INVESTMENT CASE
THE GROUP OFFERS A COMPELLING CASE FOR INVESTORS LOOKING FOR EXPOSURE TO THE COUNTRY’S RETAIL SECTOR WITH A FOCUS ON A HIGH GROWTH SEGMENT OF THE POPULATION. INVESTORS SHOULD CONSIDER THE FOLLOWING FEATURES WHEN EVALUATING A POTENTIAL INVESTMENT IN THE LEWIS GROUP:
CLEAR STRATEGIC DIRECTION
- Focused on core business of furniture retailing
- Primary focus on high growth LSM 4 – 7 target market
- Lewis one of most recognisable furniture brands in SA
PROVEN BUSINESS MODEL
- Integrated credit and marketing strategies
- Centralised credit approval and granting process
- Decentralised cash collection process
- Differentiated and exclusive merchandise ranges (refer to ‘customer-focused business model’.)
INDUSTRY-LEADING CREDIT MANAGEMENT
- Credit offered across all brands
- Advanced application and behavioural risk scorecards
- High proportion of credit business
- Opportunity to sell insurance to credit customers
SUSTAINED FINANCIAL PERFORMANCE
- Historically high operating margins
- Operating margin target of 26% by 2013
- Low cost structure
STORE-BASED CUSTOMER FOCUS
- Long-term personal relationships developed with customers
- 55% of business to existing customers through re-serve programme
STORE FOOTPRINT
- National coverage of 548 stores
- Presence in all major metropolitan and rural areas
- Stores conveniently located for needs of target customers
- Targeting to open 150 stores in three to four years
EXPERIENCED MANAGEMENT TEAM
- Strong blend of company and industry experience