As a Cornish brand through and through, womenswear retailer Seasalt is building an international reputation on its coastal charm.
The higgledy-piggledy streets of Falmouth are a vision of traditional Cornish charm. Lined with independent craft shops and pasty vendors, tourists and locals snatch views of the bustling harbour down steep ginnels as they meander along the town’s seaside high street.
Nestled in the heart of this quintessentially English scene, womenswear brand Seasalt’s Falmouth store perches on a bunting-festooned, cobbled corner, windows brimming with its recognisably quirky, nautical aesthetic.
On a late August day, the store is packed with practical anoraks in floral prints, cosy cardigans and striped summer dresses, ready to kit shoppers out with clothes geared for the typically changeable summer weather.
Showing Drapers around the shop, as the rain outside grows from a downpour to a deluge, CEO Paul Hayes notes with a wry smile that the Cornish weather does not always live up to summer expectations.
Conversely, the outlook for Seaslt is sunny: its combination of Cornish character and recognisable product has driven impressive growth in a challenging market.
In 2013, Seasalt reported turnover of £21m. In its most recent set of results, for the year to 27 January 2018, turnover had risen to £51m, up 23% on the previous year and marking the ninth consecutive year of 20%-plus year-on-year growth.
When Hayes joined six years ago, Seasalt was a small regional womenswear brand and retailer with 11 stores across Devon and Cornwall.
“One of the key decisions that needed to be made before I even officially joined the business was whether we were going to step outside of Devon and Cornwall,” he recalls. “Could the brand become national?”
Today, the answer to that question is obvious. The brand has 67 stores across the UK and Ireland, and 400 wholesale stockists, including Next and John Lewis, as well as numerous independent retailers.
Bestsellers include the brand’s Breton tops (£29.95), workwear-inspired jackets and relaxed pinafore dresses. Retail prices range from £17.95 for a vest to £165 for a parka coat.
In addition to womenswear, the brand offers a small amount of menswear, which is primarily sold as gifting. Its bestselling menswear item is socks.
Currently 50% of Seasalt’s sales come from own stores, 35% from online and the remaining 15% from wholesale stockists.
For the current financial year, Hayes is shooting for £80m turnover and feeling positive about potential future growth. National and international expansion, sturdy brand values and digital evolution are key pillars in his strategy.
Seasalt began life in 1981, when Cornwall-based Don Chadwick went shopping at General Clothing Stores while on holiday in Penzance. The store sold traditional items such as fisherman’s overalls and Breton T-shirts. The store made such an impression on Chadwick that he ended up buying the business.
When Don died in 2001, his sons, David, Leigh and Neil Chadwick, took over running the business, and transformed it into Seasalt as it is today. All are shareholders, and Leigh and Neil are still involved on a board level. The sense of Seasalt as a “family business” remains a strong priority for the company.
Hayes initially joined in 2013 as sales director, following stints at FitFlop as UK general manager and seven years with Timberland, where he was senior director and general manager for northern Europe until 2012.
His interaction with Seasalt was longstanding, having worked with the Chadwick family in a sales role early in his career. He kept in touch with them over the years and was brought in as the family eyed expansion.
“The first year for me [at Seasalt] was about organising the sales channels,” he says. “Looking across all three – retail and online on the direct side, and also across wholesale – trying to be a little bit more consistent with how we were interacting with the end consumer.”
Hayes quickly shifted to a joint MD role with Leigh Chadwick, and for the past three years he has held the role of CEO.
“My role has been about helping to evolve the business both nationally and subsequently internationally,” he says.
Despite its reach, with stockists as far afield as Inverness and Clonakilty in County Cork, Ireland, Seasalt’s coastal charm and family values remain strong. Its discinctly Cornish flavour make it popular with tourists and has enabled its expansion into markets such as Germany.
“Seasalt definitely evokes a strong feeling about Cornwall and it conveys a very positive vibe because of that location. We utilise that as far as we can,” he explains.
In stores this comes through as subtly coastal-themed decoration, such as sketches of boats and wildlife, and pottery tiles from a workshop in St Ives.
Wholesale stockists find the brand’s distinctively coastal aesthetic makes it a hit with customers.
“Seasalt is very coastal, still keeping its heritage as a seaside brand,” says Charley Wright, brand manager at Ashbourne-based independent store Henmores. “It works for us because the collections always seem to respond to the season, the weather outside,and timeless trends. It really stands out in our store.”
Laura Martin, store manager at womenswear independent Judith Glue in Inverness, agrees: “Seasalt is a really good seller. It has a very distinctive look to it, which customers recognise: its nautical style.
“It is a true-to-size brand and wears incredibly well after repeatedly wearing and washing.”
Hayes notes that this Cornish focus is integral in his approach to running the business. The entire operational set-up is based in Cornwall: a warehouse and logistics hub are 20 minutes away from the Falmouth head office, in Redruth.
