Retail Week Live: House of Fraser boss on China and the living wage

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House of Fraser’s boss said customer insight is now at the heart of the business, but that he could not rule out job losses from living wage.

Nigel Oddy said House of Fraser, which last year restructured to be more “customer-centric”, had responded to customer needs in a move away from a channel-centric structure.

However, he refused to rule out the possibility of job losses at the retailer following the introduction of a living wage on April 1.

House of Fraser's Nigel Oddy on the living wage, at Retail Week Live

In response to a question on whether job losses might occur, he said: “I certainly hope not.

“It is a cost that we didn’t have to deal with last year. But I hope we can mitigate that and absorb the costs.”

Oddy was speaking at Retail Week Live. He was joined by House of Fraser chief customer officer Andy Harding.

Harding spoke about the necessity of winning the hearts and minds of colleagues when embarking on such a restructure.

He added: “It is very easy to talk about being customer-centric but over time we recognised that behaving in a different way requires a significant amount of change.

“We were very siloed into channels and multichannel had grown up like that – online versus offline. We needed to fundamentally change the way we were thinking and the way we were organised.”

The pair also spoke about the Chinese market and its challenges. Chinese private equity firm Sanpower acquired a majority stake in House of Fraser in 2014.

Oddy maintained that the change in ownership had not had an impact on the day-to-day running of the business or its culture.

He said: “Our style is very different. We have a different model. They are more landlords than retailers. Their businesses are 99% concession, that is their style.

“Having a partner with real estate and which has been involved in retail is very important to us.

“China is not same as Europe or the UK. It is not an easy country to deal with, it is huge and complex. So having a partner who understands China is great.”

Harding added that the Chinese approach to technology and multichannel was very different.

He said: “Digital works very differently there. The two [online and bricks and mortar] are quite separate. Online is huge but it isn’t integrated. And consumers have an expectation of pricing being different – they are used to that.

“I think they will become more multichannel. We are trying to implement that in China. But we cannot be arrogant and assume that it will happen.”