{{{L’affichage du prix minoré dans les centres de marques et les magasins d’usine}}}


{(Février 2009)}
L’arrêté du 31 décembre 2008 publié le 13 janvier 2009, abroge l’arrêté n° 77-105/P du 2 septembre 1977 pour adapter les annonces de réduction de prix à l’égard du consommateur aux évolutions commerciales, telles que «le commerce en ligne et le développement des magasins d’usine et de destockage » , et autorise la pratique du double étiquetage réclamée de longue date par les centres de marques et les magasins d’usine.

{{Lire l’intégralité de l’article:}}

{{{Les centres de marques : comment échapper au statut des baux commerciaux ?}}}

{(Janvier 2009)}
Les centres de marques, centres commerciaux thématiques apparentés aux magasins d’usines, constituent un nouveau mode de distribution des invendus ; ils présentent notamment la spécificité de centraliser en un seul lieu un éventail étendu de marques, à des prix réduits toute l’année, de l’ordre de moins 30 à moins 70 % par rapport aux circuits de distribution classiques. Aujourd’hui, la quasi-totalité des centres de marques fonctionnent, en matière locative, sur le même modèle que les centres commerciaux, sur la base de baux de type 3, 6, 9 ans. Toutefois, ce type de bail ne répond pas nécessairement aux besoins des promoteurs des centres de marques ni de leurs locataires, bailleurs et locataires s’interrogent sur la possibilité de recourir à d’autres types de conventions…

{{Lire l’intégralité de l’article:}}

{{{ Projets de centres de magasins d’usine autorisés ou à l’étude en Europe (28 Septembre 2007)}}}

{{Plus d’info}}
_ [Tous les centres de magasins d’usine en Europe existants, en projet ou à l’étude->http://www.magdus.fr/spip.php?page=centre&lang=fr]

_ Pour toutes informations complémentaires
_ Contact [->accueil@magdus.com]

{{{Developments in brand distribution in Europe:
_ New stakes, new strategies?}}}

|{{Introduction}}|{{Speakers}}|
|{{wednesday 19th september 10h00/10h30}}
_ {{{European situation and evolution
_ in brand distribution:
_ figures and trends}}}
_ |{{Alessandro Bedeschi
_

_ Henrik C.Maris
_

_ Eric Daguin
_

_ Emmanuel de Labarre
_
_
_ Sven Lung
_
_
_ Pascal Roussarie
_
_
_ Olivier Dauvers
_
_
_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|

—–

|{{Plenary sessions}}|{{Speakers}}|
|{{wednesday 19th september 17h15/18h15}}
_ {{{New conquest for new customers}}}
_ Conquest Strategy
_ New Marketing
_ Customer Value
_ Brands and Differentiation
_ |{{Philippe Villemus
_

_ {{|
|{{thursday 20th september 10h15/11h15}}
_ {{{The new customer of XXIth century}}}
_ |{{Guillaume Erner
_

_ {{|

—–

|{{Workshops}}|{{Speakers}}|
|{{A1 – wednesday 19th september 10h45/11h45 }}
_ {{{Consumer developments in Europe:
_ how to adapt and anticipate}}}
_ Is there one or a variety of consumers?
_ What are the major behavioural trends
_ in buying apparel? How are they expected to develop?
_ How can brand retailers attract more consumers?
_ How can they be made loyal?
_ Can the same methods be applied to
_ everyone, everywhere?
_ Are brand centres in a class by themselves?
_ |{{
_ Valérie Voisembert

_ Pascal Roussarie
_
_
_ Laurent Locurcio
_
_
_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A2 – wednesday 19th september 10h45/11h45}}
_ {{{Unsold textiles: Can they be kept under control?
_ How can value be derived from them? }}}
What is at stake with unsold textiles?
_ What part do they play on the apparel market?
_ Can unsold items be limited upstream?
_ What are the best options for deriving
_ value from unsold items (factory outlet centres,
_ Internet, b-stores, etc.)?
_ Should brands have to manage their own
_ unsold items, as they do their collection items?
_ What are the best responses when unsold
_ items are still not sold a second time?
_ |{{Alessandro Bedeschi
_

