ASOS Can Help Arcadia Brands Regain Their Fashion Authority, says GlobalData
ASOS has reported the acquisition of Topshop and three other brands was sealed for £ 265 million by the collapse of the Arcadia retail empire. The Topshop, Topman, Miss Selfridge and HIIT brands have been purchased from administrators by the online apparel retailer.
After this acquisition, it is assumed the move would mean all shops closing permanently as the brands become online only. Asos also told investors that as part of the transaction, it would take on about 300 employees, which would not include any of the brands’ stores. But there are also rumors that in a contract with ASOS, JD Sports has been in negotiations to operate the stores.
Sir Philip Green’s retail group administrators said the buyer also paid another £ 65 million for existing and pre-ordered stock.
Chloe Collins, Senior Apparel Analyst at GlobalData, a leading data and analytics company, offers her view on this news:
“ASOS is a complementary new owner for Topshop, Topman, Miss Selfridge and HIIT and will be able to give the brands the revival they desperately need. The brands are already popular sellers through ASOS’ third-party platform, with sales growing 41% in the four months to 31 December 2020, so there is strong customer overlap which should allow for a seamless transition. Though ASOS plans to retain some of Arcadia’s design and buying teams, the brands have undoubtedly lost their fashion authority in recent years, so support from ASOS, which is much more reactive to trends and relevant among younger consumers, should help steer them back in the right direction.
“In another bleak day for retail workers, the deal unsurprisingly does not include any of the Arcadia brands’ stores, and Topshop in particular will certainly be missed from high streets across the UK. However, as shoppers become ever more accustomed to purchasing online, ASOS’ digital prowess will aid the brands in gaining top of mind appeal, with full integration onto its own platform the best route to success as the brands’ own online offers have always been behind the competition. ASOS’ impressive global reach will also help the brands target new international shoppers, and its plans to boost Topshop’s partnership with Nordstrom will hopefully reignite US shoppers’ love for the brand following the closure of its physical stores there in 2019.”