INDUSTRY
Home and Lifestyle
CHALLENGE
Covid forced closure of brick-and-mortar stores.
RESULTS
Completed a successful digital pivot and overhaul using funding. Expanded reach to 85% global sales.
SOLUTION
“This is an amazing brand. Fresh to the UK and a US leader in e-commerce lending, SellersFi (formerly SellersFunding) had a great track record working with global online retailers and was a perfect fit. SellersFi proposed a revolving credit model which won’t penalize Cath Kidston for success.”
—Michael Cass, Head of Secured & Structured Finance at Capitalize
UK high street classic Cath Kidston is a treasured home, lifestyle and fashion retailer, known for its playful prints and vibrant designs. The well-loved brand has developed a strong international and multichannel footprint, enabling it to turn over 85% in global sales — despite the challenging pandemic market.
“Our business transformed from being a brick and mortar retailer to a predominantly digital business nearly overnight.”
One of the brains behind the brand’s growth is none other than Selim Baraz, Cath Kidston’s Chief Financial Officer.
Known for his out-of-the-box thinking and finance acumen, Selim ensures Cath Kidston’s numbers always add up. But the road to success hasn’t been easy.
Covid hit high street retailers hard, and Cath Kidston was no exception. Selim realized early on that digital transformation and global expansion would be the brand’s ticket to stability and growth. He also knew they’d need a strong funding partner to help keep momentum during challenging times.
High street store closures during the lockdowns of 2020 pushed Cath Kidston online with little notice. And with the pandemic showing no sign of slowing, the clock was ticking for the lifestyle brand to expand its international reach and continue generating sales.
Supported by its owner Baring Private Equity Asia, the company embarked on a digital reboot to fuel the brand’s acceleration and international growth. If Cath Kidston wanted to keep momentum, they’d need to upgrade the brand’s e-commerce platform and CRM — while also implementing a cross-border payment and shipping solution to cover more than 200 overseas markets.
It was a tall order to say the least.
“Our business transformed from being a brick and mortar retailer to a predominantly digital business nearly overnight. This created many operational challenges and difficult negotiations with our suppliers, as well as unique growth opportunities.”
And while digital transformation and global expansion were clearly the best strategic moves for the brand, the dramatic shifts of 2020 had compounded to create a cash shortage within the business. Selim knew he’d need a flexible funding solution to help make the business more resilient and more digital, and he needed it fast.
“Maintaining liquidity during this period while facing many challenges was critical for us to capitalise on growth opportunities. We needed a partner who could formulate an innovative and flexible solution to meet our funding requirements.”
Selim reached out to capital advisory platform, Capitalise. Together they began a hunt for a funding provider who understood the online marketplace’s unique demand cycles, lead times and inventory-based investment requirements.
Working together, Cath Kidston and Capitalise zoomed in on SellersFi — a flexible, hands-on funding provider with a background in e-commerce.
SellersFi offered Cath Kidston a £5 million credit line over three years to fund its business model transition, cement its digital-first strategy and pursue growth opportunities. But more than that, Selim realized SellersFiwasn’t just a financial provider but a strategic partner in their corner, helping them win every step of the way through flexible funding and terms.
“This is an amazing brand. Fresh to the UK and a US leader in e-commerce lending, SellersFi had a great track record working with global online retailers and was a perfect fit. SellersFi proposed a revolving credit model which won’t penalize Cath Kidston for success.”
-Michael Cass, Head of Secured & Structured Finance at Capitalise
Unlike traditional banks, the team at SellersFi knew exactly what Selim and the team at Cath Kidston were up against.
“SellersFi recognixed the pressures on our liquidity due to operational challenges relating to the transition, deteriorating supplier terms, and the need to invest behind our digital assets and working capital to support growth.”
With increased liquidity, Selim and the team were now free to focus their energy on staying the course during the pandemic and fortifying the business for expansion — without sacrificing revenue.
“SellersFi brought instant access to a flexible and affordable credit facility and unique e-commerce and cross-border payments expertise. It designed a deal to fit our new supply needs with bespoke terms based on our unique circumstances and brand equity. This included a delayed start to the repayment schedule, giving us a ‘grace period’ where all our cash flow could be used to drive sales.”
For Selim, teaming up with SellersFi made perfect sense.
Armed with a flexible line of credit, Cath Kidston quickly began its global expansion and digital acceleration — which didn’t go unnoticed.
“SellersFi has seen businesses of our size pivot from bricks and mortar to digital models many times before. While other potential lenders wanted to wait until our online business was more mature, SellersFi could underwrite risk straightaway. Structuring a finance deal to move us through all the gears of our growth strategy, including startup.”
Freshly minted with flexible capital, Cath Kidston hit the ground running. The company’s digital overhaul went so well that it closed 2020 with a whopping 85% global sales.
Here are a few more things Cath Kidston achieved with SellersFi by its side:
A weight has lifted off Selim and his team’s shoulders. They can now scale confidently knowing that Cath Kidston has access to flexible and reliable credit.
But the best part?
Selim and his team also have a supportive funding provider to back them through the highs and lows of multichannel retail.
“We’ve not only found the right funding solution for today but also a partner that can provide us with valuable insight and financial support as our online business expands. Like the Cath Kidston brand, this inspires everyday optimism!”
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