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CARDSHARP
Thinking
Strategically How the mighty have fallen, mused Cardsharp. Clinton Cards, once almost a generic name for card retailing, has allegedly been taken off the market after failing to attract a buyer. Well, anyway that is the word on the greeting card street, or should that be the ‘Boulevard of Broken Dreams’?
Clintons, the UK’s second largest standalone specialist greeting card chain, was put up for sale a couple of months ago. The Weiss family who own the 334-store chain had appointed KPMG to oversee ‘A review of strategic options’ which is ‘City speak’ for ‘looking for a buyer’, thought Cardsharp. But the gossip is that a suitor has not come forward who is prepared to pay the sort of sum the Weiss family were hoping for. Cardsharp can’t say he is surprised. In fact, he was surprised that the Weiss family decided to potentially put Clintons on the market in the first place, as it is hardly the ideal time for a potential sale.
Getting a decent price for any retail chain at the moment in the UK is asking a lot. Bricks and mortar retail chains without a decent web presence (an area Clintons has never really invested in) are not exactly in high demand. Even Card Factory, which in Cardsharp’s view has performed miracles to achieve and sustain great profits in such a difficult environment, is distrusted in certain City circles. And marketing it while the
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PROGRESSIVE GREETINGS WORLDWIDE
whole country is in a state of uncertainty with the Brexit D-day looming was hardly likely to make potential suitors rush in. And with a distracting general election looming retail faces a challenging Christmas. Add to that an annual loss of £14 million in the last set of financials, which followed on from big losses in previous years, and on the surface Clintons doesn’t look a very attractive proposition. While there has been some canny ‘tidying up’, most notably moving out of its expensive and now outsized HQ in Loughton, if it were not privately owned by such wealthy private owners Cardsharp wonders whether it would have gone bust by now. How things have changed. Clinton Cards started in 1968, when Don Lewin opened a single shop in Epping. He named it Clintons after his son Clinton, who in later years would become its chief executive. After slow and steady growth, the business really took off when Clintons became a publicly-listed company in the early 1990s and then went on an acquisition trail that would see it acquire a host of specialist card chains in the UK. But hubris got the better of the directors when they bought the ailing Birthdays chain, not for sound financial reasons, but in order to top the ‘not so magical’
Above: Clintons’ owners, the Weiss family, has appointed KPMG to oversea 'A review of strategic options’ for the retail chain. Below: Clinton Cards first opened in 1968. Below left: Don Lewin, founder of Clintons.
1,000 store mark. This was one acquisition too far. Having acquired Birthdays, the management seemed to have little idea what to do with it. And they ended up putting Birthdays into administration in an attempt to slim it down to size. From then on it was all downhill from there. The management had no idea how to deal with the threat of the vertically integrated value chain that Dean Hoyle was building so adroitly and it all culminated in a sad end seven years ago when AG acquired the debt from the banks and put the whole group into administration and acquiring the chain. This could have led to a fresh start. With the Lewin family out of the picture, and the portfolio drastically slimmed down, there was in hindsight, Cardsharp reflects, still an opportunity to turn things around. But sadly the American management team AG initially brought in to run Clintons (while also keeping their hand in on the US side too) didn’t come up