Philip Green's Arcadia to Close Stores in Major Restructuring

The retail group plans to close 23 of its 566 UK stores and could close all US Topshop/Topman stores. The sites identified for potential closure employ 520 people.

Topshop store | Source: Shutterstock

LONDON, United Kingdom —  British retail tycoon Philip Green's Arcadia Group said on Wednesday it planned to close 23 of its 566 stores in the UK and Ireland in a major restructuring of the fashion business that could also see its Topshop/Topman stores close in the US.

Arcadia, which also runs fashion retailers Wallis, Miss Selfridge, Dorothy Perkins, Evans, Burton and Outfit, said it had instigated seven Company Voluntary Arrangements (CVAs), mechanisms that allow the business to avoid insolvency.

A string of British store groups have either gone out of business or announced plans to close shops over the last two years as they struggle with subdued consumer spending, rising labour costs, higher business property taxes and growing online competition.

CVAs have been adopted by UK retailers including fashion chain New Look, floor coverings group Carpetright, mother-and-baby goods firm Mothercare and department store Debenhams.

Under the proposals, which will require creditor approval, Arcadia is also requesting a reduction in rental costs and revised lease terms across 194 other UK and Ireland locations.

The sites which have been identified for potential closure employ 520 people.

Arcadia has also commenced a process which may result in the closure of all 11 of its Topshop/Topman stores in the United States. It will, however, continue to supply wholesale partners in the US and maintain a digital platform.

As part of the CVA proposals Philip Green's wife Tina, the group’s shareholder, will invest a further £50 million ($63.4 million) of equity into Arcadia to support its turnaround.

Tina Green will also provide affected landlords with an entitlement to a pro-rata share of 20 percent of any equity value in Arcadia if it is sold in the future. Landlords can also claim from a £40 million compromised creditor fund.

The restructuring will also see Arcadia reduce contributions to its two largest pensions schemes from £50 million to £25 million per year for three years, with security over certain assets also being granted.

Tina Green has offered to bridge the pension schemes' shortfall with funding of £25 million per year for the next three years, plus an additional £25 million contribution, resulting in total payments into the schemes of £100 million.

Arcadia is seeking creditor approval on the proposals at meetings on June 5.

By James Davey; editor: Kate Holton.

Whole Foods ramps up Prime Day grocery deals

In line with Amazon’s extension of this year’s Prime Day, Whole Foods Market is serving up more exclusive savings and grocery deals for the annual sales event.

Whole Foods said Monday that members of Amazon’s Prime customer benefits program who make an in-store transaction of $10 or more between July 3 and July 16 will get a $10 credit to their Amazon account that can be used to spend on Amazon.com during Prime Day. The same offer also extends to those making a Whole Foods purchase of $10 or more via the Prime Now grocery delivery and pickup service.

Related: Amazon helps lift traffic at Whole Foods

Amazon announced late last month that Prime Day 2019 will span two days, kicking off at midnight Pacific Time on Monday, July 15, and running until the end of Tuesday, July 16 — a total of 48 hours versus 36 hours in 2018.Last year, Amazon-Whole Foods offered the spend $10/get $10 deal over seven days, from July 11 to 17, compared with 14 days this year.

“To celebrate our Prime members in an even bigger way this year, we will add an additional week of amazing exclusive deals on peak-of-season produce and high-quality grocery favorites, on top of our hugely popular spend $10, get $10 offer,” Whole Foods CEO and co-founder John Mackey said in a statement. “Prime members can save more than ever before on summertime favorites they love and the Whole Foods Market quality they trust.”

Austin, Texas-based Whole Foods said it will feature deals on a range of seasonal items — such as fresh produce and meat, snacks and ice cream — for Prime members from July 10 to 16.

In produce, offers will include organic red cherries for $3.99/lb. (a $3-per-pound savings), a 1 lb. container of organic strawberries at two for $5, organic yellow peaches and nectarines at $2.49/lb. and an 18-oz. container of organic blueberries for $3.99. Meat deals will include organic air-chilled, no-antibiotic whole chicken for $2.19/lb.; wild-caught sockeye salmon fillets at $9.99/lb.; and animal welfare-rated St. Louis ribs for $3.99/lb.