_ Jean-Loup Besquent
_
_
_ Dr.Sami Sboui
_
_
_ Bruno Rogowski
_

_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A3 – wednesday 19th september 12h00/13h00}}
_ {{{Marketing for factory outlet centres:
_ what is the winning mix?}}}
_ How much pull can brands have for
_ consumers buying at factory outlet centres?
_ Is there such thing as an ideal brand portfolio?
_ How can the tourist-shopping dimension be
_ taken into consideration in the marketing mix?
_ Is communication the key to differentiation
_ from the competition?
_ What is the marketing position of factory
_ outlet centres today?
_ Can its “geo-strategy” be variable?
_ How should it be developed?
_ What is the development outlook is
_ on the horizon?
_ |{{Richard Broadhead
_
_
_ Frank Verschelle
_

_ Alain Salzman
_
_
_ Fabrice Schlosser
_

_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A4 – wednesday 19th september 12h00/13h00}}
_ {{{Sunday openings: an issue
_ at the European level?}}}
_ What are the needs and expectations of
_ each set of players?
_ What is at stake economically with Sunday
_ openings? What are the labour stakes?
_ Are they shared in the same way
_ across Europe?
_ |{{Marion Kahn-Guerra
_
_ Emmanuel de Labarre
_
_ Olivier Dauvers
_
_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A5 – wednesday 19th september 14h15/15h15}}
_ {{{Brand retail distribution strategy:
_ what role should the Internet play?}}}
_ Has the Internet changed the way
_ brands are consumed?
_ Do the major merchant sites that unload
_ brands create competition for factory
_ outlet centres?
_ Can they take up even more room
_ on this market?
_ Where brands are concerned,
_ is the Internet a complementary business tool,
_ or has it become a retail distribution
_ method in and of itself?
_ Does unloading a brand on the Internet help
_ attract new customers?
_ |{{Christine Baudchon
_

_ Geoffrey Nidd
_
_
_ Marina Martorana
_

_ Jean-Paul Leroy
_

_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A6 – wednesday 19th september 14h15/15h15}}
_ {{{The factory outlet customers:
_ are they brand-focused or price-focused?}}}
_ Who are the consumers at factory outlet centres?
_ What are they looking for when they come?
_ Do consumers still feel there exists a
_ “reference” price?
_ At factory outlet centres, are prices and brands
_ always enough to make the difference?
_ What are consumers’ actual expectations?
_ What would the ideal factory outlet be?
_ |{{Olivier Le Floch
_

_ Sven Lung
_

_ Patrick Robin
_

_ Olivier Costil
_
_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A7 – wednesday 19th september 15h45/16h45}}
_ {{{Commercial real estate in Europe:
_ textile brand retail still a winning sector?}}}
_ In the world of branded clothing retail,
_ what are the trends in commercial real
_ estate in Europe?
_ Why are more and more investors interested
_ in the concept of factory outlet centres?
_ What are the criteria they use to make
_ investment decisions?
_ Are there still development prospects
_ in Western Europe?
_ Are the Eastern countries still a
_ new Eldorado?
_ What are the conditions for establishing
_ and developing there?
_ |{{Chris Pope
_
Richard Broadhead
_
_
_ Gaël Thomas
_
_
_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A8 – wednesday 19th september 15h45/16h45}}
_ {{{Factory outlet centres:
_ a development opportunity for brands?}}}
_ From the brand standpoint,
_ how can a multi-channel distribution strategy
_ generate development?
_ How should it be handled?
_ How can the development of such
_ centres in Europe serve brand development?
_ |{{Juan-Marcos Gabas
_
_ Alain Salzman
_
_
_ Ulrich Nordhorn
_
_
_ Olivier Dauvers
_
_
_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|

—–

|{{Round table}}|{{Speakers}}|
|{{Thursday 20th september 11h45/12h15}}
_ {{{In what way, and how
_ will brand centres meet
_ the expectations of brands,
_ consumers and investors,
_ five years from now? }}}
_ |{{Henrik C.Maris
_
_ Eric Decouvelaere
_
_ François Moss
_
_ Iestyn Roberts
_
_ Alexandre Séjourné
_
_
_ Olivier Dauvers
_
_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|

—–

|{{« Country » workshops}}|{{Speakers}}|
|{{A9 – wednesday 19th september 10h45/11h45}}
_ {{{Belgium-Holland}}}
_
_

_ |{{workshop cancelled
_
_
_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A10 – wednesday 19th september 14h15/15h15}}
_ {{{Brand Centres in Europe: Facts and Figures}}}
_
_

_ |{{Caroline Lamy
_
_ Bruno Rogowski
_
_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A11 – wednesday 19th september 12h00/13h00}}
_ {{{Germany}}}
_
_

_ |{{Ulrich Nordhorn
_
_
_ Jörg Nowicki
_
_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A12 – wednesday 19th september 12h00/13h00}}
_ {{{England-Ireland}}}
_
_

_ |{{François Moss
_

_ Graham Parker
_

_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A13 – wednesday 19th september 14h15/15h15}}
_ {{{Eastern Countries}}}
_
_

_

_ |{{Eric Daguin
_

_ Jana Kurkova
_
_
_ Tomasz Leskiewicz
_

_ Fabrice Schlosser
_
_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A14 – wednesday 19th september 15h45/16h45}}
_ {{{Spain-Portugal}}}
_
_

_ |{{Manuel Saavedra
_

_ Philippe Schilde
_

_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A15 – wednesday 19th september 10h45/11h45}}
_ {{{Italy}}}
_
_

_ |{{
_
_ Roberto Pacifico
_
_
_ Marina Martorana
_

_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|
|{{A16 – wednesday 19th september 15h45/16h45}}
_ {{{France}}}
_
_

_ |{{Raymond Feyssaguet
_
_
_ Didier Moret
_
_ Alexandre Séjourné
_

_ Laurent Locurcio
_

_ {{
{[All the speakers
_ of the conference->http://www.magdus.fr/All-the-speakers]}}}|

—–

_ {This program will be updated very regularly. …}

—–

_ {Do You wish to intervene? You have remarks or suggestions? Contact us}
_ [->accueil@magdus.com]
_ Tel : 33 (0)3.25.43.70.20

——

{{{More information about the third european conference on factory outlet centres}}}

-* [Presentation->http://www.magdus.fr/Conference-2007]

-* [Partners->http://www.magdus.fr/Partnership]

-* [Partners in the press->http://www.magdus.fr/Our-press-partner]

-* [Registration->http://www.magdus.fr/Registration-fees]

-* [Hotel accommodation->http://www.magdus.fr/Hotel-reservation]

-* [General information->http://www.magdus.fr/General-information]

—–

{{Marina MARTORANA}}
_ The « typical European consumer » does not exist. In Italy, cultural and sociological differences can even be seen from one region to another. In Milan, for example, brands are much less sought after than in the rest of Italy. Today consumers are looking for quality. But brands do no longer always guarantee quality! The success of factory outlets in Italy can be explained by the leisure factor (people come as a family at the weekend as a leisure activity) and by the low prices and brands that are on sale.



{{Jean-Paul LEROY}}
_ Would factory outlets enjoy greater success in France if they could open on a Sunday?



{{Geoffrey NIDD}}
_ Yes. Factory outlets can also be used as a tourism argument – come and visit Troyes, for example.



{{Jean-Paul LEROY}}
_ Are brand and price now no longer sufficient to enable a factory outlet to survive?



{{Geoffrey NIDD}}
_ The relation between the brand and price is fundamental. They are both of equal importance. The customer expects an average discount of 42%.



{{Jean-Paul LEROY}}
_ Is there a typical brand outlet customer profile?



{{Geoffrey NIDD}}
_ For Mc Arthur Glen, the typical customer is a 35-year-old woman who has spent around two hours to get to the centre. She stays for three hours and visits eleven shops and buys in four of them.



{{Jean-Paul LEROY}}
_ Do consumers take into account the fuel they have used to come to the centres?



{{Geoffrey NIDD}}
_ Today, customers are not just looking for a brand and a good price, but also atmosphere, ease-of-access, information, etc. The market is more sophisticated than five years ago.



{{Jean-Paul LEROY}}
_ Are high-street shop customers and factory outlet customers different?



{{Christine BAUDCHON}}
_ Zapa has five brand centres and a chain of thirty shops. In our brand centres, consumers used to be looking for a brand. Now they are also seeking a price and an identity. We have developed the same customer service and the same merchandising in our high-street shops as in our Zapa brand centres. This marks us out from our competitors. We have thus increased our prices by 17 % in a year without losing any customers, because of the added value we have in terms of customer service.



{{Jean-Paul LEROY}}
_ Do customers differentiate between the high-street shops and the brand centres?



{{Christine BAUDCHON}}
_ Yes. The same customers frequent the factory outlets and the high-street shops. The closeness of the brand centres is not detrimental to the brand sold in our high-street shops.



{{Jean-Paul LEROY}}
_ Is a factory outlet more profitable than a high-street shop?



{{Christine BAUDCHON}}
_ Profitability depends on the location of the high-street shops… We are satisfied by our brand centre outlet sales.



