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Paving the way

After 36 years in retail, Catherine Paver admits she would still rather visit a footwear trade show than go on holiday. Lucia Cockcroft meets her to find out why

When Catherine Paver stood on stage to collect the Lifetime Achievement accolade at this year's Drapers Footwear Awards, it was the first time many of her friends and colleagues had seen her lost for words.

"I couldn't say anything apart from 'thank you'," she says of the Awards, which were held at Grosvenor House on London's Park Lane in May. "I was in shock. How I walked across the room and on to the stage, I'll never know."

It is 36 years since she founded footwear retailer Pavers, and she still plays a prominent role in the business. When Drapers visits, Catherine, energetic and immaculately turned out, is less than a day off the plane from the Expo Riva Schuh trade show at Lake Garda, Italy. "I feel as though I've put on half a stone", she says, patting her slim stomach. "When you meet all the suppliers, they want to wine and dine you. It's rude to say no."

Although the company is run day-to-day by her sons Stuart, Graham and Ian, her influence is still strong; she buys for the business, travels to three or four trade shows a year, mixes enthusiastically with suppliers and keeps her team of store managers firmly in line.

It is this drive and strength of personality that first led Catherine to found Pavers back in the early 1970s - a time when, she recounts, society expected women to steer clear of the male-dominated world of business start-ups. "You had to be very persistent", she recalls. "In those days, no one thought women should set up on their own. It was a big move for me and it was hard going. But I always believed in honesty, and people quickly saw this and trusted me."

The bank was also unconvinced. Catherine's request for a £200 start-up loan was refused on the basis that the business idea wasn't strong enough. Undeterred, she pretended she needed the money for a new sofa and the bank agreed.

She says the idea for Pavers arose from her own struggles to find comfortable but reasonably stylish shoes that were suitable for her sensitive feet with high arches. With the encouragement of her late husband, she had the idea of selling clothes and shoes at homewares parties in private houses and village halls. The strategy of offering clothes in this way was not new, but selling footwear was.

Fired by her plain-talking approach and verve, plus a need for well-fitting shoes in the 40-plus market, the business grew quickly. Her son Stuart, now managing director, joined in 1981 and the business opened a warehouse to sell quality brands at discount prices. This was followed by the first shop in Scarborough, North Yorkshire, and others in York, Hull and Newcastle upon Tyne.

In 1996 Pavers opened its first outlet store in North Shields, Tyne and Wear, offering footwear at 30% less than usual retail prices. More followed, and the firm now has 58 stores - 11 full-price shops, 18 discount concessions and 29 outlets - in the UK and Republic of Ireland, plus a 44,000 sq ft head office and distribution centre in York, which opened last year. The two models - retail and outlet stores - are run as one and form the backbone of the company.

Pavers has grown 30% year on year for the past decade. "I want us to reach 100 stores before I die," says Catherine with a twinkle in her eye. There is a five-year plan to take turnover to £90 million. In the year ending January 2007, Pavers recorded sales of £50m and made a net profit of £6.9m.

It has been a meteoric rise; only four years ago, sales were at £15.7m and net profit was £1.8m. In 2005, comparable figures were £31m and £4.2m.

Although the business sells men's footwear, about 70% of Pavers' product is for the female market. Key brands include familiar comfort names such as Ecco, Loretta, Hush Puppies, Clarks, Timberland and Italian label Fly Flot, for which Pavers is the sole UK licence holder.There is also a clutch of own brands, including Pavers Comfort, Pavers Wide, Pavers Sport, and Italian-designed and made Pavacini. "Own brand enables you to offer a far better product at a more competitive price and make more margin," says Stuart, who arrives to join his mother part-way through the interview.

As well as Pavers' rapidly growing retail presence, there is also a thriving internet business, www.shoe-shop.com, which Stuart, the driving force behind the launch, describes as "more fashion-led". From a starting point seven years ago, the online operation now pulls in sales of between £10m and £12m a year, with plans to boost this five-fold within five years.

Alongside the website, retail and factory outlets, the business has a new retail venture called Staccato, selling catwalk-influenced footwear to 20- to 30-year old women. The first Staccato store opened in Ashford, Kent, in October 2006. There are now three in total. Despite the competitive stance of clothing retailers in that part of the market, Stuart has ambitious plans for Stacatto. He believes the chain could grow to up to 100 stores, which would bring the combined Pavers and Staccato store count to a possible 200 within five years.

