With a wealth of experience between them, Kookai’s ex CFO Winfred Fan, and David Mullen, who has worked at the likes of Saba and Target, have joined forces to create new start-up company Brand Directions. The Melbourne-based duo, and a third silent partner, have snapped up the label on the brink of its demise and now have plans for acquiring another three to five brands over the next five years.
After going into administration in August, the future of Brown Sugar looked bleak and within weeks its once 40 stores quickly began to dwindle to 16. With reasons for its collapse such as poor stock ordering, successive management changes and decreasing net profit, cited at its first creditors meeting, the resurgence of the brand looked unlikely.
That was until earlier this month when one of Brown Sugar’s administrators, Deloitte partner Sal Algeri, announced mystery company Brand Directions as the buyer. After tracking down the people behind the company, Ragtrader spoke exclusively to one of the directors.
Having worked as general manager at Brown Sugar between 2004-08, Mullen said he was best placed to know the core-values of its customers. Mullen and Fan, who he has known for years through business, started Brand Directions in January this year, but had been waiting for the ideal market conditions before purchasing their first brand.
“We are not re-launching Brown Sugar we are re-engaging with the loyal customer, “Mullen said. “We saw this year as a terrific opportunity to buy a couple of brands and knowing the quality of Brown Sugar, and being respectful of its heritage, it fit with everything we wanted. We are not going to turn it on its head – but product service and positioning must be consistent and we will look at that.”
Mullen has brought over some ex-veteran colleagues he worked with years ago at Brown Sugar as he said they too are focused on, and remember, the consistent strategy and success of the business back then. After securing the remaining 16 Brown Sugar stores that were still trading, in a deal with administrators, Brand Directions then began making contact with some of the landlords of the other closed stores.
There has since been negotiations involving the re-opening of a further five shops and discussions are afoot with two more landlords. Offers of employment will be made to approximately 100 staff members and Mullen said the immediate focus is on the ‘people’.
“There was a very clear consistent strategy which worked before when I was at Brown Sugar,” Mullen said. “The changes for the customer will be subtle in the short term as we stabilise the brand. In the medium to long term the changes will be substantial, but will feel familiar to the traditional customer we are re-engaging.”
The name of the chain will stay the same and Mullen, who is also director of his own company, the Retail Strategy Group, said consistency will be the driving factor throughout. Once the key background mechanics are coordinated, Brand Directions will work with Roy Tavenor from the Red Design Group to create aesthetically consistent looking stores.
“The customer is someone who appreciates beautiful fabrication, quality fit and an exceptional store experience,” Mullen said. “Our core values will underpin our approach to interpreting fashion trends on her behalf, and so delivering wanted merchandise in a way that is meaningful to her.”
Most clothing is made in China using some European fabrics, but as the third ‘silent’ partner owns his own factory in China, the manufacturing side of things will change. Mullen, who is heading out to the USA to begin negotiations with the second possible brand, said the company is not intent on securing brands that have fallen into administration.
He said they were also looking at new emerging brands which needed investment, both international and domestic.
Pippa Chambers