Fenwick, the department store group, has reported substantial losses as a result of the COVID-19 pandemic. The forced closure of its stores during lockdowns, combined with a lack of online presence, led to a sharp decline in sales and pre-tax losses. Compared to 2019, the company experienced losses of £112 million, with sales plummeting from £323.7 million to £140.5 million. Fenwick, which owns nine department stores, including its flagship location on London’s Bond Street, had to decrease the value of its stores to £376 million due to reduced footfall.

CEO John Edgar acknowledged that the company’s limited online platform was a contributing factor to its struggles during the pandemic. The decision to downsize the online operations before the crisis resulted in a complete shutdown. However, Edgar emphasized the importance of investing in the digital aspect of the business for future growth. Currently, approximately 80% of Fenwick’s product range is available online, and the company aims for e-commerce to represent a fifth of its revenues. Additionally, Edgar believes that department stores can offer a wide range of products similar to their online counterparts and stressed the significance of physical stores.

Despite the challenges faced, Fenwick has seen increased footfall in some locations. While the Bond Street store suffered from a decline in visitors due to the absence of office workers and tourists, other stores have attracted customers looking for luxury products. Edgar highlighted that Fenwick often becomes the sole option for luxury items in certain areas.

To mitigate the financial impact of the pandemic, Fenwick made use of government support schemes. The company received £9 million in furlough support and £8.7 million in business rates relief. However, the retailer’s pension deficit also rose by £7 million, reaching £36 million.

Overall, Fenwick’s financial results highlight the difficulties faced by high-end department store groups during the pandemic. The absence of a robust online presence and the closure of physical stores had a significant impact on the company’s sales and profitability. Fenwick aims to strengthen its digital operations going forward while recognizing the continued importance of its physical stores in driving the business.

Useful links:
1. Fenwick department store website
2. Government support schemes during COVID-19