America’s love for Cool Britannia has helped Ted Baker post a near-25% increase in sales over the past four months, as the retailer rides a fresh wave of popularity for UK brands in the US.
The chain, which specialises in classic tailoring embellished with quirky details, is
one of several British high street names targeting shoppers stateside. Primark has acquired the leases for seven stores in the US and plans to open them by the end of 2016, while Topshop opened a store in Manhattan in 2009 and also has outlets in Houston and Atlanta.
After launching in the US in 1996, Ted Baker now has 52 shops and concessions there. The UK remains Ted Baker’s biggest market, but a strong US performance was singled out by the company as it reported a 24% rise in turnover between February and June.
Retail sales over the 18-week period grew 18.9%, as Ted Baker capitalised on increased demand across the business by adding more store space. Internet sales had also risen sharply and that it expected to meet its financial targets for the year.
The company’s founder and chief executive, Ray Kelvin, said the company was pleased with sales of its spring/summer collections. The revenue boost came despite trading at the more expensive end of the British high street, where it faces stiff competition from rivals like Primark who cater for more cost-conscious shoppers.
The four month period saw the company open new stores in Hong Kong and London as well as a number of concessions across Europe, North America and Asia.
Ted Baker said the US performance was helped by big orders from US wholesalers.
Jonathan De Mello, an analyst at Harper Dennis Hobbs, a retail advisory firm, said brands like Ted Baker and Karen Millen were enjoying a surge of success in the US at present.
They, alongside brands like Karen Millen and others, have this British design quality which is ringing quite true across the US,” he said.
“In the US a lot of the American retailers have basically the same brands. Just like we are in the UK, we have all the same brands in the different shopping centres and when a US brand comes here like a JCrew or an American Eagle or something like that, it is quite exciting new and different and they can do really well. And it is the same in reverse in the US where all these mall owners like General Growth and Simon Properties and others, they are always looking to refresh their tenant mixes.
De Mello added: “I think they [Ted Baker] are scratching the surface at the moment. I think they will open a lot more in the US as others have done successfully. They are part of a wave of European retailers who are targeting the US and expanding quickly in the US.”
Data from market research firm Euromonitor has shown that while US consumers typically spend less on clothes, they buy twice the number of items.
Ted Baker said it has also expanded with new stores in Azerbaijan, Dubai, Qatar, Saudi Arabia, Thailand and Taiwan.
Revenue growth for the full year is expected at 18%, with interim results to be announced in October. The group trades from 414 stores and concessions globally having grown from a single shirt specialist store in Glasgow. The majority of its stores are in the UK and mainland Europe.
In March, the firm posted a 24% rise in annual profit, with revenue double that reported five years ago.
“We are pleased with the performance of our spring/summer collections both in the UK and internationally, which is testament to our skilled and passionate team,” Kelvin said.
Analysts Liberium said the start of the year for the retailer had been “exceptionally strong” while retail commentator Nick Bubb said the success lay in giving the brand a “quirky personality” between the luxury and mid-level clothing markets.