{{Jean-Paul LEROY}}
_ What brands can be sold in a factory outlet?



{{Geoffrey NIDD}}
_ We select the brands depending on how well they are known in the market and the results of our studies of their popularity. How the brand presents the product is also very important. We conclude ten-year leases with the brands.



{{Marina MARTORANA}}
_ In Italy, two cultures co-exist – those people who are seeking quality and those who are looking for a brand.
Certain brand centres use events to draw in customers (such as the jazz festival in a Mc Arthur Glen centre in Italy).



{{Jean-Paul LEROY}}
_ What do you think about brand centres which sign very short-term leases with the brands?



{{Geoffrey NIDD}}
_ In France, leases are generally for ten years. The short-term leases in La Vallée Shopping Village are an exception. In England, 10 % of the brands change each year. In 1995, only ten-year leases existed. When you start with this type of lease, it is impossible to change.



{{Jean-Paul LEROY}}
_ How do you check the brand prices in these centres?



{{Geoffrey NIDD}}
_ We conduct two price controls per year. If the brand does not observe the discount, this can result in cancellation of the lease.



{{Jean-Paul LEROY}}
_ At the outset, factory outlets were not entitled to use the brands for advertising purposes. Has this changed?



{{Geoffrey NIDD}}
_ Yes.



{{Jean-Paul LEROY}}
_ What can be done to ensure that the centres operate better?



{{Geoffrey NIDD}}
_ Developing leisure activities depends on the trading area. At Troyes, it is difficult to develop leisure activities in the evening as customers come from far a field. In Wales, cinemas located next to the centres are very successful.



{{Christine BAUDCHON}}
_ I do not think that Sunday opening should become generalised. Plan de Campagne, which opens on a Sunday, has enormous sales on that day, but this is offset by more modest results at the start of the week.



{{Jean-Paul LEROY}}
_ What are the brands and sectors that do well?



{{Geoffrey NIDD}}
_ International and luxury brands.

{{ {Discussions with the floor} }}

{{Jean-Pierre LEHMANN}} (President of the National Town-centre Federation)
_ What is the reference price?



{{Geoffrey NIDD}}
_ The reference price is the previous year’s street price.



{{Jean-Paul LEROY}}
_ How regularly do customers frequent your centres?



{{Christine BAUDCHON}}
_ On average, a customer comes twice a season. High street shop frequentation is greater, come customer come twice a month. Fifteen percent of customers visit both the factory outlets and the high-street shops.



{{Jean-Pierre LEHMANN}} (President of the National Town-centre Federation)
_ Is not the increase in factory outlets likely to cause stock depletion? Is more manufactured in order to supply these sales outlets?



{{Christine BAUDCHON}}
_ When we order, we consider the factory outlets as shops in their own right.



{{Jean-Paul LEROY}}
_ You consider factory outlets as a new distribution channel…



{{Christine BAUDCHON}}
_ We do not buy for the factory outlets, but we take them into account in our stock management.



{{Geoffrey NIDD}}
_ I don’t agree. Major brand production is limited. A major brand can choose to market its unsold stock elsewhere than at Troyes!



{{Jacques MARY}} (shopping mall manager at Cholet)
_ Sixty percent of one Cholet brand’s production is for factory outlets and 40% for conventional outlets.



{{Brigitte MAULEON}} (decoration shop owner)
_ I have noticed that factory outlets dell the same products as I do at the same price, but they indicate a 30% discount. I am shocked to hear that the Zapa factory outlets offer the same services as in a small shop. Moreover, someone who lives two hours away from a centre will not come back of there is a problem with what they have bought.



{{From the floor}}
_ Certain high-street shops do not observe competition rules. Does Zapa work with other brands in its brand centres?



{{Christine BAUDCHON}}
_ We like to work with our competitors, which attracts customers.

In January 2009, the magdus team has interviewed the marketing managers of several factory outlet centres in France to draw a first balance of the French winter sales. It appears clearly that in an economical context of restrictions and difficulties, the first trend of the sales time is good and it seems that the factory outlet centres’ sector in France is not affected by the crisis.

{If you are interested in reading the results of the study in English, please contact us: accueil@magdus.com}

-*{{LME: de la réforme des soldes à une libéralisation des ventes de déstockage}}
_ Avec la loi de modernisation de l’économie, le gouvernement s’est engagé à améliorer les conditions d’accès des consommateurs à des offres de prix réduits et à adapter la

{{{« Gold » partners}}}

{{{« Silver » partner}}}

——

{{{Down load the Partnership file}}}

—–

{{{To become a partner, what you need to know}}}

-* A factory outlet conference focused on Europe
-* Targeted discussions and debates
-* A unique forum for exchanging views
-* An event that can’t be missed

{{{Become a partner of the 3rd European Conference and seize a unique opportunity for your company to be involved in this
factory outlet center gathering.}}}

_ This conference will focus on concrete issues facing factory outlet centers and provides you with an opportunity to be involved in informative, targeted, relevant, one-of-akind content.

—–

{{{Down load the Partnership file}}}

—–

{{{Partnership proposals}}}

{{opportunities for visibility. Include you company in conference information documents}}
{{ Program}}
_ This is the key document in the run-up to the Conference, providing the overall and detailed session programs, related activities and general information. It serves as a guide for preparing and registering for the conference (French /English).
_ Published in 4,000 copies, it is sent to the main players in
the factory outlet sector in France and in Europe, in A5 format.

{{Pocket program}}
_ A guide to the 2-day Conference is participants. This document will be participant badges.
_ Published in French and English.

{{Congress bag}}

{{{Several opportunities for visibility. Include you company in informal get-togethers during the conference}}}

{{Coffee breaks, wednesday morning, wednesday afternoon, thursday
morning}}
-* visual identity of your company: self-supporting signs, small flags on tables, pens, note pads, etc.
-* dedicated, exclusive space in the coffee break area table, chairs)
-* other visual presence: to be arranged with Colloquium
-* The partnership will also be announced in the Conference signs.

{{Lunch on wednesday – Lunch on thursday}}
-* your logo on the entrance sign
-* dedicated exclusive space within the lunch area (table, chairs)
-* visual identity of your company : self-supporting signs,
small flags on tables, pens, notepads, etc.
-* distribution of an object of your choice during the lunch
-* other visual presence: to be arranged with Colloquium
The partnership will also be announced in the Conference
signage.

—–

{{{Down load the Partnership file}}}

—–

_ Contact
_ Isabelle Brochot
_ 33 (0)1 44 64 15 29
_ [->i.brochot@colloquium.fr]

—–

{{{More information about the third european conference on factory outlet centres}}}

-* [Presentation->http://www.magdus.fr/Conference-2007]

-* [Program->http://www.magdus.fr/Developments-in-brand-distribution]

-* [Partners in the press->http://www.magdus.fr/Our-press-partner]

-* [Registration->http://www.magdus.fr/Registration-fees]

-* [Hotel accommodation->http://www.magdus.fr/Hotel-reservation]

-* [General information->http://www.magdus.fr/General-information]

—–

{{Gaël THOMAS}}
_ In 2007, office, logistics and trading property covered 260,000 square meters in France, or half the surface area accounted for in 1993. In view of the projects that are either underway, under study or already authorised, this surface area will soon rise to 343,000 m². With a trading surface area of 86,000 square metres and with the major actors of this sector present in the area, Troyes is the European brand centre capital.
France is in fourth position in the European rankings, it will soon be 3rd, and there are a total of 150 brand centres in Europe.

{{Richard BROADHEAD}}
_ Freeport is a European factory outlet developer that exists since 1994. It developed a portfolio of outlet centres during the 90s and early 2000s, including six centres in the UK. In 2003-04 it sold its UK interests. Now run by Carlyle Realm, its business focuses on Europe, namely one in Sweden, Portugal and in the Czech/Austrian border. Freeport specialises in outlets, we find the land, get the consensus, negotiate the contract, build the development, lease it, we launch it and operate it.
I have been with Freeport for 18 months but most of my work experience stems from the retail business specifically Marks and Spencer, which has well equipped me to work on the property side in order to be able to experience both sides of the business.
_ A shopping centre, either it is outlet or high street, will only be judged on how well its operator and developer work in partnership with the retailers.

{{Chris POPE}}
_ Kenmore Property Group is a Scottish co-investing, a trading and development property group, that has been in the business for the past 20 years. Kenmore has offices in mainland Europe since 2002-03 and one in Dubai. It operates across the main sectors in the property industry. In 2005 Kenmore purchased one centre in Germany. In 2004, Kenmore opened the office in Paris which I have run since then. In a shopping centre, either it is a traditional or factory outlet, the manager is the key.

{{Gaël THOMAS}}
_ What are the advantages of brand centres in relation to more traditional shopping centres or other office property from the point of view of a property investor?

{{Chris POPE}}
_ Kenmore is interested in the diversification of its portfolio where opportunities still exist outside the UK, in mainland Europe for instance, which allows for higher returns and sustained cash flows together with opportunities to enhance value through management initiatives and to protect the value, created by the barriers, through entry, such as getting the planning permit. The advantages of building up a portfolio, which brings benefits from economies of scale through which numerous relationships are built, are abundant and are more rewarding than a traditional shopping centre.

{{Gaël THOMAS}}
_ What interested Carlyle, a non-specialist company, in the acquisition of Freeport, an specialist investor?

{{Richard BROADHEAD}}
_ Carlyle, a private equity firm, was amongst many suitors who wanted to purchase Freeport PLC. Freeport PLC shareholders accepted the offer from Carlyle Group for 4 pounds 10 pence of the issued share capital. Freeport shares will be cancelled from listing, trading from the Official List and will be registered as a private company. Carlyle saw the potential in Freeport’s operational expertise combined with Carlyle’s financial know-how to conquer the European market as a private company.

{{Gaël THOMAS}}
_ Can the acquisitions model of companies and promoters specialised in brand centres also be part of a Kenmore strategy to build up a true international network?

{{Chris POPE}}
_ Kenmore is interested in buying assets and at the moment since very few companies specialise in factory outlet markets, we are looking for opportunities to further acquire portfolio of assets. We cannot invest into well managed centres at the value of current market prices, we prefer opportunities at the beginning for which there is still income growth and potential to generate.
_ In terms of amounts, Kenmore is driven by the market. For a successful factory outlet centre, the size of the centre is crucial. A small centre of 10,000 square meters or less, with no potential to be extended, has no interest. However a centre of 15,000 sq. m. or more can offer great potential.

{{Gaël THOMAS}}
_ What differences can be seen today in yields from existing centres and from centres being developed in emerging regions?

{{Chris POPE}}
_ When looking at pre-summer market values, prime year in the UK for an up-and-running cent' », prices were at 5 ¼ cent, whereas in Continental Europe for the same they were at 5 ¾. At the early stages of the development process, when looking at development costs, a year long cost will be much higher.

{{Richard BROADHEAD}}
_ When speaking about opportunities, it clearly depends which market we are speaking of. The UK market is saturated, also part of Portugal’s market except maybe Algarve, however many of the Eastern European markets yield a greater return and have more opportunities to offer which can become successful outlets, such as, Bulgaria, Croatia, Romania, Poland, Ukraine. There are still unlocked potentials in Germany and Central and Southern France. The key is to create well connected local partnerships which will enhance the chance to develop real businesses. Freeport is not looking to sell but to develop, operate and build a European portfolio.

{{Gaël THOMAS}}
_ Are there still any development prospects in France? Does not the existence of too many brand centres present a risk in terms of the centres’ catchment area and product attractiveness?

{{Chris POPE}}
_ This is a very good point. When comparing the situation with the UK, France is far from being overcrowded by outlet centres. There are still opportunities in South of France where there are no significant centres.

{{Richard BROADHEAD}}
_ There are many market opportunities in France. Freeport has long talked about setting up an outlet in France, there are opportunities in the South, near Lyon, St-Tropez, and in Provence just to name a few.
If the outlet is well thought out with a strong partnership with the town or city authorities, it will be beneficial.

{{Chris POPE}}
_ Yes, combined with the fact that France is a popular tourist destination, factory outlet centre are linked with tourism which emphasizes the attraction to France for this kind of activity.

{{Gaël THOMAS}}
_ Can this concept be exported to Eastern European countries?

{{Chris POPE}}
_ Eastern European countries are more liberal, there are more sites available but the risks are also higher. The markets are also less developed, therefore setting up outlets that sell brands at a discount, where there was no previous demand, at higher value prices, in city centres, can be risky.

{{Richard BROADHEAD}}
_ There are many opportunities to gain from the emerging markets. Brands do exist in places like Zagreb or in Polish cities. Also MAPIC invited numerous representatives from emerging markets who were there to sell their new development projects. The risks are higher, the lack of restrictions can be erroneous therefore a right reputable counterpart, which includes the local rules and which delivers exciting schemes, is crucial.
_ Freeport has experience in risk taking and failure. Taking this into account, we need to have a look at the consumer profile, the brands that are present on the market, consult the brand providers, determine the infrastructure and transport possibilities (air, train, road), and naturally competition. All in all, a sound catchment is important. Finally, a major experience Freeport learnt is to hire well-staffed local people who speak the language and who can run the business, such as in the Czech Republic and in Lisbon.
With the right partner, an open minded perspective, and a good plan, the risks will be diminished and the yield can be outstanding. For emerging markets there are many new growth opportunities.