Staccato has the same qualities as Pavers, Stuart explains. "It's good value but fashionable footwear. A lot of brands have become greedy with their margins and have left a gap in the market for better-value footwear," he says.

There is little doubt that Pavers has been quick off the mark in terms of innovation and expansion. Alex Thomson, UK and Ireland sales manager for footwear supplier Rieker, refers to the firm's growth plans as "progressive" and "aggressive in the good sense of the word".

"Pavers has some very nice outlets and a good online business," Thomson explains. "The business is efficient and the marketing agenda is strong, as is its profile."

Justin Morgan, managing director of Rohde, which also supplies Pavers, is full of praise for the company's efficiency and reliability. "If everyone was as nice to deal with, my life would be much easier," he says.

Pavers has managed to marry its ambition and growth with firmly-held traditional family values. Words such as honesty and openness pepper Catherine and Stuart's vocabulary.

Despite Catherine's better intentions - she wanted her sons to go to university - the three boys joined the firm at a relatively young age. Stuart is now managing director, Graham is logistics director and Ian is buying director. Apart from the initial £200 she squeezed from the bank in the early days, Pavers has never taken out a loan, and all profits have been pumped back into the business.

Catherine lives and breathes shoes. "I'll never retire," she says. "I simply love shoes. I always go to a show rather than have a holiday. I love meeting all the suppliers and socialising with them. It's important to have fun too."

It is difficult to pin Stuart down on the nitty-gritty of how Pavers has achieved its expansion, or how the business will meet its growth targets. He says: "We don't say we need to open three shops in X years' time. If the opportunity comes along we'll take it, in line with how our profits are at the time." Catherine adds: "We are just trying to steadily improve what we do."

This entrepreneurial approach has served Pavers well so far, but will it continue to do so as the business grows? "First, we work by instinct," says Catherine. "Then we measure everything scientifically to see if it has worked."

Systems are slick, investment in technology is continual, and the new warehouse and head office gives Pavers plenty of expansion space. The warehouse is kitted out with wireless hand-held scanners, giving almost 100% stock control accuracy. Stuart says this gives the firm a clear commercial advantage, allowing it to act on information, not guesswork.

He adds: "We also know, down to every penny, our margins on everything. From that we decide where best to invest our money."

The fact that Pavers is family-owned and run allows for this fluid approach. There are no shareholders to appease, and reactions can be instantaneous. "If mother likes something in Spain, we can place the order straight away, rather than buying by committee," says Stuart.

The family prioritises show visits "to seek opportunities and brands that other people overlook", as Stuart puts it. "We are constantly looking for new brands and ideas. A lot of independents don't visit the shows, but it's a vicious circle. You need to get out and see what's available and interact with other retailers."

Twice-yearly buying days are also key to Pavers' strategy, with suppliers invited to head office, or a hotel, to present their wares. These days can be tough for suppliers, with little chance of avoiding rival brands. Although not everyone wins, the process is fair, direct and very much in line with Catherine's general approach to doing business.

Rohde's Morgan says: "Catherine wants you to fight your corner and will hear what you have to say. She calls a spade a spade and has shoes running through her veins instead of blood."

Although the buying is shared between family members, much of the process hinges around Catherine's eye, experience and instinct. "Mother has always put a massive emphasis on buying the right product," says Stuart.

Stuart and Catherine admit that Pavers' niche is far from sexy. Comfort with a sense of style was always the goal, and Pavers appeals to customers turned off by the high street's sometimes unwearable focus on trends.

"We specialise in comfort and quality," says Stuart. The shoes are often recommended by chiropodists and cater for all shapes and sizes, from sizes 1 to 10 in women's and 5 to 13 in men's, including wider widths.

Pavers' Staccato venture sees the business moving into new territory, which seems risky when its main market is so secure. But Catherine explains that evolution and innovation are priorities for Pavers. And if the company fails to reach its target of 100 stores within five years - not to mention another 100 for Staccato - you get the feeling that Catherine will have more than a few words to say about it.

PAVERS' FOOTWEAR FACTS

- Pavers sells 1.5 million pairs of shoes a year.

- The company employs more than 500 staff and has 58 stores - 11 high street stores (three in department stores), 18 discount concessions and 29 designer outlets.

- Projected turnover for the year ending January 2008 is £65m, with a target of £90m and 100 outlets by 2010.

- There are currently three Staccato stores, with up to 100 planned within five years.

- Own brands include Pavers Comfort, Pavers Wide, Pavers Sport and Pavacini.

- Pavers' website, www.shoe-shop.com, turns over between £10m and £12m a year.

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