Higher costs wiped out profits for Stella McCartney in 2018. Corporate reorganisation costs mounted but the large new flagship store on Old Bond Street also added to the company’s outgoings. Overall, expenses rose and sales were virtually flat during the period – they rose by a tiny 0.2 per cent after having risen two per cent during 2017.
The company’s strategy is to expand its worldwide retail portfolio with new stores and concessions, particularly in Asia. In fact, the company is heavily focused on international sales in general and doesn’t seem to be worried about Brexit. At the moment less than five per cent of its global revenue happens in its UK shops. That also means only a small proportion of its sales are dependent on cross-border movement of goods to Britain. Further, the majority of foreign revenue recorded by the company relates to royalties, which benefit from UK international tax treaties that are unlikely to be affected by Brexit.
Stella McCartney is one of the UK’s leading designers, who’s also the flag-waver for all-things cruelty-free and sustainable. Stella McCartney has gone into a partnership with LVMH. The aim is to accelerate the development of the Stella McCartney brand globally.