The founder and owner of cashmere specialist Brora intends to retain the company’s uniquely special selling point while keeping a cap on prices.
Well, it’s very fuzzy isn’t it?” says Victoria Stapleton wrinkling her nose. “Yah, it’s pilling because it’s a very loose weave, and because it is made in China and uses very short pieces of fibre.” The personable and inimitably posh Brora founder is critiquing my year-old M&S cashmere cardigan, and finds it “fine but not special”. I suspect she is being charitable even then.
Special is Brora’s USP. The retailer’s cashmere knits cost at least three times as much as M&S’ or Uniqlo’s (£169 for its staple cropped cardigan versus my knock-down £59) and are sold on their likely longevity. The fibres are at least 34mm long. The cashmere wool is milled in Scotland, where it is washed in soft highland water. The colours are hand blended to be unique to Brora.
Made in Scotland
Unlike nearly all of its direct competitors, about 80% of Brora’s production remains in Britain. Stapleton has had difficulty sourcing factories to undertake some of the “cut, make and trim” work, however, and laments the fact that of the four factories working on its woven garments (one in Leicester and three in north London), at least one is solely dependent on Brora to survive.
As a result Brora’s margins are “some of the lowest in the business”. The company turned over more than £13m in 2009 and is on track for £17m this year. It aims for and usually achieves 10% pre-tax profit, but Stapleton is content not to pursue any more than that.
Nonetheless, Brora is feeling the pressure. The price of cashmere wool has nearly doubled over the past year from $80 (£50.55) to $140 (£88.47) a kilo (the amount required for just three cardigans) and Stapleton expects Brora to increase prices to take account of that and the January VAT rise to 20%. Its £169 cropped cardigan is likely to rise to £179.
However, Stapleton, who is the sole owner of Brora, refuses to entertain more significant price hikes, effectively debarring the company from the levels of profit enjoyed by many of its rivals or from operating a full-scale wholesale business. “I’d lose half my customers. They are quite English so they like quality, but they like value for money too,” she says.
You can almost feel the private equity buyers doing their calculations, but their regular advances are always rebuffed. Stapleton clearly has an instinct for figures but is eager for Brora to remain a lifestyle business, in the generic sense of the word. She says she gets more excitement from seeing customers wearing Brora product than from the balance sheet, and hoots with laughter at my suggestion Brora is a more upmarket Boden. “Nooo! I would never want to make that much money,” she says.
Stapleton chooses all the prints herself and is heavily involved with the design. Her photographer husband shoots the catalogues, which feature their daughters alongside the offspring of Brora staff so that they are as much Brora family albums as sales documents.
“I’m a very nostalgic person,” Stapleton says. “I’m not very interested in being rich. I’m only interested in being comfortable and not having to worry. I’ve been quite privileged and therefore it’s not so exciting for me - the money side of things.”
Stapleton’s father was also an entrepreneur, and in the 1970s took Scottish salmon from being an exclusive product for the very rich to something you could find in an upmarket supermarket. (He landed the first M&S account.)
Brora’s cashmere story is not dissimilar. “Years ago, cashmere was really only found in the Burlington Arcade and usually behind glass,” says Stapleton. “You didn’t try it on. You either bought your camel polo neck or you didn’t.”
These days about 60% of Brora’s sales are from cashmere products and the remainder come from woven product, divided roughly 50/50 between direct and bricks and mortar sales. There is a small menswear range, but most of it is womenswear and kidswear, where print is a major feature - inspired by vintage dresses hanging in Stapleton’s office.
Sales were reasonably stable during the recession, although Stapleton observed customers were buying one rather than three cardigans at a time, and favoured gloves and socks as Christmas presents. This year shoppers are returning for more expensive items.
The only way to significantly expand Brora within Stapleton’s vision for the company is to increase its bricks and mortar presence. Brora was due to start trading from its 12th store, in Bath, today and will open a 16,000 sq ft flagship on the edge of Sloane Square. A 14th store is planned for Cambridge in the spring and Stapleton expects to open “one or two more” during the course of 2011.
Will all the sites be in posh, Sloaney towns? Stapleton baulks at the description. “They are not posh. They are cultural, well-off, beautiful places where people like to do things like go to the ballet,” she says, “like I do.”
Quite. Brora does not need branding gurus or expensive marketing initiatives. Stapleton embodies the brand and is as fiercely loyal to her customers as they are to her company. The only question is whether the changing landscape of British manufacturing will allow her to stay true to this old fashioned approach.
1993 Launches Brora as a mail order company
1995 Opens first shop in London’s King’s Road
1996 Sets up Fulham HQ. Rapidly expands retail operation
2008 Moves HQ to Stevenage
2010 Opens 12th store in Bath. Sloane Square flagship planned by end of year
Keeping margins low
We make in Scotland but we still want to be fairly competitive. Luxury brands use the same mill - then take that product and multiply
[its price] by nine or 10 times because they have so many layers [of sales]. I’m taking this cashmere and giving it to the customer with nobody in between.
Pricing We’re not known to be discounters. We go on Sale in January but we don’t have the margin to play with discounting outside that. We are very honest about the whole thing and that has helped us through the recession.
At the end of the day, the Chinese don’t make the same product as the Scottish or the Italians. It’s cheaper, but it pills.
Looking after staff
You look after people the way you want to be treated and they will give it back to you. Everyone [at Brora] goes home at 5.30pm.
Designers she admires Margaret Howell sticks to her aesthetic. She does non-fashion fashion and [her clothes] are made in the UK. I also love Nicole Fahri and Paul Smith.
Autumn 10 trading
A lot of customers haven’t bought for the last two years and are feeling like they can spend again. Like-for-like sales of our navy men’s jumper [which Brora produces every season] have doubled on last year.
I think some of them just take our cardigan and ask the factory to copy it. They haven’t even had the decency to do 10 buttons instead of 12.