Following a return to operating profit, New Look is now positioned to recruit the talent needed to continue with its turnaround plan, the executive team told Drapers.
“The single biggest enabler [for a successful strategy] is people, and we’re making sure we’ve got the right people,” said chief operating officer Nigel Oddy in the wake of New Look’s return to profit.
The retailer announced underlying operating profits of £33.2m for the full year to 30 March, compared with a loss of £35.7m the previous year. EBITDA increased to £80.2m, up from £18m in 2018.
“These results are a bit of a watershed for us,” executive chairman Alistair McGeorge told Drapers. “Eighteen months ago the business was in a very stiff position, and most people thought we weren’t going to survive. Our single biggest objective was to try and restore financial and operational stability to the business.
“Without that, it was very difficult to recruit new talent and leadership to the business. We’ve been trying to deal with the business with the same people who were in it before, which inevitably brings its issues. That has all changed following the restructuring, which has given us the opportunity to recruit new talent.”
Louise English will join the team from Karen Millen as interim chief customer officer on 2 July, and Oddy said there are more appointments to follow.
”It’s only in the last couple months that we’ve started recruiting, and we’ll be doing so right across the business,” he said. “Although I can’t tell you today who they’re going to be, we’re very close to signing a couple of excellent people. We are now in a position to attract people that have got talent, and spend time developing people within our own business.”
The retailer has wasted no time bolstering its board, with the appointments of Angela Luger (née Spindler), Colin Henry, Richard Cotter and Robin Terrell as non-executive directors, earlier this month.
In its results, New Look said it had been focusing on “broad appeal product” to improve profitability, and Oddy echoed this as the retailer’s second most important focus.
”When it comes to our customer we don’t talk about age that much – we have two customer groups: core customers, and fashion customers,” he said. ”We have a broad customer base and lot of work has been done to focus on that broad appeal but we now want to accelerate that further.
”We’ll have about 95% of core and broad appeal fashion and then at the top end it’s about that high fashion. However, high fashion is high risk and so we have to move that manufacturing closer to the market to make it quick and reactionary. High fashion is usually seasonal, and as you’ve seen with this year’s weather, that can be costly for retail.” he added.
To enable flexibility, the retailer will continue to work on its supply chain. It will bring high fashion manufacturing closer to the UK to trial styles quicker, with production in Turkey, Moldova, Morocco and the UK itself.
As part of its restructuring, New Look has closed its China business and appointed administrators in Belgium, France and Poland. With the restructuring complete, Oddy noted the opportunity the UK store portfolio has to offer.
”Over my first three months I’ve been out and about in over 100 stores – and not just the major regional city centres but the smaller towns. We’re still a very key player in a lot of those towns. They are very important to us and we are to them. There is a huge amount of opportunity there now that the restructuring is complete.” he said.
“The hard work starts now,” added McGeorge. ”All we’ve done is get some level of operational and financial stability and we can now get on and accelerate and fix this business in what is as a demanding environment as I’ve ever seen.”