You are using an older browser version. Please use a supported version for the best MSN experience.

Next wins the battle of the high street and exceeds targets as M&S and John Lewis retreat

The i 21/07/2021 Chris Newlands

High street fashion stalwart Next has again beaten market expectations, with sales exceeding pre-pandemic levels and pent-up demand encouraging customers to restock wardrobes that had not been updated since before Covid hit.

Next, which has been one of the few success stories on the high street since the coronavirus took hold, said pre-tax profits for the year are now expected to top £750m – an increase of £30m on previous expectations – after sales for the 11 weeks to July 17 rose by almost 20 per cent.

The retailer has agreed to repay part of the savings it made from the Government’s business rates holiday as a result of the soaring sales

The sharp rise comes as other big names continue to disappoint, with both Marks & Spencer and John Lewis announcing a raft of store closures after profits turned to losses. In March, Marks & Spencer said it would accelerate store closures after diving £200m into the red, while John Lewis said earlier this month that it is planning to cut 1,000 jobs on the back of a £517m annual loss.

Next put the strong growth down to pent-up demand for adult clothing, with many customers having made few summer purchases in the past 18 months. The retailer also said warm weather at the end of May and start of June helped.

And bosses said they believe the growth was due to fewer people taking overseas holidays and spending their cash in the UK instead.

Russ Mould, a director at investment firm AJ Bell, said: “Next is managing to keep its stores more relevant by using them for a combination of click and collect, customer services and as a showcase for products. That’s a clever move.

“Next is giving customers a reason to keep visiting its stores and in doing so it has an opportunity to try and sell them more items.”

Despite the strong sales, business in Next’s stores fell 6 per cent in the 11 weeks to July 17 compared with the same period in 2019. But this was more than offset by online sales – up 44 per cent over the same period compared with two years earlier.

AdChoices
AdChoices

More From The i

image beaconimage beaconimage beacon