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UK retail sales were unimpressive in February with volumes down 0.3% month-on-month, although they were still 3.7% above their pre-Covid February 2020 levels.
But there was good news too as non-food store sales volumes rose by 0.6% with growth in clothing (13.2%) and department stores (1.3%). The Office for National Statistics (ONS) said wider socialising and the return to the office following the lifting of Plan B restrictions at the end of January were “potential factors”.
It added that non-store retailing — mainly online — sales volumes fell by 4.8% over the month following strong growth in December (2.7%) and January (4%). Sales volumes were 33.2% above their pre-coronavirus levels.
Now, when it comes to the year-on-year figures, the picture was quite different, but the comparisons with February 2021 aren’t as useful as they would normally be given that the UK was in full lockdown this time last year. Sales volumes rose 7% compared to a year ago and values rose 11.1% as inflation kicked in.
And inflation could also have been playing its part in the volume fall for non-store sales. The ONS said that after non-store sales volumes had risen in the previous two months, February’s month-on-month fall could have been linked to affordability concerns. But of course, the fact that consumers last month were less concerned about Covid variants in physical stores would also have played a part.
Suitors are lining up to take over UK health & beauty retail giant Boots. According to the latest report, New York-based investment giant Apollo Global Management is now in the lead position with a £6bn takeover bid.
The report from Sky News follows weekend reports of a potential £7 billion sale for the Walgreens-owned business by both Apollo and US peer Sycamore Partners. They are understood to be competing against TDR Capital and the billionaire Issa brothers, owners of the Asda UK supermarket chain.
The sale of Boots was thrown into doubt in recent weeks after a consortium of Bain Capital and CVC Capital declined to submit a first-round bid.
However, city sources told The Sunday Times they are sceptical that Sycamore, which is also circling fashion chain Ted Baker, will make a firm offer for Boots.
That leaves Apollo Global as a strong contender with the investment giant understood to be talks with banks including Bank of America and Credit Suisse to provide debt funding, Sky News reports. Apollo has so far declined to comment,
Although Apollo is likely to be able to secure the required financing for a Boots bid, debt markets have become increasingly difficult since Russia's invasion of Ukraine last month, analysts noted.
A new round of bids for Boots, which trades from more than 2,000 stores and employs over 50,000 people, is expected early next month.
Rising prices across the board sent UK inflation soaring to a new 30-year high in February as the cost-of-living crisis intensified, according to official figures.
The Office for National Statistics (ONS) said Consumer Prices Index (CPI) inflation rose to 6.2% in February, up from 5.5% in January and again reaching the highest level since March 1992, when it stood at 7.1%.
The rise was higher than expected and comes after prices rose across food, clothing and footwear and a range of products and services.
The ONS said inflation rose across 10 out of the 12 categories that feed into the index, with only communication and education not seeing increases.
Experts have warned that prices will rise further still as the Ukraine conflict pushes up already sky-high inflation, adding to painful price rises for energy, fuel, commodities and food. The energy price cap rise, the planned reversal of the hospitality VAT cut and increase in National Insurance contributions are set to deepen the crisis facing UK households.
The Bank of England last week raised interest rates for the third time since mid-December, to 0.75% from 0.5%, and warned inflation will now peak at around 8% in April – and could hit double-digits if wholesale energy prices continue to soar amid the Ukraine war.
Grant Fitzner, Chief Economist at the ONS, said: “Inflation rose steeply in February as prices increased for a wide range of goods and services, for products as diverse as food to toys and games. Clothing and footwear saw a return to traditional February price rises after last year’s falls when many shops were closed.”
February’s inflation data showed the increase in inflation was led by higher prices of food, clothing, and furniture and household equipment, with COVID lockdowns a year earlier dampening 2021 price rises.
The data also showed that the Retail Prices Index (RPI) measure of inflation remained at its highest level since March 1991 – hitting 8.2%, up from 7.8% in January.
