Harvey Nichols hit as it chases wealthy tourists

LUxURY department store Harvey Nichols has slumped to a £6.7m loss after it ploughed millions into a revamp in a battle for super-rich shoppers.

The group has spent more than a year redesigning its flagship store in Knightsbridge, west London, as it fights with nearby rival Harrods for the attention of big spenders.

But this week the firm will publish accounts showing a loss of £6.7m for the year ending April, compared to a profit of £3m last year. Bosses said turnover had remained flat at £194m, with profits taking a major hit as much of the ground floor and key entrances were closed during the makeover.

However chief executive Stacey Cartwright, 53, said she was delighted with the results, highlighting the success of the launch of pop- star Rihanna’s latest beauty line. The boss, who is stepping up into the deputy chairman’s role, said: ‘We have received excellent customer and industry reaction to our unique offer across beauty, accessories and fine jewellery.’

The firm also blamed a slump in profits last year on the revamp, which analysts are hoping will now start to show results.

Retail analyst Nick Bubb said: ‘If Stacey Cartwright is still there in a year’s time, let’s just say she’ll have no excuse if the business hasn’t bounced back into profit.’

Harvey Nichols and other luxury stores, including nearby Harrods, are overhauling their shops as they compete for wealthy including tourists from booming nations such as China and Qatar.

International shoppers are flocking to London to take advantage of the weaker pound. Harvey Nichols is also following other retailers in trying to make the most of stores to counter the threat of online shopping.

Harrods is planning the biggest facelift in its history, splashing out £200m to attract more Chinese customers. Owners Qatar Holdings plan to add a larger luxury watch room with a marble staircase. Bosses want to make the shop easier for tourists to find their way around after complaints that it was too difficult. They are hoping to go even better than sales of more than £2bn last year, boosted by international visitors, particularly from China.

British designer Burberry also plans to focus more on the luxury market, closing shops in lesswealthy areas across the country.

Cartwright, who was finance chief for Burberry, took the top post at Harvey Nichols in 2014. She has brought in a beauty tutorials service, vitamin infusions and new menswear floors.