Bernard Bunting, former soldier, IT whizz kid, and now at the age of 53 owner of a school uniform supplier, is quite ready to admit his mistakes. The first of these was in the very early 1990s, when having successfully sold off his GP software business to Reuters, he called a halt to his next business idea – selling mobile data – mainly because the country was then deep in recession.
Even with big name clients like Mars taking an interest, he put the idea “on the back burner”.
“I really thought that now was the time to get out of computers,” he says. “I couldn’t face the thought of starting again. What a mistake that was!” It certainly was, when you consider the meteoric growth the mobile data industry has seen since then. His next oversight came only a few years later.
That was when he and his wife were busy building up the Children’s Warehouse, an internet and mail order children’s clothes business which was heavily dependent for its success on constantly mining a customer database they had developed. Among high profile customers were Edwina Dunn and Clive Humby, of marketing agency Dunnhumby, and Bunting suspects it was seeing how his business operated that gave Dunnhumby the idea for its most famous product, the Tesco Clubcard.
Earlier this year Dunn and Humby stepped down from the company they founded, after taking their share of a £17m dividend. “They made something of it,” says Bunting. “We didn’t.” But this is not the story of one of life’s also-rans. Bunting still has a successful business career behind him, including a stint at being home shopping director for toy store Hamleys. And he believes his latest venture, Perry Uniform, which already turns over around £2m, could be on the point of turning into a serious money spinner. Yes, that’s right; a clothes manufacturer making serious profits in Leeds. Even he would admit that when he first came to look at the business in 2007, the idea of it being a success seemed unlikely. After all, Perry Clothes, as it was then called, was in administration. It was based, as he admits in a “clapped out mission hall in Armley, with 110 pieces of plant some of which dated back to the 19th century”.
He says: “Even as a children’s clothes supplier, I had never heard of them, never been to see them, and it wasn’t until I took the widow of the founder out to lunch last year that I learned the full history of the company. “It had been set up in 1946 as general clothiers. Of course that was a huge industry in Leeds then. The founder had just come out of the services, and he set up in Armley. In the late 1950s he met up with Peter Franklin, a textiles agent who had originally worked for Trutex, another schoolwear supplier. Franklin started going around independent schools introducing himself, and Perry would make the garments. They built up a £1m-turnover business.
“Perry died at his desk in 2004, aged 84. He was still going strong – apparently he would only take Wednesdays off for a game of golf. His widow was not equipped to take the business on, so they got two members of staff to do it. To call them managers would be an exaggeration. One was an experienced machinist and the other was a part-trained book-keeper. They didn’t have the experience or the vision to make the company survive. Stock levels doubled, the wage bill trebled, and the rest was fairly predictable.” Bunting came across the company as part of a tour he was making to find out more about the cluster of “strange northern companies” he had noticed while managing the Children’s Warehouse which was still based in the north and producing schoolwear – companies like Trutex, Banner and David Luke.
Calling these companies “strange” isn’t southern snobbery speaking – Bunting is originally from Yorkshire. While they may not be household names, they should be familiar to anyone who has struggled to get their child dressed on a school morning. Bunting was interested in how they worked. The Children’s Warehouse had itself got into schoolwear as a means of diversifying out of conventional childrenswear. The company had already tried diversifying into supplying toys and that was the reason why Bunting ended up working for Hamley’s.
“I read in the Financial Times that Hamleys were in trouble and a new guy called Simon Burke – Richard Branson’s left-hand man – had been parachuted in to try to save it,” he says. “So I dropped him a line, explaining that we had this great database focused on whatshould be a Hamleys customer, that we had been running mail order for ten years, we were in Chiswick, whereas he was in Regent Street with very limited space, so we could create Hamleys.com.
It was at the height of the dot com boom. Simon – to his great credit in a corporate environment – took me on as home shopping director while still allowing me to be at the Children’s Warehouse. “We did, after all, have complementary products. When I put the first Hamley’s catalogue out, the staff there said they could not believe the number of radiocontrolled aircraft they were selling straight off the page.” The problem was that while such as system worked for toys, it wasn’t so great for children’s clothes.
“What didn’t work was the cross-fertilisation on the mailing list,” he says. “The Hamley’s customer is to a large extent a tourist.” So when Simon Burke’s attempt to take over Hamley’s himself bit the dust and he moved on, Bunting too felt that it was time to go off “on a tangent” and his company moved into producing schoolwear. He says: “We had a database of 250,000 addresses, many of which were parents of children going to mostly London day prep schools, so we got asked by those schools to supply components of their uniform. We saw the repeatability you could get with sales of school uniform.
