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Government urges UK retailers to enter Italian market

The government has launched a campaign to encourage British retailers to expand into Italy, following concerns the UK has been “slow” to take advantage of growing opportunities in the country.

As part of its Retail Challenge campaign, government body UK Trade & Investment (UKTI) has produced a report on retail and franchising opportunities in Italy and will take up to eight UK businesses deemed to have a viable proposition to Milan for two days, from March 12-13. It is now seeking suitable, interested retailers to join the first mission.

Accompanied by trade advisors, the retailers will meet potential retail and franchise partners and visit key shopping destinations. Another mission may follow later in the year if this one is a success and UKTI will promote the campaign at the World Retail Congress in Milan in September.

Marina Iremonger, head of UKTI’s consumer and creative team in Milan, said: “The Italian retail scenario has changed a lot recently. Many international retailers have now opened multiples, chains, concessions, shop-in-shops and franchised shops.

“Only British retailers seem to be slow in tackling this strategic market, which attracts business visitors and tourists not only from Europe, but increasingly from Asia, the Arab countries, the US and Japan.” She said the main challenge for UK retailers was finding the right partners. Clarks and Accessorize are notable exceptions, enjoying successful franchise networks across Italy.

Paul Alger, director of international business development for the UK Fashion & Textile Association, agreed: “One of the things that came out of Pitti [Uomo in Florence on January 13-16], other than the huge number of Italians visiting was, conversely, just how many Italian multi-brands have closed in the last two years and how slow UK companies have been to enter the Italian retail space.”

According to the UKTI, Milan has the second highest per capita purchasing power at €22,800 (£17,000) among European cities, second only to Paris.

One UK high street womenswear retailer told Drapers: “We have looked at it. It’s a market we feel we should be in, but there are two challenges: first, the landlords want a lot of money from overseas retailers and second, there are a lot of small local shops and not so many bigger retailers, so there’s not enough scale.”

However, Richard Craig, managing director of Margaret Howell, which opened a shop and production office in Florence in November 2014, said: “The rents really aren’t that big if you’re slightly off the core streets such as Via Tornabuoni, as we are. We find it quite affordable.”

Jigsaw said it would consider going into department stores in Italy, particularly following its recent pop-up at El Corte Inglés in Spain, which was part of another initiative organised by UKTI last October.

Chief executive Peter Ruis highlighted the growing success of Italian department store La Rinascente as a particular attraction. “Historically, [the department store model in Italy] has been more focused on wholesale rather than concession, and fairly dominated by the domestic brands. However, [chief executive] Vittorio Radice is creating a revolution at La Rinascente and he is a world class retail leader.”

For more details, email consumer.creative.ukti.milan@gmail.com

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