Mothercare foresees resilience in toys

Mothercare boss Ben Gordon tells how the retailer is weathering the financial storm.
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Mothercare boss Ben Gordon tells how the retailer is weathering the financial storm.

One exception to the difficult trading conditions on the High Street is ELC parent company Mothercare.

Speaking to, Ben Gordon, chief executive of Mothercare, says: “We're not immune from recession but there is resilience in the category. People do continue to spend on their children.”

He says demand is being fuelled not just by parental devotion to their kids but also by the improvements that have been made at the company over the past four or five years. “The products are better, the stores have been renovated, and the customer experience is much better,” explains Gordon.

If share prices are an efficient indicator of success (serious question) then mothercare really is the king of the playpen. They currently stand at the same price they were 12 months ago - around the 400p level - which is some achievement when you consider that the retail sector is down almost 40 per cent.

If you have lost heart in the stock market (serious question) as a way of keeping score then the trading figures at mothercare bear out the strong performance the company has enjoyed. In the third quarter to January 9 it increased group sales by 4.2 per cent and like-for-likes increased by 1.1 per cent.

Helping boost the numbers are its key growth stories - direct sales and international - with the former, which accounts for 20 per cent of group turnover, rattling in a 15.6 per cent sales increase, while the latter's turnover jumped by almost 50 per cent.

Gordon suggests both areas are absolutely vital to growth for retailers in today's market: “These are the two big trends in retail and you need to be fully immersed in them. You need both the internet and international.”

Despite the growth international is delivering, Gordon reckons it has been “underestimated by people” and that when they begin to understand it better then they will realise the big opportunity that is there for mothercare's taking. He likes to cite the fact that only 0.5 per cent of babies are born in the UK, which leaves a massive 95.5 per cent outside the domestic market.

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