Today’s news in brief-09/10/23
Frasers Group CEO Michael Murray has announced a significant shift away from the traditional department store model for House of Fraser. Murray aims to “rethink the space” by incorporating Frasers Group’s own brands and potentially phasing out the House of Fraser brand altogether. This transformation seeks to address previous issues, including oversized stores and underinvestment. The new approach emphasises smaller, more flexible spaces that can adapt to consumer demands. While over 20 House of Fraser stores have closed since the 2018 acquisition, Frasers Group has opened smaller format Frasers shops and is in discussions with former landlords for repurposing spaces.
Natura and Co, the owner of Body Shop, has reportedly set a final bid deadline of 23 October 2023, for potential buyers. The sale is being managed by Morgan Stanley on behalf of Natura and Co, following the expiration of non-binding bids in early September. Various parties, including Aurelius Group, Elliott Advisors, and Epiris, are competing to acquire the company. However, private equity firms may be deterred by Natura and Co’s high valuation, which ranges between £400-£500m.
John Lewis continues its commitment to a housing venture, with plans to construct 1,000 rental properties on its land as part of a broader business diversification strategy. Despite encountering setbacks, including potential financial challenges in a West Ealing development, John Lewis’s strategy director, Nina Bhatia, affirms the retailer’s unwavering dedication to this initiative. The aim is to enhance rental property standards in the UK’s build-to-rent market while maintaining a focus on the group’s retail brands.
Waitrose is reportedly in discussions with Amazon to potentially sell groceries on the platform, aiming to regain market share lost to discount retailers. This comes three years after Waitrose severed ties with Ocado. The move follows Amazon’s recent partnership with Iceland for same-day delivery service and its expansion of the ‘fresh’ store model, which already includes Co-op and Morrisons. Waitrose’s market share in the grocery industry has dipped from 5.1% to 4.6% since 2020.
Aldi plans to hire 3,000 store roles, both temporary and permanent, to support increased demand during the busy Christmas season. These roles include store assistants, managerial positions, and cleaners. Additionally, the supermarket is recruiting around 1,500 roles for its Regional Distribution Centres. This move aligns with Aldi’s long-term commitment to establishing 1,500 stores across the UK.
Allianz Trade has reportedly withdrawn credit insurance for suppliers of the Very Group due to concerns about the retailer’s declining profits. Very Group reported a 17% decrease in profits, down to £123.8m for the 39 weeks ending April 1, 2023. Group sales remained flat at £1.6bn due to a 2.5% decline in retail sales. Allianz’s decision reflects wider macro-economic pressures as consumers reduce spending. This follows a similar reduction in coverage for Boohoo’s suppliers by Allianz in July.
