Myer is buying a slice of Topshop’s Australian arm and bringing the cult fast-fashion brand into its department stores as it attempts to regain its retail mojo.
From November, Myer will roll out Topshop Topman concessions in more than 20 of its department stores as a key part of a plan to turn around its struggling business.
Myer is also buying a 25 per cent stake in the Austradia Pty Ltd, the Australian franchisee of the famous UK high street brand.
“It’s one of the most exciting fashion brands in the world, globally recognised, followed by fashion lovers around the world – this is a major coup for Myer,” chief executive Richard Umbers said on Thursday.
The Topshop deal is part of Myer’s $600 million strategy to revamp its sluggish retail base by stocking “wanted” brands like French Connection, Seed and Nine West in an attempt to attract affluent, fashion-forward customers.
It recently dumped more than 100 brands, including some in-house labels, from its fashion stable.
“This is a time of massive change, a massive reinvention of the business,” Mr Umbers said.
Industry watchers say the partnership with Topshop is a smart move for Myer, which has been facing stiff competition from the arrival of global speciality retailers like Uniqlo and Zara.
“It’s a case of if you can’t beat them, join them,” said Brian Walker, founder of the Retail Doctor group.
“It’s all about bringing the existing Topshop customer into the store so they don’t go to another competitor or David Jones.
“It’s a really smart move the more I think about it and I do think that it’ll be successful as long as Topshop retains its edginess and relevance.”
With Myer stores receiving more than 130 million visits a year, the deal will also vastly expand Topshop Topman’s reach across the country and lessen the cost of expanding with its own standalone stores.
First published on Business Spectator on 1st September.