The founders of upmarket fashion label Ginger & Smart say they’ll be focused on the independence of their brand after signing away a majority stake in their company to retail behemoth Alceon.
The 17-year-old ethical fashion label has inked a deal with the prominent private equity firm to turbocharge their expansion plans, including establishing about a dozen retail stores and considering overseas expansion.
Speaking to SmartCompany about the deal on Tuesday, founders Alexandra and Genevieve Smart say they approached Alecon looking for a partner which could provide expertise on the operational and logistics side of growing their company, allowing them to focus on the product.
“In our case, its a distraction from the brand, product and fashion side of the business,” Alexandria explains.
The premium label is already stocked by more than 40 boutiques across the country, and has existing supply deals with The Iconic and David Jones for its range of women’s apparel, focusing on the $400-700 price range.
The brand has historically prioritised sustainability and has been outspoken about the dark side of international fast fashion, declaring it the “second dirtiest global industry after oil” on its website.
That’s positive for Alceon, whose other investment Noni-B was panned by Baptist World Aid in April, scoring a D grade across brands such as Katies, Millers, Rivers and Crossroads in its 2019 ethical fashion report.
Noni-B Group was rated poorly by the not-for-profit for supply chain auditing and material/product waste, although the retailer says it’s committed to complying with Ethical Trading Initiatives (ETI).
Asked how they intend to maintain the authenticity and independence of their brand, Alexandra says it will be their job to make sure the “spirit and creativity” of the business remains intact.
“We’ve found a really receptive partner … the ideas, plans and strategies we have for the business aligned with where they thought we could take the brand as well,” Alexandra says.
“It’s going to take time to bed it all down … we’re working really closely with them on shared visions and shared values.”
While there’s no shortage of headwinds facing the retail industry, particularly in women’s fashion, Alexandria says Alceon understands how to thrive in a difficult market.
“They’ve got the back end worked out very well, they’ve invested in companies that have brought in expertise in online and logistics, and they’ve got a really good handle on women with deep databases,” she says.
Alceon has emerged as one of the biggest stakeholders in Australia’s fashion industry in recent years, inking deals for once distressed brands such as Surfstich, the Katies, Crossroads, Autograph and Rivers businesses and Pumpkin Patch.
It picked up a major stake in then-troubled Noni-B Group back in 2014, proceeding to turnaround the business in a matter of years as competitors struggled to deal with rising commercial rents and poor consumer fundamentals.
Alceon’s executive director Richard Facioni said the Ginger & Smart deal will diversify its portfolio, providing access to a higher-end label.
“This is a strategic move to continue to diversify our portfolio and invest in highly desirable retail brands,” Facioni said.
“We plan to grow the business, both online and through physical stores. Alexandra and Genevieve bring notable management and design calibre and we look forward to working together to build a great future for this brand.”
Alexandra says the deal came along at the right time for both businesses and is confident her focus on being a nimble and measured player in the market will deliver.
“We’re not opening a gazillion stores, we strategically know where their customer is, we’re making sure we’re clever and strategic.”