Your browser is no longer supported. For the best experience of this website, please upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

Retailers reveal global ambitions

Potentially huge new markets are giving UK and overseas fashion groups an appetite for growth

A new wave of confidence appears to be sweeping through fashion retailers with ambitions to expand on a global scale.

The UK’s third largest fashion retailer, New Look, has revealed details of a new franchise deal that will result in the opening of 40 new stores in the Middle East over the next five years, and the UK high street is bracing itself for an influx of foreign brands keen to cash in on the British public’s appetite for fashion.

US chain Abercrombie & Fitch will open a store in London later this month and Gap plans to debut its upmarket brand Banana Republic in the UK next year. And it isn’t just the Americans getting in on the act - Swedish group H&M is poised to opened a branch of its upscale brand COS on London’s Regent Street and Denmark’s Bestseller has signalled a big retail push for its Vero Moda and Jack & Jones brands (the first joint-branded store opened in Birmingham last week).

But translating successful brands from one market to another is far from easy. Marks & Spencer famously pulled out of France and Belgium in 2001 following a poor performance in those markets, a move that M&S chief executive Stuart Rose believes was premature.

Speaking at a conference hosted by Retail Week last week, Rose told delegates that he believed his predecessor Luc Vandevelde could have stuck it out and tailored the retailer’s offering to suit the different tastes of the customers. “France was temporarily unprofitable. The UK mothership wasn’t supplying it with the right product,” he said.

Despite that setback, M&S still has a significant international presence and Rose admitted he would like to increase this, particularly in Europe, but at present it is not a priority. “I would like to get back there at some point, but I’d like to make sure the UK recovery is robust enough first,” he said.

When you get it right, however, international expansion can reap big rewards. At the same conference, Inditex UK and Ireland managing director Mike Shearwood revealed some of the factors he believed were behind the Spanish group’s international success. Its presence in both southern and northern hemisphere locations takes the seasonality out of the trading equation and the group’s decision to operate from and manufacture either from or close to its global headquarters in A Coruna, north-west Spain, lets it respond quickly to specific market demands.

Its most famous brand, Zara, which now boasts three stores on London’s Oxford Street alone, has built its reputation on turning around its stock quickly and being the first to market with the latest trends. While this model demands increased flexibility and poses a logistical challenge, it also reduces risk, according to Shearwood. “Some stores will only get two to three items by size, which lends a certain amount of exclusivity. But if [a product] doesn’t work we can quickly move it to another store or country and we don’t have to discount,” said Shearwood.

A sense of exclusivity will always serve a brand well when it debuts in an international market, but retaining that excitement is key for long-term success. The early period is what Mosaic Fashions group strategy and development director Meg Lustman, who shared a platform with Shearwood, referred to as “the initial euphoria”. UK-based Mosaic has undergone rapid international expansion in recent years and Lustman said part of its continued success has been its willingness to adjust its offering to suit different cultures while always retaining “the essence” of its brands.

It is also crucial to match the right brand to the right market and to choose the right business model. Mosaic operates a market similarity versus market opportunity model, so for instance a market that was both very different from its home market and very small would not be worth touching, while a very different but potentially huge market, such as China or India, would suit a licensing agreement. “Different brands might choose different models [in the same market]. For example, Oasis is licensed in China but for Karen Millen we would go down the franchising route,” she said.

Whichever route you choose, said Lustman, it has to be “win-win” before you should consider it. And you should never be swayed by the vanity of being a global player. “Sexy” though it is, Lustman said: “Question why you’re doing it. What does the customer want? Is the brand successful enough?”


- Based: A Coruna, Spain

- Founded: 1964 as a textile business, first Zara store opened in 1975

- Brands: Zara, Pull & Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, Zara Home, Kiddy’s Class/Skhuaban

mosaic fashions

- Based: London, UK

- Founded: 1991 with the establishment of Oasis Stores

- Brands: Coast, Karen Millen, Oasis, Odille, Principles, Shoe Studio Group, Warehouse, Whistles

Global fashion retailers

- Over here

H&M: The Swedish fashion giant now has 129 shops in the UK andRepublic of Ireland and shows little signs of slowing in 2007.

Uniqlo: After backtracking on its over-enthusiastic debut, Uniqlo has slowly restarted expansion and now has eight UK stores.

Benetton: The Italian company has about 70 UK and RoI stores, but has found it hard to impress the UK fashion shopper, and expansion has been slow.


New Look: The chain has 540 shops in the UK and RoI, as well as 200 shops under the Mim fascia in France. It has plans to open in Europe and the Middle East.

Harvey Nichols: The luxury department store’s international presence now also includes four shops in Riyadh in Saudi Arabia, Hong Kong, Dubai in the United Arab Emirates and Istanbul in Turkey alongside its six stores in the UK and RoI. A store in Jakarta in Indonesia will follow next year.

Marks & Spencer: The UK retail giant has 450 stores in 30 countries in Europe, Asia and theUnited Arab Emirates.


COS: H&M’s eagerly awaited upmarket sister brand makes its international debut on London’s Regent Street this month.

Banana Republic: The stablemate of US giant Gap will debut its more upmarket operation in London next year. Ithas 521 stores in North America and 13 in Japan.

Brooks Brothers: Debuted in the UK on London’s Regent Street last year and is scouting for more sites.

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Links may be included in your comments but HTML is not permitted.