Topshop Takes On Local Retailers

SYDNEY -- U.K. fashion retailer Topshop has opened its second store in Australia, in Sydney today, following its first store in Melbourne's Jam Factory last December. That store was a massive hit, and media reports suggest the Sydney store could be just as popular. So much for retail bricks-and-mortar stores being dead.

Topshop is looking to open seven stores in Australia over the next two years, expanded into Brazil and Chile earlier this year, and is planning to set up shop in South Africa and Canada.

The overseas invasion of international fashion retailers is set to continue, following in the wake of Zara and Forever 21. Swedish retail giant H&M is also coming to Australia in the near future.

The chief executive of Topshop Topman Australia, Hilton Seskin, has told the Australian Financial Review that "Retailers have to think differently and I think that landlords have to start adjusting their thought process," adding, "You can't just charge rents until somebody goes broke."

Local retailers are worried, with their sales and profit margins falling. Department stores David Jones Limited (ASX: DJS.AX) and Myer Holdings Limited (ASX: MYR.AX) recently reported big falls in annual profits.

But retailers could take a page out of the book of their overseas rivals. Topshop is reported to have more than 280 floor staff in the Sydney shop alone, fitting rooms are on every level, and there's even a free personal shopping service, where a Topshop stylist will assist shoppers in picking styles according to taste and body shape.

Rather than ordering product months in advance, Topshop relies on distributing product to stores twice a week from a central warehouse, and frequency may increase depending on demand.

For fashion retailers like Premier Investments (ASX: PMV.AX), the company behind names like Jay Jays, Dotti, and Portmans, and Speciality Fashion Group (ASX: SFH.AX) with its Katies, Millers, and Crossroads brands, Topshop could provide a retailing model to aspire to.

If you are looking for ASX investing ideas, look no further than our brand new free report: "The Motley Fool's Top Stock for 2012-13." In this free report, Investment Analyst Scott Phillips names his top pick for 2012-13... and beyond. Click here now to find out the name of this small but growing software company with huge potential. But hurry -- the report is free for only a limited period of time.

More reading

Motley Fool writer/analyst Mike King owns shares in David Jones. The Motley Fool's purpose is to help the world invest, better. Take Stock is The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Click here now to request your free subscription, while it's still available. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2044260, ~/Articles/ArticleHandler.aspx, 9/30/2014 8:33:14 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement