Design, Manufacture, Sourcing & Distribution of Quality Women’s Outerwear
Ref.AB045 Location London,East End of LondonAsking Price £2,000,000Confidential offered for sale
Finance available to buy this business subject to status. All regulated business is passed to independent financial advisors who are regulated by the FSA | |
Asking price includes:
Gross margins of approximately 15%
Turnover projected to reach £5m in current financial year
East London leasehold offices and Cash and carry outlet
Eastern European manufacturing facility and office in China
Large established blue chip client base including major High Street names
Thousands of independent retail customers
Design, production, sales and distribution team
Significant growth and expansion opportunities
Many years of successful operation
Training and handover
Goodwill
Samples
Stock | Business profile: | Established many years ago, this business is at the centre of the rapidly changing fashion industry as top creators, manufacturers and distributors of ladies outerwear.
Fashion is a demanding world requiring a high level of sophistication, specialist knowledge and the most efficient and professional of operations. This business operates as a tightly knit family organisation and has assembled an impressive collection of highly talented individuals. This very effective team works at home and abroad – with an Eastern European manufacturing base and an office in China - to create, manufacture, source and supply the highest quality garments at the best possible prices.
This business operates seamlessly – bringing together the combined talents of its design, production and distribution people to work with its Clients, many of which are top High Street retailers, to create garments that are tailor-made to the Client’s exact customer profile and individual style.
The design team of this business excels at creating bespoke designs to produce the unique and exclusive clothes that its Clients’ customers require – understanding that retailers have a specific market share to protect that can only come from a clear interpretation of the Client’s requirements. Working quickly and accurately and with great skill this business produces garments that its Clients will want to buy but perhaps more importantly can buy. This involves precise timing to ensure the design, production and distribution is exactly right.
As well as servicing the retail trade via a number of well-known High Street outlets this business also operates its own independent wholesale outlet in the heart of the East End. With literally hundreds of accounts from small independent retailers this side of the business is often used as a test market for new designs prior to selling them into the larger High Street fashion chains.
Following a brief period of time when turnover dipped due to the long term illness of the Managing Director, turnover is now back between £4.5m and £5m with gross margins of approximately 15% reflecting the reputation for delivering the right merchandise at the right price that this business has built up with the retail trade over its many years of operation. With one of the major supermarket chains having recently placed its first few orders this business represents a significant opportunity to acquire a major designer, manufacturer and distributor of ladies fashion with significant growth potential.
Key Strengths:
The company has an in depth understanding of the ladies outerwear sector in the UK and throughout Europe and has established an excellent reputation for its quality range at very competitive prices - delivered with very efficient and fast response times. It enjoys an enviable Client list that includes some of the major names appearing on High Streets and shopping malls throughout the UK and Europe. With many of its Clients it is currently working with more than one Buyer within any given organisation and is ideally placed to increase its penetration into these organisations even further.
With its own production base this business is in complete control of its delivery requirements – on all criteria - cost, timing and perhaps most importantly quality. Having centred production currently in Eastern Europe and with an office in China it is ideally placed to take maximum advantage of the particular economic conditions – low production costs, high levels of investment in manufacturing etc that these markets offer – enabling very advantageous pricing structures to be placed in front of the Client.
With its own wholesaling operation and a growing customer base within the independent retail trade it is perhaps better insulated from the tough negotiating stances of the High Street retailers than many of its competitors – a facility that also enables it to keep track of the changing face of retail fashion first hand. Cash and Carry customers have been carefully selected to ensure a sound base for this side of the business.
The company offers a complete turnkey operation that will undoubtedly be of interest to any larger company wanting to expand, and would complement any high profile company with perhaps more presence towards the top end of the market.
Key Opportunities:
The market for 'off the peg' and bespoke outerwear is increasing and there is an excellent opportunity to build on the existing client base of this company. For a short period of time turnover suffered due to the long-term illness of the Managing Director however steady in-roads have been made with the existing customer base to return turnover to its previous levels. Inevitably this focus on sales effort has generated many additional opportunities to deal with Buyers with whom this business has not previously worked and it would be no surprise if turnover was to far exceed previous levels.
This business has endless potential to increase its profitability by continuously assessing its production capabilities. Indeed the business is currently reviewing the competitiveness of its production facility in Romania with a view to possibly relocating to the Ukraine to secure further cost savings and there is also the possibility of establishing a production facility on the Far East – wither Vietnam or Laos for example.
