High Street falls to foreign stores invasion
Catherine Pepinster reports on why international retailers are flocking to set up shop in the UK
Twenty years ago there were just 15 foreign retailers in this country; by the end of next year at least 350 retailers from overseas will have set up shop here to compete with the likes of Marks & Spencer, WH Smith, Debenhams and Next.
There are already menswear and footwear firms from America, lingerie boutiques from Canada, designer jeans and casual clothes stores from Italy, outdoor wear from Norway, women's fashion from Spain and underwear shops from Portugal. Coming soon are opticians from Germany and museum gift shops from the other side of the Atlantic.
Their rush to set up shop in Britain now is no coincidence. According to business experts, these overseas retailers are attracted by three aspects of the trade: Britain's booming high streets, the belief that the newcomers can easily compete by offering better service than existing outlets, and Britain's location, both as first port of call in Europe for the North Americans, and as the nearest market to the States for the Europeans.
"The Americans are coming here because the UK is the aircraft carrier for Europe," said Yvonne Court, head of retail research for Healey and Baker. "Global brands and international icons create a more homogenous market. People in Britain want Swedish furniture, American street style, Italian shoes and French clothes."
The internationalisation of the high street began in London, with Louis Vuitton, Ralph Lauren, Calvin Klein and Jill Sander moving into Bond Street. Today there are 78 of the world's top 100 designers in London, running lavish new stores to sell so-called "diffusion" ranges - repackaged, cheaper versions of their haute couture designs to the mass market.
In recent weeks, the American designer Calvin Klein announced that he would open 10 new stores in Britain. Gucci plans to quadruple the size of its Sloane Street store to create its largest in the world, while Ralph Lauren announced a huge, seven-floor store in Bond Street.
The large-store format is a key characteristic of the international retailer. Shops like Nike, Gucci and Tommy Hilfiger are all opening "flagship" shops in the near future. Many of the other overseas firms are taking a similar route, following their first shop in London with major store openings in other big cities such as Manchester and Glasgow, before heading for the rest of Britain's high streets.
"Overseas retailers have realised that many British stores are mainstream and very similar," said Yvonne Court. "All our high streets tend to be the same, with the same old familiar names. These new firms offer something different." Offering something different often means the international retailers are running their own stores as well as selling their own label goods through other shops or through mail order.
Diesel, an Italian casual-wear firm, is typical of this new breed of retailer. Fashion to Diesel is humorous, as its spring/summer 1997 collection shows, combining inspiration from different decades with Fifties and Seventies ideas merging. There are shirts made from curtain prints, Roger Moore safari jackets, policemen shirts and other tops with neon branding. So far it has one store in London's Covent Garden, and plans more in the provinces, as well as selling its goods through other stores.
The American firm Dockers also runs a Covent Garden flagship and sells its trouser collection for men through other shops, while Eddie Bauer is offering casual clothes through mail order sales as well as planning a chain of shops throughout Britain.
Many of the retailers have spotted a gap in the menswear market, particularly as the American "dressing down on Fridays" policy spreads across the Atlantic to offices here in Britain. "Look around existing shops in this country and there is very little for men other than jeans and chinos," said Richard Hyman of Verdict Research, the retail analysts. "This is a gap which has opened up and the overseas stores are fast filling it.
"These new retailers will give the existing ones a kick up the backside. They have been erring on the side of caution."
For years, customers in Britain have put up with grumpy shop assistants, cramped changing rooms and purchases slung into poorly made plastic bags. Many of the new international retailers are not only looking for large amounts of floorspace to provide spacious shops, but are spending extra time and money on training their staff. Goods are gift-wrapped for no extra charge.
Emma Cameron of La Senza, a Canadian lingerie company which is looking to open about 30 shops in Britain, said: "There is a very strong emphasis on service in North America. Our stores will have plenty of assistants and, if it goes without saying, all purchases are treated as gifts."
Could this desire by international retailers to make the customer king be already making an impact on the thinking of British retailers? The signs are that it is. According to the latest jobs survey by recruitment agency Manpower, demand for shop staff has reached a seven-year high.
Stores like Laura Ashley are hiring home stylists to help advise customers of their interiors departments. And Marks & Spencer, still the giant of the high street, has just started recruiting another 2,000 staff. The reason? More staff on the tills, more people to answer shoppers' queries, and quicker shelf filling. Shopping could soon be a pleasure again.
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