[ad_1]
It’s been a steep fall from grace. Matches was founded in 1987 by Tom and Ruth Chapman as a bricks-and-mortar store in Wimbledon Village, London. It gained a cult reputation for its curation of brands, and over time grew into an e-commerce behemoth carrying over 600 luxury labels and reaching over 170 countries through Matchesfashion.com.
When the Chapmans decided to sell Matches, it triggered a fierce bidding war. Ultimately, private equity firm Apax Partners won out, acquiring Matches in 2017. The terms were undisclosed, but the deal was said to value the retailer at $1 billion. Matches reported solid sales of £430.5 million in 2019, but the pace of growth was slowing and costs were starting to mount. The retailer was operating at a loss before the Covid pandemic hit. Increasing competition from e-commerce rivals like Ssense, Farfetch and Mytheresa piled on the pressure.
Farfetch’s fire sale to Korea’s Coupang in December, and the later departure of founder José Neves, signalled that the luxury multi-brand boom era had come to a firm close. “Matches’s online business was founded in a different era of luxury e-commerce. Today, this previously successful online luxury fashion model has a number of significant issues that resulted in stagnating growth, weak fundamentals, and the inability to adapt to the change in product and service expectations of the luxury customer,” says Nina Briance, founder and CEO of Cult Mia, an independent fashion platform.
“The crowded online multi-brand luxury landscape has been drowned by pricing wars over the same Gucci bag sold on Farfetch, Net-a-Porter, Matches and Gucci itself (to name a few),” continues Briance, who adds that there has been such a shift in the way that content now discovers consumers on socials, and not the other way around, as is the case with the TikTok FYP. “It’s removed the reliance on large multi-platform e-tailers to stay up to date and for product discovery. With feeds now inundated with product recommendations from every angle, the challenge and focus is to cut through that noise and differentiate — not just your offering, but the way that you curate it too.”
As Matches’s losses continued to widen, Apax attempted to revive its fortunes, including cycling through several chief executives. In 2022, the firm drafted in Nick Beighton — the man who turned Asos into a £3.9 billion business — to lead Matches as CEO. In January 2023, Apax injected £60 million into Matches to keep it afloat. By the end of the year, it offloaded the business to Frasers Group for £52 million.
“It’s so sad that the people who will lose out the most are the people who can’t afford it at all.”
Previously known as Sports Direct International, Frasers Group has spent the past few years snapping up fashion and sportswear retailers and brands, ranging from the value end of the high street up to luxury — often acquiring them from administration, or the brink of. Its portfolio includes House of Fraser (bought for £90 million in 2018 as it went into administration), USC, Jack Wills (purchased out of administration for £12.7 million in 2019) and Sports Direct. It acquired multi-brand luxury retailer Flannels in 2017 and steered it back to profitability, growing its annual revenues to £5.5 billion in 2023.
[ad_2]
This article was originally published by a www.voguebusiness.com . Read the Original article here.
