ASOS Pandemic Profits

 

Online fashion group Asos has said the pandemic forced it to "rip up the playbook" as its young customers came to terms with being cooped up at home. Chief executive Nick Beighton said its 20-something core market normally bought clothes for going out. But the company's swift "pivot" to casual clothing paid off, with surging sales, profits and customer numbers. Asos added one and a half million customers in the past six months, giving it a total of 24.9 million. Sales rose 24% in the six months to 28 February, with profits jumping to £106.4m, up from £30.1m a year earlier. Mr Beighton told a conference call that under lockdown, there had been a greater emphasis on activewear, casual wear and beauty products. Asos had "quickly pivoted the customer offer to meet demand" in those areas, he said, with jersey tops and casual bottoms proving strong sellers. As an online-only business, Asos is one of the few retailers that have benefited from lockdown. Asos said it was still cautious about the outlook in the short term, because of uncertain economic prospects for its youthful target group. Asos said its integration of Topshop and other Arcadia brands, which Asos bought in February, was "progressing to plan". As well as Topshop, Asos also acquired the Topman, Miss Selfridge and HIIT brands in a £295m deal, but not their network of about 70 shops. The company said its latest "record results" had been driven by "exceptional execution". In the UK, where Asos now has more than seven million customers, sales were particularly strong, climbing by 39%.

ASOS Success

LG Hangs Up

LG Electronics said it would close down its loss-making smartphone business. In January, the South Korean electronics giant said it was looking at all options for the division after almost six years of losses totalling around $4.5bn (£3.3bn). LG had made many innovations including ultra-wide angle cameras, rising to third largest smartphone maker in 2013. But bosses said the mobile phone market had become "incredibly competitive". While Samsung and Apple are the two biggest players in the smartphone market, LG has suffered from its own hardware and software issues. As LG struggled with losses it had held talks to sell part of the business but these fell through. It still ranks as the third most popular brand in North America but has slipped in other markets. LG phones are still fairly common in its domestic South Korean market. "LG's strategic decision to exit the incredibly competitive mobile phone sector will enable the company to focus resources in growth areas such as electric vehicle components, connected devices, smart homes, robotics and artificial intelligence," it said in a statement.  Last year it shipped 28 million phones, which compares with 256 million for Samsung, according to research firm Counterpoint. The smartphone business is the smallest of LG's five divisions, accounting for just 7.4% of revenue. Currently its global mobile phone market share is about 2%.

LG Hangs Up

Work from Pods

Recent surveys from around the world suggest that a majority of employers will permanently adopt a hybrid working model when the pandemic finally ends - staff will be able to continue to work from home part of the time. However, home working has raised new questions about who pays for what. For example, if employees work from a kitchen table or study, should their employers pay for their internet connection or their ergonomic chairs?  Switch thinks its booths may offer a solution, and some of its corporate clients already allow their employees to charge the cost of a booth to the company.The pods, which cost less than four Singapore dollars ($3; £2.15) per hour, have been created by a Singaporean company called Switch. They follow similar booths that have been around for a few years in Japan, where a handful of companies like Telecube and Cocodesk have placed them in metro stations, hotel lobbies and convenience stores. However, Switch's main competition in Singapore appears to be Starbucks, or any other coffee shop with free wi-fi. Switch has now opened more than 60 of its booths in Singapore. They are in addition to its 3,500 hireable desks in shared co-working offices that are the more typical way of hiring somewhere to work. Switch aims to place many more booths across the city-state. And overseas expansion is on the horizon too.

Working Pods

Thontons Closes Shop Doors

 

Chocolate maker Thorntons has said none of its stores will reopen after coronavirus lockdowns are lifted. The decision to close its 61 shops will put more than 600 jobs at risk. The company said it had been badly hit by the pandemic, which forced its stores to shut their doors during the crucial Christmas and Easter holidays. "The obstacles we have faced and will continue to face on the High Street are too severe," said Thorntons retail director Adam Goddard. "Despite our best efforts we have taken the difficult decision to permanently close our retail store estate." Thorntons has been on the High Street for more than a century but these days history isn't enough to guarantee survival. The company, which was founded in Sheffield in 1911, said it would continue to sell its chocolate online and try to sell more through supermarkets. Since the beginning of the crisis, sales through its website have increased by more than 70% compared to the previous year, it said.  It will also try to expand the range of products made at its factory in Alfreton, Derbyshire and increase international sales. In 2015, Italian food giant Ferrero bought the chocolate chain for £112m. In a statement, the company said: "We remain committed to this iconic British brand and will continue to invest further in the future potential of Thorntons to ensure we evolve with the times."

Thorntons

Uber Contracts Milestone

 

Uber has insisted its fares will not rise after saying that its 70,000 UK drivers will be guaranteed a minimum wage, holiday pay and pensions. The ride-hailing giant said drivers would earn at least the National Living Wage, or £8.72 an hour, in a move that could shake up the wider gig economy. It comes a month after it lost a legal battle in the UK over drivers' status. Uber said it was "turning the page" on workers' rights, but some said it had not gone far enough. Analysts also warned the company had increased prices in California after a similar ruling and was likely to do the same in the UK.  Uber, which is worth $110bn but has never made a profit, said the changes to its UK drivers' pay would come in from Wednesday, and form an earnings floor, not an earnings ceiling. Union leaders and employment experts said Uber's move would have far reaching consequences for the gig economy. Bates Wells lawyer Rachel Mathieson, who represented Uber drivers fighting for worker rights, called it "a very significant milestone".

Uber

Lockdown Pet Boom

A total of 3.2 million households in the UK have acquired a pet since the start of the pandemic, according to the Pet Food Manufacturers' Association. That means the country now has 17 million pet-owning homes, the association says. Young people are the main drivers of this trend, with more than half of new owners aged 16 to 34, the PFMA says. Many have bought pets in response to social isolation, but there are concerns about animal welfare, it adds. UK supermarkets have already noted an "unprecedented" rise in pet ownership and have warned that it is causing a shortage of some dog and cat food products. Helen Warren-Piper, general manager of Mars Petcare UK, which makes Pedigree and Whiskas, said: "We recognise retailers are experiencing unusual demand for pet food during lockdown." The pandemic boost to pet ownership has led retail chain Pets at Home to raise its profit forecast yet again as demand for pet products continues to soar. The company, which has 451 outlets across the UK, says full-year profits will be £85m, up from a previous estimate of £77m. It said trading over the past eight weeks, during the latest lockdown, had been better than expected.

Pets at Home

M&S Online Expansion

 

Marks & Spencer is to launch 46 new websites in overseas markets from Iceland to Uzbekistan, as part of moves to grow its online business. It expands the retailer's online reach to more than 100 countries, offering M&S clothing and homeware. The firm said the expansion would enable it to capitalise on growth without considerable upfront costs. Last year, M&S posted its first loss in its 94 years as a publicly-listed company as coronavirus hit store sales.Online e-commerce sales were up 75% according to its latest interim results, as overall losses across the business reached £87.6m in the six months to 26 September. M&S is in the midst of a wide-reaching transformation programme which last year saw 7,000 job cuts across stores and management. Using an "adaptable" website platform designed for international sales, orders are fulfilled through M&S' distribution network. M&S' international online channels have been translated into 10 more languages and additional currencies. They will also start selling clothes from 11 rival brands on its website this spring in a bid to boost its online sales. Marks said the move to sell items from Hobbs, Joules, Phase Eight and White Stuff from March was part of its ongoing "transformation programme".

M&S Online Expansion