The latest News for your perusal (1)

Acquisition

Commission clears acquisition of a newly created joint venture by Proximus and Nexus Infrastructure

The European Commission has approved, under the EU Merger Regulation, the acquisition of a newly created joint venture by Proximus, NV/SA and Nexus Infrastructure, S.à r.l., all of Belgium. The joint venture will roll out and operate a passive open point-to-point Fiber-To-The-Home network in certain parts of Flanders in Belgium. Proximus is the incumbent telecommunications operator in Belgium and a provider of a full range of wholesale and retail telecommunications services. Nexus is a special purpose vehicle, which is part of the EQT Group. EQT is a global integrated alternative investments firm, which invests in infrastructure-related assets and businesses primarily in Europe and North America. The Commission concluded that the proposed acquisition would raise no horizontal competition concerns, given the joint venture’s very limited increment on the wholesale broadband access market. The Commission also found that the vertical relationship between the upstream wholesale broadband access services, and downstream retail and wholesale telecommunications services would be unproblematic, as Proximus and the joint venture’s activities are subject to Belgian sector-specific regulation. The transaction was examined under the normal merger review procedure.

www.ec.europa.eu

Aid for Trade

Tourism’s Recovery Strategies Highlighted at WTO ‘Aid for Trade’ Event

The Asian Development Bank (ADB) partnered with the UN World Tourism Organization (UNWTO) to lead a conversation on what the COVID-19 pandemic’s impact on global tourism means for development across the Asia-Pacific region. Held as part of the World Trade Organization’s Aid-for-Trade Stocktaking Event, the special session brought key sector representatives together to assess how the sector can be transformed to drive recovery and build sustainability.

According to the latest data from UNWTO, the pandemic led to a 73% fall globally in international tourist arrivals in 2020. The drop has been even steeper in Asia-Pacific where ADB estimates a decline of over 80% for 2020, as many Asian countries continued to impose strict travel restrictions. This sudden fall has placed the sector’s ability to drive sustainable development forward on hold.

Building Sustainability and Resilience

The special event at WTO, moderated by Anna Fink, Economist at ADB, explored how ‘aid-for-trade’ can be used to build greater sustainability and resilience in the tourism sector. Joining Matthias Helble Senior Economist at the Asian Development Bank and Zoritsa Urosevic Director of Institutional Relations and Partnerships at UNWTO were representatives from the governments of Azerbaijan and New Zealand, and Suzanne Becken, a tourism expert from Griffith University.

Short and Long-Term Support for Tourism

ADB’s Matthias Helble stressed that a prolonged pandemic puts the survival of large parts of the tourism sector at risk. To help governments finance policy measures that facilitate targeted aid to households and firms most severely affected by the pandemic, ADB launched a USD 20 billion support package in April 2020. By the end of 2020, ADB had committed USD 16.3 billion of this package in the form of grants, technical assistance, and loans to developing member governments and the private sector. At the same time, UNWTO has expanded on its support to Member States across the region, including through the launch of the UNWTO Tourism Recovery Technical Assistance Package, delivering expert support to destinations across the historic Silk Road.

For longer-term recovery, UNWTO’s Zoritsa Urosevic stressed the importance of developing a new finance architecture to to adopt and build innovative, low carbon, circular, safe, and inclusive business policies, and instruments for recovery. At the same time, both ADB and UNWTO reiterated the importance of international cooperation and the harmonization of policies, both to restart international tourism and then to monitor and guide future growth to ensure the sector delivers on its potential to drive sustainable development. 

Further information:

2020: Worst Year in Tourism History with 1 Billion Fewer International Arrivals

www.unwto.org/news/tourism-s-recovery-strategies-highlighted-at-wto-aid-for-trade-event

www.unwto.org

Circular Fashion


RadiciGroup joins Bocconi SDA “Monitor for Circular Fashion”

A community of companies committed to circular fashion along the entire supply chain

RadiciGroup joins Bocconi SDA “Monitor for Circular Fashion”

A community of companies committed to circular fashion along the entire supply chain

 RadiciGroup – an Italian multinational founded in Bergamo and leader in the production of polyamide polymers, advanced textile solutions and engineering polymers for applications in a variety of industries, including textiles and fashion –  is participating in the “Monitor for Circular Fashion”, an innovative Italian project launched by the SDA Bocconi School of Management and Enel X, with the objective of creating an Italian fashion community through the collaboration of the supply chain players most committed to the sustainability agenda.

The initiative aims to assess the state of maturity of the circular economy in the Italian fashion industry, to define an ambitious plan integrating circularity in fashion and to develop new concrete and measurable circular economy solutions through the sharing of best practices, with the goal of making the strategic fashion sector ever more sustainable.