Quality Assurance:
The responsibility to achieve quality is inbuilt into the culture of the organisation. Quality and attention to detail underpin all aspects of the production process. Manufacturing within its own factory allows strict control covering all aspects of the order process from initial sampling, ongoing production and scheduled delivery with frequent personal visits on behalf of many members of the operation to the production facilities to ensure the highest levels of quality production are achieved. The management team is small and flexible; this allows excellent response to customer requests., | Premises:
The business operates from two buildings, both leasehold in the heart of the East End of London. Approximately 3,000 square feet is dedicated to the manufacturing side of the business with a further 3,000 square feet of warehousing with a sampling area, offices, loading bay and car parking. The annual rent is £26,000 with an additional £9,000 payable for the car park.
The wholesale operation is run from the second building on the same site - 7,500 square feet comprising ‘retail’ space and large basement storage plus additional storage on two further floors. There are a further 3 years available on the lease which it is understood can be re-negotiated at a cost of £39,000 per annum. Prominently situated on a major arterial route into and out of London’s West End and the City this business enjoys a £10,000 annual contribution from the rental of a billboard placed high up on the building.
The 4,000 square metre factory in Romania is fully equipped with all the necessary production machinery and a huge storage/hanging area. Currently employing 300 workers there is capacity to increase this to 1000. Rent is approximately £24,000 per annum. | <>Advertising and Marketing:
The business does very little by way of advertising and marketing having built up a very good reputation throughout its many years of operation with only one full-time salesman out on the road regularly visiting the High Street retailers | | | Financial profile: | The business is being offered for sale on a going concern basis. All financial discussions will take place directly between the vendor and all interested parties under the auspices of Turner Butler.
The business is financially stable with a strong order book. The current turnover is in excess of £4.5m per annum with gross margins of approximately 15%.
Full financial information is available, subject to the confidentiality letter being returned. | Employees:
This is a tight-knit family business with the Managing Director/Owner working with his wife, daughter, son and son-in-law. In addition there is a highly talented designer, a Sample Room Manager, a Salesman with a further part-time Salesman that also doubles up on administrative support, three sample machinists, two ‘sample cutters’ an Accountant and three warehousemen.
Twelve other employees operate out of the office in China | Support and Training:
The owner is happy to provide full business familiarisation, training and handover for as long as is required to ensure a smooth transfer of the business to new Owners – exact duration to be negotiated prior to the sale. | Reason for Sale:
Having built the business back up to its previous scale the Owner believes it is time to hand the business on to new Owners who can build upon the excellent foundations that have been established. | | Turner Butler Disclosure Statement: This statement applies to information relating to any company or other undertaking or business advertised for sale by Turner Butler (a 'Business') The information supplied by Turner Butler on its website or in any other promotional material ('the Information') is not and is not intended to constitute an offer for sale of the Business or any assets of the Business or of the shares of any company which owns the Business. For the avoidance of doubt there is no intention to create a legal relationship which will only come into existence when a written contract for sale and purchase of the shares in or the Business has been entered into The Information provided is not intended to address your particular requirements. Further the Information does not constitute any form of advice recommendation representation endorsement or arrangement by Turner Butler and is not intended to be relied upon in making (or refraining from making) any specific decisions. Any agreements transactions or other arrangements made between you and any client of Turner Butler are at your sole risk and responsibility. The prospective sellers of the Business have provided the Information to Turner Butler. The Information has not been verified by Turner Butler. You must carry out your own due diligence and satisfy yourself as to the accuracy of all matters. In the case of the sale of shares in a Business the Information has been prepared on the basis that the shares will consist of or include more than 50% of the voting shares and that both the seller and the buyer is either a body corporate, a partnership, a single individual or a group of connected individuals so as to fall outside the scope of regulated activities as defined by the Financial Services and Markets Act 2000. If you are considering a transaction which falls within the scope of such regulated activities you cannot do so through Turner Butler. Appropriate professional, legal and accountancy advice should be obtained before making or refraining to make any decision. Turner Butler does not accept any responsibility or liability for loss or damage of any nature that may occur by reliance on the Information. Neither Turner Butler nor any of our employees or agents makes any representation as to the completeness or accuracy of the Information nor do we accept any liability for any losses, costs, liabilities or expenses which may arise directly or indirectly from your use of, or reliance on the Information. This document is governed by and shall be construed in accordance with English Law and any dispute arising in connection with it shall be subject to the non-exclusive jurisdiction of the English courts Turner & Co (GB) Limited registered in England and Wales under company no. 2477988 of registered office Savoy House Savoy Circus London W3 7DA, trading as Turner Butler © Shaun Sweeney October 2006 |
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