Kurt Geiger had big news on Monday when the shoe-to-handbag retailer announced its “most profitable month in the company's history, demonstrating an all-time record for global Christmas trading,” in addition to explosive growth in North America and bags becoming its largest category.
The company, which also owns Carvela and operates shoe concessions in department stores, said it would pump more than £1 million into its foundation to establish 'Business By Design'. It is a new “internal academy that provides education and opportunities to underrepresented youth.”
Business news first. The company reported double-digit sales growth in December and especially strong sales in North America, as well as further growth in its handbag business.
December was its “most profitable month” ever, with the group's total sales last month rising 15% year-on-year to £45m. While the UK market was weak for the wider fashion sector, Kurt Geiger UK store sales were up 12% and digital sales were up 45%, both driven by demand for bags and accessories.
For the financial year ending January 28, 2023, Kurt Geiger had previously reported a 31% increase in group turnover to £329.5 million and a 49% increase in EBITDA to £30 million. . In the United States sales increased by 171% that year and total handbag sales rose to a record £91.6 million in the period.
And its stock market growth has clearly continued since then. In fact, bags are now such a big part of the business that it's no longer accurate to call it a shoe retailer that also sells bags. He is a complete specialist in footwear and accessories and one of the fastest growing accessory brands in North America. Handbags have been a big driver of that growth internationally, but especially in the United States, where they are now its best-selling category. In the UK, the category also accounts for 50% of Kurt Geiger's sales.
It is now a key name in affordable luxury bags – the average price of its leather bags is £250 in a market where luxury bag prices have for some time been in eye-watering four-figure prices.
The company also said its average prices and recent increase in spending on bags reflect “the launch of new shapes and larger sizes within its bag range, with much more development for 2024.”
North American Growth
It has also been helped by celebrity endorsement of Kurt Geiger London's flagship brand, with Kylie Jenner, Julia Roberts, Jennifer Lopez, Viola Davis, Eva Longoria, Paris Hilton and Afiya Bennett all seen wearing/carrying the brand.
And as that list of American names suggests, as mentioned above, the American business is growing rapidly. The company called the United States “exceptionally strong” and said it is now its largest market even though it entered North America just four years ago.
That regional business has also been boosted by the “successful opening” of Kurt Geiger stores in Mexico, with plans to open five additional stores in the United States this year as well.
It is not that the stores in the national market are being neglected and the company It now has 74 independent stores in the UK and two in Ireland. It will open eight new stores in the UK in 2023, including its flagship store on London's Oxford Street in October.
new academy
Commenting on the academy's key development, the company said last year's success “helped fund a £1 million donation to the Kurt Geiger Kindness Foundation, which seeks to remove barriers and provide young people, regardless of their background, opportunities, support and tools to enter the creative industries.”
This week sees the launch of the Business By Design academy, “providing opportunities for young talent from underserved communities to learn all areas of Kurt Geiger and creative business, sealed with a certified educational accreditation recognized by AQA.”
It is a free seven-month “innovative learning programme”, co-created by young people “to help the next generation unlock their full potential”.
At launch, it includes 22 students aged 18 to 20 who will “learn directly from the people who built Kurt Geiger's business, giving the cohort access to practical, tangible and fundamental skills.”
The program includes “inspiring masterclasses, practical skills sessions and paid work experience across all core functions of a creative business – design, buying, marketing, digital, sales, finance, merchandising and social media – with direct mentoring from experienced Kurt. Members of the Geiger team.
CEO Neil Clifford was justifiably optimistic about the company's success, saying: “These results underline Kurt Geiger's transformation over the last decade from a predominantly British footwear brand to what it is today; a global accessories brand with a cult following in both the US and UK.
“December's performance marks a very strong end to what has been an extraordinary year. With in-store and digital sales achieving double-digit growth in the UK and US, the group delivers what customers want – affordable luxury combined with distinctive, high-quality design.
“Handbags and accessories continue to support our strong sales and, combined with a growing celebrity following, we are very well positioned to continue our profitable growth trajectory into 2024.”
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