Marco De Silvestri, sales and marketing director of RadiciGroup Advanced Textile Solutions – Apparel & Technical, commented: “The evolution of fashion with a view to promoting sustainability is a key element in the reboot of this strategic sector of our economy. As upstream players in the supply chain, we have always tried to share our knowledge of materials and deliver solutions featuring both better performance and respect for the environment. We have implemented a circular economy business model, striving to create durable, quality products by investing in innovation, using low-impact and recyclable raw materials, choosing renewable sources, minimizing waste, perfecting processes and adopting rigorous environmental impact measurement systems.”

However, we are convinced the circular economy cannot be put into practice by anyone working alone,” Mr. De Silvestri continued. “That is why we have enthusiastically joined this community, where we will work as a team with other fashion industry players to share excellent practices and lay the groundwork for developing innovative, sustainable and measurable solutions for the Italian fashion industry.”

www.radicigroup.com

And here is the official press release of Bocconi:

SDA Bocconi School of Management and Enel X partner to launch the Monitor for Circular Fashion

SDA Bocconi School of Management and Enel X today announced the launch of the Monitor for Circular Fashion, part of the SDA Bocconi Sustainability Lab: an ambitious, first of its kind project, that will provide a picture of the maturity status of the circular economy in the Italian Fashion Industry. The Monitor for Circular Fashion is willing to engage a representative cross-section of the Italian fashion industry across the whole supply chain, in collaboration with the sustainability consultancy Eco-Age.

Already, the initiative has been joined by some of the industry’s key players that shared significant inputs, including Candiani Denim, Dedagroup Stealth, Intesa (Gruppo IBM), Manteco, RadiciGroup, Save the Duck, Vibram, Vitale Barberis Canonico, Vivienne Westwood, and YKK.

This community of companies, chosen for their sustainability and circularity credentials in the Italian fashion industry, is already on a virtuous path, sharing ideas on the opportunities and challenges of circularity. They are specifically focusing on applying best practices to identify and develop new applicable and measurable circular solutions.

One of the main points concerns the key role of transparency and traceability in supply chains, seen as the way to substantiate the sustainability and circularity claims before all the stakeholders, including consumers.

As a key output of the initiative, based on an innovative circularity assessment methodology developed by Enel X and the know-how of SDA Bocconi School of Management Sustainability Lab’s research team for the identification of industry-specific KPIs, a seminal Report will be launched in September 2021, revealing the sector’s macrotrends, measuring how Italian fashion companies apply Circular Economy principles along the value chain, highlighting best practices, gaps, and ultimately proposing an ambitious plan of how to integrate circularity into one of Italy’s biggest export industries.

A circular approach allows the take-make-waste paradigm to be radically changed thanks to the application of five circular business models (Sustainable input, Life Extension, End of Life, Product as a Service, Sharing Platform) ensuring products and materials are kept in use for as long as possible, redesigning the manufacturing, logistic, distribution processes and the customer journeys with the objective of making more efficient the use of resources. The move to a circular system will continue to speed up the global economy’s journey toward a sustainable future.

The Monitor for Circular Fashion also takes part and commits to spreading the Call to Action of the UNECE project “Enhancing Transparency and Traceability of Sustainable Value Chains in Garment and Footwear sector” and the European “Circular Economy Action Plan”.

“The scientific approach is essential to enhance and grow the numerous pilot projects in circular fashion. With the Monitor for Circular Fashion we want to support companies in measuring circularity performance, identifying the main KPIs for each circular fashion business model. In the open dialogue with Institutions and Policy Makers, the Circular Fashion Manifesto will give voice to the best practices of the Italian fashion system”.

Says Francesca Romana Rinaldi, Coordinator of the Monitor for Circular Fashion at SDA Bocconi School of Management Sustainability Lab.

Nicola Tagliafierro, head of global sustainability at Enel X, said: “The Circular Economy is at the center of the Enel X’s strategy, thanks to sustainable business opportunities it is able to generate, and which has allowed Enel Group to position as the leading global utility in the Dow Jones sustainability index. For this reason, we have decided to make our experience and know-how available to support one of Italy’s most important and strategic industries, with the aim of making the sector increasingly circular and an example for the global market.”

Quote from Livia Firth: “I am very excited that Eco-Age is playing a strategic role in amplifying the key outputs of the research and in engaging new partners for the SDA Bocconi Monitor for Circular Fashion powered by Enel X, to place Italy at centre of the global discussion on sustainable fashion.”

