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Focal point

After snapping up sports casual label Sergio Tacchini last year, brand house Focus Group is back in the spotlight. Directors Michael and David Gilbert reveal how keeping a low profile is now harder than ever

Michael Gilbert is wincing and is visibly uncomfortable. "We didn't want to do this in the first place," he says. "We really want to keep a low profile."

Michael and his brother David own Focus Group, a brand licence operator and distributor. Prising financials from the brothers is notoriously difficult, but with a solid business and healthy turnover approaching £70 million, what do they have to be shy about?

They have agreed to an interview following their acquisition of casual sportswear brand Sergio Tacchini three months ago, for which they have big plans. Older brother Michael is the frontman, taller and slightly more forthcoming. David seems astute and laid-back, yet both have proved they are canny businessmen.

The Focus brand stable includes the Converse footwear and clothing offer, plus casualwear brands Ecko Enterprises and Zoo York. The group's recently acquired Sergio Tacchini licence bridges the gap between sport and fashion, sitting alongside the U Are U fashion offer and sports brand Le Coq Sportif in Focus's portfolio. On top of the Sergio Tacchini acquisition, the group landed a merchandising deal with UK record label Stiff Records in December.

All of the brands are licensed, distributed or wholly owned by Focus Group and, after more than 30 years of slogging it out in the retail business, the strategy is paying off for the brothers. Together they oversee a total of 13 brands and count JD Sports, Asos.com and Foot Asylum among their top retail accounts, as well as smaller retailers such as Liverpool-based independent Microzine.

David and Michael's first foray into retail was with a pitch on north London's Wembley market in 1975, when the brothers were aged 16 and 19 respectively, selling dartboards and skateboards. "Michael started it," says David. "I was rubbish at school so I used to run the stall and we had fantastic takings."

The partnership continued, until in 1976 the two young entrepreneurs formed Focus Group. Their early days involved schlepping around London and the Home Counties selling sports equipment and what they term "fancy goods" to stores. It was a step up from their market roots. "We don't want to sound dismissive of market traders, but we thought we had more in us," David explains.

Back when independent sports retailers were king, the two served swathes of sports shops including local chains such as Allsports and Hargreaves, and national multiples including Sir Tom Hunter's Sports Division and Olympus. They continued with the sports accessories market for years, occasionally dipping into new business areas in an attempt to diversify, but failing along the way. "Anything we tried to do that was out of our remit didn't go very well," concedes Michael.

He recalls one attempt to break into the kidswear market in the 1980s - a boom era for the category. However, the Gilberts failed to grab their slice and had to quit the venture because of supply chain problems. "The supply chain wasn't geared up properly. We weren't savvy enough in that area," says David.

It was not until 2000 that the brothers moved into the fashion market, following a fortuitous meeting with David Tolman, a former Puma executive director of marketing and ex-managing director of Gola Sportswear International. Tolman decided to join the business and is now one of Focus's three directors. It was he who orchestrated a new UK licence for Converse in 2000, which set the company on the licensing and brand management path. The Converse opportunity came on the market when its US holding company went through Chapter 11, a protected reorganisation to avoid bankruptcy.

The brothers refuse to reveal turnover by brand, but Ecko is thought to top Focus's brand stable in terms of revenue. The US streetwear label, identified by its Rhinoceros logo, has moved away from its urban roots, insists Tolman, and is now attracting an active sports crowd. "Now that football supporters and motocrossers are wearing the brand, it has gone mainstream now it is in JD Sports," he says.

Focus Group manages its brand stable via what the brothers term a "mini-business unit method", led by individual managers. Tolman catalogues each brand as if tracking the lifecycle of a human being. Le Coq Sportif, he says, is mature, so rather than looking to grow the brand, the group is now just "maintaining it" and capping distribution. Sergio Tacchini is a baby and Tolman says it has strong growth prospects. He is currently developing both premium and mainstream ranges for the brand for spring 08.

Ecko, he adds, is in its late youth, with a lot of growing to do in terms of distribution. Zoo York - the "small child" - was initially a skate brand, but the group is planning to increase distribution by taking it from its base of 100 UK independents into an as-yet unnamed "major retail player".

