Wednesday 18 May 2011
Mothercare announced a closure of nearly a third of its stores.
Its not quite as dramatic as the headline suggests but they will still be shedding stores and staff.
110 high street stores are to close by March 2013. But then the leases on 40% of its High Street Stores are due for renewal by 2013.
Mothercare are preferring the out of town shed units, and have done for quite a while. A big, single storey space, with ample parking outside suits ther format better than a cramped, multi floor unit, far from the paying car parks.
Mothercare are in talks with other chains who might like their good sized high street locations, so its not a JJB type desperate situation. Its a managed transition.
But not good news for Mary Portas, Mary Queen of Shops, the TV retail guru who is to carry out a government-backed review aimed at halting the "decline of the High Street" in England.
Well,if you want some advice Mary, you know where we are.
Oh, and just to repeat C@W advice that we've been saying for a few years now.
1.Look at the overseas operations.
Wednesday's preliminary results from Mothercare underlined the extent to which the company is performing better overseas than in its traditional home market. Underlying profits in the UK slumped to £11.1m in the last year, down from £36.1m Underlying profits overseas, though, jumped by 18.5% to £27.5m.
2. Internet sales.
Mothercare's exposure to the UK high street will be reduced with the focus placed on out-of-town Parenting Centres and online sales.