It is still too early to know what the joining of these two well known brands will mean for the market place, but educated guesses would include the selling of ELC branded toys in Mothercare stores, especially the out of town stores where ELC has a limited presence. Combining many corporate functions should also bring greater efficiencies especially in sourcing products in the far east.

Mothercare has also been in the conversation of many of our suppliers. A few weeks ago, Mothercare asked its suppliers to confirm prices until the end of the Spring/Summer 08 season. That by itself is fair enough. Everyone needs to plan. Mothercare has usually collected product directly from the supplier, so these prices would have been calculated on the basis of no shipping costs. However, recently, Mothercare told its suppliers that they would now have to deliver into Mothercare's warehouses - at their expense! This will make a big difference to suppliers' bottom line. In fact, for a number of them, it will mean the difference between making a profit and not making a profit. So what is the prudent supplier to do? Well, they could just accept the change - and lose money on sales to Mothercare. They could object, insisting that prices must rise. This is a very dangerous strategy for many as potentially this could mean the loss of Mothercare's business. At least one supplier has done this, but as they told me “Mothercare isn't an important part of our business and if we lose sales there so be it.” However, for many suppliers, losing Mothercare's business would mean a substantial drop in sales and possibly mean the end of the company! A choice between the devil and the deep blue sea! Naturally, most suppliers are being very tight lipped about their response as delicate negotiations take place.

How successful they are only time will tell!

Finally, take a look at our new website - www.nursery-industry.co.uk. Now you can keep up to date through your computer!