Hotter - Location Planning Model
About the brand
Hotter is the largest UK-based manufacturer and retailer of shoes, founded in 1959. It specialises in comfort shoes for a consumer over 50 years of age, which it sells successfully through a mail order business and over 70 own stores in the UK and internationally. Turnover was c.£96m in the year ending 2015
The Challenge/Task
Hotter was experiencing a period of rapid growth in the mid-2000s, and was seeking investment to allow it to pursue further growth opportunities in new channels and markets. Gresham Private Equity was considering investing in the business and asked Pragma to support in the due diligence process. Pragma subsequently advised Hotter on numerous strategic questions, most notably on retail roll out potential and location planning.
WHAT WE DID
Review of the market and Hotter customer, and evaluation of the growth opportunities for the business
Assessment of suitable locations for the brand in the UK based on its customer profile and optimal retail models
Market trend analysis, consumer evaluation and market sizing for the comfort footwear market in the UK, US and Germany
“Pragma provided us with a very thorough and sophisticated location planning model. Their approach combines scientific rigour and practical experience and enabled us to have real confidence about which locations we select for new stores. I was very impressed with their work.”
The Result
Pragma provided the store roll-out plan that saw the business grow from 6 stores in 2008 to over 70 profitable stores in the UK today, and was instrumental in helping the business exploit international opportunities more effectively. During our involvement, Hotter tripled the size of its business, and was sold by Gresham to Electra Partners in 2014 in a deal that valued the business at £200m.