SDA Bocconi School of Management has been a leading institution in management training for 50 years. The School’s mission is to help individuals, companies and institutions grow by promoting managerial culture, knowledge and innovation. MBA Programs, Executive and Specialized Masters, Executive Programmes, Custom Programmes, Applied Research, Research Labs and Knowledge Centers all contribute to this – a wide offering aimed at professionals from all over the world and from all sectors of the economy.

SDA Bocconi is among the leading Business Schools in Europe and is among the few to have gained the triple accreditation – EQUIS, AMBA and AACSB – which puts it in the élite of Business Schools worldwide. These results reflect SDA Bocconi’s commitment to be a world-renowned centre for the creation and disseminationof knowledge. #5 European B-School Financial Times Rankings 2020.

SDA Bocconi Sustainability Lab is a multidisciplinary think tank aiming at developing and spreading relevant and innovative research to support enterprises and financial institutions, policy makers and non-profit organisations in their path towards sustainability, ESG and energy transition. The researchers of the SDA Bocconi Sustainability Lab are considered among the main experts on the CSR topic and published several publications also on Sustainable Fashion. The research team is strongly involved in the MASEM – Master in Sustainability and Energy Management (World Rank #1)

www.linkedin.com/school/sda-bocconi-school-of-management/

Enel X is Enel Group’s global business line offering services that accelerate innovation and drive the energy transition. A global leader in the advanced energy solution sector, Enel X manages services such as demand response for around 6 GW of total capacity at global level and 124 MW of storage capacity installed worldwide, as well as around 175000 public and private electric vehicle charging points made available around the globe . Through its advanced solutions, including energy management, financial services and electric mobility, Enel X provides each partner with an intuitive, personalized ecosystem of tech platforms and consulting services, focusing on sustainability and circular economy principles in order to provide people, communities, institutions and companies with an alternative model that respects the environment and integrates technological innovation into daily life. Each solution has the power to turn decarbonisation, electrification and digitalisation goals into sustainable actions for everyone, in order to build a more sustainable and efficient world together.

www.enelx.com  

Eco-Age is a specialist sustainability and communications agency. We are a leading and trusted voice, expert in bringing positive, sustainable change to key audiences.

Our evidence-led sustainability narratives and programmes of change resonate with both consumers and industry insiders. Over the last decade we have honed specific expertise in supply-chains, textiles, impact measurement, internal and external communications, PR and event-planning. The programmes that we develop are aligned with international best practice and feed into global targets. This means the change that we help to activate is real and substantive.

Our sole purpose is to distil our know-how, expertise, enthusiasm and talent into client campaigns, strategies and programmes that bring real and substantive change. Not only does this help to shift the dial on sustainable change, but it gives a new generation of conscious consumers fresh and compelling reasons to invest – emotionally and financially – in the brands of our partners.

Our current partners include luxury fashion and jewellery brands, fashion retailers (including online), real estate companies, celebrity opinion-formers, film and TV academies, music academies, and fashion councils around the world.

Partners

   

FIT’s for Finland

Finland records uptick in foreign investment despite the pandemic

By guest author Aleksi Teivainen from Good News from Finland

Almost 300 foreign companies entered and 130 expanded in Finland in 2020, in spite of the economic and operational challenges brought about by the coronavirus pandemic.

The industries that received the biggest boost from new foreign investments were business services, and information and communications technology. A little over a half of the investments were allocated to Uusimaa, the most populous region of Finland.

The highest number of new investments came from Sweden, Norway and the UK.

The total number of entries represents an increase from both of the two previous years, a remarkable feat in light of the crippling impact the pandemic has had on global investment flows. The UN Conference on Trade and Development (UNCTD) in January reported that foreign direct investment plummeted by 42 per cent year-on-year to less than 860 billion US dollars – a new low since the 1990s.

Foreign companies operating in the country additionally made 130 investments in expanding their operations, substantiating the findings of Finland as a Business Location 2020. The survey found that foreign companies perceived the operating environment more positively than domestic ones and were widely satisfied with the stability, digital infrastructure and functioning of society in Finland.

Ikea and Google, for instance, both invested in developing their own wind farms.

“Although the situation is still difficult with regard to the coronavirus, many foreign-owned companies have said that in these circumstances Finland is the best place for a company to be,” stated Antti Aumo, the executive director of Invest in Finland.

The industries that received the biggest boost from new foreign investments were business services, and information and communications technology. A little over a half of the investments were allocated to Uusimaa, the most populous region of Finland.

The highest number of new investments came from Sweden, Norway and the UK.

The total number of entries represents an increase from both of the two previous years, a remarkable feat in light of the crippling impact the pandemic has had on global investment flows. The UN Conference on Trade and Development (UNCTD) in January reported that foreign direct investment plummeted by 42 per cent year-on-year to less than 860 billion US dollars – a new low since the 1990s.

