Warehouse buys school uniform business
The Warehouse Group plans to buy Postie Plus's school uniform business for $9 million.
NZX-listed retailer The Warehouse Group, which owns the red sheds, Warehouse Stationery, Noel Leeming and Torpedo7, has entered into a conditional agreement to buy the SchoolTex school uniform brand and stock from listed Postie Plus Group, the Warehouse said in a market announcement this morning.
SchoolTex supplies more than 1100 schools with uniforms and sportswear, the Warehouse said.
The Warehouse Group chief executive Mark Powell said the SchoolTex brand would strengthen The Warehouse's position in the school uniform market.
"We see the SchoolTex uniform brand complementing The Warehouse's existing school apparel and back to school product range," he said.
SchoolTex was an established brand with good quality products, Powell said.
The Warehouse did not plan to sacrifice the quality of the products but could leverage its scale to offer better deals and sales on uniforms and back-to-school packages, he said.
The purchase also aligned well with work across The Warehouse group to support schools and education from a community perspective.
Schools would be contacted during January and February so they could tell parents which Warehouse stores uniforms could be purchased at from the end of February.
Powell said uniforms would be available in stores and online, with the option to order online and collect in-store or have the uniform delivered.
"It's the full anywhere-anyway offer that we talk about," he said.
The Warehouse also bought the SchoolTex website as part of the brand acquisition.
Powell said generic school clothing would be available throughout stores nationwide and uniforms for specific schools would be available at the school's local store.
The six existing SchoolTex support office and regional staff would be employed by The Warehouse at the end of February.
The Warehouse did not have specific plans to take on more staff in the SchoolTex business at present but it was always looking to grow business rather than shrink it, he said.
"We're always looking to be efficient as well."
The uniforms were largely made in China, as was most of The Warehouse's apparel offering, with some work done in the South Pacific and New Zealand.
The Warehouse always looked to get the best supply chain for customers but there were no specific plans to take the manufacturing of the products out of China, he said.
Powell said the purchase was "exciting" and was another building block in the company's school offering.
Postie plus chairman Richard Binns said the company was feeling "very positive" about the transaction and was "delighted" to be working with the Warehouse.
The sale was an opportunity to focus on the company's core business, Binns said.
"It's sad, as you say, it's the end of an era, but we're excited about the future . . . it's a great opportunity to go forward."
Postie Plus said the transaction was expected to be completed at the end of February with SchoolTex uniforms available in Warehouse stores from then.
The move comes after the company recorded a loss of $13.2m last month for the year to August.
Binns said the $9m from the sale would help Postie reduce its bank debt from $21.1m to $12.2m.