Wise Words or Not?
The reasons for living and for being in business? We all have our own dreams, but most are motivated by that dirty word – MONEY. The same is true of retail magnate Theo Paphitis. On the reality show Dragon’s Den, he confessed:
“There are three reasons to be in business. To make money, to have fun, and to make money.”
Paphitis Starts Out
And it seems as though money has been the driving factor in Theo’s life from the outset. As a so-called self-made individual, his first enterprise was operating a tuck shop at school. The Cypriot started working for Watches of Switzerland in Bond Street at the young age of 18. At 21 Paphitis was selling mortgages and barely two years on he set up his own property finance company with close friend Mark Moran.
Lingerie Endeavours
Paphitis bought the UK and Ireland clothing franchise of La Senza, a lingerie brand for £1 and two packets of cigarettes – or so he says. In 2006, he sold the business for £100 million to a private equity firm founded by Lyndon Lee called Lion Capital. Lion Capital have been investors in brands such as Jimmy Choo, American Apparel, All Saints, and John Varvatos. Paphitis attempted to buy La Senza back, but his bid didn’t make the grade. La Senza UK, in December 2011, filed for administration citing “trading conditions” as one of the conditions for the brand’s closure.
But Paphitis, never being one to give up on anything, forayed into lingerie again launching his Boux Avenue brand in 2011. In early 2020 there are 30 standalone stores in the UK and a handful of international stockists.
Boux Avenue Losses
You would think Paphitis understood the business of lingerie from his experience with La Senza, but the numbers speak for themselves. Boux Avenue has had pre-tax losses every year from 2011 to 2018, totalling £49.9 million for the period. The 2018 losses alone were £11.7 million. Losses for 2019 have not yet been published but are possibly similar to those seen in 2018.
Paphitis cannot blame his losses on BREXIT or COVID-19 for his brand’s demise. The losses began way back in 2011 and every year after that. The accounts for the year-end 31 March 2019 should have been filed last year but as of 30 April 2020 they remain unfiled and many months overdue.
Boux Avenue Restructuring
In February 2020, Paphitis appointed restructuring experts from Deloitte which no doubt will lead to store closures and redundancies. Will the brand ever make a profit in future?
Rymans Acquisition
Fortunately, Paphitis had his sights well beyond fashion and property. In 1995, he acquired the floundering British stationery chain Rymans and today the brand has 210 stores and an annual turnover of more than £100 million and makes profits. He also owns Robert Dyas, the UK hardware retailer, which is profitable at the moment.
What I Love
While not quite in the same league as Bill Gates or Jeff Bezos, Paphitis’s net worth comes in at around £300 million, according to The Sunday Times. But is it all money and fun? We guess that’s a matter of opinion. In an interview with the Independent he said:
“But this isn’t work. This is what I love. This is seven days a week. I start when I get up before 7 am and I work until 9 pm.”