Center-store offers will include 40% off RXBAR bars and nut butters and Orgain organic, plant-based protein powders; 50% off self-serve Mochi ice cream; and Ben & Jerry’s and Talenti pints at two for $6. Prime members also will find deals on health and beauty care items, such as Alaffia beauty and body care products at 40% off, as well as on general merchandise, including a reusable water bottles for 30% off as part of a hydration sale

When a bulk buy is a bad buy

When buying in bulk makes you poorer

Geoff Jones from Llanwrtyd Wells in Powys wrote to highlight the price of Tesco's extra virgin olive oil, amused by the supermarket's "eccentric pricing". On the store's shelves, the 500ml bottles retail for a very reasonable £1.99. That's equivalent to £3.98 a litre. But look on the shelf below and you'll find the bigger 750ml bottle, priced at £3.53 – that works out at £4.71 a litre. Mysteriously, as Jones points out, the price then drops back to £3.98 for the full litre bottle.

Tesco's lemon juice is another puzzler. Anne Barry from Chichester highlights how Tesco charges £1.19 for its own-brand 500ml bottle of lemon juice. But if you buy the 250ml bottle, the price is only 48p. So never buy the 500ml bottle, just pop two 250ml bottles in your basket.nothing more

Do those bags of pre-packaged fruit and veg that shout "25% extra free!" really give you that bit extra? Ed Richards of Blandford Forum, Dorset, is sure they don't. "They never seem to display the pack weight so that one can compare with the same item sold loose. I always find the scales, weigh the pack, then compare. I find it's hardly ever beneficial to pay for the pre-packed stuff. (And I'd rather not have all the extra packaging.)"

Meanwhile Catherine Griffiths in Anglesey says the small print "per 100g" information under the actual price "can be completely inaccurate and now I don't dare trust these figures. (Is this breaking some consumer law, even if it's an honest error?)"

Fake two-for-one and half-price deals

Sharp-eyed "DanJO" posted on theguardian.com his experience of how his local supermarket prices Radox shower gel. "The shower gels are £1.94 each for a while just before the two for £2 offer … [it then] drops down to 95p each without any offer not long afterwards. Bottles of coke do something similar. The Sure For Men ones rotate between offers but over the course of about six months went up by about 80p on its baseline price. Presumably, an inflation rate of something like 33% would have raised eyebrows if it happened overnight so the offer toggling masks it."

Readers are highly suspicious of the supermarket half-price wine deals. Guardian.co.uk poster Afcone wrote: "All supermarkets do this: 1) Take a £3 bottle of wine. 2) Sell it for £8 for a day or two. 3) 'Reduce' it to £3. For maximum effect, they limit this with a sign saying 'maximum six bottles per customer', knowing full well that people will, on average, actually buy more by putting a limit on it."

Shops and supermarkets constantly exploit our desire for a bargain, even when none exists, says Monsterchild on theguardian.com. "I've worked in retail all my life and can say with absolute certainty that if Shop A has a widget in the window for £100, and Shop B has the exact same widget advertised as 'Half Price! – was £200, now £100', Shop B will sell twice as many widgets."

When buying on eBay costs more

"Penninebliss" wrote: "I recently sold a camera on eBay (new, still in box). Another seller had the same camera as a 'buy it now' (no auction) for £18. Mine sold for £27, but the buy-it-now camera at £18 was unsold. I watched in amazement as the bidding kept pushing up the price, yet none of the bidders bothered to check the prices of identical items to see what would be best value. The philosophy of the majority of buyers seems to be: if it's eBay, it's cheap, and if it's a 99p start auction it must be a total bargain. I laughed all the way to the bank!"

The evidence of eBay buyers who pay over the odds came from Halo572 at theguardian.com. Last week he saw 11 bids for an "autobiography" of FBI special agent Dale Cooper, the fictional character from the TV series, Twin Peaks. The bidding pushed the price of the used book up to £8 plus £1 delivery. But had these net-savvy bidders simply clicked over to Amazon, they would have found scores of sellers offering it for just 1p plus £2.80 for delivery.

"It was the same with the Kindle on launch – people were marking it up and putting it on eBay as some people wouldn't wait. Even after the shortage ended [and it was easily available at Amazon] people were still selling it at a premium."

It's not just eBay which pulls in the suckers. Michael Walton, emeritus professor of drama at the University of Hull, has fun tracking the price of his own book, Living Group Theatre. It is available new on Amazon (UK and US) at any time for £63.60. Yet he's also found it on sale, used, for £163 on another US site.

