What future does Kendals have in city?
EXPERTS GIVE VERDICT ON HOUSE OF FRASER’S WOES
HOUSE of Fraser, known to Mancunians as Kendals, has been a staple of city centre shopping for decades.
The towering limestone building on Deansgate is steeped in history and memories, from its origins as a drapery in 1796 to the Harrods takeover of 1985.
Now though, times are changing once more as the House of Fraser chain is struggling. Plans have been revealed to close 31 of their 59 leased stores across the UK and Ireland including the Altrincham branch - known as Rackhams to locals - which will shut in 2019.
The changes are part of CVA (company voluntary arrangement), a process to restructure the business which will be under consultation for the next couple of weeks.
Kendals is not on the closure list, surviving the cull when other stores, including the flagship London branch on Oxford Street, haven’t.
So why has Kendals survived and what’s its future?
We’ve asked Manchester retail experts for their view.
Dr Gordon Fletcher, a business and retail expert from the University of Salford, said the announcement could be seen as ‘an opportunity’ for the Deansgate store to ‘reinvent itself as a landmark retail destination in the city centre’ - but also warned the store could be greatly reduced in size.
He said: “One of the challenges for the House of Fraser company has been the pull towards the middle ground of retailing, where it has found itself competing with a wide variety of brands and retailers for increasingly discerning and well-informed customers.
“The challenge for the Deansgate branch, and all the company’s remaining stores, will be to create a different, distinctive and even individualised retail experience that cannot be found online or among the aisles of the cheaper retailers. The landmark Deansgate building could easily be reduced in size from the top down. But reducing the tradeable floor area would be a false economy when the opportunity exists to work with new and local brands that are compatible with current offerings and could revitalise the entire House of Fraser offering.
“The emphasis for the Deansgate store needs to be on creating experiences, offering variety and building services that satisfy loyal consumers.
“The location and physical space of the store should be the opportunity to offer services that cannot be found or delivered online.
Cathy Parker, Professor of Marketing and Retail Enterprise at Manchester Metropolitan University and Chair of the Institute of Place Management, said: “For decades, House of Fraser was the height of sophisticated shopping in Manchester, but it does not compete with the higher end luxury of Harvey Nichols or the trendiness of Selfridges.
“Manchester’s House of Fraser is still at risk if it is unable to position itself effectively within this market and get the right offer to Manchester customers.
“House of Fraser’s store closures are the result of a range of issues. Even in the most popular high street shopping areas, stores that fail to address the changing nature of their competition will ultimately suffer. If House of Fraser needs to close stores in locations such as Altrincham, an area which still attracts a high number of shoppers, this would suggest it is the retailers’ offering that is a problem and a restructuring of operational costs will not fix this.”
John Pal, retail expert at Alliance Manchester Business School, said: “In the short term, House of Fraser’s store on Deansgate is safe, as obviously the owners see it, at present, as a viable store.
“It might, however, close off sales floors in the building – this is not an uncommon occurrence in retailing. In addition, or alternatively, it may seek new concessions to trade in the store. Even the ‘mighty’ Tesco has Next as a shopin-shop concept in some stores. This would have been unimaginable a few years ago.
“That tie-up is indicative of two things; the over-capacity of retail space and, that all retailers will test out new ideas in ways that have not been done in the past. House of Fraser already has a strong branded concession offer. In order to survive, it needs to stay and improve its profitability.
“House of Fraser has stated that if the CVA does not go through the business would not be viable. It remains to be seen whether that is a bluff or not.”