Pair of stores ideal fit for new owner

Photo / Thinkstock

Locals and visitors make tracks for profitable Bay of Islands shoe shops.

Two dedicated shoe stores in the Bay of Islands tourism centres of Kerikeri and Paihia are for sale as one going concern business as the only stores of their type in the Far North.

The two Shoestyles stores are prominently located at 49 Kerikeri Rd, in Kerikeri, and in Selwyn Mall, Paihia.

"There are no dedicated shoe-only competitors in the marketplace, giving a new owner an opportunity to hit the ground running with an already successful business," says Alan Broadbent of Bayleys Kerikeri. With manager Paul Jeeves he is marketing the business within two leased premises.

"The enviable position of the business is reflected by its profitability year-on-year," Broadbent says. "With a history dating back to 1978, the business represents the same qualities as its products: longevity, sturdiness, reliability and a great fit for the market.

"New and repeat customers are drawn to the stores by a large range of well-known quality brands on offer, including Hush Puppies, Josef Seibel, Timberland, Converse and Diana Ferrari."

Jeeves says it is a cash business that has achieved consistent earnings. "It is well regarded by local customers from Kawakawa to Kaitaia and by visitors from further afield, including Auckland and Whangarei and beyond."

He says the latest figures from Statistics New Zealand show demand for footwear is growing. Along with clothing and accessories, footwear retail sales reached a combined total of $3.37 billion in 2012 - increasing from $3.36 billion in 2011.

"These figures indicate the growing customer appetite for shoe shopping, and potential for expansion in the industry," Jeeves says.

The Shoestyles' stores stock footwear for men, women and children, along with handbags and shoe accessories such as socks, laces and shoe polish. A user-friendly website for the stores delivers online marketing and sales. In the past five years revenue across the two shops has consistently averaged about $175,000.

The Paihia store has the added advantage of cruise ship visitors who come ashore for shopping.

The lease for the Kerikeri store expires in February 2020 while the lease for the Paihia store expires in January 2016. The annual lease payments are $25,750 and $28,800 - both plus GST.

The first Shoestyles store opened in Kerikeri in 1978 and was bought by the current owners 17 years ago before being relocated to its existing location in 2005. The second store was opened in Paihia in 2002 to accommodate the high tourist numbers.

Broadbent says products are sourced from about 30 suppliers, with whom the owners have long-standing relationships. "The business also belongs to buying group Composite Retail Group, enabling the owners to increase their purchasing power on some products and services."

Five fulltime and one casual staff member are employed across the two stores.

Jeeves says a new owner could take over the successful business and continue it as it is. "But there is also potential for growth, particularly given the stores' reputation and lack of competitors."

Additional branded stores could be opened in areas north of Auckland such as Kaitaia, Whangarei and Warkworth. Alternatively, the business could be franchised.

Jeeves says the current owners are ready to move on to new ventures after 17 years in the business but would be happy to assist new owners with the transition of taking over the running of the two stores.

What's on offer?

The business: Two Northland shoe stores.
Comprising: Shoestyles, Kerikeri and Paihia.
Sales method: By negotiation as one going concern business.
Agency: Bayleys Kerikeri.
Features:

* No dedicated shoe-only competitors.
* Year-on-year profitability.
* Well established since 1978.
* Potential for other stores or franchising.