Britain's biggest supermarket chain, Tesco, an adventurous marketer that has already set up a retail bank, a film-production company and a mobile phone business, is now targeting fashion. The company has declared its ambition to make its F&F clothing and accessories line "the world's leading brand of affordable fashion."
Starting with the Middle East. Tesco's next step is a partnership with a Saudi Arabian retail group called Fawaz Abdulaziz Al Hokair. The franchise agreement is intended to accelerate the growth of F&F in the Middle East, beginning with 19 outlets.
F&F was launched as Florence & Fred in the U.K. and Ireland in 2001, and now sells in 11 countries, mostly in Central Europe. Tesco recently opened two standalone stores in the Czech Republic, in Prague and Brno. Both are wholly-owned and operated by Tesco, but have been used to test out ideas for the franchise format.
The first F&F franchise will open this year in Saudi Arabia. Based primarily on the core European F&F range, Tesco will work closely with Fawaz Abdulaziz Al Hokair to develop a range of clothing and accessories that works for the local market. Tesco is also exploring further franchise opportunities in other countries.
Fawaz Abdulaziz Al Hokair already works with many western retailers including Gap, Banana Republic, Zara and Mango. With Tesco, the Saudi retailer plans to launch F&F stores in shopping centers and within department stores and even supermarkets.
Jason Tarry, CEO of F&F International, said in a statement, "The franchise model is a natural extension of the work we have been doing to turn F&F into a truly global fashion brand. We have in a very short time created a market-leading fashion brand in Central Europe, worth more than $600 million. Now we have the opportunity to grow our brand further, in markets where Tesco does not have a presence."
F&F launched in Tesco supermarkets in Asia in 2009, and isently selling in the Republic of Ireland, Czech Republic, Hungary, Poland, Slovakia, Turkey, China, Korea, Malaysia, Thailand, as well as the U.K. From the U.K., online orders are fulfilled to 21 countries in Europe.
Simon Marshall, CEO of Fawaz Abdulaziz Al Hokair, said in a statement, "We're delighted to be partnering with Tesco, and to be the world's first franchise partner for F&F.
Tesco has been working hard on refining the layout, visual merchandising, and even lighting in the F&F areas of its stores. Mr. Tarry said, "Two years ago we had 40% awareness among customers and now it's 90%. F&F is comparable with anything else you'd see on the high street or in shopping malls."