Retail group Buy It Direct has bought showroom chain and e-tailer Better Bathrooms out of administration for an undisclosed sum.
The privately-owned, Huddersfield-based company has acquired all Better Bathrooms’ assets and ‘goodwill’, including its domain name and remaining stock.
Buy It Direct, which was set up by entrepreneur Nick Glynne 20 years ago, owns a number of mainly online brands in consumer electronics, kitchen appliances, IT and furniture. These include Appliances Direct and Furniture123.
It has already re-employed 12 staff and will look to save a total of around 50 jobs.
Speaking exclusively to kbbreview, Glynne revealed that Better Bathrooms now aims to partner with major bathroom industry brands rather than rely solely on OEM product.
News of the acquisition comes only two weeks after Better Bathrooms announced it had closed its doors with the loss of more than 300 jobs.
Administrator FRP Advisory said the decision was reached following “severe cash-flow difficulties and an extended period of soft trading”.
Roxor Group, which owns BC Designs, Ultra Finishing, The Fireclay Factory and PTB Manufacturing, had bought the loss-making company back in November, vowing to bring it back to profitability.
But it was unable to turn round its fortunes and was forced to place it into administration on March 1.
“The strategy is to continue to do OEM, but we’re also keen to work with major brands. We’ll have a showroom strategy but have a smaller network of stores. Our sweet spot is mid-range products and we’ll sell to aspirational consumers”
Nick Glynne, owner, Buy It Direct
Glynne revealed Buy It Direct had tried to buy Better Bathrooms in a prepack deal shortly before Roxor’s bid was accepted.
“We’ve tried unsuccessfully to launch a bathroom business in the past, but struggled with web traffic,” he explained. “So when Better Bathrooms came up in November, it was the perfect fit. But we were offering a prepack and Roxor were offering a solvent deal.”
Glynne said he was surprised that Roxor had seen potential in Better Bathrooms, which despite being one of the UK’s biggest bathroom retailers, had posted a pre-tax loss of £1.8 million for the 12 months to April 2017.
“I’m not sure what Roxor saw in it,” he said. “The strategic side makes sense, but it had to be run as e-tail and wholesale and e-tail is hard to run.
“They were also crippled with the rates on the showrooms.
“The key thing is we’ve bought all the assets. I can’t say how much we paid for it, but it was a fair price. It’s worth a lot more to us than it is to others.
“The strategy is to continue to do OEM, but we’re also keen to work with major brands. We’ll have a showroom strategy but have a smaller network of stores. Our sweet spot is mid-range products and we’ll sell to aspirational consumers.”
According to Buy it Direct’s latest 12-month financial statements to the end of March, revenue had increased almost 30% to £188.2 million and pre-tax profit was up to almost £2m, an increase of £1.5m from the year before.
The business employs 660 staff and has two stores, the main one at Trident Business Park in Huddersfield, which is also the site of its head office.
Recently, the group has been on the acquisition trail, picking up the carcasses of failed companies.
It bought Swansea-based electronics Trojan Electronics out of administration last December for £250,000, and tabled a bid for the brand and website of the failed high-street electronics retailer Maplin last June, which Glynne said at the time “would be a great addition” to his portfolio of brands.
But Glynne was unsuccessful in his efforts to buy Maplin’s brand and e-commerce business, which was bought by another private buyer.