{{Chris POPE}}
_ Adding on, as opposed to the risk perspective, it is essential to see how to improve a centre, its marketing budget and flexibility on the lease terms, to communicate with tenants on their performance and to reallocate these around to suit everyone.

{{Richard BROADHEAD}}
_ Concerning marketing, it is essential to plan it well. The experience with the Czech/Austrian border outlet centre is a good example of how Freeport did not evaluate the difficulty. Two different countries operating with different – currencies, – priorities, -customer profile and different culture increased the complexity and challenge of running a centre.

{{Gaël THOMAS}}
_ Do specific regional features act as a brake on the construction of world-wide and international networks?

{{Richard BROADHEAD}}
_ To be successful in an emerging market, partnership needs to be strong with locals who can help with the whole process in getting the approval, building the site and developing the centre.

{{Gaël THOMAS}}
_ With respect to product design, are the modules and formats always the same or does the centre have to be specifically adapted each time?

{{Richard BROADHEAD}}
_ From country to country, there is consistency in the layout of the centres and choice of brands. Brands are often in the same sized unit. International brands will always be relevant in every country. In specific countries, there needs to be a good representation of the brands that are already known by the local consumers. It is about understanding the international platform and including the other layers, such as operators and retailers who are local and regional, that are relevant to that local market.

{{Chris POPE}}
_ The architectural input, both for the local and regional features, is becoming more and more important in the design of a shopping centre. As you are treating more with leisure experiences, one has to put more efforts into the conception of the outlet centre.

{{Gaël THOMAS}}
_ Are there new sector prospects in order to continue to attract the consumer?

{{Richard BROADHEAD}}
_ The core business of outlet factories is clothing apparel and sporting brands of which respectively represent 80 % and 20 % of the turnover. Therefore putting international and well-known sports and clothing apparel brands will encourage the success of the outlet operator.
When looking at the trend in which people aspire to own and take care of their home, I think that home wear will become more important in the next few years. These can be purchases that you can bring with you in the car unlike beds and furniture.
There are other sectors that one could try, books, electronics and confections but ancillary to the core big brands. Developers should pay more attention to the local and regional operators who care to sell their crafts, allocating 30 to 50 square metres which would provide local traders (the opportunity) to be involved in the centre. Consumers will appreciate this and it will also build genuine partnership with the town and the city. Freeport will be more focused on the future, on catering to local traders and consumers, which adds a new dimension to the outlet centre.

{{Gaël THOMAS}}
_ Would you buy from a brand centre that had small traders in it?

{{Chris POPE}}
_ If the centre contained only local traders one would have to study the situation but it does raise an interesting issue. When looking at standard office or industrial investments, the quality of the covenants the tenant has signed for the lease is key but, with a factory outlet, the quality of the brand matters. It does not have a big financial weight and trading with the right brands adds considerable value to the centre. Letting local people have a representation in the centre is important.

{{Discussions with the floor}}

{{From the floor}}
_ Is there a real advantage in possessing a share of the market compared to these « major shareholders » and these brands?

{{Chris POPE}}
_ Speaking from Kenmore, we only have one outlet centre at the moment. Clearly, we see the attraction of having a critical mass. If you have a network of centres you will have a lot more of the same tenants in each centre through which you can develop good relationships. Tenants will want to expand or reduce in one centre, which brings a lot of cross-fertilisation. How many centres? Three to four centres at least would be a good start.

{{Richard BROADHEAD}}
_ Yes, Freeport sees an importance in networking. There are big advantages on building up a network. Developers generally have a good relationship with retailers and that is one of the reasons why one can witness a consistency of centres operated by the same developer, such as the great Mac Arthur Glen schemes.
There are some economies to be gained from it, in reality not as strong as they could be. However if you have an operation with three or four centres in the same country you have an opportunity to aggregate certain parts of your business, such as awarding contracts covering the four sites, carrying out operational functions in one location rather than paying the facility in all four locations.
This conference talks little about the operational functions of a centre which is a crucial part, building and opening, which we covered, are only part of the whole scheme. Indeed the success of a centre is about the ‘brand’ but in terms of network it is about partnership and trust with retailers.