IKEA Finland now produces renewable energy comparable to the annual consumption of the residents of a city the size of Finland’s Turku. Image: Ingka

Foreign companies operating in the country additionally made 130 investments in expanding their operations, substantiating the findings of Finland as a Business Location 2020. The survey found that foreign companies perceived the operating environment more positively than domestic ones and were widely satisfied with the stability, digital infrastructure and functioning of society in Finland.

Ikea and Google, for instance, both invested in developing their own wind farms.

“Although the situation is still difficult with regard to the coronavirus, many foreign-owned companies have said that in these circumstances Finland is the best place for a company to be,” stated Antti Aumo, the executive director of Invest in Finland.

Finns attract foreign capital

The ability of Finnish companies themselves to raise foreign capital is continuing from last year’s record-breaking start. Among the recent beneficiaries of significant funding rounds are Aiven, Enfuce and Sellforte.

Aiven, a Helsinki-based provider of open-source data technologies on public clouds, has pocketed 100 million US dollars in a venture capital round led by Atomico, with participation from Salesforce Ventures, World Innovation Lab, Earlybird Venture Capital and IVP.

The startup said it intends to allocate a large share of the funding to ramp up its contributions to pure open-source projects, bring new products to market, expand internationally and double its headcount.

The funding injection comes as open source is gaining considerable traction as a model of cross-company collaboration.

“Many of our companies are medium to large companies that generate massive amounts of data and need a modern infrastructure to iterate this data faster,” Oskari Saarenmaa, the CEO of Aiven, told VentureBeat.

“For example, we work with a few large retail companies who are moving data between their physical stores, e-commerce site, warehouse and more. On the Aiven platform, these companies can build a customised data infrastructure in the public cloud that allows them to move this data quicker and gain insights from their data pipelines.”

Enfuce, meanwhile, has received a financial and strategic boost from Tencent, a Chinese technology behemoth.

The Espoo-based provider of banking and payment processing services reported earlier this month that it has completed a seven million-euro funding round highlighted by a five million-euro investment from Tencent. It also bolstered its strategic expertise by welcoming to its board Ling Ge, the chief representative of Tencent in Europe.

“Tencent sees that we will bring new things to payment technologies, especially speed. They’re also interested in the impact we can make through My Carbon Action, our carbon footprint calculator connected to payments,” commented CEO Monika Liikamaa.

Sellforte, a Helsinki-headquartered developer of marketing optimisation software, stated that it is accelerating its growth and scaling up product development with the help of four million euros raised in a round led by Sonae IM, with participation from Bonnier Ventures and Icebreaker.vc.

“Sellforte’s platform is the home of all internal and external marketing data,” said Juha Nuutinen, the founder and chief executive of Sellforte.

“When the data is found in one place, our data analytics models can calculate comparable [return on investment] ROI figures for each marketing investment in different channels and different campaigns,” he commented.

www.goodnewsfromfinland.com

Data

On January 1, 2020, 23 million citizens of a non-member country lived in one of the EU Member States, representing 5.1 % of the EU population.

In addition, there were 13.5 million people living in one of the EU Member States with the citizenship of another EU Member State, representing 3.0 % of the EU population.

Highest shares of non-nationals in Luxembourg, lowest in Poland and Romania. In relative terms, the EU Member State with the highest share of non-national citizens was Luxembourg (47 % of its total population).

A high proportion of foreign citizens (10 % or more of the resident population) was also observed in Malta, Cyprus, Austria, Estonia, Latvia, Ireland, Germany, Belgium and Spain.

In contrast, non-nationals represented less than 1% of the population in Poland and Romania.

In most EU Member States, the majority of non-nationals were citizens of non-EU countries. Only in Belgium, Ireland, Luxembourg, Austria and Slovakia the non-nationals were mainly citizens of another EU Member State.

Share of non-nationals

www.ec.europa.eu/eurostat/

EU trade in goods strongly impacted by the COVID-19 pandemic in 2020

n 2020, the trade of the European Union of 27 Member States (EU)  was hit hard by the coronavirus pandemic, with significant falls observed for both exports (-9.4 %) and imports (-11.6 %) compared with 2019.

Looking at the last decade, the export growth rate, after recording particularly high values (12 % in 2011 and 9 % in 2012), remained positive until 2019 before sharply decreasing in 2020. The import growth rate peaked in 2011 (12 %), followed by small fluctuations between 2012 and 2015, before growing significantly in 2017 and 2018, and closing the decade with a sharp decrease in 2020.

