November

IN THE NEWS

Delta Two abandoned its bid for Sainsbury’s because of turmoil in the global credit markets and concerns about future funding of the Sainsbury’s pension scheme.

The Competition Commission concluded that consumers benefit from rivalry, allowing the big four supermarket players to breathe a sigh of relief. Tesco was also cleared of abusing its dominant position.

Following discussions with the board, Kingfisher group chief executive Gerry Murphy announced he would step down in February.

Retail Week revealed that Alliance Boots’ new private equity owners planned to accelerate its business transformation programme in an effort to become the world’s biggest health and beauty retailer.

Marks & Spencer announced forecast-beating interims as chief executive Stuart Rose revealed it would debut in China. A food range was launched in India as it prepared to ramp up operations there.

Tesco revealed some of the developments it is planning for its online business. Features included integrating the grocery and non-food web sites and creating a 3D virtual store online.

Angela Spindler, former managing director of Asda clothing business George, was appointed to the new role of Debenhams managing director.

UK fashion retailers had been hit by poor trading. BDO Stoy Hayward’s Like-4-Like Index showed average sales were down 6 per cent in the week to November 4.

TK Maxx prepared to shake up the flagging home furnishings sectors with the launch of a standalone homewares fascia.

WHSmith’s board was so keen to retain chief executive Kate Swann that they promised a total remuneration package of£5 million, providing she stays until 2010.

Sports Direct boss Mike Ashley outlined a masterplan to restore Piccadilly flagship sports store Lilywhites to its former glory with a major refurbishment.

Land Securities – the UK’s biggest property company, which has stakes in Birmingham’s Bullring and Bristol’s Cabot Circus schemes – revealed it is to split into three companies.

STORE OF THE MONTH

Uniqlo, Oxford Street West
Probably the most exciting fashion shop to open in the UK this year was Uniqlo’s high-profile three-floor store on Oxford Street, in the former Waterstone’s store.

Aside from the revolving glass cylinders containing pirouetting mannequins, the ground floor boasted a giant pantone light-box, used as the central part of a cashmere jumper promotion.

In the basement, a vitrine extending across half of the floor was home to a catwalk of male mannequins. That and the wooden half-torsos placed in niches around the walls made this a store not to be missed. Impressively, the stock seemed at least as good as the surroundings.

ON THE MOVE

Blacks appointed former Esporta boss Neil Gillis as chief executive.

Goldsmiths chairman Jurek Piasecki stepped down after more than 25 years at the retailer. He was replaced by Justin Stead, who joined as chief operating officer 18 months earlier.

Matalan founder John Hargreaves resigned as chairman less than a year after taking the retailer private. It was announced that his replacement would be director John Mills.

Jessops chief executive Chris Langley quit, after confirming in September that losses were set to hit£7.5 million.

Tesco’s big American dream

“Where’s Colin Smith gone?” was a common question in the grocery world in the first half of 2005, when Tesco was formulating its US vision. The trading director had seemingly vanished. He was, in fact, in California, doing the groundwork for what is probably the most significant retail launch of the decade.

In the months ahead, senior Tesco executives lived the American dream. They moved in with US families, ate with them and shopped with them, doing everything possible to get inside the mind of the American shopper.

Tesco knew only too well that the US has proved a graveyard for UK retailers. Dixons, Sainsbury’s and Marks & Spencer all came home with their tails between their legs.

Smith moved on to Somerfield and Tesco’s supremely confident marketing director Tim Mason was given the task of setting up the US business.

Many expected he was being groomed to replace Sir Terry Leahy as Tesco boss if the venture succeeded, although he played those suggestions down this week.

The format settled on was a unique hybrid of UK-style convenience and a no-frills discount format. Tesco had observed that US shoppers had never been offered convenience retailing as we know it, with second-rate stores selling hot dogs and pornography being the only option.

So Fresh & Easy was born, smaller than a typical US supermarket and offering convenience foods at low prices. Costs were kept to a minimum with a basic shopfit, bare concrete floors and 100 per cent self-checkout.

The liberal-leaning West Coast seemed a good place to start, with Tesco’s focus on provenance and organic options still much less commonplace in US grocery stores. Generally, the reception to the stores has been favourable.

Tesco’s ambition for the chain is clearly immense. By mid-November it had acquired sites for 122 stores, with 50 to open by the end of February. As the company keeps saying, Fresh & Easy is not a trial, it’s a roll-out.