British fashion chain New Look is making a profit again: during the financial year 2013, that ended at the end of March, New Look realised a gross profit of 3.1 million pound (3.6 million euro). Last year the company made a loss of 54.5 million pound (64 million euro).
Online growth compensates offline decline
The improvement is partly due to the rise in sales, which climbed by 2.5% in the past financial year to 1.48 billion pound (1.7 billion euro). This was mainly because of much higher online sales, up by no less than 50.1%. Those compensated the slight decline in physical shops.
The strong expansion of online sales, already worth 95 million pound (111 million euro), was the result of new, more user-friendly online shop and a broader offer with some exclusive products.
Closing shops on home market, expansion abroad
New Look also used a cost-effective style and company processes improved to increase their efficiency. This caused the closing of 42 onerous British shops, while a quarter of the remaining 589 locations in the United Kingdom received a thorough makeover. The rest will receive the same treatment over the next three years.
Outside of the home market the number of shops raised from 499 to 549. In March 2014 New Look is planning to open is first shop in China. Hundreds of new shops are set to open in the near future, with Russia, Poland and South Korea also on the books for expansion.
New Look is owned by founder Rom Singh and the investment funds Apax and Permira. The chain has more than 1.100 locations in 32 countries.