In 2020, the EU trade in goods balance was in surplus by EUR 217 billion. Looking at the trend over time, after recording a small deficit in 2011, the EU trade balance subsequently recorded a continuous surplus, peaking at EUR 264 billion in 2016. The surplus decreased in 2017 and 2018, then increased again in 2019 and 2020.

This information comes from recently published data on international trade in goods. This news item presents only a handful of findings from the more detailed Statistics Explained article.

The majority of EU Member States traded mainly inside the European single market.

The proportion of intra-EU and extra-EU flows in total trade in goods varied considerably across the EU Member States, reflecting to some degree historical ties and geographical location.

Among the EU Member States, the highest share of intra-EU trade in 2020 for both imports and exports was recorded in Luxembourg. In contrast, Ireland was the EU Member State with the largest share of trade for both imports and exports with third countries, which is not surprising as its first trade partner is the United Kingdom.

In 2020, the Netherlands was the entry point of the EU, importing a large share of goods from third countries and dispatching them within the EU. In contrast, Cyprus imported a large share of goods from EU Member States, while the largest share was exported outside the EU.

www.ec.europa.eu/eurostat/

Key figures on European business

Did you know that small enterprises with up to 50 persons employed account for 99 % of the total number of enterprises in the business economy in the EU? And that manufacturing is the largest sector, accounting for 30 % of value added?

You can find these answers and many more in Key Figures on European Business — Statistics Illustrated, a new publication which through visuals and short texts gives an overview of the business economy in Europe.

The publication starts with an overview, followed by more detailed analyses on four specific parts of the business economy — industry, construction, distributive trades and other non-financial services, and ends with a chapter on tourism.

Each of these chapters focusing on different parts of the business economy starts with an overview of the economic structure and continues with information on annual developments through to 2020.

The COVID-19 pandemic itself and the accompanying restrictions have impacted on the supply of and demand for many goods and services produced and traded within the EU’s business economy. Although it is too soon to evaluate the full impact of the crisis, this publication provides an initial review of COVID-19 impacts for different parts of the business economy.

Go to the publication Key figures on European business

www.ec.europa.eu/eurostat/

McKinsey’s week in charts

The papas join the mamas

Hands up for the last time you saw a survey result of 100 percent. Our survey on paternity leave produced this rare result: men were unanimously happy about their experience. Only 20 percent were even slightly worried about career risk.

To read the article, see “A fresh look at paternity leave: Why the benefits extend beyond the personal,” March 5, 2021.

Black talent is last in, first out, and quick to be cut

Already underrepresented in the industry, Black actors, writers, directors, and producers are especially vulnerable to market shocks.

To read the article, see “Black representation in film and TV: The challenges and impact of increasing diversity,” March 11, 2021.

Remote learning gets an “F” in poorer schools

Teachers working in poorer schools found virtual classes to be especially ineffective, rating it 3.5 out of 10. In contrast, teachers in private schools averaged a rating of 6.2. Resources make a difference—teachers in wealthy and private schools were also more likely to report that their students were well equipped with internet access and the devices required for remote learning, leading to higher engagement.

To read the article, see “Teacher survey: Learning loss is global—and significant,” March 1, 2021.

Autonomous dinner deliveries may be headed your way

Pandemic lockdowns have increased interest in autonomous technology: in North America, many more respondents said they’d likely take food and package deliveries from autonomous vehicles.

To read the article, see “Mobility investments in the next normal,” March 4, 2021.

We’ll always have Paris—as a goal

With no formal, defined global standards to price their carbon emissions, many companies are selecting values that are most useful within their own business contexts and regions—even if they are considerably lower than what’s needed to meet Paris Agreement targets.

To read the article, see “The state of internal carbon pricing,” February 10, 2021.

Masks

Biden Administration Awards two Contracts for more than 17 Million American-Made Face Masks to NCTO’s Parkdale Mills, Ferrara Manufacturing Inc.

The Biden Administration has awarded two contracts to National Council of Textile Organisations (NCTO) members Parkdale Mills and Ferrara Manufacturing Inc., following through on the President’s pledge to procure millions of fully Made in America face masks for community health centers, food pantries and soup kitchens across the country.  A third contract is expected to be awarded to a small business early next week.

North Carolina headquartered Parkdale Mills, the nation’s largest cotton yarn spinner, has partnered with Ferrara Manufacturing, a tailored clothing company based in New York City’s garment center whose workforce is union represented by Workers United/SEIU, to manufacture over 17 million reusable masks. The government said it could purchase up to a maximum of 22.2 million masks under the two contracts announced today. The masks will be Berry compliant and thus 100% U.S.-made.

