A colourful proposition
Following the buy-out from WH Smith, Graphite Capital successfully grew the Paperchase business, trebling annual sales.
In June 1996 Graphite led the management buy-out of Paperchase, a specialist retailer of stationery products and greeting cards. At the time of the buy-out the business had 12 stores and made an operating loss. Under Graphite Capital’s ownership a number of successful retail concepts were developed for the brand and rolled out in a variety of locations.
The business presented scope for significant growth in several different store types and locations. Paperchase developed flagship stores, stand-alone stores in high profile sites, railway station outlets and concessions in leading retailers. By developing a relationship with Borders, Paperchase was able to accelerate the programme of in-store concessions using a highly successful model.
Under Graphite's ownership, Paperchase:
- increased the number of stores from 12 to 61
- developed a wide range of formats including two flagship stores, nine stand-alone stores, six railway outlets and 44 concessions
- recruited a strong retail team including a new Chairman, Finance Director, Operations Director and IT Director
- made a loss-making business profitable and generated cash to fund the store expansion programme
- trebled annual sales from £7.7 million to £27.4 million
In 2004 Paperchase was sold to Borders, the US-based book, film and music retailer, generating a multiple of 3.0 times cost.
