We provide due diligence and portfolio optimisation acquisition advice for private equity companies based on our understanding of retailer performance and market potential. The ability to use store expansion/divestment strategy as a base allows us to inform clients about the future viability of businesses they are looking to acquire. We carry out store strategy from an ‘outside in’ perspective, using our knowledge of European retail markets and supported by local teams. We also provide advice on how to reduce occupier’s costs through restructuring/regearing portfolios to create competitive advantage in the sale/acquisition process.
How you benefit
In order to understand future value, clients need to understand the true revenue potential of a specific retailer in order to run financial models from an investment perspective (IRR, % margin etc).
Understanding potential for growth, and the ‘optimised portfolio’ enables the client to future proof their investments, and understand turnover which is achievable and rents that would be required in specific locations.
In this note, we set out the key issues which Brexit is already raising for retailers. Migration controls and currency movements may mean workers are less ready to work in the UK retail industry, which may increase time and cost. Currency devaluation will also generate more general cost inflation, though not everyone is a loser from these effects, and cost increases may spur yet more innovation in an already dynamic sector. The good news is that this year isn’t all about Brexit. The bad news is there are other more pressing concerns in 2017, with the rating revaluation and apprenticeship levy among the factors which retailers will have to grapple with. As always in retail, the winners will be the most agile and forward-thinking.