High street fashion chain Ted Baker has announced plans to reduce heavy promotions and focus on selling more clothes at full price as part of a recovery strategy. The retailer reported a 50% increase in sales for the 16 weeks to August 14 compared to the same period last year, when stores were closed during national lockdowns. However, sales remain below pre-Covid levels, with store sales down 45% on 2019.
Online sales fell 25% year-on-year, but bosses remain unconcerned, citing a strong recovery after the end of Covid-19 restrictions. The company noted that sales in the last four weeks have grown substantially as shoppers return to stores, particularly at out-of-town and shopping centre sites, while city centres remain subdued.
By reducing promotions, Ted Baker improved profit margins by 5%. The company stated: 'Re-establishing our premium positioning has meant moving away from the aggressive promotional stance... negatively impacting the sales performance of e-commerce relative to last year.'
However, hopes for a recovery in online sales were dented by technical issues with its new website, which have 'taken longer than expected to fully resolve.' The launch has been delayed until early next year to avoid problems during the Christmas peak season, though bosses say this will not have a 'material' impact on performance.
Chief executive Rachel Osborne said: 'We have made encouraging progress, with trading over the second quarter in line with expectations... Full-price sales mix has significantly improved across all our retail channels as we continue to re-establish our premium lifestyle brand positioning.' She added: 'It is still early days in the recovery, but we are confident that Ted is starting to emerge from Covid a stronger and more resilient business.'
