View more on these topics

Schroders’ Buxton: Patience needed for high street investment

Opportunities for investment will arise in the UK retail sector, despite harsh conditions blighting the high street, according to Schroders’ head of UK equities Richard Buxton.

Buxton, who manages the £2.9 billion Schroder UK alpha plus fund, says “all is not well” in the sector and expects this to continue for some time to come.

He highlights the fact that retailers such as Jane Norman and Habitat recently went into administration, HMV is selling off Waterstone’s in a bid to cut debts and Carpetright suggested it might close stores.

“After a boost to clothing sales from the early summer sunshine in April, trade has slowed through May and the return of rain in June has accelerated the decline,” Buxton adds.

Figures from the British Retail Consortium support this view, showing that May’s sales were 2.1 per cent lower than those one year before. The group says consumers are increasingly reluctant to spend in the current economic climate.

Buxton also predicts this subdued consumer environment will continue for several more years, which will result in more retailers reducing in size or dropping out of the market completely.

But he claims that pressure on the consumer, such as VAT increases and rising unemployment, are close to their end, which will benefit stores willing to invest in advertising and hiring.

“If as a UK retailer you have a strong balance sheet, experienced and cautious management and a sustainable franchise, then you will survive the current tough times,” the manager adds.

“For the patient investor, there will be great opportunities on the high street in the coming years.”


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm