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The Drapers Interview: Maurice Helfgott

Amery Capital’s Maurice Helfgott is proving to have a knack for transforming the fortunes of struggling fashion businesses

For Maurice Helfgott, the thrill of retail is in the “transformation and reinvention”, and this is something he knows a thing or two about.

“I love anticipating the future, preparing and putting in place product and experiences that will excite customers and take them with you. I love the pace of it and the fact we all make mistakes all the time, and in retail you get the direct feedback and you fix them,” he explains.

After 16 years at Marks & Spencer - where he rose from graduate trainee to head of menswear and a board director, launching men’s brand Blue Harbour in 2002 - he left in 2004 to found retail investor Amery Capital. He has since led the turnaround of men’s premium footwear brand Oliver Sweeney and taller women’s retailer Long Tall Sally.

Amery bought both out of administration in 2009 and 2005 respectively, and took a minority interest in premium womenswear label Goat in 2013, all with financial backing from the 2006 Drapers Awards Lifetime Achievement winners Maurice and Michael Bennett, founders of Oasis, Coast and Warehouse.

In a testament to the solid turnaround of Oliver Sweeney - Helfgott says sales will reach around £8m this year, more than double the first year after acquisition - the brand attracted £3.75m of new investment this week.

The cash came from the Business Growth Fund, a £2.5bn pot of contributions from five of the UK’s main banks that injects capital into smaller companies, in return for an undisclosed minority stake.

Helfgott says the funds will pay down shareholder debt and provide “financial flexibility to grow the business”, giving both Bennetts some return on their investment while they retain a “significant stake”.

Helfgott and cobbler-in-chief - his real job title - Tim Cooper also plan to use the investment to explore potential licensing options to expand Oliver Sweeney’s sales channels.

“We’ve reached the stage where there’s significant opportunity to invest more in the brand and to develop a licensing model for the business,” he explains. “We’ve had a number of approaches on licensing and this additional capital will help that as well.”

Refusing to reveal any further details, he simply says: “It’s an option we’re exploring. Our ambition is to build a leading British menswear brand from the base of our footwear.”

As a part of the investment, BGF investment director Alistair Brew has joined the board as non-executive director. Adam Leigh, who founded and last year sold marketing firm The Communications Agency, is an independent non-executive director.

Brew adds: “We are keen to grow Oliver Sweeney’s profitability by introducing licensing and then implementing a decisive shift in channel mix.”

On March 23 Oliver Sweeney will open its latest shop in Covent Garden, at 10 Henrietta Street - where landlord Capco is working to create a menswear destination. In a sign of the six-store brand’s growing strength, the 1,600 sq ft shop will replace an existing 400 sq ft shop around the corner at 14 King Street.

While Helfgott says no further shops are in the pipeline in the UK, he has the US in his sights for future stores, as he believes this market for men’s luxury footwear is almost 10 times that of the UK.

But the story is not so clear for wholesale. The brand has about 79 UK stockists, including House of Fraser and Schuh, alongside about 24 in the US, such as department store group Nordstrom. However, when asked if the plan is to grow this, Helfgott - who is dressed in the brand’s dark blue wool coat and black double-buckle shoes from the autumn 14 collection, which as well as footwear includes a small range of shirts, jackets and coats - says Oliver Sweeney “will be discerning with existing and new accounts”, but refuses to be drawn on whether this means shedding any non-core stockists.

“We are ambitious for the business, but not for growth for sales sake,” he explains. “There has to be a strong commitment on both sides to make a partnership worthwhile. It’s not about the number of doors - it’s about the quality of doors.”

Walking through the Conduit Street store, Helfgott avidly points out his favourite products from the spring collection, including the two-tone brown and mustard yellow Deliceto lace-up Derby with a fin-like ridge on the toe to catch the light, and the deer leather Biva lace-up loafer using Bologna construction so the upper is wrappedunder the shoe to create a soft leather insole, which both wholesale at £115.67. The collection ranges from £50.59 for the Buxhall shoe up to £136.86 for the Noceto boot.

Although Oliver Sweeney is arguably the better known of Amery’s brands, its first major investment was Long Tall Sally in 2005. The business was founded in 1976, and Helfgott is proud of its turnaround, saying it has been “transformed” from a struggling catalogue business with 30 UK stores into an international omnichannel retailer. In the year to January 31 it made just under £31m of sales - triple 2005’s level. Nearly two-thirds of sales are now made online, and two-thirds also come from overseas.

