What: Frasers Group CFO warns GBP 1.7bn business rates increase could halt store expansion plans, citing government's failure to understand retail sector challenges.

Why it is important: This stance from Frasers Group, which has acquired over 1 million sq ft of retail space in the past year, demonstrates how taxation policies directly influence retail expansion strategies and market growth.

Frasers Group's Chief Financial Officer Chris Wootton has issued a stark warning about the impact of proposed business rates increases on future store openings. Speaking candidly about the government's approach, Wootton expressed frustration with repeated delays in business rates reform and criticised last autumn's Budget for penalising retail and hospitality sectors during challenging times. The proposed GBP 1.7 billion increase in business rates on larger retail premises would directly affect store opening decisions, with Wootton emphasising that high business rates could make new locations financially unviable. The company is already working to mitigate over GBP 50 million in extra costs from last year's Budget. Despite these challenges, Frasers' luxury division shows signs of recovery, though this improvement is attributed more to internal restructuring and right-sizing of acquired businesses than to increased consumer confidence. The company maintains a cautious outlook, suggesting at least another six to twelve months of observation before declaring a turnaround in the luxury sector.

IADS Notes: Wootton's warning comes as Frasers Group navigates a complex retail landscape. In October 2024, the company demonstrated its commitment to physical retail by acquiring over 1 million sq ft of retail space across three strategic locations. However, December 2024 results showed an 8.3% revenue decline to GBP 2.54 billion, particularly affecting its luxury division. Despite these challenges, the group has continued its expansion, including opening a 60,000 sq ft multi-brand concept store in June 2025, highlighting the delicate balance between growth ambitions and increasing operational costs.

Frasers CFO: Business rates hike could scupper future store opening plans