Ferrara Manufacturing and Parkdale Mills will contract with additional U.S. companies across the manufacturing supply chain, employing nearly 5,000 American workers as a result of these awards.  Parkdale will be utilizing yarn from their facilities in NC, VA, and GA and Ferrara will deploy their cut and sew operations in New York City.  Additional suppliers include:

•             Clover Knits (SC)

•             A&E (NC)

•             America Knits (GA)

•             Apex Elastic (NC)

•             Texlon Plastics (NC)

•             Cotswold Industries (NY/SC)

•             South Fork Industries (NC)

•             USC Bag (New Mexico)

•             Fitessa (Simpsonville SC)

•             Unionwear (NJ)

•             Lynda Studios (NY)

•             Domoi Collection (NY)

“The entire Parkdale team wants to thank President Biden and his administration for this opportunity to make reusable cotton face masks for millions of Americans,” said Davis Warlick of Parkdale Mills. “By procuring 100 % American-made masks, we are putting thousands of workers across the United States to work to help our most vulnerable communities.  We are excited to partner with Ferrara Manufacturing and are proud of our supply chain partners and their hard work to make this product crafted with pride in the United States.”

Gabrielle Ferrara, Chief Operating Officer and owner, of Ferrara Manufacturing: “This is another amazing moment for our industry to come together to produce lifesaving PPE for people who need it most. Ferrara is proud to partner with Parkdale Mills and we want to thank the administration for supporting our workforce, who have sacrificed so much during the pandemic to answer the call of the nation to produce million masks. We also greatly appreciate the strong support and partnership of Workers United/SEIU to help amplify the needs to bolster this critical supply chain.  We are honored to have this opportunity.”

The U.S. textile industry has produced over a billion lifesaving PPE and other medical products over the last year.  Since the spring of 2020, both Ferrara and Parkdale have retooled their production chains to help produce millions of masks and gowns to help workers on the frontlines. 

Kim Glas, President and CEO of NCTO: “We want to sincerely thank President Biden for his leadership and support of American manufacturing workers with this purchase. We appreciate the administration’s commitment to purchase fully made in America masks and we believe this is a significant opportunity to continue to showcase our incredible domestic textile industry and all of its capabilities.  We have a once-in-a-generation opportunity to onshore these critical supply chains long-term and we look forward to working with the administration and Congress to advance long-term policies to bolster this critical production capacity here in the United States.”

See press release from Workers United, an affiliate of SEIU, here

NCTO is a Washington, DC-based trade association that represents domestic textile manufacturers.

•             U.S. employment in the textile supply chain was 530000 in 2020.

•             The value of shipments for U.S. textiles and apparel was USD 64.4 billion in 2020.

•             U.S. exports of fiber, textiles and apparel were USD 25.4 billion in 2020.

•             Capital expenditures for textiles and apparel production totaled USD 2.38 billion in 2019, the last year for which data is available.

www.ncto.org

Retailing

Confirmed: John Lewis shuts down 8 more stores; 1465 staff affected

By guest author Elias Jashan from Retail Gazette

  • John Lewis Partnership will not reopen 8 John Lewis stores when non-essential retail lockdown ends
  • The move will affect 1465 staff and brings the John Lewis store count down to 34
  • It’s part of a strategy to “rebalance” John Lewis’ portfolio & to open John Lewis shop-in-shops in Waitrose stores

The John Lewis Partnership has announced plans to not reopen eight John Lewis stores when lockdown on non-essential retail is lifted from next month.

Consultations with 1465 staff affected by the proposals have commenced and the partnership said it would “make every effort to find alternative roles” in the business for as many staff as possible.

The eight John Lewis stores identified for closure include four smaller At Home shops in Ashford, Basingstoke, Chester and Tunbridge Wells plus four full-size department stores in Aberdeen, Peterborough, Sheffield and York.

www.johnlewis.com

www.retailgazette.com

Another 18000 shops may permanently close their doors this year

By guest author Elias Jashan from Retail Gazette

  • Another 18,000 shops could permanently close down this year, according to Local Data Company
  • LDC says the worst is yet to come and UK retail still needs to grapple with the collapse of Debenhams & Arcadia
  • More than 11,000 retailers, restaurants and leisure outlets shut in 2020

New research has revealed that another 18,000 shops could close down for good in 2021, making this year worse than 2020 even if the Covid-19 pandemic subsides in the UK.

According to new data from the Local Data Company (LDC), up to 18000 more retailers, restaurants and leisure outlets could be left vacant this year as high streets and shopping centres grapple with the collapse of major retailers including Debenhams and Sir Philip Green’s Arcadia Group retail empire.

