Private equity firm gets Hotter


Private equity firm gets Hotter

Lancashire-based Hotter Shoes has received a £21 million
investment from Gresham Private Equity. The deal backs current
Hotter managing director Stewart Houlgrave and chairman Peter
Chappelow as the business enters its next phase of growth.

Catering to the grey market, Hotter was established in 1959
selling comfortable footwear via mail order. It now also has four
retail outlets across the UK and a transactional website with
over 70 per cent of sales generated by its direct arm. It produces
30,000 pairs of shoes per week and employs nearly 400 people at
its headquarters in Skelmersdale, which includes a production
plant and a 100-seater call centre. Following the investment,
Hotter plans to double its current turnover of around £38
million over the next four years.

Commenting, Stewart Houlgrave, who has driven the company’s
expansion to date, said, “By focusing on our brand values
we have established a loyal customer base, however, we recognise
there is huge potential to develop the business further. Our
strategy is to significantly expand our product ranges for both
men and women in line with the lifestyle needs of the growing
over 50’s market. Our investment plans include strengthening the
management team, new manufacturing plant and IT systems and
developing our export markets and retails outlets. The
partnership with Gresham will help us to take the business
forward in all these areas while remaining true to our core
values.”

Gresham partner Andy Marsh said he saw “exciting growth
potential” in the business given the UK’s ageing population
and an increase in foot-health problems associated with obesity,
diabetes and arthritis. “The business has real scalability
through its direct marketing channels via mail order catalogues
and the internet,” he added. Gresham said it has put
together a package to expand the Hotter product range and improve
its direct marketing strategy. Indeed, according to a survey by
marketing agency Millennium, the plurality of consumers over the
age of 50-28 per cent prefer to do their shopping online. By
contrast, only 23 per cent prefer to shop on the high street.

This is the second catalogue deal experience for Gresham, which
also invested in Flowtech, a direct supplier of pneumatic and
hydraulic products.

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