Ex-Boots boss hopes to spark Revolution. Optical Revolution business sets sights on London with bold expansion plans, Optician Magazine

Optical Revolution, the high street opticians business, has announced it is planning a £1m raid to buy an optical retail chain in London.
And the ex-managing director of Boots retail operations has emerged as one of the figures behind the multi-million pound programme to create a new multiple in the profession.
Ken Piggott, who left Boots two years ago, and his Optical Revolution colleagues expect to make their first high-profile acquisition in the New Year with the purchase of a number of outlets in the capital.
As non-executive chairman Piggott is a key member of the optical retail concept fronted by ex-Tempo Electrical boss Michael Kraftman. Chief executive Kraftman launched Optical Revolution in Colchester in 2001 with plans to launch a national business of over 200 stores.
Since then the group has best been described as a ‘sleeping giant’ – having big plans but opening just one further store, this time in Norwich.
However, all this is about to change. Kraftman told OPTICIAN this week. The business, Optical Partners plc, has raised an initial £1m by the issue of five million ordinary shares at 20p each through an ‘offer for subscription’.
‘We’re using this money to make its first acquisition, a small group of opticians in London,’ he said. ‘As it’s in “legals” at the moment with a confidentiality clause and an “exclusivity” clause until contracts are signed, it is sensitive on both sides.’
The group is aiming to complete the transaction at the end of January. He said this was the first phase of a four-part plan to acquire up to 300 stores, and the business aimed to attract £3.5m in this funding round which would finance the acquisition and refurbishment of a total of 10 outlets.
During phase two, anticipated to be within 12 months, the company plans to float on AIM, and add a further 30-35 stores, bringing the total to 45. Phase three will a group of 80 stores and phase four will bring the total to 250.
Piggott joined Boots in 1970. He became beauty business general manager in 1986, then managing director of Children’s World, Do It All, Halfords and Boots The Chemists successively.
Michael Kraftman told OPTICIAN: ‘Our concept of pulling together hundreds of small retail outlets, branding them, and applying modern retailing principles will give us the clout to go against the big four chains. With our mergers and acquisitions adviser Katalyst Ventures, we are already in the advanced stages of negotiations with several groups of our second phase.
‘We have tested the Optical Revolution concept in two stores. These have given us a proven model of aggressive pricing, cut-through advertising and state-of-the-art systems. We will maintain the customer base of the acquired business, stop the slow attrition to the big chains, and acquire new customers through aggressive marketing.
‘What really makes us different is our product range and our pricing policy. The pricing strategy of the major players incorporates gross margins of up to 90 per cent return.
‘We source our products through UK distribution channels and have negotiated extremely good rates both for unbranded products and designer names. The very high margin structure within the industry allows us to be aggressive on price while still enjoying average gross margins of 60-70 per cent.
‘All frames are priced inclusive of basic lenses, with additional lens option prices published in an easy-to-understand format. This structure also supports the pricing policies of the designer brand distributors by avoiding explicit discounting of the frames themselves – while still maintaining a highly aggressive designer offering. The top four retail opticians have a combined market share of around 47 per cent. This represents a relatively small share in comparison to other retail sectors.’

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