LDC said this would be much worse than 2020, when 11000 high street businesses closed their doors for good across England, Wales and Scotland.

Of that total, 9877 were retail units operated by chains and 1442 were independent shops, restaurants and leisure venues.

Recent and similar data from LDC, compiled with PwC, found that the 9877 figure of permanent retail closures was the highest on record and equates to 48 stores closing every day, with just 21 opening.

PwC and LDC also said that figure was based on 17532 chain stores closing down last year, while only 7655 opened up.

Nonetheless, LDC said retailers were hardest hit during 2020, followed by bookmakers, estate agents and mobile phone shops.

However, it found that beauty salons, fast food outlets and nail bars were among the fastest growing sectors.

The LDC added that city centres were hardest hit by the pandemic as they suffered from a lack of tourism and commuters, with vacancy rates rising 2.5 percentage points to 16.1 %.

Small towns and villages fared better, with vacancy rates increasing only 0.4 percentage points to 11.1 %.

LDC warned that the UK has still not yet seen the worst of Covid-19’s impact on retail.

“What remains to be seen are the consequences of government support ending, effectively ‘defrosting’ a significant portion of the market which has been frozen in time since the onset of the pandemic,” LDC head of retail Lucy Stainton said. With this in mind we would expect to see the state of play in terms of vacancy rates and net change worsening over the course of 2021 and 2022 before levelling out.”

LDC’s analysis covered 680000 outlets in 3000 shopping locations.

www.ldc.co.uk

www.retailgazette.com

JC Penney’s interim CEO sees green shoots emerging as department store chain plots post-bankruptcy turnaround

By guest author Lauren Thomas from CNBC

Key Points

  • Just a few months into serving as interim CEO of J.C. Penney, Stanley Shashoua said he sees signs of growth in the business.
  • Shashoua, who also serves as chief investment officer of the biggest U.S. mall owner, Simon Property Group, has been at the helm of Penney since Dec. 31.
  • That’s when former CEO Jill Soltau abruptly left, following the department store chain’s Chapter 11 bankruptcy filing seven months earlier.
Caption courtesy by CNBC

Just a few months into serving as interim CEO of J.C. Penney, Stanley Shashoua said he sees signs of growth in the business.

“J.C. Penney is a great American family destination, and our strength is in our storied brands and the services we provide,” he said in a phone interview. “We’re seeing week-over-week improvements in the business, and we’re increasingly optimistic as we work our way through this.”

Specifically, he cited growth in home goods and athletic apparel — two categories that have outperformed during the Covid pandemic as Americans look to refresh their houses and restock their wardrobes with more comfortable clothing. More recently, Shashoua said, customers have been coming to Penney for Easter dresses and other formal wear — another sign that people are ready to dress up again.

Shashoua, who also is chief investment officer of the biggest U.S. mall owner — Simon Property Group — has been at the helm of Penney since Dec. 31. That’s when former CEO Jill Soltau abruptly left, following the department store chain’s Chapter 11 bankruptcy filing seven months earlier.

Simon, along with the U.S. mall owner Brookfield, came to the rescue late last year, acquiring nearly all of Penney’s assets out of bankruptcy for USD 1.75 billion in cash and debt. That included taking control of roughly 670 stores, compared with the more than 800 that Penney had when it filed. For now, the company said, no additional store closures are being planned.

According to Shashoua, the search for a permanent CEO is also ongoing and the prospects are plentiful.

“We are taking our time,” he said. “We’ve gotten a lot of interest from a lot of very high-quality, highly qualified people. And that’s very encouraging. People come to us and tell us they love Penney, they grew up with Penney, and they’re emotionally invested in it and have real points of view about the business.”

Simon Property hopes for another success story

J.C. Penney’s troubles didn’t crop up overnight. The business had been stumbling for years due to the ascent of e-commerce and what many analysts say was a failure by management to invest in upgrading stores and modern merchandising. A heavy debt load and the pandemic are ultimately what pushed it over the edge.

After working through bankruptcy proceedings, Shashoua said the Texas-headquartered company has emerged with a stronger balance sheet and better liquidity, though he did not provide figures. He said the focus has shifted to keeping cash flowing into the coffers. It has scaled back contracts with vendors and has invested in launching more private labels across apparel and home, he added.

“It’s a very similar approach in the initial stages that we’ve taken with all the other companies that we’ve managed to turn around,” he said.

Simon has already helped to take several retailers out of bankruptcy. Those include the mall-based retailers Aeropostale, Forever 21, Brooks Brothers and Lucky Brand. The latter two filed for bankruptcy in 2020.

Simon CEO David Simon has said his company “made a ton of money” in its Aeropostale deal. He’s also told analysts, “We’re certainly as good as the private-equity guys when it comes to retail investment.”

