Foschini Acquires Whistles, With Big Expansion Plans Ahead
France: 55. Italy: 47. Germany: 30. England: 16. No, not the sports scores. These are in fact the figures for the number of luxury brands in each country with revenues of £100 million or more, according to a March 2016 McKinsey and Company report prepared for Walpole.
There’s clearly enormous potential for global growth then, and it’s not surprising that international companies are homing in on British luxury brands because of their under-exploited international appeal. As a consequence, luxury brand headhunters are finding themselves drawn into a hunt for the executive talent that can make this happen. And it is happening not only at the highest end of the market, as the same applies to many mid-market quality brands, particularly in fashion, which have potential for huge overseas sales.
Foschini on the Acquisition Trail
This reasoning underlies the acquisition strategy currently being followed by Foschini. Last year, the South African company bought the British high street retailer Phase 8. This year, it has acquired Whistles. Since Jane Shepherdson joined Whistles as chief executive, it has become a favourite with the likes of Sam Cameron and the Duchess of Cambridge.
Shepherdson took a 20% stake in the chain when she joined. The company was previously owned by Baugur, which collapsed during the financial crisis but was refinanced the following year. Both Foschini and Ms. Shepherdson have declined to comment either on the price being paid for Whistles or on other financial arrangements, but it’s understood that she has kept her stake in the company.
Foschini has big plans for Whistles, and intends to expand from the current 46 stores by moving into international markets. The Foschini deals follow last year’s acquisition of the popular Office shoe brand by South African company Truworth International Ltd, which bought a majority stake in the shoe chain Office Retail Group Ltd.
Growing Luxury Brands Require Top Management Talent
The McKinsey company report highlights several key steps to building a successful global luxury brand. One of these is to source top-performing business managers and executives who can work with the creative talent to deliver growth. The report refers to “an undeclared war in retailing for talent of this sort”. The answer would seem to be executive search, especially since one of the difficulties facing luxury brands in finding and retaining this talent is fierce competition for these people in markets such as London. McKinsey comments that luxury brand headhunters are needed as well as their own networks.
The need for skilled managers and executives who can work with creative talent has never been greater. Luxury brand recruitment can be used to find a cohesive top team, strongly incentivised, as an essential requirement for growing the brand.