The sale of Hobbs to TFG London will help to accelerate its success in the UK and abroad, chief executive Meg Lustman has told Drapers.
The UK arm of South African retailer The Foschini Group announced its acquisition of Hobbs earlier today, adding to a portfolio that already includes Phase Eight, Whistles and Damsel in a Dress. It follows a two-year turnaround programme led by Lustman, who joined Hobbs as CEO in 2014.
“The deal will make us go further, faster,” she explained to Drapers after the deal was made public.
“International has always been a key part of our strategy and will continue to be, but [with TFG’s backing] we will hopefully avoid some of the mistakes we may have made with regards to our choice of partner, for example.
“It will be great to plug into TFG’s network and knowledge; it’ll help to accelerate our success, and get where we want to go.”
Hobbs sells online in 49 countries, and operates stores and concessions in the US, and concessions in Germany. Ben Barnett, chief executive of TFG London, said the acquisition would allow the group to gain more leverage in international markets.
“When speaking to landlords abroad it gives us a stronger position as we can co-locate stores. They will be separate stores and have separate entrances but they will sit next to each other. It makes sense as they have a similar customer demographic.”
Lustman agreed that there was some customer cross-over with Phase Eight and Whistles, but insisted each brand would remain separate.
“Customers are well informed and shop across many brands. There will be some sharing of customers but each brand in the portfolio is distinct so customers won’t be confused,” she said.
“They won’t mix up a Hobbs coat and a Phase Eight dress – each brand does different things well.”
In the UK, Hobbs has 140 stores and concessions, and Barnett sees potential for further openings: “We see a huge opportunity for adding more stores and concessions both in the UK and abroad as it is a great way to introduce the brand to new customers.”
Hobbs’ gross profit grew 8.7% to £76.2m for the year to January 28, while sales were up 9% to £119.5m.