In its bid to save Penney with Brookfield, Simon saw an opportunity in Penney’s loyal and diverse customer base. It also at one point had a Penney store in about 50% of its U.S. malls, based on one analyst’s analysis, which also likely spurred the landlord’s interest in investing to avoid further store closures at its own shopping centers.

Simon Property shares are up more than 33 % this year. It has a market cap of USD 42.7 billion.

New brands coming to stores

Simon’s retail deals often involve collaboration with the global brand owner and licensing company Authentic Brands Group, who is also now playing a role in reviving J.C. Penney.

Shashoua said some of ABG’s apparel brands, like Forever 21 and Juicy Couture, are going to be added to Penney’s merchandise assortment in stores and online. “2021 is more about rebuilding the company, and I think 2022 you’re going to see good growth,” he said.

For Penney, categories of focus in coming months include home goods, men’s merchandise in big-and-tall sizes, women’s merchandise in inclusive size ranges, and baby and kids gear, according to Shashoua. He also wants to grow online commerce, which now represents about 20% of Penney’s sales.

To be sure, Penney’s path to profitable growth, winning back customers, and gaining market share in key categories like apparel and footwear won’t come easily.

Consumers have increasingly steered clear of suburban malls, and especially during the pandemic. Many have shifted their purchasing online to the benefit of e-commerce giants like Amazon and Walmart. Clothing sales also have been hampered during the health crisis, as Americans have been spending much less time getting dressed up to get out.

Spending by U.S. consumers on clothing and footwear tumbled 48% year over year last April, when many retail stores that sell apparel and accessories were shut for the full month, according to a tracking by Coresight Research. More recently, spending in the category has ticked back up, growing 0.8% in January, Coresight said.

Last year, along with Penney, department store operators Neiman Marcus, Stage Stores, Lord & Taylor and Century 21 filed for bankruptcy.

Penney hopes to avoid the fate of the iconic department store chain Sears. Since filing for bankruptcy in 2018, Sears has slowly been whittling down its store footprint to become a fraction of its former self.

“We’re strengthening our retail fundamentals, with a focus on modern retail, digital, and an engaging customer experience,” Shashoua said. “Retail is evolving faster than ever … and so our goal is to execute swiftly.”

www.jcpenney.com

www.cnbc.com

Boohoo cuts ties with over 100 suppliers in latest Leveson report

By guest author Elias Jashan from Retail Gazette

  • Boohoo cuts ties with over 100 suppliers, now only works with an approved list of 78
  • It comes 6 months after the firm accepted all the recommendations of an independent review led by senior lawyer Allison Levitt
  • Cutting ties with suppliers was one of the recommendations for Boohoo to meet transparency commitments

Boohoo Group has severed ties with over a 100 garment factories after a sweeping review of its supply chain in the UK.

In its second Sir Brian Leveson-led report investigating its supply chain, the retail giant published a list of 78 approved manufacturers operating across 100 sites in the UK, meeting a commitment for increased transparency.

This is down from an estimated 200 main manufacturers.

Boohoo Group, which owns a raft of online retailers like PrettyLittleThing, Karen Millen, Oasis and now Debenhams, initially launched its investigation after it became embroiled in controversy surrounding modern slavery allegations and poor working conditions among its third party suppliers.

The latest report in the investigation comes six months after the retailer accepted all the recommendations of an independent review led by senior lawyer Allison Levitt, which found major failings in its supply chain in England.

It also marks the first time the fast fashion giant has published a full list of suppliers since the controversy, and was one of Levitt’s core recommendations.

Last September Boohoo set out steps to tackle the problems.

The following November, it appointed Leveson to independently oversee its “Agenda for Change” programme, which implements the recommendations of Levitt’s report.

Boohoo said the list was the result of work carried out through the programme, to map and audit its manufacturers and introduce changes to the way the business works with its suppliers.

Boohoo responsible sourcing director Andrew Reaney also worked with independent auditors Verisio and Bureau Veritas to examine the working practices of suppliers, the majority of which have been audited twice in the last eight months, including at evenings and at weekends.

Boohoo said Leveson also commissioned Tim Godwin, a former senior police officer, to carry out additional forensic-level enquiries to identify and address any irregularities in the leadership and management of suppliers.

Boohoo said it has ceased doing business with the manufacturers that were unable to demonstrate the required standard of transparency. “This is the not the end of a project for us at Boohoo but the beginning of a new way of working with our suppliers,” chief executive John Lyttle said. We have faced up to the problems of the past and are now driving positive change in the industry.”

www.boohoo.com

www.retailgazette.com