Why are some companies recession proof?

8th September 2011

The owners of the Superdry fashion label, SuperGroup, revealed a 66% rise in sales during the first three of this year, and total group sales were £54m in the three months to the end of July.

According to the Guardian wholesale sales of SuperDry and SuperGroups other label Cult almost doubled on the strength of international demand for the retailer's clothing.

Investors who bought into SuperGroup when it listed have done well, its shares, which were floated a year ago at 500p closed at £10.59.

Luxury and must-have labels have done well this recession, mainly because of demand from overseas, but many analysts feel that brands like Burberry may now no longer represent value i.e they have reached their peak.

Demand from emerging markets has helped fuel fashionable brands and is likely to do so for some time but choose your companies carefully because brands come in and out of fashion.

Our appetite for caffeine has not diminished during the recession, in fact it's stronger than ever with Britons preferring a skinny latte to a Big Mac.

UK coffee chain Costa Coffee has overtaken MacDonalds as the nation's third largest food and drink chain.

Figures from Costa owner Whitbread showed that it now has 1295 UK coffee shops compared to 1200 McDonald's, after opening 145 in the past six months, The Daily Mail reported.

And like SuperGroup, Costa, or rather its owner Whitbread is planning to expand its business in emerging markets including India and China, where it recently opened its 100th store.

Other likely beneficiaries of the recession include confectionary makers.

In the US Krispy Kreme doubled its earnings in the first quarter of the year, while last year Dunkin' Donuts launched its first donut-related ad campaign in a decade. 

Running is also become more popular as people ditch their expensive gym memberships. Sales of trainers have helped companies like JJB Sports take over the high street.

Car sales are also showing signs of a comeback, Mindful Money's economist blogger Simon Ward writes: "It is early days but August vehicle sales numbers are reassuring, with the G7 total up solidly from July to its highest level since March. This reflected increases in Japan and Europe, with the US little changed. Caveat: the gain is partly Japanese supply coming back on line, allowing earlier orders to be filled."

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