After adding another string to his bow with a gaggle of franchise stores, the future looks bright for Sam Morrison, owner of Northern Ireland-based indie Clockwork Orange.
When Drapers catches up with Sam Morrison in Belfast, he is negotiating his way around sawdust-covered floors and giving instructions to hard-hatted workmen in what will be young fashion retailer Clockwork Orange’s ninth store.
It is the launch day of the city’s new Victoria Square shopping centre and the store has been unable to open due to a few technical hitches, although Morrison’s Tommy Hilfiger franchise in the shopping centre is up and running for the launch. Nevertheless, Morrison is still buzzing from the centre’s opening event the night before, which saw the city’s dignitaries, politicians and VIPs turn out to celebrate Belfast’s first new shopping centre in 25 years.
“When I was a kid you would never have seen some of those politicians in the same room, let alone on stage celebrating together,” Morrison says, referring to the city’s troubled history. “It was quite incredible to see and shows how much has happened since then.”
The Belfast store, which is now open and trading well, is Morrison’s ninth Clockwork Orange shop since he opened his first store 10 years ago in Ballymena. The business has built up a reputation as a destination for branded men’s and women’s young fashion, selling the likes of Replay, Firetrap, Miss Sixty, Ted Baker, Energie, Killah, NAdidas, 55DSL and Hilfiger Denim.
But Clockwork Orange aside, Morrison has other eggs in his basket. There are two shops under the Sam’s Yard fascia, targeting a slightly more mainstream market with brands such as Henri-Lloyd and Remus Uomo, and seven franchise stores for the likes of Replay, Tommy Hilfiger and Sixty. There is also a one-store hire business called Hire Class. All the fascias are part of the SVM Textiles group, of which Morrison is managing director.
Morrison says: “Five years ago, the plan was totally different. We were going to open Clockwork Orange stores in the Republic of Ireland but we opened a Replay store in Belfast in 2004, and discovered that franchising was a great way of doing business. It was a relatively easy route and you had a lot of brand support. After two years the Replay shop was our best-performing store.
“It became clear to me that as these brands grew, having mono-brand retail stores was going to be an important part of their strategy, so it made sense for me to do it before they did it themselves.”
Clockwork Orange opened a Replay store at the Dundrum shopping centre in the Republic of Ireland, but Morrison says it was more difficult to make this business work there than it was in Northern Ireland. Choosing his words carefully, Morrison says: “There’s a different work ethic in the south, and there’s the whole issue of exchange rates. It was also harder and more expensive to keep staff, because retail doesn’t seem to be as attractive a career option in the south.”
However, he adds that more stores in the Republic of Ireland are still on the radar and another one may open next year, although a move to England, Scotland or Wales is unlikely.
Clockwork Orange’s offer is tight, selling only eight core brands, with Morrison buying deeply into four key brands that he has been backing right from the start, such as Replay and Hilfiger Denim. He has dropped a few brands, including Ted Baker, as the brands increased their own retail expansion, even though they may have performed well. He explains the strategy: “We may only do a few brands, but where the likes of USC may buy 50 SKUs, we buy right through the collection. Replay and Tommy Hilfiger are both very big brands in Ireland – Tommy is like Next here.”
Morrison has spent his time developing a franchise business with the key brands he feels are a relatively safe bet in the Republic of Ireland. However, he believes there is potential for more fashion brands to retail in Ireland. He says: “A lot of brands have retail stores in the UK, so it’s obviously part of their strategy. We want to be a partner for those kind of brands to open an Irish store.”
The business tried its hand with a move into the potentially lucrative own-label arena. But the brand, called 2 Die 4, was short lived and there are no plans to resurrect the idea. “We did it because we felt we needed margin,” says Morrison. “But we had inconsistent seasons and I don’t know why. Now we’ve got more scale and we’ve developed strong relationships with our brands, so we get better margins from them now anyway.”
The Belfast retail offer is now entering a new era, with the Victoria Square development bringing a host of new brands to the area, and it is likely to become a destination for label-hungry shoppers from all over Northern Ireland. However, Morrison says he is not worried about competition from the likes of House of Fraser moving in – in fact, he believes that more distribution helps to increase awareness of brands, which in turn benefits his business.
“Short term, there will be more footfall and all the shops should benefit from the regeneration in Belfast,” he explains. “Some shoppers from Dublin will come up, and the Outlet down in Banbridge also encourages visitors. Easyjet flights are cheaper these days too, so all of that helps to draw shoppers from the south.”
Morrison says he does not insist on brand exclusivity in his area, but it is clear that his scale in Northern Ireland means his pull with the brands is big and he would expect a call from a brand if they were considering supplying retailers on his patch.
Finding its niche
When young fashion rival USC was planning to expand its presence in Northern Ireland, Morrison saw potential problems. “We tend to be pitched a little above USC, Republic and Bank, but below the likes of designer indie Cruise. USC owner Tom Hunter was planning to open more stores here and we had to put our foot down with the brands. But we are in the top six accounts in the UK for our four big brands, so it worked out alright.