Alongside its 11 UK stores, it has seven in Canada, four in Germany and will soon have four in the US when it opens in Chicago this spring. But Helfgott adds: “We are very confident that there’s a substantial roll-out opportunity beyond that in the US.”

So much so that he suggests there could be potential to build a portfolio of around 50 stores in the US, owing to the size of the market and the fact women there tend to be taller.
long tall sally does not wholesale and Helfgott firmly believes it should stay that way, as only it can create the destination for taller women that is required. “Tall is a niche, and to do it well we offer our customers over 500 options. We offer them a total wardrobe solution with product changing all the time. No wholesale customer would ever offer that, they might take a few of this or a few of that.”

Another testimony to Long Tall Sally’s growth rate is the planned office move - its fourth since Amery bought the business. The 65 staff will move from its 2,000 sq ft office on Welbeck Street in Mayfair to a 7,000 sq ft space on Camperdown Street in Whitechapel, east London.

Amery Capital’s most recent addition, a minority interest in cashmere specialist Goat, marks somewhat of a departure for the investor from the two clear turnaround projects already in the portfolio.

“We never looked for investing in turnarounds because we like turnarounds - we found opportunities we liked and they happened to be turnarounds, so our little bit of money and a lot of elbow grease could make a big difference,” says Helfgott. “In the case of Goat it wasn’t about the money at all - it was about the expertise, experience and support we could bring a great brand.”

Goat founder and creative director Jane Lewis tells Drapers: “Maurice’s experience has proved invaluable. He is approachable, supportive and realistic while advising us on every aspect of our growth.”

With Amery’s support, Goat, which last year became a favourite of the Duchess of Cambridge, opened its first store in October at 4 Conduit Street, adjacent to Oliver Sweeney.

With no immediate plans for further stores, Goat is now focused on international wholesale growth, particularly in the US. It has five key accounts there, such as Saks Fifth Avenue in New York, and 40 in the UK and Ireland, including Fenwick Bond Street. A new showroom has been created below the 600 sq ft Conduit Street store to promote the range, with wholesale prices from £50 for knitwear to £210 for a coat.

But things haven’t always worked so smoothly for Helfgott. In 2006 he formed a joint venture with Kookaï France to buy the retailer out of administration and run the UK arm, but this ended in 2013 with the UK business being wound down.

He explains: “The reality was, although we operated the business well, we were not responsible for the sourcing, design and marketing of the brand; that came from France. It went in a direction that didn’t prove very successful in France and certainly wasn’t suitable for the UK market.”

He adds that Kookaï UK was also hindered by the slower French supply chain and a greater emphasis on daywear rather than eveningwear. “I wouldn’t hurry to invest in a business again where we are not in control of the design, sourcing, product and marketing.” All creditors were paid, he says.

But Helfgott, who is also senior independent non-executive director at men’s formalwear chain Moss Bros, didn’t let this setback stand in his way, and he has maintained his clear “investment thesis”. “We invest in businesses that professional investors usually avoid so that with a little bit of cash and hard work we turn them into opportunities wise investors should seriously consider.”

Now with all of this growth potential, the 10-year anniversary of Amery’s first acquisition - Long Tall Sally - approaching and the fact Maurice and Michael Bennett are not getting any younger, Helfgott admits the firm is more likely to sell down investments in the future rather than take on new ventures. In 2010 Amery realised its first investment with the sale of shopping centre kiosk rental business Retail Profile to SpaceandPeople Group, which provides marketing space and kiosks in shopping malls, and subsequently Helfgott and the Bennetts sold down their shares.

“Maurice and Michael Bennett were in their early 70s when we started our partnership. They are now in their early 80s, so we will invest in our businesses where we need to, but probably we’re closer to realising a return on investment rather than finding new investments to make.”

He won’t be drawn on which could be the focus, but hints Long Tall Sally could find itself in the spotlight.

“It’s natural at a 10-year point to review strategic options,” he says. “There are lots of options in reality. There was one business [Retail Profile] we were invested in that we sold out of completely. There’s another business [Oliver Sweeney] that we invested in that reduced the shareholder debt a bit and took new investment in as a minority.

“We are not a private-equity firm that raises £100m and has seven-year life of a fund and we have to exit to demonstrate carry [share of the profits of an investment paid to an investment manager] - that’s not what we are. We are professional and experienced but we’re hands-on investors backing amazing chief executives and management teams, and each case is different.”

As Amery Capital ramps up the growth across its brands, it’s only natural that they will pique the interest of more of these “wise investors”. The only question is who and when.

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