Next to open beauty halls in former Debenhams stores

There'll be a new name in beauty appearing at shopping centres after the lockdown ends.

Next has snapped up space in five former Debenhams stores to extend its online Beauty concept to bricks and mortar.

The retail fashion chain launched its beauty business in 2018 and now offers 200 different brands online.

"We're creating a new force in beauty retailing," said Next boss Simon Wolfson.

The new stores will open up in five Hammerson shopping centres.

The stores will be located at Bullring & Grand Central, Birmingham, The Oracle, Reading, Highcross, Leicester, Silverburn, Glasgow and Centrale in Croydon.

Next said it is also in discussions for a "small number" of further sites, as it continues to grow its beauty business.

Replacing Debenhams

The beauty halls from Next will replace Debenhams' beauty halls in Hammerson's centres while the property owner looks at opportunities to fill the other empty floors of the former department stores.

Next said the stores would be adapted to ensure that, when they open, they adhere to government social distancing guidelines and are safe for customers and staff.

"This is an exciting opportunity to bring our online business to life," said Mr Wolfson.

Amid the high street gloom, the health and beauty sector is a bright spot.

According to GlobalData, it's the fast growing sector in retail and is forecast to grow by 16.5% until 2023, thanks, in part, to Instagram influencers and YouTube vloggers as well as new brands and products coming onto the scene.

Lots of retailers are getting in on the act. Next started selling online beauty items in 2018. But in-store shopping for beauty products still remains the go to option for consumers who like trying out a new lipstick, for instance, or getting some personal advice.

Next senses an opportunity to try something new. It also has the financial confidence to be bold when others can't. It's a fascinating move.

Retail analyst Richard Hyman said the deal reflects the differing fortunes of retailers. "While Debenhams is facing an existential crisis - which it's not going to survive - the threat to Next is manageable.

"That's because it's better run, on a much sounder footing, and has strong relationship with its customers." He said that Next's action is a "positive opportunistic move".

Next has about 500 clothes stores in the UK

Next launched its Beauty business online in 2018 in conjunction with Fabled by Marie Claire, then owned by Ocado.

It bought Fabled from Ocado in July 2019 and now sells brands such as Estee Lauder, Clinique, Benefit, Origins, The Ordinary, GHD, Dermalogica, Aveda, Illamasqua, Elemis, Burberry, By Terry, Rituals, L'Occitane, Bvlgari, Emporio Armani and Boss.

Challenging time

The deal is a boost to Hammerson, which saw a £400m deal to sell seven UK retail parks collapse on Wednesday.

"This is a really challenging time for all of us, so it's really encouraging to see strong, innovative brands like Next work with us to plan for the future," said David Atkins, Hammerson's chief executive.

"This is another example of how we are re-purposing department store space and improving the shopping experience for consumers."

It received planning consent to redevelop the House of Fraser store at the Oracle, Reading in March and has secured Ireland's luxury retail store Brown Thomas to replace the House of Fraser unit in Dundrum Town Centre, Dublin.

"The Next deal is the right decision not only for consumers but for our communities more broadly, as it will create employment prospects and support local economies all over the country," said Mr Atkins.

Richard Lim, chief executive of Retail Economics, said deal with Hammerson marked the changing relationship between landlords and retailers as firms close down and others protest against high rents.

"The balance of power has shifted. Many retailers are looking at what's happening in the retail property market and seeing it as an opportunity," he said.