Helen Dickinson, Chief Executive of the British Retail Consortium, commented: “Rising inflation remains a significant concern for the economy, squeezing household incomes and increasing cost pressures on retailers. For the second month in a row, Transport saw the highest rate of inflation this month, while food inflation rose slower than the headline rate.
“The BRC’s Shop Price Index, which tracks the price of basic goods, showed an even smaller price rise in food, suggesting that retailers are successfully managing to limit cost increases for many essential groceries. Many supermarkets have expanded their value ranges to support individuals and households on lower incomes. Nonetheless, with retailers struggling to absorb these higher costs, shop prices look set to rise in the coming months.
A London company which aims to help businesses build global teams has raised £90 million.
Omnipresent, which was founded two years ago, has been backed in the Series B round by lead investors Kinnevik and Tencent. Uncorrelated Ventures joined alongside existing investors Episode 1, Playfair Capital and Truesight Ventures.
It says the world of work has changed significantly due to COVID-19 amid a ‘tectonic shift’ in the way businesses work and hire.
“The trend of remote, global work has been gathering pace, and Omnipresent is a catalyst for this change,” said co-founders and co-CEOs Guenther Eisinger and Matthew Wilson.
The company’s revenue grew 25x and its team 10x in 2021, with more than 230 employees now distributed across 40+ countries worldwide.
“Omnipresent is in a stage of hyper-growth, and we’re proud to have developed a culture that can scale with us and that truly resonates with our people,” added Wilson.
“Our Series B will not only enable us to grow our team, but also invest in innovative ways to keep our people engaged, fulfilled, and motivated as they shape the future of work.”
Omnipresent’s clients are building international teams in more than 160 countries and regions worldwide. It takes care of all the administrative duties associated with global employment so they can focus on expanding their business quickly and efficiently.
It says a priority is the development of its OmniPlatform, a tech-enabled HR platform.
“The way Omnipresent onboards our new hires is really important. There’s a lot of care and a lot of contact – a real agility in providing people with support,” said Marie Favre, people operations manager at Cervest.
“All of this is really priceless … It’s a real partnership, rather than a client relationship.”
Bringing a new meaning to the fashion cycle, FatFace has unveiled a collaboration with Raleigh.
The fashion and lifestyle retailer and the bicycle producer have launched FatFace x Raleigh, a spring apparel collection for kids, men and women, also including accessories, stationery and homewares.
The line features hoodies, T-shirts, sweats, plus underwear and socks emblazoned with classic Raleigh bike prints alongside “playful slogans that capture the spirit of the cycling brand”.
Highlights include a zip-through hoodie featuring Raleigh bikes through the years, including the brand’s classic ‘Banana’ road bike and the ‘Burner’. There are also T-shirts featuring colourful graphics of other legendary bikes such as the ‘Chopper’ accompanied by slogans such as ‘Joyrider’ and ‘Grab Life by the Handlebars’.
The collection also includes a water bottle, notebook, mug and puncture repair kit housed in a metal tin adorned with some of Raleigh’s best-loved bikes.
Collaborations are key for fashion brands to engage with unrelated sectors as a way to attract an audience that might not have considered the brand before. And with the spring/summer season upon us, linking up with a brand related to the outdoors and exercise should be a positive one in this key post-pandemic/lockdown era.
Lisa Bray, Buying Manager, FatFace said: "Raleigh was such a fun and exciting range to pull together. The designs, branding and colour palette are fresh, fun and modern. Raleigh is a great brand that aligns with our values, so it feels like the perfect partnership.”
Michelle Jakeway, Head of Marketing at Raleigh UK, added: “We're all about helping to spread the joy of cycling. Creating high-quality apparel and accessories for a wide range of ages, FatFace is the perfect partner to help us achieve this. We're thrilled to share the new collection with the UK and hope it helps inspire others to embrace life on two wheels.”
This spring will see H&M opening its first UK store in an outlet destination with a debut at Affinity, Staffordshire this spring.
It will cover 7,000 sq ft and comes as outlet shopping remains one of the most buoyant sectors of UK retail with Affinity continuing to attract new brands to the location.
