Growth Street helped Garment Quarter invest in stock and inventory to support their growth both online and offline.
Who are Garment Quarter?
Garment Quarter was founded in 2010 by John Reid, a former buyer for a successful Vivienne Westwood franchisee; and Peter Lake, a former IT consultant. Having recognised the strong potential within online retail the initial aim was to establish a multi-brand fashion business and Bristol was chosen as the base and location for the first store.
Their youthful yet inclusive approach to luxury fashion has seen them operate franchise stores for both Vivienne Westwood and Unconditional in addition to their own multi-brand, multi-channel store.
What was their challenge?
Luxury fashion, like most retail businesses, is a capital intensive business. With seasonal buying taking place six months in advance, there is a commitment to stock that must be made. The same can be said for the cost of creating a luxury retail store and website.
Garment Quarter's challenges were therefore two fold. Firstly, to break into an industry where their identified competitors were much bigger companies and reputations are key. Secondly, financial due to the general economic state of the market and the business model itself.
Unfortunately the business was born in the midst of the global financial crisis and exceptionally tight credit conditions. We had to take on expensive finance in order both to survive, and grow. This only got them so far but is an unsustainable model in the long run.
Finding a solution
Despite recording profitable figures and a much strengthened balance sheet they found it difficult to source funding from traditional lenders. This despite growing sales, margins and profits across the business. Unfortunately, the Limited Company of 2015 is not so limited and as directors without significant equity they were unable to stand further behind their business – despite having invested over £250,000 of their own money.
Working with Growth Street
Growth Street was the perfect solution for Garment Quarter when traditional lenders said they wanted to help but their automated credit procedures turned them down. Growth Street's individual approach with decisions made by experienced finance professionals is unique amongst affordable lenders to growing, mid-sized businesses such as Garment Quarter.
“Our search for a finance partner grew far and wide until we came across Growth Street – it’s a shame it took us so long to find them”
What does the future hold?
In the short term Garment Quarter are looking forward to continued strong sales growth into the crucial fourth quarter with significantly improved stock levels versus previous years.
John wants to see increased growth for Garment Quarter. “I am ambitious and don’t want to sit on a one-store business,” he says.
They want to take this business as far as they possible can which means growing quickly and competing with some exceptional companies. That in itself represents an awesome challenge. However, hand in hand with that they will need to structure their finances well in order to achieve that. It’s a big challenge but none more so than the one that faced them starting from nowhere in 2010!