Retailers should consider a foreign holiday

Slowing consumer spending at home need not preclude splashing out overseas.

What is it about tough times that foster a desire on the part of certain retailers to jump on a plane and set up shop in parts foreign? Topshop is set to make Chicago shoppers’ fashion days later this year and will follow this with another store in Las Vegas.

Sounds fine and meanwhile the rush by US retailers to populate shopping centres and high streets in Europe (think Abercrombie/Hollister, Urban Outfitters or maybe even M&M’s), shows little sign of abating. Both the UK and the US are not without their share of economic difficulties, and yet the steady stream of retail incomers continues.

And doing the rounds of some of the larger UK store design outfits, you rapidly get a sense that while home territory may be a mite moribund, plenty of the more robust home grown retailers are considering grabbing a slice of the overseas action.

The underlying cause of this may be simpler than many think. On either side of the Atlantic, novelty is becoming increasingly hard to find, as domestic players batten down the hatches, and therefore if you have sufficient cash to set up a modest offshore operation, providing you choose your location carefully (and no, Normal, Illinois will not do) the chances of standout are good.

Couple this with the acres of free press that will be garnered in both countries and the question almost becomes why bother with Bristol when Brooklyn may be within reach? This is not of course to decry Bristol, it remains a strong destination, it’s just that in spite of the cost, there may just be better reasons for making the international leap currently.

The other point that really is worth thinking about is that in order to make a splash you won’t necessarily have to spend huge amounts on developing a new format as, with a few tweaks, what you have back home will not be familiar to those in a new country. All of which is a long and somewhat roundabout way of saying that if a retailer is in the fortunate position of having at least some development capital, then now might be a good time for it to mull over the possibility of an overseas rented sojourn that might turn into a permanent second home. And given that this means leasing not buying, the danger of a Spanish-style property crash with owners left high, dry and penniless need not even be considered.