The company is one of the region’s biggest employers with just under 500 staff, and Hayes notes that attracting and nurturing local talent are one reason the business is able to thrive: “When you look at the county itself, we have a huge draw for very creative individuals,” he says. “In terms of sustaining what we do from a product perspective, we have a rich pool of talent to tap into.”
Alison Hughes, co-owner of Falmouth-based independent boutique Cream Cornwall, agrees that the town, with its mix of history and culture, has made Falmouth a popular town for creatives: “Falmouth is such an interesting place to live because it’s not as seasonal as many other seaside towns,” she notes. “The town and its surroundings influence everything in our creative process. It’s not just about tourists: it’s about the people who live, work and go to university here. This makes it a truly vibrant place.”
Alongside creatives, Hayes has focused on developing a strong leadership team: “What has been important for us over time is that we wanted to make sure we onboarded a professional management team who were able to embrace where the business has come from. We have a nice blend of homegrown talent and people that we have brought into the business. By having that mix it retains your identity in a far better way.”
Hayes’ decisions have paid off, and in addition to the consistent store expansion and turnover increases, profitability and gross margin have improved significantly under his leadership. In its most recent financial results, underlying operating profit was up 66% on the previous year, and gross margin improved to 55% up from 51% the year before.
“We had a decision to make with the business model,” explains Hayes. “If we look at what a number of our competitors do, they made a decision to do business in a different way: offering regular discounts. We could have chosen to go down that route, but we really wanted to maintain our integrity in our brand and our product.
“We feel like we offer affordable product with great quality. So, to retain that quality we decided we needed to focus on full-price sales. While it is a tougher trading environment at the moment, to date that has held us in good stead.”
At a time when many businesses are reducing their store portfolios, Seasalt is taking the opposite approach. It has a target of 100 UK stores, opening at a rate of 10 stores a year over the next two to three years. Recent openings include Leamington Spa, Aldeburgh, on the Suffolk coast, and Winchester. Coastal and market towns are popular.
“We are very thoughtful about where we open stores,” says Hayes. “We’ve never been reckless. They’re all very well thought out.”
He also stresses that the physical nature of the stores are also important – bringing character and charm to the spaces.
“We like to take properties where we can give something back and develop the actual store itself,” he says. “To use features that haven’t been utilised – things that we can bring back to life.”
In the Falmouth store, for example, heavy ceiling beams have been made into feature murals, and a warren of rooms above the store are the base for the brand’s window-dressing team, which designs and creates the displays for all the stores in Seasalt’s portfolio. When Drapers visits at the end of summer, boxes of origami-esque Christmas decorations are hastily being assembled, and plans for spring 20 and autumn 20 windows are well under way.
Multichannel opportunity is a core focus for Seasalt.
“For me, it’s always been about making sure we have a healthy mix between the two channels,” says Hayes. “Our multichannel customers are certainly our most profitable ones – so clearly that demonstrates an opportunity that both stores and online experiences working together is more beneficial.”
In October, Seasalt will launch omnichannel stock fulfilment, so customers will be able to order from any location to any location. Online and in-store orders will be able to be delivered either to stores or home.
Seasalt is trialling tablets in stores, for customer orders and for staff to carry out transactions.
It is on also on the cusp of a significant re-platforming of the website. Currently undergoing testing at the head office, the new platform is set to be rolled out early next year.
In addition to improvements to functionality for UK shoppers, the re-platforming will help Seasalt with its international ambitions.
“Through our UK site we already ship to 200 markets. What we want to do is make sure we can do that in a more professional manner,” says Hayes.
International websites for key markets will be set up during 2020, to support a planned increase in wholesale activity. International sales from online and wholesale partners made up just 6% of Seasalt’s total last year, and while own-brand international stores are not yet on the horizon, Hayes is optimistic about future growth.
Germany and the US are top of the list of locations for expansion. The brand has sold in Germany since 2014, and resonates well with consumers thanks to Cornwall’s popularity with German tourists. It will debut in the US for spring 20, via online and wholesale platforms.
“We’ve spent a lot of time out there understanding the market, particularly the north-east – understanding the lifestyle and the product availability the market has already,” says Hayes.
As the business looks international, Brexit is a natural point of uncertainty. However, Hayes is confident that the business and its future operations are relatively shielded from potential fallout.
“We’re fortunate in that the main body of our business is actually in the UK and the international opportunity is one that is still very much to be developed,” he says. “We will develop that in line with what any new trade developments will be.”
“We’ve made some provisions from a product point of view – for example, we’ve been making sure we have product coming in in a timely fashion to the business,” he adds. “But there is little more we can do until we know what will happen.”
Hayes sees huge potential for the future of the business, but is level-headed in his approach to the future: “While we have grown quite rapidly over the past five or six years, we do believe we can sustain that. As much as trade is a little more challenging at the moment, we think we have a long way to go yet – both from a UK and international perspective.”
Tied irrevocably to its Cornish home, Seasalt has carved itself an impressively solid, recognisable brand identity. From its deceptively quaint base in Falmouth, Hayes is succeeding in building the business into an international brand.