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The highs and lows of 2016

Drapers looks back on the biggest stories of the year, including the BHS scandal, unexpected people moves, the Brexit vote and Marks & Spencer’s turnaround plans. 

 

Blue Inc in Basingstoke

Blue Inc in Basingstoke

Blue Inc in Basingstoke

January

The year got off to a mixed start for retailers, after a perfect storm of warm, wet weather and heavy discounting resulted in lukewarm festive trading for many. Next and Marks & Spencer both blamed the unseasonal conditions for disappointing Christmas trading, although Debenhams reported its best ever December after it limited its price cuts.

Young fashion chain Blue Inc became the first high street casualty of the year, after it shut a quarter of its stores, resulting in the loss of around 580 jobs. And now Blue Inc’s suppliers have taken a majority share.

Elsewhere, Steve Rowe was named as Marc Bolland’s replacement for the top job at M&S and Asda’s vice-president of own-label development, Fiona Lambert, made the decision to leave the business after the supermarket chain axed 300 jobs at its Leeds head office. 

 

Burb rtw fw16 1026

Burb rtw fw16 1026

Burberry boss Christopher Bailey was among those who signed an open letter supporting the remain campaign

 

February

Fashion retailers and independents began to pick sides in the debate raging over whether or not Britain should leave the European Union in February. Ann Summers chief executive Jacqueline Gold and Burberry chief creative officer Christopher Bailey were among 36 FTSE 100 bosses who signed an open letter supporting the remain campaign.

More redundancies followed in February: Clarks made job cuts at its UK headquarters in Somerset with immediate effect as part of a global restructuring.

Online giant Amazon also began to outline its plans to become a dominant player in UK fashion, appointing former Marks & Spencer director Frances Russell and rolling out several private label brands in the US.

 

Bhs in sale

Bhs in sale

It was the beginning of the end for BHS in March

 

March

March saw Sports Direct boss Mike Ashley receive a formal summons to give evidence before MPs about the treatment of workers at the retailer’s Shirebrook Warehouse. In the year’s other big retail scandal, it was the beginning of the end for a floundering BHS after it filed a (company voluntary agreement) CVA proposal and put pressure on creditors to slash rents on its store portfolio.

In people moves, David Walker-Smith resigned from his role as managing director of Fenwick. Walker-Smith had joined the company in February 2013 and was credited with repositioning the department store.

Phase Eight owner the Foschini Group also acquired a substantial majority shareholding in Whistles for an undisclosed sum.

 

Hp block01 rec

Hp block01 rec

The fashion industry expressed his concerns about heavy discounting in April 

 

April

Concerns over the amount of discounting on the high street reached fever pitch in April, as multiple and independent retailers told Drapers “unsustainable” price cuts were to blame for increasingly tough trading. It was a mixed month for Asos, which discontinued its Chinese operations but increased pre-tax profits by 18% year on year for the six months to the end of February.

Young fashion chain Forever 21 continued to scale back its UK store portfolio, closing its 65,000 sq ft Scottish flagship and the Austin Reed Group was bought by Alteri Investors.

 

Marksspencer

Marksspencer

M&S boss Steve Rowe unveiled his turnaround plans 

 

May

Steve Rowe began the difficult job of turning Marks & Spencer around in May. The new boss revealed a slimmed-down management structure, a new operating committee and a well-received autumn 16 range – all largely welcomed as good first steps towards a revived M&S.

BHS staff launched a last-ditch effort to win public support as the inquiry into the £571m pension deficit kicked off, projecting campaign images on to London landmark Marble Arch.

In happier news, it was a good month for fast fashion brand Missguided, as chief executive Nitin Passi outlined plans to embark on an “aggressive” retail rollout, starting with its first store at Westfield Stratford City.

 

brexit

brexit

Brexit dominated the headlines in June 

 

June

There was really only one story in June: the Brexit vote. Fashion retailers across the UK expressed their shock and dismay after 51.9% of British voters decided in favour of leaving the European Union. Concerns about the potential for “economic and political” disaster abounded, as a lack of certainty spooked many in the fashion industry. The value of sterling slumped and prime minister David Cameron resigned, later to be replaced by former home secretary Theresa May.

But despite the bombshell, the bosses of several high street multiples and department stores called for calm, stressing the importance of “business as usual.”

 

Bhs closing down in ashford 2

Bhs closing down in ashford 2

The first wave of BHS stores pulled down their shutters for the last time in July

 

July

Unsurprisingly, July was the month Brexit continued to dominate the headlines. The weak pound emerged as one of the most pressing issues, as increased import costs created headaches over rising prices.

However, welcome warmer weather meant an upturn in trading for many and led to a slightly cheerier mood on the high street.

Away from Brexit, the first 20 BHS stores closed their doors for the last time. Up to 580 employees were affected, and most lost their jobs.

