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Beales axes ecommerce to return group to profitability

Beales has stopped trading online as part of its new management team’s strategy to return the department store group to profitability.

“We have stopped trading online because the site was not well set up and was trading at a significant loss,” said Beales’ new chairman Stuart Lyons. “It is the handling of the transactions that costs and you can only do ecommerce if the business is trading profitably.

“We won’t review it for another year at least,” he added, explaining that will continue as a website providing information to customers, but it has stopped taking orders.

It comes after property magnate Andrew Perloff won control of the 30-strong department store chain, making an offer through his investment vehicle English Rose in January that valued Beales at £1.2m.

Previous board members chief executive Michael Hitchcock, chairman William Tuffy, trading director Tony Richards and non-executive director Catherine Norgate-Hart have now left the business.

Anne Horton, former managing director of Hoopers department stores, has been appointed director of retail.

“Our strategy is to bring the group back to break even,” said Lyons. “Andrew Perloff is a serious investor and not an asset stripper. It won’t be easy because we are committed to all of our spring 15 and autumn 15 merchandise for fashion, so there isn’t a lot we can do for the next six months. Going forward we will have less cheap promotional buys and more development of brands.”

He said Beales will hold smaller mid-season Sales located to the rear and side of stores so they won’t occupy selling space to the extent they did previously.

It will also refurbish stores, with work already underway on the Mansfield store. Lyons would not disclose which other stores may be in the pipeline, addingL “We are not talking about vast amounts of money because department stores are all about retail theatre.”

At the start of the year, the former Beales management team and English Rose’s directors said they were in agreement about the need to address the operation of certain loss-making stores and the need for investment in selective store refurbishments.

Lyons said: “There are no closures planned at present. We have only been in place for six weeks so we are reviewing stores but no decisions have been made.”

Sales are currently level with last year, which Lyons said is “not brilliant but a reasonable performance given the merchandise we have in stores”.

In its most recent figures, the Beales Group’s sales, including concessions and VAT, dropped 3.7% for the full year to November 1, compared to the same period in 2013.

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