It has been a difficult year for many, but for Ted Baker it has been near catastrophic.
Two profit warnings in the first half of 2019, an embarrassing admission that it had overstated the value of some of its stock and ongoing weak trading prompted the decision last week to appoint advisers from turnaround specialist AlixPartners, to conduct a full review of its operations.
It was always going to be tough to ride out the storm of founder Ray Kelvin’s departure amid accusations of “forced hugging”, and the subsequent scrutiny of its workplace culture. Ted Baker has also been hit by challenging trading conditions, the fall in the value of sterling and heavy discounting, as well as its accountancy errors. There are signs customers are falling out of love with the brand, and it is hard to see how it will recover from this annus horribilis.
AlixPartners has its work cut out to unpick this sorry mess, as does interim CEO Rachel Osborne, whose appointment to Ted Baker as chief financial officer was only announced in September. Once the review is completed, the business needs to refocus on the high-quality, distinctive product it was once known for. However, its offer needs to be updated for the modern consumer.
This will be a make-or-break peak trading period for Ted Baker. However, many of its high street competitors are bullishly optimistic about sales over Christmas and beyond, despite the threat to consumer confidence from the general election on 12 December. In times of uncertainty, the strong get stronger and new, innovative companies come to the fore.
This is evident in our Power 100 list of the most influential people in fashion retail this year. There are 44 new entrants this year, compared with 2018’s list – including a section dedicated to those leading the way in sustainable fashion. As ever, the list has prompted much debate at Drapers headquarters, and we would love to hear your views: firstname.lastname@example.org.
The next issue of Drapers will be published on 10 January. In the meantime, we will continue to bring you the latest breaking news – including reaction to the election – on drapersonline.com and via our newsletters, WhatsApp and social media. Merry Christmas!