Debenhams' IT investment fuels profits

Debenhams today said a £6 million investment in radio frequency identification (RFID) technology, improvements to its e-commerce site and a new IT platform had helped grow annual profits to £131.4 million.

The high street department store was keen to talk up the £37.1 million retail investment to refit stores, involving new IT and a new distribution centre as part of what it said is its attempt to revive its business fortunes.

"Our new autumn/winter ranges are being well received and this, together with the refitting of stores and previous investment in a new IT platform and distribution centre, is improving the customer experience," said the company's chief executive Rob Templeman.

The retailer said the RFID technology deployed to all of its 142-strong store estate was helping to improve goods tracking and customer service, while the introduction of a mobile office, work planner and better stock availability management and pricing control had contributed to its bottom line.

And online, it said a complete redesign of its debenhams.com e-commerce arm, upgrading and rebuilding its website, had led it to produce "strong sales and profit growth" and become the most successful part of its business.

Only last month, it said it had also become a beta implementation site for a new finance system from its existing supplier Coda.

At that time, Michael Conway, Debenhams' retail finance director said the company plans to double its 141-strong UK store estate in the next five years, while also introducing 100 stores for its new, smaller retail format, Desire. It also plans to expand on its 35-strong international franchise business with a further 12 stores scheduled to open next year.

Debenhams posted pre-tax profits that were up 11.5 per cent for the 12 months ended 30 September 2007 and grew sales 5.1 per cent to £2.3 billion.

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