But the company clearly wants to distance itself from the idea of a store that’s all about price and overcrowded clothing rails as it said it’s aiming for “a lower volume of products, which will be displayed in an inspirational way”.
The firm’s long-running Garment Collection and Recycling service that guarantees nothing goes to landfill will also be part of the new store.
Outlet shopping is increasingly appealing for lower-priced retailers as well as the mid-and high-priced names we usually associate with the sector and this year, New Look has also made a move into the segment.
Nicky Lovell, who heads outlets and business development at Global Mutual, which secured H&M for the centre, said: “As the retail market continues to reposition itself post-pandemic, it is becoming clearer that the outlet environment is increasingly sought after for both consumers and brands offering convenience, value and quality within a welcoming and accessible setting.”
Amazon Web Services claims it is to invest upwards of £1.8bn ($2.36bn) over the next two years in building and operating data centers in the UK, meet the ever growing demand for cloudy tech.
The cash burn includes spending on infrastructure, renewable energy, and skills and training, the megacorp said.
AWS opened its London region in December 2016, before which the company's UK customers had to rely on servers and services delivered from Dublin, Frankfurt or US East Coast data centers. Amazon said that the latest estimated budget splash would more than double its total AWS investment in the UK to date.
In those intervening five and a bit years, AWS has expanded its footprint, adding a third Availability Zone to the London Region in 2018. Availability Zones provide for redundancy and fault-tolerance in applications by allowing AWS customers to spread operations across multiple sites within the same region.
Amazon did not reveal whereabouts it would build out its data center capacity in the UK, but as The Register detailed in an article earlier this year, the firm is understood to be constructing at least three new data center sites in England: one is at Bracknell in the southeast, another at Burderop near Swindon in the southwest, and the third is at the site of the former Didcot, a power station in Oxfordshire, also in the southeast of the country.
It also isn't clear how much of the £1.8bn is actually going into building new data centers or expanding existing facilities. Rival cloud operator Microsoft disclosed last year that it was constructing up to five colocation buildings at a site in San Antonio, Texas, that were projected to cost over $200m, according to reports.
Rene Buest, Gartner senior director and analyst for cloud & cloud IT services, said all the hyperscale providers are now spending on local delivery to meet rising demand.
He added that in the UK, Gartner's Cloud End-User Buying Behavior Survey found 73 percent of respondents involved in purchasing decisions expect their organization to increase spending on cloud services in the next 12 months.
Amazon declined to comment for this article.
But in its announcement, Amazon does not hold back from congratulating itself on its contribution to the UK economy, stating that 41 percent of companies in its AWS Partner Network (APN) said their business would not be possible without AWS, and 58 percent that AWS had helped them to win more customers.
"We are proud of the contributions we are making to the UK economy," said AWS VP & General Manager for UK and Ireland, Darren Hardman, in a canned statement as part of the announcement.
"Looking ahead, we know that the UK remains full of opportunity and we continue to be excited by the potential to continue supporting our customers, partners, and citizens across the UK over the years to come," he added.
Amazon also states that its "dedication to delivering value in the UK" extends beyond infrastructure investments, pointing to research that estimates that AWS is generating £8.7bn ($11.4bn) in economic value for businesses across the country.
The company has, of late, been pressured to be more transparent about how and where it pays tax around the world, with its last set of accounts in the UK showing a tax payment of £9.2m (once £9.1m of deferred tax had been applied) on profits of £127.8m for the year ended 31 December 2020, while turnover stood at £4.8bn.
Hoxton Ventures, which is today announcing that it has closed its second fund at just under $100m, is a little different from other European VC firms.
For starters, its team is tiny. Until recently, it was a two-man band; partners Hussein Kanji and Rob Kniaz had to set up payroll for the first time only recently when chief operating officer Rob Ludwig joined the show. There are no PAs or principals.
