FSP Retail Blog

FSP has identified over 100 retailers in the UK across all merchandise categories that are profitable and expanding. These are the companies best positioned to benefit from the opportunities created by the current economic conditions.

The criteria for inclusion in the list are:

Accounts available from Companies House for years ending in 2007 or 2008
annual sales of at least £2 million
annual operating profit of a minimum of £1 million
Wealth Creation Index, as specified by DIUS, of 130 or more. The index is the ratio between the value added and the cost of creating the value (employment costs and depreciation)
Return on Trading Assets (ROTA) more than 25%. This is the return on investment in an additional outlet, assuming no addition to central costs
Tenor of press articles about the retailer over last 12 months supplemented by FSP market intelligence

It would be a mistake to assume from recent wide publicity about the expansion of fast food restaurants, that they represent the greatest expansion opportunity. Within the FSP Hot 100, catering accounts for only 10% of the list. The largest group, around a quarter, are in clothing and footwear but all merchandise categories are included.

The current challenge for asset managers is to know which retailers to support. The Hot 100 makes a good starting point within the context of establishing the correct retailer fit for the location.