Bizarre flight pricing

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Nichola Bell wrote to say that booking the return leg of a flight in a foreign currency is cheaper than buying it in sterling. Indeed, a look at Ryanair's pricing proves the point. The return leg of a flight from London to Dublin for 2 October (3.40pm) is priced at £85.95. But exactly the same flight, if bought as a single in euros, is €89.88 or £78 – a saving of £7.95, and enough to more than compensate the exchange charges.

Afcone added: "Why does a flight with Air Canada to Vancouver cost 15% more than a flight to Seattle, changing in Vancouver?"

… and the deals that really confuse you

This intrigues a lot of readers. It's when a retailer sells the large pack not just at a lower per-unit price, but for less than the smaller pack price.

Dave Foddy from Northwich in Cheshire explains: "About 10 years ago at Hilton Park Services M6 southbound, I went in for some AA batteries. I found the required pack of four and took them to the till, where I was asked if I wanted eight. When I said I only wanted four the assistant told me that eight were cheaper. I said that I understood the economies of bulk buying, but only wanted four. It was then explained to me that to take a pack of eight out of the shop required handing over less money than for a pack of four. I still don't really understand."

At theguardian.com, Jonbryce found a similar example. His local Sainsbury's, he says, was recently selling a 500ml bottle of Irn Bru for £1.09, while the one litre bottle was £1.05.

Bizarrely, Susan Craig – our reader who spotted the Persil example, emailed us a second time to say the pricing had, since she first wrote, become even more perverse. Now, the smaller 25-wash box had gone up to £6.40, while the 50-wash box had gone to £6. "Now where is the logic in that? I'm confused.com!"

Not so supermarché? Why we either loathe or love French supermarkets

It appears that when it comes to French supermarkets, foreigners either seem to love them or absolutely loathe them.

For some, they’re wonderful places full of great French products and real fresh food, but for others, a visit to a French supermarket can leave them cursing into their panier (basket) or caddie (trolley).

Here’s why French supermarkets might drive you mad:

1. Anarchy in the queues

This is a common complaint given that queuing in French supermarkets can often be a chaotic affair.

Even for those used to waiting patiently in line, shopping for your dinner could be a somewhat traumatic experience in France given the average length of the supermarket queues (or is that just in Paris?).

France has only recently started to cotton on to automatic checkouts but supermarché managers seem no nearer to cottoning on to the fact that maybe they should help out at the check outs from time to time, when they see the queues begin to lengthen.

And when it comes to queuing the general attitude of 'every shopper for themselves' doesn't really help the situation.

You can have clusters, multiple lines and people just milling around in random positions with their baskets waiting for an opportunity to get to to the nearest till.

Even if a queue does form shoppers will deem it fair game to just to stroll up to the checkout from a different side.

And if you've been waiting a while and a new checkout is opened up, don't expect new queue arrivals to usher you through. In a French supermarket you have to be alert at all times. In general 'you snooze, you lose'.

2. Lack of world foods

"Surely we don't need foreign foods, we're in France!" many people say. But then many others are desperate to get their hands on some global goodies.

But as seen from the often microscopic “world food” sections of a French supermarket, the world outside of France seems to be made up of a few overpriced tortillas, some bizarre sweetened French soy sauce and a jar of suspect yellow sauce simply labelled “curry”. 

While things are changing slowly French supermarkets are still a source (or sauce) of frustration for those foreign citizens looking for something a little more exotic than jambon and fromage. 

And it’s not just complaining Anglos who think they’re missing out.

Simon Goodenough, director a British company that delivers food from the UK to homes in France, told the Guardian his French customers can't get enough of their tacos and curries, because they just can't get them in France.

3. Not-so-ready meals

Surely we should be celebrating the lack of ready meals in French supermarkets?

But there's always a time and place for a pre-cooked meal isn't there?

And let’s not pretend that French people don’t enjoy a little commercial convenience food. In 2014, the all-frozen goods supermarket Picard was rated France’s favourite brand.

So why is the ready meal selection in the supermarkets so, well, unappealing? Perhaps the fact many were found to contain horsemeat did not help (although the French don't tend to wretch at the idea of horsemeat like others might).

(Photo: The Local)

To the relief of many Brits in France Marks & Spencer is now filling the huge void.

4. Customer service

Service culture is a little different in France and you’ll have to get used to working harder to flag down some assistance.

Don’t expect the (admittedly way over attentive) helpers you might find in supermarkets at home leaping out from the aisles with a chirpy “can I help you?”

And if there’s a problem, it’s you and the shop assistant on your own. It’s not certain that French supermarkets actually have managers, as they are rather elusive creatures.