It also has an impressive unicorn herd — its first $40m fund invested in food delivery giant Deliveroo, digital health company Babylon and cyber security firm Darktrace, all now valued at more than one billion dollars. 75% of its portfolio has also gone on to raise from leading US funds.
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Turkish urban delivery startup Getir has hit a valuation of $11.8bn (£9bn) following a $768m (£585m) round of funding.
The latest valuation makes it Europe’s first rapid delivery decacorn – a private company valued at $10bn or more.
Getir exploded onto the UK market after an aggressive expansion plan that saw it snap up UK delivery rival Weezy in November 2021.
The Istanbul-based startup also bought Spanish competitor BLOK in July 2021, allowing further European expansion.
It comes just over a year after Istanbul-headquartered Getir launched in London. It has since expanded across the UK to more than 15 cities, including Birmingham and Manchester.
The Series E round was led by Mubadala Investment Company, which contributed $250m to the company.
Other participants in the latest round of funding include Abu Dhabi Growth Fund, Alpha Wave Global, Sequoia Capital and Tiger Global.
The new funds will go towards Getir’s goal of beating its rivals in the highly competitive rapid delivery industry.
Rapid delivery, which sees consumers order grocery goods via an app to arrive in 20 minutes or less, has attracted a surge in investments over the last few years. The popularity of the service was boosted by the pandemic’s stay at home restrictions, and now investors are throwing billions of dollars at grocery delivery startups in the hope of future returns.
Getir’s latest valuation puts it above the £6.11bn market capitalisation of Sainsbury’s, the UK’s second-largest supermarket chain.
Getir does not publicise its financials, but its CEO Nazim Salur has said the business is not yet profitable overall. Its revenues are reportedly about $1bn (£760m). Sainsbury’s most recent annual revenues stood at £28.8bn.
Whether or not rapid grocery delivery startups can sustain the enormous level of growth they have enjoyed during the pandemic remains to be seen. However, at least for now, the investments continue to pour in.
The market is incredibly competitive right now, but Getir is proving to be up for the fight with a massive new valuation and a network of over 1,000 dark store locations globally.
Dark stores are retail outlets that exist exclusively for the purpose of online delivery. Getir’s large network of ‘G-stores’ is part of what allows it to deliver so quickly, as is the case for most of the rapid delivery market.
“In such an exciting and competitive market, we cannot afford to stand still. This investment will enable us to further develop our proposition and technology, as well as invest in our employees to continue to attract the best talent,” said Getir founder and CEO Nazim Salur.
U.S. apparel retailer Abercrombie & Fitch announced on Wednesday the launch of an all-new activewear sub-brand.
Dubbed 'YPB', which is an acronym for 'Your Personal Best', the brand aims to empower customers for activities ranging from sprinting to stretching, and lifting to lounging.
It launches with a collection of fashion-forward, yet functional activewear and accessories for men and women. It features squat-proof and breathable bottoms, performance tops with four-way stretch, sweat-wicking and anti-odor elements, studio outer layers with fashion detailing like cutouts and straps. YPB’s styles are available in XXS-XXL with additional options for long and short lengths.
To create the collection, designers spent hundreds of hours conducting fit research on models across genders, sizes, shapes and heights to ensure fit. Additionally, YPB’s team held focus groups with customers and key fitness and lifestyle influencers to gain their perspective on what they and their followers were missing from the activewear world, to refine design and details like pocket angles and drawstrings.
“We’ve been dedicated to outfitting our millennial consumers for every part of their lives, whether they’re traveling, brunching with friends or celebrating a wedding, for example. Being active is another key part of that lifestyle, and now, with the launch of YPB, we can meet those specific needs,” said Kristin Scott, global brand president at Abercrombie & Fitch Co.
“We’re laser-focused on listening to our customers, and they were clear: They're looking for fashion-forward activewear that actually performs, looks good and combines quality with value. YPB delivers on all of that, while also providing the comfort and attention to detail that our customers expect from us.”
The collection is now available at www.abercrombie.com and in most North American Abercrombie & Fitch stores.