Retail Round Up - 24th February
Arla shrugs off downturn to grow profits
Global dairy giant Arla beat the global downturn last year to post a 3.4% increase in global profits, to DKK1.3bn (£152.8m). Revenue at the Danish co-operative rose 12% over the period to DKK55bn (£6.4bn), the company in its latest annual results. Last year, Arla paid out £186.5m more to its co-operative farmer-owners than it did in 2010.
Now Poundland pulls out of controversial work scheme
Poundland has become the latest retailer to withdraw from the government’s controversial work programme, which placed job seekers in mandatory unpaid positions in a number of retailers across the UK. The round-pound store hit the headlines after one jobseeker placed at a Poundland store began legal proceeedings against the government for being used as what her lawyer called “forced labour”. Poundland said it had decided to suspend its participation while the government clarified its position on the scheme.
Sainsbury’s signs up for seven more years of Nectar
Sainsbury’s has extended its contract with Nectar for a further seven years. The extension with Aimia, the parent company of Nectar, follows Sainsbury’s continued success with the loyalty care scheme. A record number of shoppers used their Nectar cards to do their Christmas shop last year at Sainsbury’s, with £100m worth of points redeemed. The retailer’s Brand Match coupon-at-till scheme, which is powered by Nectar, also helped it record its highest market share since 2003 over Christmas.
Tesco online food sales to double in next five years
Grocery giant already close to controlling 50% of internet food sales.
Tesco expects to double its online grocery revenue to £5.5bn in the next five years, as the popularity of internet food shopping grows.
Director of internet retailing Ken Towle said the growth is achievable if the market continues to develop at a rapid rate and that Tesco is already on the cusp of a 50% market share in food online. It now stands at 48%.
Peacocks sold to Edinburgh Woollen Mill
Peacocks has been sold to Edinburgh Woollen Mill, which has acquired 388 stores and concessions, out of administration.
The deal has protected around 6,000 jobs but means 224 stores will close down today, resulting in 3,100 job losses and an additional 16 redundancies at Peacocks’ head office in Wales.
It emerged today that Edinburgh Woollen Mill had re-entered eleventh hour bidding discussions for the retailer after it pulled out of the process on February 7.
Retailers to meet with government over Get Britain Working scheme
Argos owner Home Retail Group said it is reviewing its involvement in the back-to-work scheme but maintains it is “a valuable opportunity for people currently looking for work.”
The retailer, along with high street healthy and beauty retailer Superdrug, will meet with the Department for Work and Pensions next week to ensure the scheme is voluntary and that jobseekers would no longer fear having their benefits removed if they pulled out of placements after the first week.
Tesco yesterday called for the Department of Work and Pensions to remove the risk of losing benefits that currently follows the four-week placement.
The Arcardia Group said it would be terminating the pilot scheme at its Bhs stores at the end of the month. Maplin and Matalan suspended their involvement in the scheme this week while Sainsbury’s, TK Maxx and Waterstone’s had already pulled out.