Women’s activewear retailer Lorna Jane will embark on an ambitious national expansion program after private equity firm CHAMP Ventures took a significant stake in the business.
Lorna Jane, which was established by Bill and Lorna Jane Clarkson in Brisbane in 1990, has grown rapidly from 32 to 72 stores in the past three years.
With half the stores located in Queensland, CHAMP Ventures director Paul Readdy says the goal is now to build a national footprint.
“NSW and Victoria are probably the key. The majority of growth in new stores is going to come from the southern states.”
Lorna Jane has recently opened stores in the Sydney suburbs of Bondi and Mossman, and has also opened a new store in the Mid City complex in Sydney’s Pitt Street Mall, where Richard Branson’s Virgin Active is set to open a new gym in the coming months.
“We tend to locate the stores within a gym community,” Readdy says.
Readdy says CHAMP has been looking at the Lorna Jane business since October or November last year. The firm has investments in several retail businesses through its Retail Apparel Group, which owns stakes in menswear brands including YD and Tarocash.
“We quite like this model and we’ve been tracking it for awhile,” Readdy says, adding that CHAMP is also interested in tapping into the general societal shift towards health and wellbeing.
“Generally the trend towards healthy living and active living was something that attracted us.”
It is understood that CHAMP will take a stake of between 40-50% in the company. The Clarksons, who previously owned the entire company, will remain in management roles.
“This opportunity with CHAMP Ventures allows us to realise the potential in the active wear category both here in Australia and overseas,” Bill Clarkson said in a statement.
Another attractive element was the fact that Lorna Jane has a tight control of its margins and its supply chain. More than 95% of the stock in each store is Lorna Jane branded and the company designs all its products in Brisbane before having them manufactured offshore.
“That’s the concept from owning it from end-to-end and controlling your margins,” Readdy says.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
