshing ranges more frequently, so when the weather is bad, you can’t react.”
Bonmarché at a glance
- Revenue for year to March 28 2015: £178.6m
- Profit before tax: £12.4m
- 310 stores
- Competitors: BHS, Marks & Spencer, Jacques Vert Group, N Brown Group
- Launched responsive website in July 2015
- Online sales circa 8% of the total
Bonmarché also faces growing competition as retailers cotton on to the opportunities in the over-fifties market. Verdict reports that people aged 45 or above spent £16.7bn on clothing in 2015 – 48.4% of the total spend on adult clothing – and that is only set to rise.
For Connolly this presents both a challenge and an opportunity to acquire new customers.
Bonmarche’s online sales are only around 8% of the total, says Verdict, compared with an average of 20% across all clothing retailers in 2015. It can increase this, as more older women shift their spend online. The website could also help it to attract younger shoppers, who may not go into the stores.
Connolly can also leverage sales through plus-size brand Ann Harvey, which Bonmarché acquired in 2014.
Its strategy of opening in garden centres, started in 2013, has proved popular and could be expanded.
And, as BHS shrinks its retail footprint, Bonmarché could actively target its customers.
If Connolly invests in the brand, evolves its multichannel offer and explores ways to acquire new customers, Bonmarché will be able to brush off the next unseasonably mild weather conditions with greater ease.