The Adams Success Story

Adams is the world's largest designer and producer of clothing for children aged 0-10 years and will sell over 50 million items in the next year. A growing network of international partners has contributed to this phenomenal success and we aim to double the number of Adams franchises over the next three years.

Adams has a strong business model and proven techniques for establishing profitable new stores in the UK and international markets. With a relatively low investment, you could soon be a franchisee sharing in our success.

The company

Adams was founded in Birmingham in 1933 by Amy Adams. Since staging a management buyout from Sears in 1999, the company has operated as a private, independent business. We now employ over 4,000 full and part-time staff and turned over £246 million in the last financial year.

Over the last 18 months, Adams has diversified by forming a series of business partnerships. In addition to our standalone stores, we now have departments in Littlewoods, and supply Sainsbury's for its TU kidswear range and Boots for its Mini Mode range.

The Adams group of companies now trades from over 1,000 UK distribution outlets and 86 international outlets.

Refreshing the Adams brand

Over the last year we have taken major steps to re-energise the Adams brand by updating our brand identity, product ranges and stores. Our refreshed stores are bright and spacious with improved accessibility and changing rooms and a more fashionable look to offer an exciting experience.

A new logo and fascia will be used across all Adams stores this year and we have also started to trial a brand new store format, featuring new equipment, lighting and in store signage in two existing UK stores and a new international store from the end of March '05.

Why adams kids?

'Adams' is an instantly recognisable international brand. It has a solid reputation for customer satisfaction and value.

The word 'kids' has been adopted into the company name in order to bring a feeling of casual informality and friendliness to the brand. It is felt to be less formal and more modern and friendly than 'children'.

Since we established our first international partnership in Saudi Arabia in 1997 up to our most recent opening in Lebanon in 2003, partners have been playing an increasingly important role in the success of Adams Kids. Adams Kids currently operates through 86 stores in 17 countries, primarily in the Middle East and Europe.

The Adams Kids brand and business model translates effectively across all international markets and we continue to strengthen existing relationships and build new partnerships around the world. Over the last year we have opened seven new stores in existing markets and aim to double our partnerships over the next three years.

Who are we looking for?

Adams Kids would like to develop long-term relationships with franchise partners who can demonstrate the following qualities:

• An established company (or individual) with a thorough understanding of the fashion and the retail market within which the franchise will operate.

• The necessary skills and experience to run a strong retail business.

• The ability to select items from the Adams Kids range that are suitable for the childrenswear market within which it operates.

• The financial capacity to support the growth and development of a substantial franchise business.

• A willingness to emulate the Adams Kids brand and culture.

We:

• Are the largest, specialist childrenswear retailer for 0-10 year olds in the UK.

• Have a sound business with a strong financial record and proof of successful franchised outlets - our franchise stores increased sales by 11% at UK retail prices in the year to July 2004.

• Have a strong, viable business model to successfully establish new stores in the UK and international markets - Adams Kids currently has 86 franchise stores in 13 countries.

• Can prove our ability to convey the Adams business format and techniques to a franchisee so that they can be successful in their market place.

• Can prove that our product can be sold profitably.

• Have a dedicated support team for our international business providing strategic, operational, marketing, buying and merchandising support.

• Have a comprehensive franchise agreement, which protects both the franchisor and franchisee equally.

You:

• Make a profit within the first two years of trading, on average.

• Have a profit margin of approximately 50%. (This is subject to the price positioning agreed for your market and the rates for freight and import duty.)

• Receive an agreement to operate exclusively in a territory or market for up to 10 years. This is renewable by mutual agreement, subject to achieving agreed milestones/targets.

• Pay a franchise fee equivalent to 25% of the landed cost of goods in the UK. This achieves a sales density of approximately £250 per square foot at UK equivalent prices. (The average yearly order of products for one store is around £90,000 to £120,000 based on a 1000 sq ft store/93 m2.)

• Pay a one off market entry fee, which depends on the size and long-term growth potential of your territory or market.

• Make an initial outlay of between £60,000 to £100,000 for shop fitting.