BONMARCHE is planning to establish new stores, just nine months after it opened its doors to investors and floated on the London Stock Exchange.
Since then, its share price has risen by more than 38 per cent, profits have jumped 66 per cent and like-for-like sales are up 10.4 per cent.
The Wakefield-based retailer has undergone a dramatic turnaround since its administration in 2012 and is one of AIM’s success stories of 2014.
The management team, led by chief executive Beth Butterwick, has taken Bonmarche back to its original mission statement – value and style for ladies over 50.
The company was acquired by private equity firm Sun European Partners in January 2012 from administrators KPMG after its previous owner, Peacocks, saddled with £240m of debt, went into administration. Ms Butterwick joined the company as brand director just before the administration. “I could see the business had incredible potential,” she says.
She was chosen to lead the turnaround of the company and became chief executive. Last November, Sun decided to sell a 40 per cent stake in the business and raised £40m from a stock market flotation.
“Bonmarche was always a very good business in terms of its proposition but it had just been badly managed,” said Ms Butterwick.
A few months later, the company posted pre-tax profits of £8m for the year to March 29, a jump of 66 per cent, while like-for-like sales rose 10.4 per cent. Shares have risen from an initial 200p to around 277p.
“We’re catering for a growing demographic so there’s a great proposition and an opportunity to be had there,” Ms Butterwick said.
The retailer lost its way under the Peacocks ownership but now it has a very clear strategy for growth, which appears to be working. Bonmarche was operating from over 390 stores before the administration.
After being slimmed down to 265, the group now has circa 270 stores, including 18 in Yorkshire. It also has a customer database of 6.5m members, a website, mail order catalogues, a telephone order service and also sells through a TV shopping channel.
It is expanding into garden centres, mills, and department stores as well as looking at cruise ships. It also has tie-ups with 1,000 care homes. It recently re-launched the plus-size Ann Harvey brand, which it bought last year.
“My vision for the business is to be the front-of-mind destination for our customer,” Ms Butterwick said.
Her biggest investments for the year ahead are store refits, new stores and Bonmarche’s new EPOS (electronic point of sale) system.
By the end of March 2015 she also plans to have a fully-optimised tablet and mobile site.
“Tablet has fundamentally changed everything,” she said. Online visits via tablets currently account for 30 per cent of all online visits to the retailer and 16 per cent of all purchases – 100 per cent growth on the year before.
Online purchases account for seven or eight per cent of total sales, a figure she is keen to move into double figures.
But Ms Butterwick, who describes Bonmarche as ‘the high street’s best kept secret’, believes there will always be a place for bricks and mortar.
She is opening five new stores and up to 20 concessions this year. “Stores reflect community and have personality,” she said
The company employs just under 2,000 people including 435 in the head office and adjacent distribution centre.
Back in 2008, Bonmarche’s competitors were Ethel Austin, TJ Hughes and Littlewoods but since their demise, there is no other retailer catering purely for the same market.
Instead, Bonmarche overlaps with the likes of M&S, BHS and Debenhams.
Looking to the year ahead, Ms Butterwick said: “I think we’ve successfully delivered the first set of objectives and this year is about more of the same thing.”
She added: “We’ve had great feedback from our customers so far and that’s what matters.”