House of Fraser: to Sale or not to Sale?

The department store today unveiled that it was slashing prices in stores and online by up to 50 per cent. A raft of ads in national newspapers screamed out the news this morning.

Curious then, that House of Fraser's own chairman Don McCarthy told Retail Week two weeks ago that there would not be any full Sale activity before Christmas and that there was no promotion planned to start on Thursday, December 11. Let me check my calendar.

More curious still is the fact that stance was maintained by the retailer this week and up to one day before the said event blared from the pages.

At the time of writing, the official line from the retailer is that it will go on winter Sale on December 26. Between now and the start of that Sale, there will be discounted offers on selected items. Concessions in stores may mirror their own standalone operation's stance on Sales, it added.

Plain saling

The fine print in today's ads may indicate that the discounts are on “selected lines only”, but there is no doubting the depth of this Sale.

There is also no doubting what to infer from this decision by House of Fraser as it, like most retailers, battles against torrid trading conditions. It could be one of the first major high street retailers to be forced into full Sale before Christmas - it is unclear how long the Sale will last. Unlike Debenhams and Marks & Spencer's recent fervent price-slashing, there is no indication of when the end will come for House of Fraser's Sale.

Anecdotally, the department store is understood to have suffered in the wake of the all-singing, all-dancing promotions, Sales, Mega-Days - call them what you will - from the likes of Debenhams and Marks & Spencer.

If House of Fraser is now on Sale for the duration of the festive shopping period and beyond, times are tougher than first thought for the retailer, which has been widely regarded as the jewel in the crown of Baugur's portfolio of brands.

Undoubtedly, the change at House of Fraser since Baugur's investment two years ago is marked. There is a clear step change in the in-store experience and in drafting in new, higher-end brands exclusively to the UK, spearheaded by well-regarded chief executive John King. These changes have been for the better. However, in these unprecedented months, shoppers are more likely to stick to what they know and are comfortable with. They are spending their pennies wisely and don't want to pay full price, let alone high price.

The turnaround strategy of the department store should, in less volatile times, successfully revitalise a high street brand that had grown tired, as well as offer a point of difference on the high street.

However, times are volatile, retail investors are twitchy and debt is being traded aggressively across the board.

After today's revelation, it seems House of Fraser is no different from most retailers out there, struggling to clock up sales.