I was chatting with a friend over Christmas. She is the finance director for a UK fashion distribution business that deals with some cool brands. Apparently, an average of 105 debtor days is the norm for them. So they may get their Christmas revenues in at about Easter time then.
Today I saw an interesting article in The Daily Telegraph about how the behaviour of a few celebrities or a Royal can change fortunes. Look at this for an example:
Hunter, which lost £300,000 on sales of £4.3 million in 2006, made a £16 million profit on sales of £56 million in 2010.
Source: The Telegraph (the original article has been removed since this page was published, hence no link).
And so, £300 for a pair of boots seems to be the new going rate! Excellent.
If the rapid growth of a brand’s sales gets mixed together with retailers not paying for 105 days, does this mean fashion brands go bust quicker with rapid swings in fashions?

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