The Business
JTF is a cash & carry discount wholesaler and retailer of a wide range of household and seasonal products, with annual turnover of around £50 million. It operates from nine locations across the North of England and the Midlands, with the units largely situated in out of town locations. The head office is located alongside its central distribution centre in Tuxford, Nottinghamshire, adjacent to the A1.
Through the strength of its supply chain, JTF is able to source products at highly competitive prices and to offer to its members everyday products at consistently low prices and one off “bargains”. JTF has more than 350,000 active members and is in the process of expanding its store portfolio, which will include the introduction of ‘open to the public’ stores.
The Transaction
Endless stepped in to acquire the business in Spring 2009 and provided turnaround funding to support the business ahead of its working capital build for the key Christmas sales period. The business was incurring consistent and substantial losses and consequently was unable to invest sufficiently in new stock for each key sales season. The investment from Endless and the subsequent equity provided by the new management team has provided a firm financial base from which the turnaround in performance can be driven, in the process securing the future of almost 700 jobs.
Value Creation
Since the Acquisition the business has been completely restructured. The Company now has a strong balance sheet, an appropriate capital structure and modest levels of debt. Endless has replaced the Executive team and introduced Anthony Solomon, a retail specialist and entrepreneur, to run the Company. In two years profitability has been re-established through reductions to the Company’s cost base, re-engineering of the buying department and processes and a successful drive to increase footfall and membership levels.
Like for like sales have been dramatically improved and the shareholders are now embarking on a new phase for JTF by rolling out new stores. Two stores were opened in 2010, including a new format. 2011 will see further new store openings and retail initiatives to further enhance the profitability of the Company.
The Endless Difference
At a time when both investors and banks were withdrawing from UK retail, Endless and Anthony Solomon were prepared to support JTF and help drive its turnaround. The JTF business has delivered two years of strong profits, with the prospects for the future looking to be extremely positive as more stores are opened across the UK. The approach and partnership developed by Endless and Anthony Solomon is, in our view, a unique and successful offering to UK retail turnaround.