5. Extortionate toiletries

Stocking up your bathroom shelves in a French supermarket might leave you more out of pocket than you expected.

Razors, deodorants, shampoo, sunscreen; general grooming makes a deep dent in the supermarket grocery bill.

So much so that some foreign shoppers have taken to bulk buying in other countries and taking the products back to France.

6. Tiny stores in city centres

If you can’t get to one of the big out-of-town stores, you’re left with the “city” or “express” versions of bigger supermarkets.

Many of these, especially in Paris, are more reminiscent of rabbit burrows than a regular supermarket.

There's little room to swing a demi-baguette in most of them and the queues (did we mention them?) can often fill the entire aisle.

… But in their defence

But faithful French supermarket lovers will vehemently defend their favourite stores from these criticisms.

Let's face it, who doesn't get excited when pulling up at a cavernous L'Eclerc or Hypermarché on the way home from the beach? Or at least kids certainly did, but that was probably down the mammoth "back to school" sections in French supermarkets that made them go weak at the knees.

(AFP)

Despite the drawbacks highlighted above wheeling a trolley round the deserted isles of a French supermarket can be a soothing experience for many.

After all, in the supermarché, fruit and vegetables taste “how they’re meant to”, (rather than just tasting of water), there’s real “made in France” goods, there are cheese counters, meat counters, fish counters, yoghurt counters...  just kidding, but there are yoghurt walls and wine walls and chocolate walls to feast on.

The French also care about the environment (or at least the government does) because single-use plastic bags are also banned in French supermarkets.

So, love or loathe them – what’s your take? 

France rolls out colour-coded food labels to help public improve diet

Usually you're told to read the small print, but soon it won't be necessary - at least if we're talking about the list of ingredients on the back of supermarket items. 

 

The idea was revealed by France's health minister in May last year, and was tested in sixty supermarkets across the country. 

 

When the colour-coded system - called the "Nutri-score" - is rolled out in April, it will see selected foods and drinks ranked on a scale of A to E, with the colours ranging from dark green to red. 

 

If a product is labelled with a Green A then you can rest assured you've chosen the healthy alternative. The idea is that it will be easier for customers to choose between two brands offering the same product, all based on their nutritional content.

So in theory, a frozen pizza with a Green A should be more enticing to a customer than another pizza with a Red E. 

 

Health Minster Marisol Touraine said she hoped the move would see French people eating less fat, salt, and sugar. 

 

"A good diet is a part of being healthy," she told Le Parisien newspaper.

 

She added that around 30 percent of adults in France were overweight and about 15 percent were obese - with the disadvantaged families the worst affected. 

 

"The indicators on food today are often too hard to analyze. They need to be understandable at a glance," she added. 

 

Food brands won't be forced to label their foods according to the new system as that would be against EU laws, but Touraine said she hopes for a "snowball effect" as other brands join the movement.  

 

It's not the first time France has turned to logos to help drive an improvement in the quality of food.

 

In 2014 it rolled out a "fait maison" logo for menus that was aimed at encouraging French restaurants to serve up homemade dishes rather than ready meals.

 

France saw a raft of controversial health reforms in 2015, part of which saw a crackdown on obesity. It included the banning of unlimited refills of soft drinks and harsher penalties for binge drinkers.  

French supermarkets to test colour-coded 'nutrition logos'

Usually you're told to read the small print, but soon it might not be necessary - at least if we're talking about the list of ingredients on the back of supermarket items. 

 

The new idea, revealed by France's health minister on Tuesday, is simple:

 

Four colours, four different levels of nutrition. These labels get added to over 800 products in 50 supermarkets across France.Researchers will monitor people's buying habits, then compare them with those of shoppers in other supermarkets that don't have the nutritional labels on their products.

 

"Obviously this isn't about comparing a tub of yoghurt with a pizza - it's about making a choice between two different yoghurts or two pizzas," Touraine said. 

 

She added that the move was part of a larger fight to get France healthy, not least considering that a third of French people were overweight and that the number of diabetics was on the rise.

 

The experiment will begin in September and run for three months. If successful, Touraine aims to roll the new colour-coding system out across France next year. 

 

France saw a raft of controversial health reforms last year, part of which saw a crackdown on obesity. It included the banning of unlimited refills of soft drinks and harsher penalties for binge drinkers.  

Supermarket price deals: the good, the bad and the ugly

On first glance, it seems that supermarkets are offering consumers great deals these days.

Many do save us money and majority of consumers manage the task of judging the value of a deal.