Director of fashion agency Evil Tongues and former JD Sports fashion and apparel buying director Stephen Spellacy says Tolman is well regarded in the sportswear industry. "He has always had very strong links with sports retailers, which is his main strength. Dave has been fighting against the industry's two-for-one discount approach, instead trying to carve another niche for the business by selling good-quality, well-branded product and keeping prices up."

One Focus Group stockist says it is the firm's brand acumen that gives retailers confidence when doing business with the brothers. He says: "They have a knack of finding the next brand and they nail it."

But it is not all smooth sailing, as Tolman is happy to admit. The Converse clothing line, which the group launched for spring 07, is giving Focus a headache as it strives to find a clearly defined position in an already crowded clothing market.

Tolman explains: "Converse has many pitching opportunities, from sporting heritage to a more student-esque Abercrombie and Fitch-type look. We are still trying to get the right handle on the business. It has not realised its full potential and we are working on finding the right recipe for our retailers."

Finding the right flavour for its brands and meeting the demands of retailers is a growing challenge for the group. As a brand house, Focus needs to live and breathe the market, as well as having brands on hand that give retailers the trends and product they require. But between 7% and 8% of the group's turnover is tied up in design and supply development for high street retailers and other brands outside of the Focus stable, including River Island. Michael insists this is not a significant part of the business, but it demonstrates the breadth of the company's interests across the sector.

The contract design business enables Focus to stay in tune with the changing rhythms of the trade, such as speed to market. David says that over the past two years, retailers have been looking for brands that can react to trends and are more flexible on orders closer to the season.

Although Focus's supply chain slipped up when the brothers dabbled in kids' clothing, today David is confident in their sourcing expertise. Charged with the supply operation for the group, he controls an operation that buys out of Jakarta, Indonesia, Shanghai, China and Turkey.

Sixty employees help him run the supply chain, including four expats on the ground in each of the respective territories, one of whom - Trevor Freeman - held senior positions at Gola Sportswear International and Puma, and now lives full-time in Asia carrying out product development, sourcing and keeping on top of pricing and quality control. Monitoring lead times is also part of his remit, which is a relatively fresh part of the operation.

Historically, the sports industry allowed lead times of 90 to 120 days, but with the growth of fashion crossover this has shortened to 30 to 40 days, says David. "I would like to think that because of the logistics we have in place, the shorter lead times haven't affected the quality of the product. If anything I think it has made us sharper on design and much closer to what is happening on the high street."

For David, keeping the operation competitive is just one of the challenges that comes with juggling a business that has global interests. There are many local issues, including currency and language, but one of the most prevalent for Focus is counterfeiting. "It is definitely on the rise and it is a big issue," says sales director Elliot Brown, who joined Focus from Levi's in October 2005. The group will only say that it is facing counterfeiting problems on two of its brands, both of which have international profiles. One of them is thought to be Ecko. As a result, it is employing a professional auditor to remedy the situation or, as David puts it with his tongue only half in cheek, "to put someone in prison".

The business's growth over the past two years has spawned a new showroom in Camden, north London, and two years ago Focus hired design director Michael Grant, who joined from family-run brand house business Guide London, to push the fashion category. The move is understood to have caused friction at Guide London when Grant took fashion label U Are U with him when he moved to Focus Group.

Although the Gilberts insist they are not at capacity brand-wise and are always on the lookout for new acquisitions, they are content with their current portfolio. They say the casual and fashion categories have the most potential, compared with more sports-focused brands, which are struggling at the moment in a deeply discounted market.

The director of one rival brand house says that the Gilberts are successful because they have spread the risk and focused on building a stable brand list to ensure they get more bites at the cherry. But Focus does not want to be solely reliant on its stockist base in the future. It sees own retail as a potential new strategy, with both bricks-and-mortar stores and an online transactional offer in the pipeline for next year, and is currently on the prowl for stores.

"Theoretically, each label has retail potential," says Michael. "I think there is a good case for each of the brands in the casualwear category to move into standalone retail."

Despite being cagey and insisting that they do not want to draw attention to themselves, Focus is currently in discussions with a Premiership football team with a view to landing a kit sponsorship deal, ensuring that its name might soon become better known.

Could the bashful act simply be a ruse? As the men leave the interview room to have their photograph snapped by a Drapers photographer, David says: "Can he make us look like Brad Pitt?"

Low profile? Not for long.

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