It was supposed to be a year when UK consumers reined in their spending, but the advent of new technology and people’s seemingly in-built desire to keep shopping meant many retailers experienced continued growth and there were fewer business casualties than 2009.
There were some obvious winners such as department store retailer John Lewis and online fashion house Asos.com, which both went from strength to strength as the year went on, but big occasions like the General Election in May and the World Cup in June affected retailers in different ways.
UK retail also welcomed some new arrivals from abroad to stir up the industry, with US electricals giant Best Buy and trendy clothing provider Forever 21 among the fresh faces on the scene.
On the other side of the coin we said goodbye to high street retailers like Faith and Ethel Austin, while Suits You will soon disappear after Christmas. In general, though, the gaps left behind by the raft of closures in 2008 and 2009 are beginning to fill up again, thanks primarily to the growth of value and variety retailers.
In the big recruitment news of the year, Tesco boss Sir Terry Leahy announced he will be stepping down from the top job in UK retail next spring, while 2010 also marked the last year at the top for M&S’s Sir Stuart Rose. Andy Clarke, Dalton Phillips and Marc Bolland took CEO jobs at Asda, Morrisons and M&S respectively.
In the summer we launched the new digital magazine dedicated to the UK retail industry, Retail Gazette. Here is just a selection of the major news stories we covered since going live.
Online grocer Ocado floated on the stock market but the initial price of shares was much lower than it had hoped, dropping even further on the first morning. Meanwhile, TK Maxx opened its first store in the West End and Retail Gazette joined the podium dancers and fashionistas to celebrate with them.
A further sign that the UK high street was a far healthier place to be in 2011 than it was in 2009 was seen when Robert Dyas reported annual profit of £2.7 million after the previous year’s substantial loss. Finance Director Graham Coles told Retail Gazette that confidence had returned to the company.
After two years of a clogged up retail property development pipeline, Land Securities announcement that it was restarting work on its huge Trinity Leeds Shopping Centre project came as a welcome relief.
In other news, leading electricals retailer Apple reported record quarterly revenues, while New Look was left looking for a new Chief Operating Officer after Lex Gemas announced he was leaving following an abandoned IPO attempt.
It was a month of retail appointments in August, with Ex-WHSmith Group Finance Director Alan Stewart named as Chief Finance Officer of Marks & Spencer, Primark recruiting John Lyttle as Chief Operating Officer and former Asda boss Andy Bond joining the board of online bike retailer Wiggle.
Robert Swannell was also named as the successor in waiting to Sir Stuart Rose at M&S Chairman, while Alexon Group appointed Kevin Keaney as Commercial Director, and former LK Bennett CEO Margaret McDonald joined fellow women’s fashion retailer Coast.
In fashion, Kate Moss announced that she was ending her longstanding relationship with Topshop, and Gap launched a transactional website in the UK for first time.
Meanwhile, wedding products retailer Confetti was plunged into administration and Apple opened its biggest ever UK store in London’s Covent Garden. The huge queues forming around central London highlighted the nation’s love of the company which brought us the iPod and Mac.
Ocado’s first trading statement since its IPO showed strong sales, but the biggest news was the fact it secured a new customer fulfillment centre, which most agreed was vital for the future growth of the company.
Zara and H&M followed Gap’s lead by launching transactional websites in the UK, while Asda’s acquisition of Danish-owned Netto was approved by the Office of Fair Trading.
Early signs that all is not well at Game Group came when the company reported a 10.9 per cent drop in like-for-like (LFL) sales for the half-year to the end of July, but it remains to be seen whether the busy second half of the year will have got the retailer back on track.
Morrisons announced plans to open convenience stores in 2011, while Mike Barnes was appointed the new CEO of US-based jewellery retailer Signet, which owns Ernest Jones and H Samuel in the UK.
In employment news, Nick Wharton revealed he would be stepping down from his position as Group Finance Director at Halfords to become the new CEO of Dunelm Group.
Meanwhile Poundland CEO Jim McCarthy told Retail Gazette that he was completely confident that the retailer would be creating 2,000 jobs this financial year as the value retailer continues to grow.
As the countdown to Sir Terry Leahy’s departure from Tesco continued, the likeable Liverpudlian addressed delegates at the London Business Forum, revealing his secrets to successful leadership.
The month was dominated by talk of the government’s Comprehensive Spending Review, which revealed that almost 500,000 public sector jobs will be lost in the next five years. The British Retail Consortium said the plans offered the right balance between public spending cuts and tax increases.
Later in the month One New Change shopping centre opened in London, giving City workers easy access to the UK’s favourite retailers, but there was controversy over the modern design of the building, considering its close proximity to London skyline mainstay St Paul’s Cathedral.
Go Outdoors CEO John Graham told Retail Gazette that his outdoor product retailer was set to overtake market rival Blacks, and within weeks Blacks revealed that it was up for sale.
Changes at the top included Charles Kay quitting Netto earlier than expected, while chocolate retailer Thorntons appointed Jonathan Hart as CEO following a five-month search for someone with relevant retail experience.
The retail industry went mad when Buckingham Palace announced that Prince William will be marrying Kate Middleton in April next year, and Verdict Research predicted that the industry was set for a £400 million financial boost as result.
WHSmith and New Look reported sales drops, but grocery giants Asda and Sainsbury’s and Morrisons all reported strong trading periods.
Tesco grew its grocery market share over the course of the month and even opened a store in an old church, but M&S revealed it wants to open more stores abroad - perhaps aiming to replicate the international success of maternity and baby products retailer Mothercare and the ever popular Asos.
The heavy snowfall hitting many parts of the UK has dominated the news in December, with fears that a White Christmas would hit retail sales at a time when many observers expected record levels of festive trading activity.
Ladies fashion retailer Alexon Group was the first to issue a profits warning in light of the snow after the poor weather conditions caused like-for-like sales on the first snowy day in November to fall 53 per cent year-on-year.
HMV Group also announced that losses almost doubled in the first half of its financial year, asking serious questions about the sustainability of the entertainment retailer and owner of HMV and Waterstone’s.
The big freeze also forced Brent Cross Shopping Centre to close its doors to the public on what is likely to have been one of its busiest days of the year, but perhaps the biggest problem for retailers will be the industrial action planned by London Underground workers on Boxing Day.
Aside from the problems caused by the natural world, we had concerns about cyber warfare when payment service websites were targeted and brought down by online activists, and protestors forced Topshop stores around the UK to close.
A tough month overall, but there was still time for Supergroup, Zara owner Inditex, Best Buy Europe and Mulberry to post impressive financial results, while John Lewis’s fantastic year continued when it achieved a record sales week of £121 million.
To cap things off Sir Tom Hunter also made £150 million by selling shoe retailer Office to private equity firm Silverfleet.
It has certainly been a busy year for the private sector’s number one employer, but the next 12 months are sure to be tough to say the least.
A rise in VAT, increasing material prices and growing unemployment are on the cards for 2011, but retail always seems to have the capacity to bounce back and cope in times of adversity.
Retail is sure to prove a vital source of employment for millions of people in 2011. If the government keep its red tape firmly in its pocket - and there are signs that private sector businesses will have a strong say in many of the UK’s important decisions - retail will continue to be a sector that holds the potential to help with the country’s economic growth at a time when such expansion is crucial.
Either way, there are sure to be even more twists and turns in one of the most interesting business sectors around.
Merry Christmas everyone, from the entire Retail Gazette team.
Ben Sillitoe - Retail Gazette Editor