With the launch of a new concept to showcase its womenswear, F&F chief operating officer Richard Collins says Tesco’s fashion brand has earned its high street credentials.
It is on reaching the top of a winding staircase above the cafe in the West Kensington Tesco branch that I meet Richard Collins, chief operating officer of F&F, looking purposeful in a leather chair. It is two days before the store officially opens to the public, and he sits confidently in front of the shiny new F&F concept that’s bustling with eager members of the press.
This is the first of the brand’s new breed of store, a hybrid of the retailer’s overseas standalones and those stores that are part of the Next Generation refurbishment programme.
In the year to February 23, UK sales at Tesco’s clothing brand F&F exceeded £1bn, representing 1.5% of total group turnover. But the supermarket chain, which is the world’s third largest retailer behind US firm Walmart and French business Carrefour, has grander designs for its clothing arm.
“It’s a case of ‘how fast can you go?’” the former Tesco operations director explains. According to research firm Verdict Retail, F&F (formerly known as Florence & Fred) is ranked fourth in terms of share of the UK value fashion market, with 10%. By comparison, market leader Primark’s share is double the size of F&F’s. With some way to catch up, overtaking its competitors could seem like a daunting prospect, but Collins is confident he’s working for the right company.
“The fact you’ve got the backing of the business going at a pace means you wouldn’t want to be working anywhere else,” he enthuses. His confidence is not wholly misplaced considering F&F’s UK sales growth of 8.6%
in the second quarter of this year. Key to the immediate future of F&F is the business’s Next Generation store refurbishment project, which aims to improve the environment and ease of navigation, as revamped stores in Pitsea in Essex and Watford demonstrate.
Collins says the Next Generation overhauls have made the stores “very much high street”, with lower fixtures and a more boutique feel (in contrast to the traditional pile-them-high supermarket displays). He adds that the new format has proven popular with staff and shoppers - something reflected in F&F’s sales figures, with a 10% increase in sales at refurbished stores against the previous year.
“It metamorphosises the [floor space] at the stores where it happens and the colleagues that work in that environment absolutely love it,” he says. “While it is hard work of course, and challenging from an implementation perspective, we’re executing it well and there’s a real buzz around it.”
Eleven stores a week are being reconfigured. “We’re going at some pace,” Collins explains. “To do 30% [of the store portfolio] in two quarters is by anybody’s standards ambitious, so that’s an illustration of how quickly that could happen.” He reveals the scheme has already received “significant investment”, with plans to spend further in 2014.
Staff across the refreshed stores have also been specifically trained, or “F&Fed” as Anita Bolger, F&F’s brand and marketing director, puts it. “They get all the brand training, the service training and they get talked through all the ranges so they can almost be like a personal shopper,” she says. “The service element is hugely important.”
Beyond training staff, creating an operation that competes with the high street requires certain expertise. “My team has recruited some of the best people from the high street,” says Collins. The most notable addition has been a dedicated visual merchandising team, which is responsible for the interiors and displays across all the Next Generation stores, and the new West Kensington format, where the team’s hard work is best shown off. This store is a hybrid concept that mixes the Next Generation format and the shopfit seen in F&F’s 29 international standalone stores across territories such as Poland, Czech Republic and latest addition Gibraltar. In some countries it has operated separately from the supermarket for eight years.
The West Kensington shop-in-shop, which opened to the public on October 25, is more than 2,300 sq ft in size and is located on a mezzanine above the main entrance to the supermarket, overlooking part of the fresh grocery department. If it were not for the gaps in the clothing rails, which allow you to see through to the supermarket below, it would be easy to imagine this was a standalone clothes shop on a high street.
Its simple but decent quality rails, racks and tables create a familiar fashion interior that displays 300 F&F womenswear styles. The collection, which retails for between £6 for basics and £95 for a leather jacket, has been carefully edited specifically for West Kensington and includes ‘online exclusives’ and ‘top store’ packages. However, this is only just over 3% of the brand’s total fashion offer of around 9,000 SKUs, all of which are available on the F-F.com website and via online kiosks in store.
But why launch the new concept without menswear or kidswear? “Womenswear is two-and-a-half to three times the size of the menswear business,” answers Collins. “It’s important it’s presented with authority. If we had tried to get a breadth across men’s and kids’ in this space it would have disappointed.”
“The worst thing you can do in a small-space format is to try to be a bit of everything to nobody,” adds Bolger.
What’s more, the duo see the womenswear collections as where the brand has improved the most. “I think we’ve made particular progress in the past two seasons and our customers are telling us that,” says Collins.
Bolger adds that while not quite a “rebirth”, the “major transition” the brand has gone through in the past six months has been significant: “People have described it as us fast-tracking the brand, which is coming through in the stats and the customer feedback. People are recognising that it’s got more fashion credentials and the quality is improving.”
Verdict senior analyst Honor Westnedge asserts that F&F “has the potential to be a huge global brand”, but caveats that with concerns about how quickly it can lose its supermarket association.
So with the product heading in the right direction, how long will it be before F&F opens UK standalone stores, as it has done with its central Europe business, going head to head with the biggest players on the high street?
“I think it’s early days,” says Collins. “We’re building learnings all the time and we’ll take fresh ones from here.”
Bolger is quick to never say never: “There are no plans to do any more of these [West Kensington format stores] at the moment,” she says. “[But] the business is very proactive and reactive - this wasn’t even on the cards six months ago so we can turn things around very fast.”
Right now the West Kensington store is a test bed for new products, the store environment and service initiatives, but “the journey is not finished”, adds Collins. To compete on the high street, F&F needs this store to hold its own.