The BBC has a good story about what went wrong at The Body Shop, a trailblazing retailer in the eighties that recently has been placed in administration, which is like filing for bankruptcy.
An excerpt:
“The Body Shop of today is facing a crisis. Its new owner – the third in seven years – has taken the drastic decision to place the UK side of the business into administration.
“At this stage, it is a little too early to say what it will mean for The Body Shop’s 200 stores in the UK but it is safe to assume many will have to close to cut costs, leading to job losses.
“It is understood that Aurelius, the private equity firm that bought The Body Shop for £207m in November, made the move after poor sales during the all-important Christmas shopping season seeped into January.
“It is also believed that The Body Shop’s working capital was not as healthy as initially thought.
“Some would argue, however, that this was a long time coming.”
You can read the entire story here.
KC’s View:
The bottom line, the story suggests, also is a good business lesson for any retailer. The Body Shop used to be a must-have brand for young people. But now it is perceived as a brand that only is must-have for young people’s mothers and grandmothers.
“It is the retailer that has to own that,” one observer says. “They need to make it a current, must-have brand and they haven’t done that.”
Exactly.
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