Furniture Village, the largest independent furniture retailer in the UK, has announced that it has secured a £6m investment from the Business Growth Fund (BGF), an independent company established to help Britain's growing businesses.
BGF’s funding will enable Furniture Village to accelerate a roll-out expansion of new stores across the UK, as well as bolster an ongoing investment in technology – to enhance the customer experience in-store, and further develop the company’s ecommerce platform. BGF will take a minority stake in the business and Jon Simon will join the board as BGF’s representative.
Peter Harrison, CEO of Furniture Village, comments: "Having achieved a significant improvement in trading performance in our last financial year ending March 2014, which has continued strongly into this current year, this is an ideal time for us to expand and further enhance our presence, both in terms of physical stores and online.
“We appointed PWC as advisors and they approached a variety of appropriate parties on our behalf, including BGF, who ultimately proved the right fit.
"We are appreciative of BGF's support and confidence, and beyond the many other potential benefits that will arise from our new and close association, this substantial investment will enable us to accelerate our plans and for Furniture Village to remain at the forefront of British retail in its sector."
The investment was managed for BGF by Jon Simon, Joe Wilson and Rory Pope. Senior investment manager Jon Simon comments: “This represents an exciting opportunity for BGF to back a well-known British brand with a strong heritage and a track record of profitability. We are supporting a clear growth strategy based on selective store roll-out and investment in new software. This in turn will improve the operational efficiencies of the business and increase the focus on ecommerce, all of which will add to the customer experience.
"Over 25 years, Furniture Village has developed into one of the UK’s leading furniture retailers, and we look forward to supporting the management team as the company embarks on this next phase of growth.”
On the subject of specific growth targets, Peter Harrison adds: “We would anticipate reaching 50 stores within three to four years. However, our expansion plans will remain measured, because, after 25 years of trading, we are familiar with what makes Furniture Village relevant to our customers, so we will always be selective about new store locations. However, online development and the ongoing enhancement of our ecommerce capabilities are of equal significance to our bricks and mortar plans. We are committed to making the Furniture Village website the best in its retail sector.”
Furniture Village marks its 25th anniversary of trading this month, and, still independently owned, the business has 40 stores across the UK, employs 760 people and generates revenues of £200m per annum. Furniture Village is positioned at the top end of the volume market, and prides itself on being the largest retailer of leading brands in the sector, the majority of which are sourced from the UK.
BGF is an independent company that was established to help Britain’s growing businesses with a turnover between £5m-£100m. Growth potential is the key criteria – BGF will invest between £2m and £10m per business in return for a minority equity stake and a seat on the board for a BGF director. BGF will provide long-term equity investment for those growing companies that today do not have access to this source of capital – as such, BGF hopes to be a catalyst for growth among smaller UK companies.
BGF is an independent company with capital of up to £2.5b, backed by five of the UK’s main banking groups - Barclays, HSBC, Lloyds, RBS, and Standard Chartered. BGF is managed autonomously by an independent management team.
