Following today’s news that Next is reportedly in talks to acquire FatFace; Alice Price, apparel analyst at GlobalData, a leading data and analytics company, offers her view: “An acquisition of FatFace by Next, which is reportedly close to being confirmed for more than £100m, would be a financially sound investment. Sales at FatFace rose by 15% to reach £282m in the year to 27 May 2023, significantly beyond pre-pandemic levels, meaning it should generate immediate returns for Next without the need for significant additional resources. Next is also focused on strengthening its mid to upper-priced brand offering, as it recognises consumers are prioritising higher quality products to achieve better value for money during the cost-of-living crisis, so FatFace’s market positioning should help it achieve this goal.
“Having Next as its owner would also benefit FatFace and bolster its growth potential, with its launch on Next’s Platform Plus earlier this year, where Next fulfils orders from its third-party brands’ own warehouses within two days, already enabling the brand to increase its customer base. Next’s superior online proposition and global reach will also allow FatFace to expand internationally, which has been a focus for the brand recently, with North America accounting for 7% of its sales and growing 20% in its FY2022/23.”