“For most of those branded young fashion chains, Ireland is not really on their radar. It also means that when a shopping centre opens in Ireland we are on the lists of most of the developers so we always get approached. When projects come up such as Victoria Square in Belfast, where we have more than one store, it gives us more bargaining power.”
Morrison is probably better placed than most to understand the retail property market in Ireland. His father, Sam Morrison senior, owns Corbo, the £350 million Irish property development business.
Having such connections is sure to be an advantage, although he says that his retail company is profitable in its own right. What’s more, it is self-financing. Turnover is just over £10 million, up 20% on the previous year, and a 40% increase is predicted this year with the two Victoria Square stores. Menswear and womenswear is split 50/50, with accessories helping to drive the women’s side of the business.
However, the branded young fashion market has become one of the most competitive in the UK in recent years. Although Morrison is one of the major players in the sector in Ireland, he is not totally immune to the rise of the high street proposition, which is making life tough on the mainland.
“There’s no doubt that branded fashion is more difficult than it has ever been, especially on womenswear,” says Morrison. “The brands have broadened their offer, which has helped. Footwear and handbags now make up 20% of the women’s business. Women will spend a bit more on accessories. If you get the right brand it works well – Ugg and Guess are very big now.”
The past two years have seen Clockwork Orange shaking up its team. Morrison says: “We had the finance, but not necessarily the right office structure. We’ve brought in visual merchandisers, buyers, area managers, a retail operations manager, and financial controllers over the past two years.”
The group may be looking to expand, but it is doing so in the face of an increasing cost base. Morrison says this is leading him and other retailers in his sector to constantly scrutinise their product offers.
“The growing rents, rates and staffing costs are affecting profitability so more margin is crucial,” says Morrison. “The challenge is to find product that will give this edge to the business and help fund the primary sites such as Belfast, as well as the secondary locations. Staffing costs in the Republic of Ireland are higher than in the UK and that is another factor when expanding there.”
About 40% of the company’s turnover comes from the franchise business, and that is set to grow, with Morrison planning a new retail park concept called The Jeanery. It will bring together brand concessions for Diesel, Replay, Hilfiger Denim and Sixty, as well as Clockwork Orange’s branded offer, under the one fascia in retail park locations.
Morrison says: “Some fashion brands have difficulty operating in retail parks because the space requirements aren’t right for them to do their own stores. This concept gives them the opportunity to target the retail park customer. The brands are having to develop their business. The quickest way to do it is through retail, and I want a piece of that.”
Morrison may be looking to grow the business, but not at the expense of the personal touch – or control of the company.
“I want to be able to walk into stores and know the staff, but I also want it to be commercial,” he says. “There’s a value to the business. If someone wants to release it we would have to consider selling it, but that’s not in my business plan. I don’t want to be a chain. I’d rather it was a small business but a great business.”
The Clockwork Orange business runs 19 stores under five fascias:
Clockwork Orange: nine stores
Replay: three stores, in Dublin, Belfast and Glasgow, plus an outlet shop in Banbridge in Northern Ireland
Tommy Hilfiger: one store in Belfast
Hilfiger Denim: one store, also in Belfast
Sam’s Yard: two stores in Ballymena
Hire Class: one store in Ballymena
Sixty: one franchise store in Belfast
Turnover is more than £10 million
Who is your fashion mentor?
I wouldn’t exactly say I have a fashion mentor, but the late Claudio Buziol, who founded Replay in Italy back in the 1970s, was a very interesting guy. I always admired the way he seemed to be able to achieve a perfect balance between work and play in his life. Of course Claudio sadly passed on a few years ago, and is still missed by many in the fashion industry.
What is your favourite shop?
There are many fantastic examples of retail space out there and I love to recce all the changing trends. Close to home, menswear independent The Bureau in Belfast is a great example of a store that personifies the passion and personality of owners Michael Hamilton and Paul Craig.
What’s the best-selling product you have ever been involved with?
There have been quite a few movers and shakers over the years. Most recently, Replay’s WV410 women’s boyfriend jeans were phenomenally successful. We sold thousands of pairs. However, the Clockwork Orange business was originally built on the success of Diesel denim.
What has been your proudest achievement so far?
It sounds a little corny, but everybody who knows me will understand me when I say it was the birth of my daughter Eva.
What would you be doing in you weren’t in fashion retail?
If you can imagine what it’s like being brought up in a family business, it’s hard to think of doing anything else. It’s so ingrained from a young age. I was on the shop floor from the age of 14 so I can’t imagine doing anything but this.
What would your dream job be?
I’m in my dream job.
Sam Morrison CV
2008 The Jeanery retail park concept takes shape
2007 First Sixty franchise opens in Belfast. First outlet store launched in Banbridge
2006 First Tommy Hilfiger franchise opens in Belfast
2004 First Replay franchise opens in Belfast
1998 Clockwork Orange opens in Ballymena