UK's House of Fraser store sold to Chinese Sanpower
Besides the acquisition of House of Fraser by a Chinese buyer, several other recent large international deals – many from Asia and the Middle East – centre around buying and turning around British heritage brands starved of marketing investment.
Some of these include: Harvey Nichols (Dickson Concepts, Hong Kong); Selfridge’s (Galen Weston, Canada); Harrods (Qatar Holdings, Qatar) Battersea Power Station (S P Setia, Malaysia).
So why are non-UK companies investing in these home-grown brands, often with royal warrants, property assets and global brand recognition attached?
1) Those outside the UK recognise the opportunities to leverage the brand and its asset value which British companies are less inclined to see objectively
2) These investments are long-term plays, for which increasingly UK investors have less of an appetite
3) The brand may have potential use as a springboard into Continental European market development
4) Those outside the UK are less tainted by the baggage and boredom that comes with home market brands with turbulent trading
How can these foreign acquirers make the most of these British heritage brand assets?
- Invest in infrastructure
- Bring a fresh view and strategy on customer service, merchandise mix, product development
- Modernise while leveraging the brand’s best aspects of its British heritage
China’s luxury consumption patterns are changing and the high-end, unique British brands are now playing a major role in the country’s luxury portfolio.