Keeping up with Joneses hits Woolworths
Retailer misreads market to pitch fashion too high and too low for customers
The story of Woolworths in recent times is headlined by an expansion project in Australia that failed to meet high expectations. The performance of ailing retailer David Jones, bought almost five years ago, has been a sad chapter for shareholders, contributing to a 24% slump in the company's shares since then. Woolworths acquired the David Jones department store chain for a steep R21bn-plus and concedes that it overpaid for it. It has struggled to reverse the impairments caused by the chain, which dealt a blow to the retailer's 2018 financial year. While much attention has focused on turnaround efforts more than 10,000km away from its Cape Town head office, the performance of Woolworths's fashion, beauty and home business has also started to raise some worrying signs for the retailer. Its clothing business has missed the mark for a number of seasons and, in a fiercely competitive local market that has seen the entry of international retailers such as Zara and H&M, it has been left e...
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