And obviously that was somewhere we can apply our distance-selling skills. After all, not many retailers had websites in the year 2000. In contrast, we had put our first website up in 1996 – pretty good considering that in 1995 Microsoft launched Windows without even mentioning the word internet.” It was with such a background that Bunting came to acquire Perry Clothes.
The idea initially was to merge the two companies and have two bases – London and Leeds. But 18 months later when the company needed more space he was persuaded to relocate both operations into new 20,000 sq ft premises in Stanningley. He invested £300,000 into the new factory – all of his own money. Even then, he said, he still saw the business as mainly a lifestyle operation. But he has since changed his mind. Why? Largely because of changes he sees in the international market. With budget-conscious parent customers in mind, childrenswear in general, and schoolwear in particular has been relentlessly outsourcing in recent years.
And we do mean relentlessly. This writer remembers meeting a schoolwear supplier ten years ago who had just got back from a sourcing trip to Colombia. The country was then and still is suffering the worst ravages of a civil war, and the supplier had been going to see factories in towns that were only accessible by air as a result. But even that was felt to be more commercially viable than maintaining production in England. Bunting thinks such far-flung ventures will only end in disaster.
By contrast, Perry Uniform manufactures 20% of all the uniforms it supplies in the Armley factory, with a further 30% manufactured in Portugal – no further than that. The rest is wholesale. He says: “When I first came into this industry some of our competitors were really starting to struggle because they were going to Eastern Europe to source goods and the quality coming back was a shambles.” Many companies have also been attracted by China, too. But he says: “I know a senior businessman in this sector who has just returned from China and is very worried about lack of capacity and material and labour rates.” He says once you look at the figures it is hardly surprising that Chinese manufacturers have not been rushing to build capacity to make clothes for English schoolchildren.
Put simply, they have bigger fish to fry. “The national market for schoolwear is around £350m in UK,” he says. “Once you take out the portion going to the likes of Asda, my estimate of the size of the independent sector is £75m. “That is a drop in the ocean on the global scale. Even if you have a 1,000 pupil school across ten years, that is a very small volume of pieces you are making.” Yet it is precisely the niche quality of this market, he says, and its particular vagaries, that make it an ideal target for what’s left of Leeds manufacturing to aim at.
“If you want a white polo shirt in big volumes, China has a role,” he says. “But it will be difficult to source there for specific merchandise. You have consumer who is becoming very savvy on the internet. They expect delivery tomorrow. You combine that with a highly seasonal business, where most turnover is between June and September. Once you take account of lead time and the fact that many factories close in August, if you are only sensing demand in June or July and think you can get finished goods back by September it just isn’t going to happen.” In contrast, Perry Uniform can easily scale up to cope with such a peak demand.
“My headcount at the end of the year is half what it would be in August,” he says. “I can scale it up and down because I have Leeds University just down the valley – a very educated student body who are keen during the summer holidays to earn a bit of extra money in the warehouse.” And if there is a problem with a garment not manufactured on site, he says, “I can be in Oporto by lunchtime”.
Right on cue he shows me a story from the Sun (wittily headlined “Queue-niform”) about parents having to wait for four hours to be served at one shop this summer. Perry, in comparison, sells mainly over the internet or directly into the school’s own shop.
The real issue about schoolwear, he says, is that it is a qualitative business, not a quantitative one. “You really have got to get it 100% right,” he says, “Having just one component not available gives you a massive problem. John Lewis is probably our main competitor, but they struggle in their schools to employ a level of service. To try to provide school uniform for such a narrow period of time is difficult.
They are looking at the internet, but very few people have the level of logistics to deal with it that we have.” And that is why he now feels the time is right for the £2m business to scale up.
“We began that earlier this year with the added flexibility to cater for outsize garments,” he says. “It may be tongue in cheek to say that I can make a blazer in an hour, but it is the case.” He senses increasing demand too, with school’s eager to strengthen their brand by specifying bolder and better quality uniforms. It’s no surprise to learn that Perry supplies Christ’s Hospital, the private school in Sussex where boys and girls still wear black and yellow cloaks down below the knees. But as the son of a sculptor who taught at York Art School for 50 years, Bunting is very proud that all this is happening in Yorkshire.
Alongside the story about the school uniforms, he has a cutting from another paper of two boys in school blazers leaving a wreath at the Cenotaph during the Remembrance Day service this year. As a former soldier who had many tours in Northern Ireland, he was marching there too.
“Those blazers were spun in Huddersfield, woven in Bradford, dyed in Yorkshire, and came here to be cut,” he says. And with the company’s 40-strong workforce ageing, he is proud that it has just taken two teenagers through an apprenticeship too. Yorkshire manufacturing, as far as this man is concerned, is certainly not dying.