The Australian high-street retailer’s newly announced ambitious global expansion plan could result in the children’s stationery brand separating from parent company Premier Investments.
In its full-year earnings report, Premier Investments said it aims to grow Smiggle’s worldwide sales to A$450m by FY20, and then set up future pathways for growth beyond 2020.
Smiggle continues to deliver ahead of expectations, with 67% of sales coming from outside its domestic market of Australia. The UK is the brand’s largest market for sales, profitability and store numbers.
Expect to see more than just “a cross between a smile and a giggle” from Premier Investments if its children’s stationery brand Smiggle becomes a separate listed company. The Australian Financial Review reported that the brand shows all the signs of following the path to a public listing, and that such a move would give fund managers a global growth option without the noise of other brands in Solomon Lew’s Premier Investments. Although it is early days, these latest expansion plans could well be the foundation for a demerger at a later date.
Premier Investments has mapped out the expansion of Smiggle’s global reach via four main channels: online, global concession partnerships, wholesale relationships with key retailers in major markets where the brand has no plans to open standalone stores, and new store growth.
The growth of its online operations could extend to relationships with third-party websites such as Alibaba and Amazon. Their eyes are on new markets, and growing their European footprint.
Following results that exceeded all expectations, the first ever Smiggle concession - in Selfridges Oxford Street - has prompted the company to expand its plans to roll out further concession stores.
Smiggle followed the Oxford Street flagship concession with concessions opening in Selfridges Trafford Manchester and Harrods London in August, with another set to launch in Selfridges Birmingham in October.
The possible eventual move to public listing would come on the back of Smiggle’s record global sales of A$293m, a year-on-year increase of 22.7%, fuelled by 52 new store openings, including a two-level flagship store in Oxford Street, London, its first global flagship concession in Selfridges, also on Oxford Street, plus strong growth in sales online.
There were 134 Smiggle stores trading in the UK at the end of FY18, its biggest market for store numbers outside of Australia, which had 132 stores at the end of FY18.