The retail entrepreneur has returned to lingerie with his Boux Avenue chain, confident he has spotted a gap in the market. So why should his rivals beware the TV dragon?
I love women’s lingerie, but I’d never wear it. I’ve never worn it, not even just to try on because I’m scared I might like it,” jokes Theo Paphitis.
Despite the teasing and him being worth a reported £160m, the former La Senza owner and ‘dragon’ from hit BBC TV series Dragons’ Den is remarkably down to earth. He is full of enthusiasm about the launch of his lingerie chain Boux Avenue later this month. “It feels like I’ve never been away [from fashion retail], I’m excited,” he says, sitting in a quiet corner of a bustling piano bar at the Ivy Club in London’s Covent Garden.
Although he is already chairman of stationer Ryman, co-owner of gift experience business Red Letter Days and former owner of La Senza, Paphitis says he set up Boux Avenue because he likes to keep busy. “I’m a restless soul. I’m a shopkeeper at heart, that’s what I do.”
The first Boux Avenue stores will open in major shopping centres the Trafford Centre, Bluewater in Kent, Sheffield’s Meadowhall, Lakeside in Essex, St David’s in Cardiff and Buchanan Galleries in Glasgow at the end of this month. There are plans to roll out a total of 30 stores over the next 12 months.
Paphitis was inspired to set up Boux Avenue two years ago when he noticed a gap in the market for a mid-market lingerie chain offering women an experience that was more of a “treat”. He says: “Someone had to fill [that gap]. I know how to do it. I know about lingerie.”
Paphitis first ventured into the lingerie market when he bought the publicly listed La Senza chain for £1 in 1998. After eight years, Paphitis sold it on to private equity firm Lion Capital for about £100m.
In 2009, he tried to buy back a majority stake in the retailer. It was understood he was unhappy over the direction the business was heading in. That year, the company had made a pre-tax loss of £7.6m and saw the departure of its then chief executive Rose Foster, leaving Paphitis to take on the day-to-day running of the business. But by May, Paphitis had had enough and left the board, while retaining a 10% stake in La Senza. Later that year, Lion Capital broke the terms of its loan agreements, and rumours resurfaced in early 2010 that Paphitis would try to buy the business again. But Lion Capital acquired 100% of the long-term debt of La Senza, securing its future.
Paphitis says he would have taken La Senza in a different direction had he stayed on, but declines to give details.
A savvy, media-trained profile builder, Paphitis is here to promote Boux Avenue. “People ask me if I’m bitter [about La Senza], and no, I’m not bitter. I’m happy in some ways because I would have never been able to do this [set up Boux Avenue]. And this is me, this is all about me. You’ve got to do something that doesn’t already exist on the high street.”
Shaking up the sector
So what’s different about Boux Avenue? Paphitis explains in his cockney lilt: “The shopfit doesn’t exist on the high street, the level of service doesn’t exist on the high street, [neither does] the price point.” He could be right - to some extent - on the first two points. Paphitis gives Drapers a sneak peek of the shopfit on his iPad but says he will “kill” us if we report on it. But he has some tricks up his sleeve, which will keep rivals on their toes. As for price points, yes, they are inexpensive - bras range from £14 to £34 - but mid-market shoppers can get £4 bras from Primark and £9 bras from Marks & Spencer, which has the largest share of the UK lingerie market.
“I think La Senza will benefit from us being around because when we’re close by in shopping centres, we will draw people to that area,” he says. “I think we’re going to take business from department stores and the wonderful Marks & Spencer. La Senza is focused on a young market, which is not us.”
Aside from admitting he is targeting the middle market, Paphitis is vague when discussing the age of the target Boux Avenue shopper. He says, instead, it is more about a “state of mind”. “Our shopfit is about you and our staff are about you,” he says.
“It’s about you coming in for an experience in our store and feeling great when you leave because lingerie is a very personal thing. It’s the closest thing you have to the most intimate parts of your body. You can get away with wearing clothes you don’t feel quite happy with, as it doesn’t really matter.”
As for the product, there are two stories for this season, including a feminine, retro-inspired range in blush pink and lace. A burlesque boudoir story features satin and boning in rich colours.
Time to shine
Something that becomes clear during the interview is just how passionate Paphitis is about retail. However, in the tough trading climate, Paphitis admits retail is not easy. “It will be survival of the fittest,” he says.
Paphitis believes he has used the tough climate to his advantage. “Why didn’t I wait until things got better? Well, would I be able to get the sites I’ve got in the height of a retail boom? Unlikely.”
He adds: “This is my baby. I’ve got a great team of people [including buying director Debby Duckett] but I’m chairman and chief executive. I will have someone come in at some stage, but not in the next 24 months. For the next 24 months it’s my vision and I can’t think of anyone better to deliver that than me.”
2011 Launches Boux Avenue
2007 Buys the Stationery Box chain
2006 Sells interest in La Senza (UK) and Contessa
2005 Buys gift experience firm Red Letter Days
2001 Buys stationer Partners
1998 Buys lingerie retailer La Senza
1997 Buys Millwall Football Club
1996 Buys lingerie chain Contessa
1995 Buys stationer Rymans
Why do you feel so passionate about retail?
It’s going to the stores and just talking to people in shops. Where else can you influence so many people, be around so many people? And so many diverse types of people?
Why do you love lingerie?
It’s such a beautiful product. I think if I wasn’t in lingerie, I’d be into shoes. I’ve got more shoes and bags than my missus.
Which retailers do you admire?
I admire John Lewis. As big as the chain is, you can go around its stores and talk to its staff. And the attitude of the staff is admirable. You talk to any other [staff in other retailers] and they can’t get anywhere near it [the John Lewis experience].
Where does your inspiration come from?
I just love listening to women speak about shopping, whether it’s shoes, handbags, clothes.
I sit there asking the questions. A great day for me is to be out of the office and walking through the high street, walking in the shopping centres all bloody day.
I am a shopaholic. It was my wedding anniversary recently and I had the day off; I actually thought I’d spend it shopping.
What role will online play in the launch of Boux Avenue?
We’ve got the most magnificent website to go with the stores and, as excited as we are about the stores, we’re just as excited about the website. If we haven’t got your size in store, we can deliver it to you the next day. I think [online] is part of the future, but people want to feel [the product too].