It was a balmy 17C in London on Friday as unseasonably warm weather persisted in large parts of the country. Wearing shorts as the clocks go back may be pleasant for most people, but it’s a nightmare for clothes shops. Clothing made up less than half of Debenhams’ annual sales for the first time, partly due to warm weather, and the department store group has hired BHS’s former lighting buyers to help make up for falling fashion sales.
On Wednesday, we’ll hear from Next, which vies with Marks & Spencer to be Britain’s biggest clothes retailer. It’s only a month or so since Next reported its half-year results. Then, chief executive Lord Wolfson said trading was unpredictable as customers in the south stuck with their summer gear while autumn came to Aberdeen. Squeezed consumer incomes, and the trend for people to spend any spare cash on a night out instead of new threads, added to fashion sellers’ problems, he said.
If things aren’t going well at Next, investors can’t say they weren’t warned, and some of Next’s problems, such as lack of stock, have been of its own making. The shares of what was once seen as a rock-solid performer have fallen from £8 to less than a fiver in the past 12 months, but Wolfson’s words still have the potential to cause a stir in the industry before the important Christmas trading season.
FTSE 100 still a no-go area for minorities
How many black Britons have risen to become a FTSE 100 chief executive? The answer is none. The industrialist Sir John Parker will address this state of affairs when he publishes his report on Wednesday into representation of ethnic minorities in business.
Two black FTSE 100 bosses come to mind: Tidjane Thiam, who left Prudential for Credit Suisse last year, and Arnold Donald at Carnival. That is progress of sorts but Thiam is from Ivory Coast and Donald is from the US. Things aren’t much better for other minorities. A study by recruiter Green Park last year found just four non-white FTSE 100 chief executives, and the proportion of ethnic minority executive directors had fallen to 4% from 5.2% in a year.
Companies will argue that barriers to advancement lie in wider society, the education system and all that. Parker will no doubt acknowledge those problems but surely more pressure is needed. As with women on boards, where progress has been made, companies should start by recruiting non-executive directors from minority backgrounds – and preferably from Britain. Companies should also report what they are doing to bring ethnic minority employees into the ranks of senior managers. Strong backing from the government would help.
Marmite madness at Morrisons
Oh, Morrisons, what were you thinking? On Friday it emerged that the supermarket chain had put up prices on 92 Unilever brands, including … Marmite. Only a couple of weeks ago, Tesco hit the front pages when it ran low on the nation’s favourite yeasty spread in a spat with Unilever over price increases. Tesco played a blinder and reached an accommodation with Unilever over the dispute, which was depressingly but predictably called Marmitegate. So why didn’t Morrisons leave Marmite alone while bumping up the prices of less emotive Unilever brands? When you’re in a war with Aldi, Lidl and Tesco for shoppers, headlines about price rises aren’t welcome.
Morrisons publishes a trading statement on Thursday. When the Bradford-based grocer reported on progress last month, things seemed to be picking up under David Potts, who took over in March 2015 when sales were plunging. Sales at established stores have now risen for three quarters. Potts has cut prices, but he’s also been improving service and products – especially pies –encouraging customers to trade up to premium ranges and doing simple things like putting food on the go near the door. If there’s more encouraging news this week, let’s hope it’s not overshadowed by the Marmite episode.
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