Card Factory is attracting the attention of private equity houses after owner Charterhouse put the greetings card retailer up for sale. Retail Week takes a look at the Card Factory business.

  • The 650-store value greetings card retailer Card Factory has grown rapidly in recent years due to its low priced products, which have helped it take share away from its rivals.
  • It manufactures its own cards which keeps costs low and means it can sell quality cards at lower prices.
  • Card Factory was named as one of the key reasons for Clinton Cards’ collapse last year due to its more value-driven proposition, while Clintons’ products were seen as over-priced.
  • Meanwhile, its stores are much smaller than Clinton Cards’, covering at least half the size.
  • It was founded in 1997, the year when it opened its first store, by couple Dean and Janet Hoyle. Prior to this Dean had sold cards out of a van.
  • Less than 10 years later, in 2006, the company had dramatically expanded, recording sales of £100m. This was 10 times the figure just four years before.
  • Private equity firm Charterhouse acquired the retailer in 2010 in a deal reportedly worth more than £350m.
  • Card Factory is led by chief executive Richard Hayes and he has ambitious plans to double the number of stores in the long term to 1,200.
  • But store growth is limited to the UK, as the rest of Europe does not have the same card-sending culture.
  • In 2011, the firm bought online personalisation retailer Gettingpersonal.co.uk. In the nine months to January 2012, during which time the company was acquired by Card Factory, sales at Gettingpersonal.co.uk stood at £9.9m, on which it generated an operating profit of £0.4m.
  • Now Charterhouse is pushing ahead with a sale of the company after it appointed Ernst & Young to look at its options late last year which included a possible float on the stock exchange.
  • It is understood that the private equity firms interested in the retailer include Cinven, Advent International, KKR and CD&R, which bought value retailer B&M last year.
  • In the year to January 2012, Card Factory’s sales jumped 11% to £254.3m. Pre-tax profit edged up 1% to £56.2m after the retailer had to absorb the VAT increase from 17.5% to 20%.

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