Weak sales won't derail Mothercare's turnaround strategy, says chief executive

The retailer’s chief executive, mark Newton-Jones has said that the brand ‘wouldn’t allow a 12 week reporting period to create knee-jerk reaction,’ and will continue to focus on ‘style, price point, design, quality and exclusivity.’
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The maternity and babywear chain Mothercare is to continue its turnaround plans as normal despite an 11 per cent fall in sales over Christmas.

The retailer’s chief executive, mark Newton-Jones has said that the brand ‘wouldn’t allow a 12 week reporting period to create knee-jerk reaction,’ and will continue to focus on ‘style, price point, design, quality and exclusivity.’

Mothercare will also continue to reduce its retail space across the country, aiming to close 53 of its 143 stores in the next five years through lease expiry.

“Times are uncertain at the moment for UK retail and for the next six months until June or July, things will continue to be bumpy,” said Newton-Jones.

“Inflation started to come through in costs of goods and selling prices in July 2017, and we think things will level off at the same time this year and give us a better feel for the future.

“Until then, things will be relatively soft, and stock and central costs will be closely controlled.”

The chief executive explained that the fall in ecommerce slaes during the period – down 6.9 per cent on the previous year – could be explained by the proportion of online transactions generated in stores.

“40 per cent of online sales are generated in-store on iPads from our advisors; they order product for customers to be delivered to their homes. If we get a drop in footfall in store, which is what we saw, then we inevitably see a drop online.”

When asked if Mothercare’s plans to move away from heavy discounting will change, he said: “We won’t change that strategy, though if the market gets worse, we might have to change our outlook.”

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