Lingerie chain La Senza calls in restructuring experts
December 15, 2011 by admin
Filed under Latest Lingerie News
Struggling lingerie chain La Senza has become the latest retailer to call in restructuring experts, but Andy Street, managing director of department store chain John Lewis, is optimistic that this Christmas will not be as bad as many think.
A number of high street retailers are battling for survival, with shoe chain Barratts Priceless calling in administrators last week.
La Senza, which is owned by private equity firm Lion Capital, has appointed KPMG to advise on its restructuring options, including administration or a company voluntary agreement.
However, Street said Christmas could turn out better for many retailers than expected. “The high street performance is not nearly as bad as some commentators would have us believe,” he told the Guardian.”
While sales at John Lewis were flat in November, they improved in the run-up to Christmas and the department store enjoyed a record performance last week, and is on track to beat that this week. Online sales are 25% higher than last year. Although consumers were clearly feeling the pinch, many households were prioritising Christmas spending, said Street.
“This reflects that John Lews is outperforming the market but it also reflects other retailers as well,” he said. “Even in a tough year customers really want to protect spending at Christmas. They almost sacrifice other things in order to spend at Christmas. I think a number of retailers are going to come forward with pretty good numbers for December.”
However, this did not alter the fact that next year would be tough. “We know that consumer spending is still going to be tight, so we will probably be going back to the negative or flat numbers overall that we’ve seen through the autumn.”
The next rent day, when shops’ quarterly rents fall due, is on Christmas Day, but pundits believe many struggling retailers will hold out until late January, to assess their performance in the post-Christmas sales.
There may be another wave of business failures then if Street’s optimistic predictions for the festive season do not come true.