{{From the floor}}
_ The network umbrella brand covers the store brands; what is the target marketing cost that this involves? What marketing costs does a network have to incur for it to make sense for the consumer?

{{Richard BROADHEAD}}
_ In terms of networks with retailers, generally if the operator can build a strong relationship with the retailer and understands their needs, there is good chance of becoming a successful outlet operator and developer. For instance there are a number of retailers here today, such as the MD of Mango, who represent the key people we should be liaising with.
In terms of turning brands away, it needs to be done. If a centre is strong on sports and a new sports operator approaches you, you need to judge whether it will be beneficial to do business together.
In the past, the sex shop company ‘Bertuso’ was refused in Freeport outlet centres which looking back was an ignorant decision. Today we are dealing with them again. Bertuso is a very well known brand, sex is part of peoples lives, and the retailer is found in many markets in Austria. Freeport is sometimes approached by certain ideas that do not benefit the brand, such as a company that wanted to set up a tattoo shop in the outlet centre, which does not fit the designer outlet concept. It is all about finding the right balance and good judgment call.

{{From the floor}}
_ Do you have a value and a goodwill for the brand-name for Freeport or otherwise why would consumers go to the shopping centre?

{{Richard BROADHEAD}}
_ We believe that Freeport has a value according to research done by consumers and non-consumers. It is a solid brand, even though bad choices were made that could have damaged the name, and the fact that Carlyle is willing to spend nearly 2 million pounds demonstrates the value that they put in the brand.

{{From the floor}}
_ What is the marketing cost attached for the brand?

{{Richard BROADHEAD}}
_ We spend a significant amount on marketing, more than the retailer’s marketing contribution. More than 2 million euros are spent from the sites, which is an investment to be spent wisely and is essential.

{{Gaël THOMAS}}
_ Are marketing costs carried over into the rent paid by the outlets or are they, on the contrary, necessary to attract the brand outlets?

{{Richard BROADHEAD}}
_ All of the sites are different. We have introduced flexible rental arrangements, which depend on the value of the brand. Leases are relatively short term, averaging five years, which varies from site to site and retail to retail. Some have a base rent and turnover percentage situation, some have a simple turnover arrangement. Crucial is to make money from the investments and the retailers in order to make a profit. We also charge our occupiers a set fee for the service charge, for cleaning and security, and a set fee for marketing. These are occupancy costs for the retailer to remain in the outlet centre. Freeport tops up what the retailers provide for marketing because we value marketing.

{{Gaël THOMAS}}
_ Could not being known by the brands constitute an obstacle for a non-specialised institutional investor, like Kenmore?

{{Chris POPE}}
_ I do not think so. I am not sure that the branding is an issue. The consumer would want to visit an outlet centre that is well run, has value retail and is a good experience to go to.

{{Richard BROADHEAD}}
_ The brand has value. It is not our intention to change the name of Freeport to Carlyle. Stronger recognised brands do benefit from that.

{{From the floor}}
_ Mr Broadhead, do you ever have to approach the brands in order to fill the outlet space on certain projects or is it always the brands who are fighting to obtain their premises? Mr Pope, brand centres are becoming smaller and smaller – could you invest in small surface areas with a relatively unknown start-up?

{{Chris POPE}}
_ In terms of size, speaking as a non specialist of this sector, critical mass, as earlier mentioned, is important. The centres that approach 20, 000 or plus square metres trade the best. If business fundamentals are good we would invest with a start up developer.

{{Richard BROADHEAD}}
_ We chase and we are chased by brands. The mix you have and the question of how you better serve the consumer, by providing new and international brands, needs to be incorporated in your plan.

{{Frédéric Willems}} (Legal representative of the National Clothing Federation)
_ How do we ensure that brand centres do not become just ordinary shopping centres?

{{Richard BROADHEAD}}
_ Although the identity of the outlet centre still needs to be further developed, brands will need an exit for their stock and the function an outlet serves is very important. International and big brands at discount are the core business of outlets, and it is the developers, the town and city interests’ to develop extra attractions in addition to the fundamentals of the business.

{{From the floor}}
_ As far as your European experiences, could you tell us about the general trends of yields in Europe?

{{Richard BROADHEAD}}
_ The general trends is that yields are going down and stagnating. Sub-prime lending, financial markets, it will be an interesting two years. For the UK it is an interesting turning point where people are queuing at banks to retrieve their money.