Having watched the extraordinary brinkmanship over the debt ceiling limit bill from more than 3000 miles away, it would be easy to form the impression that things aren’t good in the US of A. There’s always a degree of smoke and mirrors about these things and who can really say what the economic truth is on either side of the Atlantic.
For American retailers, however, it appears that one thing is crystal clear. While business may not be all that on the home turf, overseas markets are looking more attractive. For several that have made the journey to London, business is booming. This is certainly the case for two of Abercrombie’s brands and Urban Outfitters.
All of which is leading others to believe that the problems of setting up shop in an unknown and distant market are worth confronting for the obvious rewards.
The latest to make a London debut is Forever 21, which opened a 50,000-square-foot store in Birmingham at the end of last year. It paid top dollar for a site on Oxford Street. In doing so, it more or less guarantees vast footfalls and many are predicting that it will outcompete some of the home-grown young fashion outfits.
But then news arrives that American Eagle, Aeropostale and others are also looking at London to make European landfall. At which point it’s hard not to see the U.K. as a potential 51st retail state.
There’s a fly in the ointment however. U.K. retail is very tough currently. Given this, the notion that since things are somewhat average back home, the answer for U.S. retailers is to venture overseas may be flawed. First mover advantage has been successful for a few, but second, third, forth, or even fifth? Perhaps not.