JJB Sports has hit out at Umbro, saying that it will buy record low numbers of the new England away shirt because it is poorly designed, exacerbating the problem of the national football team's failure to qualify for Euro 2008.
Chris Ronnie, JJB's new chief executive, said of the new shirts which are due to be released next month: "We don't think that Umbro has gone about the design in the right way." He was speaking as the company issued a profit warning, saying that while like-for-like sales in the six weeks to January 6 rose by 2.5pc, margins were hit as the sports retailer slashed prices to shift old stock.
As a result gross margins were 4pc lower than the same period the year before, and it is expecting pre-tax profit in the second half to be "slightly below the £27.4m achieved in the second half last year.
Like-for-like sales in the 23 weeks to January 6 rose by 2.2pc. and gross margins rose by about 2pc.
Mr Ronnie said that it was not just a backlog of England shirts that it had to shift, but stock from across JJB's product range.
"It's frustrating that I've had to spend so much time cleaning the business up, but it had to be done," he said.
He said that he would now focus on changing it stores and products to make them more appealing to younger customers. The majority of JJB's customers are aged 25 and above, but Mr Ronnie wants to appeal to younger customers with "fresher" brands and products.
That strategy has paid off for rival JD, which said last week that it had managed to defy the Christmas slowdown partly because most of its customers are teenagers and twenty-somethings who are not saddled by mortgage worries.
Mr Ronnie said that now the old stock had been cleared the business was in a stronger position for 2008, but the outlook remained tough for retailers.
Philip Dorgan, analyst at Panmure Gordon, said: "While painful, this decision to bite the bullet by Chris Ronnie, leaves JJB without any legacy stock issues, which puts it in good shape to begin its recovery programme in the next financial year."
After the trading update Mr Dorgan cut pre-tax forecasts for the year to January 27 2008 from £36.2m to £33.5m.