Brexit, BHS and discounting were just some of the topics that our readers reacted strongly to this year. Here is an overview what you had to say about 2016’s biggest stories.
- Britain votes to leave the EU, a shock for retailers
Following the shock news that Britain voted to leave the EU in the referendum on 23 June Drapers readers had a mixed reaction:
“Immediate pain for all those retailers expanding internationally. Costs just went up 10% overnight as most of the world trades on the back of the US dollar. One positive is tourism, trying to think of others.” – Anonymous
“Anyone would think it was the end of the world! There will still be mutual co-operation between the UK and the EU, without being part of the archaic and undemocratic EU. There is no doom and no gloom only brighter days ahead.” – Anonymous
- Fashion industry at ‘crisis’ point
The rising costs of doing business teamed with a slowing economy, unseasonable weather, concerns over Brexit, increasing levels of discounting and changing consumer behaviour have led to an unprecedented squeeze on fashion:
“Many brands now want to deal direct with the end consumer via their websites. Brands and etailers are constantly offering deals, enticing shoppers to buy cheaply online which makes the rest of us look like we are expensive. Where will it end, like the sports trade with one or two discount giants?” – Anonymous
“At last the high street chains have realised the customer they have created is obsessed with discount rather than value. Trying to out-do each other with the lowest prices and constant sales combined with overstocking and bad buying decisions have eroded the margins of these chains. Time to start ‘retailing’ again and concentrate on the core values of a great product, innovation and awesome customer service.” – Steve Taylor, owner of Fab Frocks boutique in Westbourne.
“Finding brands that maintain quality and design with a good margin is becoming increasingly difficult. With operating costs rising year on year, a minimum of x3 mark-up is needed for most independent businesses to remain profitable after seasonal markdowns. Customers will pay for good-quality fabrics and great design, but fabric qualities are being compromised by the brands to maintain their internal margins and this is having a knock-on effect on the end consumer. It isn’t that the customer won’t buy the product without a discount – it is that they don’t feel the product is worth the RRP.” – Anonymous
- ‘Unsustainable’ levels of discounting to blame for industry crisis
Retailers blamed the vicious cycle of discounting for increasingly tough trading conditions on the high street:
“I’ve never known it to be so difficult to sell a dress. The internet, the brands and the big boys have ruined our industry. The worry for me is we now have a generation who don’t know anything other than discount codes and online deals. Where are the cool fashionistas going to shop for the cool brands when all the indies are gone? It’s sheer madness.” – Lauren Ferguson, owner, Sister’s Boutique, Falkirk
“Retail is changing and its changing fast so just accept it. There are not two seasons any more – there are four and each one should be bought for accordingly. A change of mentality is required and traditional methods of retailing do not work anymore. If brands or products don’t reach an acceptable sell-through after 90 days, get rid and get fresh stock in to excite the customer. Retailers need to be more analytical and invest in technology that can provide detailed reports to highlight performance. It’s time to stop complaining, accept the situation and invest in your business.” – Julian Blades, owner, eight-store chain Jules B
The boss of BHS’s owner, Retail Acquisitions, Dominic Chappell, blamed Sir Philip Green for the department store chain’s collapse:
“Dominic Chappell is an amateur and is more responsible for the collapse of BHS than Philip Green. Chappell will also profit personally despite being responsible for 11,000 job losses. The main criticism of Green is selling BHS to a previously twice-bankrupt amateur with no retail experience, and not forgetting the huge dividends he took out of the business.” – Anonymous
“Philip Green mismanaged this business for years and years and has made a fortune from it. Yes, of course Dominic Chappell and his team must share some of the responsibility for the collapse of BHS, but the lion’s share of the buck stops with PG.” – Anonymous
- Higher shop prices ‘in the pipeline’ warns BRC chairman
The chairman of the British Retail Consortium has warned that retailers are set for higher shop prices in the wake of the Brexit vote, thanks to the devaluation in the pound:
“A bit different to his July comments. Maybe if the public had realised this before [the referendum] they might have voted to stay in. The prices have to go up for spring. How can importers hold their prices? We are the ones working on pennies, not the retailers. Retailers will either have to pay the increases or pass them on.” – Andrew Pace, director, Panda Sourcing
“Of course retail prices will have to increase, whether it’s clothes or food or anything that relies on any imported components. Perhaps when the economy has stalled, inflation has increased and investment in the UK reduces considerably, those that voted to leave the European Union will see the error of their ways. I doubt it though.” – Anonymous.
“This is short term, expected and documented before the referendum. ‘In’ voters will be thankful to the ‘Out’ voters in five years’ time.” – Anonymous