Luxury brands slam Mike Ashley's plan for ‘High Street Harrods’

Luxury brands on Tuesday cast doubt on Mike Ashley’s plan to sell labels like Gucci and Prada in House of Fraser after the Sports Direct billionaire fleshed out his plans to create a “Harrods of the High Street”.

In his first interview since taking over the stricken department stores group, Ashley on Tuesday declared he would sell more top-end labels and offer luxury personal shopping and other upmarket services.

However, Helen Brocklebank, chief executive of Walpole, the body which represents luxury-goods firms, responded: “Luxury brands are not magic fairy dust you can sprinkle over an ailing infrastructure and a store environment that badly needs investment and imagination.”

Responding to Ashley’s comments, which he made in an interview to The Sun newspaper, she said: “It’s good to see a strong vision for House of Fraser, but without huge investment it’s a vision that will be hard to deliver.”

“Harrods is currently investing £250 million into creating the kind of in-store environment luxury brands and luxury customers expect. Ashley has a hard act to follow.”

Another high-end adviser added: “The ambition isn’t very realistic. Luxury brands have been working hard towards tightening their wholesale networks and presence in the most appropriate and high-end doors only to protect their brands.

“I struggle to see how House of Fraser can create a truly luxury environment while still being on the High Street and appealing to its core customer.”

One voice that was more optimistic was the founder of upmarket menswear label Private White VC. James Eden said: “We are pleased someone is willing to resurrect House of Fraser. No one knows retail better than Mike Ashley.”

The retail tycoon also promised to keep open the bulk of the House of Fraser stores, reversing the previous rescue plan which earmarked 31 of its 59 shops for closure.

Ian Gilmartin, head of retail and wholesale at Barclays, said: “Sports Direct doesn’t have to keep all the stores as House of Fraser. They can use the real estate in a different manner to utilise all their stable of brands, such as [designer chain] Flannels, in the broader Ashley empire.”

Ashley could draw on his experience with Flannels, also owned by Sports Direct, to go upmarket, retail analysts added.

But even then, “it is still questionable whether premium stores are needed nationwide”, said Global Data’s Sofie Willmott. “Consumers nationwide are unlikely to spend as willingly as both foreign and domestic tourists visiting the capital.”

A senior director at of one the Britain’s largest luxury goods online retailers said: “I doubt anyone’s ability to establish an additional physical wholesale presence in the high end luxury fashion space.”