Shop Direct’s deputy chief executive, Gareth Jones, also announced his plans to leave the business at the end of the year to “explore other opportunities”.

 

River island 2

River island 2

Retailers opened an impressive array of new offices in August, including River Island’s digital colloboration space

 

August

Traditionally a quiet month, in August Harrods boss Michael Ward reneged on his decision to leave the department store, announcing his intention to stay on indefinitely to help the business deal with the changing economy. Fashion director Helen David was promoted to the role of chief merchant.

A lacklustre summer triggered a reduction in staff numbers across the retail sector.

August was also a month for some inspiring new offices. Etailer Shop Direct opened a new “well-being” space at its Liverpool headquarters, complete with a conference facility, relaxation zone and juice bar.

Not to be outdone, River Island unveiled its new “digital collaboration space” dedicated to technology in Shoreditch, east London. BHS finally disappeared from the high street at the end of August, as the final 22 stores pulled down the shutters for the last time. 

 

Stylecom 02

Stylecom 02

Conde Nast’s Style.com finally launched in September 

 

September

Multiples reported disappointing August bank holiday trade at the start of the month, as warm weather and flash promotions failed to tempt shoppers on to the high street. September was a month for people moves at the top end of the high street.

Whistles chief executive Jane Shepherdson left the business after eight years in the role, handing over the reins to brand director Helen Williamson, managing director Justin Hampshire and creative director Nick Passmore. At LK Bennett, former BHS boss Darren Topp replaced Robert Bensoussan as CEO.

The fallout from the weak pound continued to hit retailers: Next, John Lewis and Fat Face all warned they would have to rise prices next year in an attempt to limit the fallout. In other Fat Face news, the retailer launched a festive prise promise reassuring customers it would not slash prices in the lead-up to Christmas. Condé Nast finally unveiled its ecommerce site Style.com, a year behind schedule.

Towards the end of the month, the new BHS began to outline its plan to relaunch later in the year, promising to listen to customers.

 

Paula nickolds from john lewis

Paula nickolds from john lewis

Paula Nickolds took over from Andy Street at the top of John Lewis 

 

October

More high-profile people moves followed in October: John Lewis managing director Andy Street bowed out of the retailer to stand as mayor for the West Midlands. Commercial director Paula Nickolds, who joined as a graduate trainee and has worked for the partnership for 22 years, was named as his replacement.

Liberty of London managing director Ed Burstell announced he was also leaving to take up the role of head of partnerships at Canadian retailer Hudson’s Bay Company and at House of Fraser, four house brands were axed in a bid to revive flagging womenswear sales.

Away from department stores, profits at Ted Baker surged, driven by an improvement in full-price sell-through and Asos chief executive Nick Beighton refuted reports of alleged staff mistreatment at the etailer’s Barnsley distribution centre.

October was also the month when the fashion industry bid a sad farewell to designer Richard Nicoll, who died unexpectedly at his home in Australia.

 

Ms westfield 041108

Ms westfield 041108

Source: Enter source

It was revealed 30 M&S stores would close 

 

November

The month started with the much-anticipated second phase of Marks & Spencer’s turnaround plans, where it was revealed 30 stores would close and another 45 would be downsized or turned into branches of M&S Simply Food.

As Black Friday drew nearer, many multiples hit out at the American discounting phenomenon, labelling it “unprofitable and unsustainable,” although it was a good day for John Lewis. Customers rushed to its website on the morning of the 25th, placing five orders every second between 8am and 8.30am.

Coast, Warehouse and Oasis reported improved profit figures for the year to 27 February as their owners prepared for a sale.

November also fired the starting gun on the battle of the Christmas ads as retailers unveiled their festive offerings, including John Lewis’s bouncing boxer dog and M&S’s modern take on Mrs Claus.

Finally, as November drew to an end it was announced House of Fraser chief executive Nigel Oddy was to leave the business, following rumoured tensions with HoF owner Sanpower.

Superdry berlin

Superdry berlin

In December, Superdry unveiled its largest ever store 

December

Following Nigel Oddy’s announcement ahead of the festive season tht he was to leave House of Fraser, the Chinese-owned department store chain unveiled a new five-year strategy to help drive efficiency, embarking on ambitious plans to transform its supply chain.

A trio of departures were announced from premium retailer Jaeger: trading director Gwynn Milligan, product director Liza Canneford-Webb and chief information officer Cathy McCabe all exited the business.

Samantha Cameron revealed her plans to launch womenwear label Cefinn for spring 17 and British brand Superdry opened its largest ever store, a 40,900 sq ft monster in west Berlin.

JD Sports fashion said it would launch an investigation after allegations about poor treatment of workers at its warehouse.

Finally, independent retailers in Islington, north London were left counting costs after a burst water main caused severe flooding in the crucial weeks before Christmas.

 

 

 

 

 

 

 

 

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