However, our new research shows confusion among some consumers about how much they’re saving through price promotions. One in four consumers misjudge the value of the deals offered and the most vulnerable shoppers are most likely to be left out of pocket.

Our analysis across 23 product categories in five retail chains of the UK and the US shows that between 30 - 50% of supermarket sales in developed countries are bought on some form of deal. With such high prevalence, it is important we all develop the numeracy skills needed to tell a good deal from a bad one.

A deal is not always a saving

There are deal types ranging from “20% off” to “buy one get one free” and even “lowest prices guaranteed”. However, consumer advocates say supermarket price promotions can mislead consumers.

UK consumer advocacy group Which? has just launched an unprecedented “super-complaint” to the UK Competition and Markets Authority against supermarkets’ misleading price promotions.

We wanted to understand just how confusing some of these practices are to consumers. We conducted a study using two representative samples from the US (1016 consumers) and Australia (607 consumers).

It showed that while the majority judged the promotions correctly, a quarter of customers miscalculated the value of the deals on offer.

“Buy one, get the second of equal or lower value half price” caused the most difficulty for consumers. Almost half of the US and a quarter of Australian consumers surveyed wrongly estimated the maximum they could save on the total purchase. (The answer is up to 25% off.)

Younger and lower income consumers tend to have the most difficulties in understanding the offer. Yet they are the consumers who would benefit the most from making sound purchase decisions.

And it’s easy to understand why anyone could have trouble doing the maths required to understand the price promotion in front of them, especially with all the time pressure, visual clutter and multi-tasking involved in doing a weekly shop.

Our study participants analysed prices under the best possible conditions – with no time pressure, and no interruptions – and we still found that common deals confused some shoppers.

For example, 36% of the US and 24% of the Australian consumers could not calculate which offer would be cheaper for a $4 loaf of bread – “45 cents off” or “15% off”. (Answer: the latter.)

New tactics

Tough competition amongst manufacturers and retailers means more promotions for consumers and more opportunities to save. Yet, a downside of this competition is that it also pushes the industry to constantly invent new types of promotions and novel ways of communication to cut through the competitive clutter.

The most prevalent types of deal are “Price Off” (eg “30% off” or “$1 off” normal price), which accounts for around around 25% of all offers. This is closely followed by “multi buy” or “X for $Y” deals, representing around 19% of all offers.

The complexity of the information on the point-of-purchase signage is also increasing.

Our audit of price promotion signage across 10 product categories revealed up to six numerical pieces of information located on just one sign. This may include retail price for loyalty members and non-members, unit price for members and non-members, savings for members, past reference price (before the discount) and deal expiry date.

All the above suggests consumers are faced with a varied and large amount of price promotion information in supermarkets.

Tips for the critical shopper

Price promotion signs give consumers the license not to pay close attention to the actual information on the sign and to what degree it represents a real saving.

Here are some ways consumers can critically assess deals on offer:

• Remember that discounts vary widely, so some “deals” may actually only save a few cents.
• Consider the prices of alternatives (sometimes the promo price is still dearer than the price offered by acceptable competitors or the same brand in a different pack size);
• Remember that buying the “every day low price” or “locked down low price” deal results in no real savings on the day
• Don’t forget that different colour-coded product tags attract attention but may not offer actual savings (for example, the promo sign may say “new” but offer no discount)
• Multi-buy offers may result in people buying more than they need and increases the potential for over-consumption and/or wastage;
• Some inventive promotions confuse the consumer with the use of verbal cues such as “special” and “sale” – make sure you check whether or not such items truly are being discounted
• Price discounts can be for loyalty card members only, meaning the non-members and those who forgot to use the card will have to pay the full price.

Australian consumer advocates, CHOICE, and their UK counterpart, Which?, have also been reporting examples of clearly misleading promotions.

Where to from here?

There are three areas where action is needed.

First, best practice guidelines for the retail industry need to be developed on how to clearly communicate price promotion information. In the United States, the National Institute of Standards and Technology recently developed A Best Practice Approach to Unit Pricing. This is a document and extensive network of seminars and podcasts rolled out across all the US states on how to present the unit price information on point-of-sale signs.

Second, regulators should consult widely with researchers, retailers and consumer advocate groups to identify those price promotion practices that need tighter rules to avoid misleading consumers.

Third, education programs aimed at improving consumer literacy, particularly amongst young and low income groups, could be incorporated into the existing national curriculum on financial literacy.