Lush to pass tariffs onto US shoppers as it sinks further into the red
Lush has revealed plans to open a UK hotel as it detailed its response to President Donald Trump’s tariffs amid the ethical cosmetics retailer sinking further into the red.
The Dorset-headquartered company has included scant detail in its annual accounts about its plans for a new hotel but did say it is working with a “British partner”.
The move would be a first for the business which currently runs around 870 retail stores across the world.
Lush responds to Trump’s tariffs
Lush took the “sad decision” to close its Dusseldorf manufacturing site in 2024 and consolidate its North American production into its Toronto base. Dusseldorf’s production was moved to its UK factory in Poole.
In the accounts, the company said President Donald Trump’s 25 per cent tariff on Canada will lead to it “passing this tax directly to our American customers”.
It also confirmed that it does not plan to open a factory in the US.
Lush said it is looking to launch new franchises in Italy and France and is working with new partners in India and Indonesia.
It is also targeting around 30 outlets in these regions over the next decade as well as “a more imminent expansion” in Turkey and smaller markets such as Panama and Cyprus.
Retailer creates hundreds of jobs
The details on Lush’s plans for a UK hotel and its response to Trump’s tariffs and international expansion have been revealed in new accounts filed with Companies House.
They show that the firm’s turnover fell from £708.1m to £647.5m in the 12 months to 30 June, 2024, while its pre-tax loss widened from £28m to £42.5m.
In last year’s accounts, Lush had said its tie up deals with the SpongeBob SquarePants and Barbie brands were helping to boost sales.
Lush’s retail sales fell from £576.2m to £548m in the year while its digital sales went from £107.3m to £101.3m. Manufacturing turnover remained broadly flat at £24m.
The company’s average headcount jumped rom 13,034 to 13,614 while it operated 869 at year end, up from 857.
A “resilient, if not spectacular’ year
A statement signed off by the board said: “We began the year strongly, achieving total sales growth of 5.7 per cent in Q1.
“Our latest cross-brand collaborations, including Barbie and SpongeBob, proved popular with customers and helped to drive increased shop footfall and online traffic.
“However, Q2 delivered mixed results across our markets and we struggled to sustain the growth trajectory of the first quarter.
“December, our most important trading month, saw sales decline by 2.2 per cent.
“That said, there were many highlights to celebrate, including record-breaking sales days for nearly 100 stores and five countries (including the UK).
“We also recorded our highest ever daily revenue for a single store, with our incredible new Glasgow anchor taking over £100,000.
“Following Christmas, shifts in the calendar for internal product launches and seasonal events such as Easter and Mother’s Day caused some monthly fluctuations, however, overall sales remained broadly in line with last year.
“Over the past two years, global political and economic challenges have driven unprecedented levels of cost inflation.
“understandably, the business has prioritised mitigating significant increases in raw materials, ages and energy costs.
“More recently, our focus has shifted toward reigniting sales growth, and we are beginning to see positive signs.”
Lush added that in the final month of its financial year, its combined retail and digital sales grew by 3.2 per cent year on year.
The company described it as a “pleasing way to close what we’d describe as a resilient, if not spectacular, year”.