Seasalt is a rapidly growing lifestyle clothing brand that differentiates through its Cornish heritage and places social and environmental responsibility at its core.
This dual-pronged approach has fuelled ongoing growth and the retailer now has more than 70 stores across the UK, as well as a thriving international business. Supported by its online presence and wholesale partnerships, physical expansion is now a key priority.
Our Retail Week analysts look at five ways the Cornwall-based brand will continue to outperform the market.
1. Making the most of USPs
Seasalt’s distinctive product offer comprises workwear-inspired clothing and accessories with more than a passing nod to Cornwall’s maritime and artistic heritage. Hero categories include Seasalt Rain and Sailor Stripes.
Originally focused on womenswear, including a petite and tall range and sizes up to 28, developing menswear has now moved up the Seasalt agenda.
Menswear sales have grown by 42% in the 2023 year to date, following a significant extension to the offer from spring/summer.
The retailer’s sustainability and ethical credentials chime well with today’s consumer and are helping to fuel rapid growth.
Sustainability targets include: increasing the use of certified sustainable materials in products each year; transitioning to become a carbon net zero business by 2040; and working with partners such as resale specialist Reskinned to enable customers to buy secondhand Seasalt clothing on its platform.
2. Served well by multichannel origins
As a relatively young brand, Seasalt has operated along multichannel lines since its launch.
While the retailer had been opening around 10 new stores a year, physical expansion was scaled back during the pandemic and four stores deemed “insufficiently profitable” were shuttered in 2021/22.
Seasalt has started expanding again cautiously this year. Four new UK stores have been brought on in 2023, including a northern outpost in Aberdeen, as well as an Irish store in Kenmare, County Kerry.
The business expects to open UK stores at a similar – or greater – trajectory in 2024.
Seasalt chief executive Paul Hayes says it’s all about making sure there is “a healthy mix between the two channels”. The retailer’s multichannel customers are the most profitable and it continues to invest in digital innovation.
Seasalt allows customers to order items in store – while they are on holiday, for example – and have that order fulfilled at their local store, as well as offering home delivery for purchases made either online or in store.
Commenting on its most recent results for the year to January 2022, Seasalt management said online performance continued to benefit from the ability of the website to trade store stock, with approximately 27% of online orders fulfilled from stores that year.
The business said this “greatly assists full-price sell-through and end-of-season stock clearance, and has enhanced our ability to trade stock efficiently”.
3. Partnerships driving additional growth
Digital and wholesale channels are also a focus for development.
Having introduced inserts to more than 40 M&S locations in the UK and Ireland by the end of 2023, Seasalt is the leading women’s brand in store for the retail giant.
Since the launch of the partnership a couple of years ago, sales via M&S are reported to “have greatly exceeded expectations” while also “raising brand awareness that drives new traffic to the company’s own stores and websites”.
Seasalt also sells online via Zalando, giving it further access to international customers, especially in Germany.
4. Upping international expansion
Seasalt is upping international expansion plans from 2023 and partnering with Rarely Heard Voices, which has “extensive experience in bringing brands and operators together” to accelerate the pace of development. The immediate focus is on North America and Europe.
The retailer will open its first standalone, company-operated store in the US, in New England, next June. Up to three further locations will be confirmed in 2024, with ambitions for up to 20 stores in the country over the next three years.
The focus is on the East Coast, which is perceived to be particularly receptive to UK-based brands and, interestingly, is also where rival Fat Face began its US onslaught a few years ago.
Hayes says Seasalt’s US market strategy has been “in development for some time”, with the retailer having “established a strong foundation” in the country through its online partnership with local department store group Belk from 2022.
Belk is to introduce Seasalt to a number of its key stores next year, while Seasalt will launch a dedicated US website in summer 2024.
The retailer is also “actively looking” at other department store partnerships across North America.
US expansion will be led by Jason McNary as consulting director for the continent.
Further afield, Seasalt has a long-established partnership with the Ballantynes department store business in New Zealand, operating several concessions there.
Extending this partnership, in September 2023 Seasalt opened its first standalone store with a franchise partner outside Europe in Auckland’s Milford Centre.
Further store openings are planned for New Zealand, although locations have yet to be confirmed, with Ballantynes becoming the exclusive distributor for Seasalt across the region.
5. Maintaining sector-leading performance
Seasalt turned in one of the fashion sector’s strongest performances in 2021/22 when group sales rose 38% to £96.4m.
This reflected a 200% surge in store sales and 8% growth in online revenues against exceptionally strong comparatives. Revenues were also bolstered by Seasalt’s growing third-party and wholesale channels.
The core UK business posted a 41.2% advance in sales to £90.8m in 2021/22, up from £64.3m the year before.
Sales continued to edge up across the fledgling international business, growing 2.8% to £5.6m, against £5.5m the previous year.
Profitability also strengthened on the back of the robust trading performance and the ongoing renegotiation of leases, with pre-tax profits soaring 167% to £6.5m and pre-tax profit margin virtually doubling to 6.7%.
Going forward, the business aims for “a balanced approach between a strong UK store estate and high levels of online and international growth”.
At its current level of expansion, Retail Week Prospect envisages that total sales will reach around £170m by 2026/27, with the international business generating about £20m of the total.
With the brand proposition very much focused on its Cornish heritage, a key challenge will be maintaining an authentic connection with customers as international development ramps up against the background of a possible change of ownership at some point down the line.