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Product and geographical expansion boost sales at AllSaints

The east-London firm’s strategy to diversify by product and geography is paying off.

AllSaints

AllSaints’ sales grew 9% to £252.5m in the year to 30 January, while its EBITDA before exceptional items rose 18% to £28.5m.

The diversification strategy it first embarked on in 2012 has been central to its success, said chief executive William Kim. 

“Our sales are split equally between men’s and womenswear and we have 10 sub-categories, which generate 75% of our revenues,” he explained.

“We launched the Capital Collection of women’s bags in September 2015 and inventory was our biggest struggle as they were selling really well.”

The Capital Collection was created with Seoul-based manufacturer Simone and marked AllSaints’ move into wholesale for accessories, with launch partners including Selfridges, Nordstrom, Bloomingdale’s, Shinsegae and Mitsukoshi. The collection was also sold within its own stores.

The firm is now piloting a men’s collection of bags and anticipates that non-apparel products will be a “significant part” of the business by 2020.

Expanding into new territories has also boosted sales. ”We have had outstanding performance in the US, Middle East and Asia so we see continued opportunities there,” said Kim.

AllSaints’ international sales grew by 12% during the period, to account for 43% of total mix. Kim said he is targeting this will be closer to 66% of the total business by 2020, with particularly strong sales in the US and Canada, as well as Asia.

“We took the decision to enter markets like Korea, Taiwan and Japan directly and we will continue to focus and invest there through stores, digital partnerships and partnerships with department stores.”

AllSaints currently has 208 stores in 18 countries and opened its first store in the Middle East in September 2015, with its partner Majid Al Futtaim.

They expect to expand to five countries in the Middle East in the next three years.

On the issue of Brexit and the associated currency fluctuations, Kim said the business has a natural hedge through its diversified markets and direct sourcing model, with operations in Portugal, India, Turkey and Hong Kong.

Online sales rose by 33% to £47.3m during the period, representing 19% of total sales mix.

Kim accredited this to the company’s in-house approach, whereby it owns its own websites, distribution centres and does its coding in-house.

He acknowledged the uncertain outlook and challenging trading conditions in some of its markets, particularly the UK and US, but said he felt AllSaints’ control over the customer experience through its own stores and monthly drops of newness positioned the firm well for the future.

“Consumers want branded experience, not just products, and they are constantly seeking novelty so I am feeling confident going into peak trading,” he said.

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