The high street is littered with brands that failed to survive the test of time. Just ask anyone who wore a FCUK T-shirt in the 2000s. Then observe the ninth consecutive year of losses at its parent company French Connection, which is slowly shrinking into obscurity.
SuperGroup, the youth fashion brand known for its distinctive Superdry logo and Japanese slogans emblazoned across hoodies and T-shirts, has managed to defy this gravity.
Founded from a market stall in 1985 by Julian Dunkerton, it floated in 2010 with 40 stores and 54 concessions. Today it has more than 700 stores and concessions, operating 25 websites in 18 countries. It paid its maiden dividend last year and this week it should report another quarter of market-beating growth.
After his bruising spell running the Co-operative Group, chief executive Euan Sutherland has gone quietly about the job of growing SuperGroup. He is trying to take it upmarket, hiring actor Idris Elba to front a new brand that entices people to pay £345 for a leather jacket. He has shifted it sideways, adding sportswear, shoes and a broader range of accessories. It has turned its attention to growth in America, China and Europe, and more than half of sales now come from overseas.
Online accounts for more than a fifth of sales and profits are set to reach £86m this year, on sales of about £740m. Also, as a relatively new player, it is free of the legacy of long leases in shabby shopping centres. With net cash in its coffers, it can afford a rolling programme of modernising its shops.
Yet SuperGroup is not immune from the winds that buffet its peers. Next warned on profits again last week with the household spending squeeze and the falling value of the pound pushing consumers away from clothes shopping and towards experiences. Inflation on manufacturing its clothes will inevitably feed through to prices, although its takings overseas helped to deliver a small overall currency boost in the half-year figures.
Chasing older, albeit wealthier, customers is a risky game too. Which self-respecting teenager wants to be seen wearing the same brand as his dad?
All of this has weighed on the shares, which broadly trod water last year, as the chart shows. The market value is about £1.3bn. For all its growth, SuperGroup has never been able to shake off the fear that it is only a few steps from becoming yesterday’s brand. Avoid.
