Mike Ashley’s sportswear giant Sports Direct this week stuck one of its many fingers in yet another pie, with the company investing in indie mini-chain Pulp.
Sports Direct is understood to have concluded a deal with young fashion retailer Pulp this week. It is not known whether the deal will see Sports Direct gain total control of the business. However, sources close to the situation said in the wake of the deal Pulp will expand both its online presence and store portfolio with Sports Direct’s backing.
Although many Drapers readers may recoil at another smaller firm getting scooped up by a large organisation I believe this could in fact be a good thing for the business.
In such a tough economic market many smaller retailers have had to either ask for further loans or succumb to the pressures and collapse into administration. Sports Direct however will provide Pulp with solid financial backing allowing it to benefit from a healthy cash flow.
With additional investment Pulp should also be able to blossom and grow. At this early stage it is understood the retailer will expand its ecommerce operations as well as its bricks and mortar stable, great news for the high street, which has seen soaring vacancy rates of late.
The business could now also look to bolster its staff numbers as well as experimenting with a wider brand mix as it will be able to test out new things without the fear of total failure if something doesn’t work out.
Sports Direct has repeatedly delivered impressive financial figures and so, although they may not be everyone’s cup of tea, it cannot be denied that Ashley and his team know how to run a successful business. Transferring their knowledge alongside a little bit of cash could do no harm to a beleaguered UK high street.