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In My View by Eric Musgrave: Superdry's 20th birthday celebrations fall flat

Eric Musgrave
05 September 2023

What’s the expected lifespan of a decent-sized fashion brand these days?

Should we be thinking of decades, or years or maybe just seasons? What should we regard as “a good run” in today’s demanding market, one that is still reshaping itself after the extraordinary transformation caused by the COVID-19 pandemic?

It was a bit of a surprise for me to be reminded recently that Superdry is 20 years old this year. That is a not a bad innings at all, but lots of questions are being asked now about how long the men’s and women’s wear operator might survive.

Its annual results to April 2023, published last week after a short but somewhat embarrassing delay due to some technical accounting issues that led to trading in its shares being suspended, showed the public limited company suffered a stonking loss of £148m on global sales of £622m.

Fashion is a fickle business, isn’t it?

At the time of writing (4 September), its shares have dropped under 50p, giving Superdry plc a market capitalisation of slightly less than £50m. This is all a very long way from the share price of £11-plus and market cap of £395m the company enjoyed not long after its flotation in 2010.

Julian Dunkerton CEO and Founder of Superdry

Julian Dunkerton CEO and Co-founder of Superdry

It was back in 2003 Julian Dunkerton teamed up with James Holder to create what was usually termed a “streetwear brand” in those days.

The original idea was to have an in-house brand for Cult Clothing, the multi-brand streetwear retailer Dunkerton had set up in Cheltenham with a partner, Ian Tibbs, way back in 1985. Separately Holder had started a BMX-inspired range under the Bench brand but had become disillusioned with it when he was pressed, in his eyes, to dilute the purity of the offer to widen its appeal.

Theirs was a very effective meeting of minds.

Dunkerton and Holder opened the first Superdry shop in London in 2004, around the time they were joined by a third key team member, Theo Karpathios, who headed up the then-new wholesale operation for Superdry. He had a background in importing clothes from Greece, then making clothes for the UK market and finally running a small chain of skatewear shops.

By the time David Beckham was photographed wearing an “Osaka” T-shirt for his 2005 calendar, Superdry was becoming super-hot internationally. I recall how mobbed its stand was at the Bread & Butter trade fair in Berlin. By accident or design it plugged into a European fascination at the time with Japanese design and cultural influences.

Its flotation in 2010 saw the three main men share around £100m, with the large majority of that going to Dunkerton. He netted another £48m when he sold some shares in 2016, two years after stepping down as CEO. Karpathios and Holder had also left the company by then.

In 2019 Dunkerton returned to seize control in a controversial ousting of CEO Euan Sutherland, who Dunkerton clearly did not rate. Since then the co-founder has been telling anyone who will listen that he is the man to turn the business round.

But is that possible? Clearly to make £622m in sales the company is still shifting a lot of product somewhere but the most common description of Superdry seen in the press is that it is a “dad’s brand”. Sadly a brand cannot pick and choose who wears its goods and its popularity with one demographic usually means its irrelevance to another.

Superdry Battersea Power Station

Superdry at Battersea Power Station

It would be an oversimplification to state Superdry relied on a few logos put onto some basic garments, but its point of difference was its name, its brand and the way that was treated on the goods.

Friends in the trade I spoke to about it recently referred to it as “tired” and “having gone off the boil”. Identifying the problems is much easier than correcting them. Sorting inherent problems out is hard enough for private companies, but as a plc Superdry is in the constant glare of analysis and comment.

One option would be for Dunkerton to take his precious creation private again but according to The Sunday Times last weekend talks with buyout firms last year led to nothing. Maybe the money men don’t see the turnround happening as he does.

Worryingly, the business has been doing some unimpressive deals to shore up its finances, such as selling off its IP rights in some major Asian territories to its franchise partner in South Korea and securing an expensive loan from Hilco, the retail restructuring firm.

Since he has been back in charge, Dunkerton has been banging the drum for sustainability but as regular readers of my column will know I think this sort of stance makes very little difference with the vast majority of fashion consumers. My view is if you are that concerned about fashion consumption, don’t consume fashion.

As it enters its third decade, it is easy to acknowledge Superdry has been a brilliant creation and an enviable success. No one has got a higher opinion of Dunkerton’s abilities than the man himself and he may well have some fabulous ideas to present to the world but the people who will decide if they are good enough are the consumers themselves – and they have lots and lots of other, newer fashion options, especially if they don’t want to dress like their dad.

Superdry may not have many more seasons to win them over but I am hoping for better, more secure times for the 4,000 or so people the company employs worldwide.

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