Markham is the largest men’s fashion retail chain in southern Africa, located in most major shopping centres and large towns. In our endeavour to make our customers “feel great, look good, and share our passion for style”, we provide up-to-date, internationally-inspired menswear of good quality and value, suitable for all occasions and daily experiences. Whilst we target the LSM 6 – 10 range, LSM 3 – 5 are also buyers of our apparel for stylish appearance. “Markham Relay” has recently been established as a more compact store focused on our casual range.
RJL, which was part of the Markham stable, was phased out to free up retail space required for other group brands, including “Markham Relay”, that have a greater rollout potential and trade at higher gross margins.
| % change | % change | |||||||
| 52 versus | 52 versus | |||||||
| 2007 | 53 weeks | 52 weeks | 2006 | |||||
| Turnover | Markham | 1 117,6 | 15,9 | 18,6 | 963,9 | |||
| (R million) | RJL | 20,8 | (77,1) | (76,4) | 90,8 | |||
| Total | 1 138,4 | 7,9 | 10,4 | 1 054,7 | ||||
| Number | Markham | 191 | 6,1 | 180 | ||||
| of stores | RJL | – | (100,0) | 28 | ||||
| Total | 191 | (8,2) | 208 | |||||
| Floor area | Markham | 58 230 | 6,0 | 54 939 | ||||
| (gross m2) | RJL | – | (100,0) | 3 825 | ||||
| Total | 58 230 | (0,9) | 58 764 | |||||
| Number of | Markham | 1 560 | 20,5 | 1 295 | ||||
| employees | RJL | – | (100,0) | 167 | ||||
| Total | 1 560 | 6,7 | 1 462 |
Markham stores improved comparable sales by 18,6% for the year with comparable same store sales growth of 8,2%. Although prices effectively remained constant, changes in the product mix resulted in 2% product inflation. Cellphones again performed well with growth of 34,3%, representing 17% of turnover. Continued control of markdown and expenses resulted in a further increase in profitability.
Markdowns at 10,5% of turnover are at a very acceptable level which is sustainable for the future. The table following sets out the clothing markdown history.
| 2003 | 2004 | 2005 | 2006 | 2007 | ||
| Markdown value (Rm) | 66,1 | 83,1 | 95,0 | 106,6 | 99,2 | |
| % to sales | 10,6 | 12,0 | 12,4 | 11,7 | 10,5 |
Our brand repositioning, which commenced in the second half of 2005 has more than exceeded expectations. The same store new-format Markham stores grew in excess of 35% for the year, and we now have 72 of these stores all trading extremely well. In addition to this, a further 38 smaller Markham stores have been rebranded with the new Markham logo, but without a complete store revamp.
During the year 12 new stores were added and a further ten relocated or enlarged. Of these new stores, five are the new “Markham Relay” casual range stores.
In 2005 we saw the start of a major repositioning of the Markham brand. This repositioning seeks to ensure that we remain a relevant, aspirational brand, focused on delivering fashion and style in an exciting shopping environment. The new store design will be further rolled out during 2008.
Training of all staff will continue to ensure that the repositioned brand is professionally and passionately delivered. We will also continue with the existing programme of rightsizing and repositioning stores in major centres. We will open in excess of six new stores in 2008 as well as convert at least five stores into the new format.
| Store statistics | 2003 | 2004 | 2005 | 2006 | 2007 | |
| Markham | 172 | 173 | 177 | 180 | 191 | |
| RJL | 35 | 37 | 38 | 28 | – | |
| Total no. of stores | 207 | 210 | 215 | 208 | 191 | |
| Closures | 3 | 1 | 3 | 13 | 29 | |
| Floor area (m2) | 56 106 | 56 956 | 58 538 | 58 764 | 58 230 |
| Projection | ||
| Store statistics | 2008 | 2009 |
| Markham | 197 | 210 |
| RJL | – | – |
| Total no. of stores | 197 | 210 |
| Closures | – | – |
| Floor area (m2) | 59 790 | 61 939 |
In addition to the above, we continue to investigate several options to reduce merchandise procurement lead-times, giving us the ability to react quicker to current trends. We will also focus on better fulfilment of customers’ size requirements utilising our newly-implemented size-management tool.
The men’s fashion arena has extremely limited local manufacturing capability. However, we continue striving to develop closer relationships with domestic suppliers to address this over time, thus lowering our reliance on imported product.
The further rollout of new-format Markham stores, combined with better fulfilment of customers’ size requirements will ensure that this division performs well in 2008 and beyond.
Our ultimate goal is to have well in excess of 210 stores which will include at least 30 of our new “Markham Relay” stores. In addition, a standalone “formalwear-only” offering is being considered.
