Floorings specialist wins £3.25m cash injection and hires sector veteran as it guns for growth
Floors-2-Go has hired retail veteran and former B&Q chief Jim Hodkinson as chairman and won a £3.25m cash injection as it seeks to expand and grow market share.
Investment vehicle Hotbed has invested in Floors-2-Go to fund growth. There are plans to open 60 stores this year.
Floors-2-Go director Michael Coleman said the 94-store retailer will embark on “significant growth”, opening potentially hundreds of stores, but he would not be drawn on an exact number.
The retailer has struggled in recent years and collapsed into administration in 2008 before being bought back by the original founders, the Hodges family. They subsequently invested £3.5m into the retailer.
Coleman insisted there is “space in the market for Floors-2-Go”.
He said the retailer can be “much bigger than we already are. Floors-2-Go is here to stay.”
Coleman said it “took a while to sort the business out” after buying it out of administration. “We’ve completed a total turnaround and are now ready to go and take greater share of the market,” he said.
Hodkinson - who is also chairman of Furniture Village as well as a non-executive director at Massmart, the South African retailer Walmart is in the process of acquiring - will lead the charge in the newly created role. He said the opportunity to expand comes after improvements in the business. He also pointed out that Floors-2-Go has “very little debt”.
Coleman said the retailer was trading “very comfortably” but remained cautious about 2011. “It will be tough for everyone but we’ve got a good strong management team,” he said. He pointed out that Hodkinson has “a lot of very relevant experience”.
Floors-2-Go opened new stores in Doncaster, Birkenhead, Peterborough and Taunton in December, which Coleman said are all “trading well”.
Floors-2-Go co-founder and commercial director Richard Hodges said: “This investment in Floors-2-Go is undoubtedly the start of an exciting phase in the company’s development and I’m extremely enthused to be able to work alongside such an experienced non-executive team.”
Robert Clark, director of Retail Week Knowledge Bank, said the appointment of Hodkinson “underwrites the company’s future”. He said Hodkinson has a wealth of experience in the home sector and “experience counts for a lot, he’s been through it all”.
Clark said to attract someone of Hodkinson’s calibre shows the retailer has strong potential. In the year to July 31, 2009, Floors-2-Go clocked up revenues of £34m and pre-tax profits of £765,000.