Morrisons to launch low-cost clothes line

Yorkshire-based Morrisons is to launch a no-nonsense clothes brand from the spring tagged Nutmeg. It's the supermarket's first foray into clothing, an area that rivals like Asda and Tesco have taken up with gusto - though not without hiccups.

Morrisons has shown it can get pies right. But can it do fashion?

Tough market

It's unlikely because they're not doing fashion, strictly speaking. Morrisons aims to supply basic kids' togs and adult basics, some distance from the fancier ambitions of Zara and Primark - not to mention Asda's George fashion label. One City analyst said that supermarket fashion is very hard to get right.

"It's quite difficult to make money also. Clothes can carry higher margins than food but higher mark-downs do come with the territory. George [Asda] has been the most successful, but it's difficult to track how well they're doing beyond the PR spin." It's also, too, an increasingly mature market, making quick gains harder.

Sales pressure

Morrisons has hired ex-Peacocks managing director Tim Bettley as clothing director who will head a buying and design team of 50. The move is needed as Morrisons third quarter numbers emerge later this week - there are predictions of a 1% dip in like-for-like sales.

"We want to offer a different approach from other supermarkets with simple hard-wearing fashion that is easy for customers to pick up while they are doing their food shop," Bettley said in a press release. It's thought the Nutmeg range will debut in around 100 Morrisons stores from March.

Tesco and Sainsbury's will be watching closely. Non-food is increasingly important for retailers, witness sales campaigns from Sainsbury's supported by Gok Wan. Recent Kantar Worldpanel supermarket figures showed that for the 12 weeks ending 30 September, Sainsbury's bagged the strongest growth of 5.6%, lifting its share from 16.2% a year ago to 16.5%.

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