“We have been focused on becoming more relevant to our customer,” said Hobbs chief executive Meg Lustman today.
Meg Lustman Hobbs
Turnover at Hobbs fell 5.7% to £109.9m in the year to January 30, but its EBITDA rose 18% to £7.7m as it sold more product at full price.
“We are concentrating on three end uses, which are wear to work, occasionwear and smart casual, and we have invested in branch merchandising to ensure the stock is in the right place at the right time,” Lustman told Drapers.
“We have broadened the product proposition because women are now more likely to be thinking to buy now and wear now so we are less reliant on seasonal clothing like knitwear and outerwear,” she said. “We’re focusing on layering pieces like coatigans and wraps.”
Lustman said the strategy has allowed Hobbs to trade more at full price, which is in turn had a positive effect on margin and EBITDA.
Meg Lustman was drafted in as chief executive of Hobbs in September 2014 following a strategic review of the womenswear chain by chairman Phil Wrigley. Since then she has been reviewing the store portfolio.
During the year to January 30, two stores closed, in Solihull and Meadowhall. Hobbs opened new stores in Birmingham and Manchester, and relocated to a “bigger store in a better location” in Milton Keynes.
Since the year end Hobbs has opened a store on High Street Kensington in London, which is said to provide a blueprint for future openings. Lustman could not confirm any new stores in the pipeline.
Hobbs has invested in its omnichannel proposition, allowing the customer to interact with the retailer “in whichever way she wants” with a seamless journey to browse and buy across all platforms, offering click-and-collect, order in store and deliver to home, and vice versa.
Internationally, Hobbs “has had a great year,” Lustman said, with its five Bloomingdale concessions opened in 2014 becoming profitable in 2015. It opened more concessions during the year, ending the period with 14 and will open its first concession in German department store chain Karstadt next month.
Lustman said the expansion in the US “has been a big success”, adding: “We’ve done things like make sure we edited the range to be appropriate for the US customer so we realigned the trading calendar to ensure that outerwear hits stores for Labor Day at the end of August for example, which is an important trading day in the US but it is around a month earlier than they typically would do in the UK.”
During the year, it launched in Germany online with Zalando and via physical concessions in premium department stores Wohrl and SinnLeffers.
Lustman, who joined Hobbs in September 2014, admitted the spring 16 season has not been easy, in line with other retailers, but said she remained confident thanks to the strength of the brand and the new strategy, which will run for the next two to four years.