This week it emerged that yet another young fashion brand, Bench, could be sold. Victoria Gallagher considers who is lining up to take on the business.
Americana, the parent company of brands Bench and Hooch, has hired investment bank and corporate advisory firm Camaccord Genuity to lead a strategic review of the company.With a sale of the group among the options potential bidders could already be eying up the business to ensure they are ahead of the game.
Sportswear business Sports Direct already has a strong history of buying brands, having already snapped up similar young fashion labels such as Firetrap and Full Circle, which Bench and Hooch would sit well alongside. Mike Ashley’s company has also recently added Republic to its portfolio and so could use this fascia to sell products.
However if the retail group were to buy Americana then stockists may feel a little uneasy after the fiasco with Firetrap, which concluded with Sports Direct selling products in stores for less than the wholesale price. Bench and Hooch could lose loyal stockists if they end up in Ashley’s stable.
If JD wanted to keep Bench and Hooch as separate brands with a strong wholesale networks then placing them under its Focus Group division could be one option. However the labels could also make strong in-house labels for its fashion fascias such as Bank or even its eponymous store JD. Bench would provide JD with a strong brand name known to its target young adult market.
There are of course other players out there. Americana is currently owned by private equity firm HG Capital and so it might favour selling the brands to another similar company.
Under HG Capital, the group has been primed for growth with money being ploughed into marketing, launching concept stores and plotting international expansion. Bench’s parent company may be keen to further this with additional private equity funding.
So of the potential suitors, who is best placed to take on the brands?
I believe both Bench and Hooch have got a little bit lost along the way and their streetwear slant has been diluted when product has been updated for the modern consumer.
During the ’90s both brands were big names and were well known for their casual hoodies and T-shirts as well as their quirky womenswear styles. As trends have changed the pair have attempted to move with the times launching trend-led coloured chinos and fitted checked shirts, but perhaps they should have stuck to what they know.
Nonetheless Americana has continued to deliver earnings of £16m, with annual sales of £100m.
And while they may have lost some of their lustre in their domestic market, the pair have a strong international business particularly in European markets like Germany.
This suggests to me that rather than writing them off and selling them as cheap shadows of their former selves as Sports Direct is doing with Firetrap, with a bit of time and money Bench and Hooch could prosper.
With JD’s Focus Group set on developing labels and expanding their international remit, it seems that JD may be the best placed business to become the brands’ new parent company.