Whitehead & Sons, Stuart Graham Reach Distribution Agreement
January 17, 2003
South Africa - David Whitehead & Sons, acquired by entrepreneur Stefano Magni from Tongaat Hulett for an undisclosed sum in June last year, has struck a deal with Stuart Graham Furnishing Fabrics to distribute all its branded products in South Africa.
Based in Port Elizabeth, Stuart Graham, the biggest independent furnishing fabric converter and wholesaler in the country, complements its ranges by sourcing curtaining and upholstery fabrics from all over the world. The ranges are supplied to independent retailers, decorators, wholesalers, interior designers and the hospitality industry.
The company also exports its original design ranges, some of which are outsourced to manufacturers, who convert them into fabric that is sold under the Stuart Graham brand name.
''However, David White-head will continue to distribute to its local chain store customers, which account for the bulk of its domestic sales,'' Magni said. ''It will also retain control of its exports, which have grown from R60 million two years ago to over 30 percent of output in rand terms.''
Stuart Graham is one of David Whitehead's largest customers. The synergies of the open-ended agreement will allow both companies to benefit from one another's strengths.
Whitehead & Sons is now able to tap into Stuart Graham's distribution and marketing expertise and its 4,000 strong customer base.
''As a result, the company has been able to cut costs by closing its Johannesburg distribution center to avoid infrastructure duplication costs,'' Magni said.
Graham said his company would benefit from carrying the Whitehead brand name and by using its manufacturing expertise to fill gaps in the market.
''The deal has also enabled Stuart Graham Furnishing Fabrics to gain a foothold in the readymade market, which has great growth potential,'' he said.
The companies will retain separate identities but are co-operating on product development, with designers collaborating to produce original ranges.
David Whitehead & Sons turnover has climbed 25 percent from R378 million last year to R475 million as the market has picked up. Furnishing fabrics account for one-third of its 24-million meter production a year. The balance is sold to South Africa's top apparel manufacturers, who are scrambling for local textiles to meet the requirements of the Africa Growth and Opportunity Act (Agoa).
Jack Kipling, chairman of the Clothing Industry Export Council, said many more opportunities were being created for local textile manufacturers, who were gearing up to meet the challenge of supplying the continent's apparel industry when the exemption allowing lesser developed countries (LDCs) to source fabrics from outside eligibile sub-Saharan countries expired in September 2004.
The Act, intended to promote the textile and clothing industries in sub-Saharan Africa, gives eligible countries the advantage of exporting duty- and quota-free to the U.S.
Magni said exports are key to the future growth of the company.
''While output has increased 30 percent over the past 18 months, David Whitehead is focusing on producing better quality products, rather than on increasing volumes,'' he said.
David Whitehead has established cordial relations with the Southern African Clothing and Textile Workers' Union. F&FI
Based in Port Elizabeth, Stuart Graham, the biggest independent furnishing fabric converter and wholesaler in the country, complements its ranges by sourcing curtaining and upholstery fabrics from all over the world. The ranges are supplied to independent retailers, decorators, wholesalers, interior designers and the hospitality industry.
The company also exports its original design ranges, some of which are outsourced to manufacturers, who convert them into fabric that is sold under the Stuart Graham brand name.
''However, David White-head will continue to distribute to its local chain store customers, which account for the bulk of its domestic sales,'' Magni said. ''It will also retain control of its exports, which have grown from R60 million two years ago to over 30 percent of output in rand terms.''
Stuart Graham is one of David Whitehead's largest customers. The synergies of the open-ended agreement will allow both companies to benefit from one another's strengths.
Whitehead & Sons is now able to tap into Stuart Graham's distribution and marketing expertise and its 4,000 strong customer base.
''As a result, the company has been able to cut costs by closing its Johannesburg distribution center to avoid infrastructure duplication costs,'' Magni said.
Graham said his company would benefit from carrying the Whitehead brand name and by using its manufacturing expertise to fill gaps in the market.
''The deal has also enabled Stuart Graham Furnishing Fabrics to gain a foothold in the readymade market, which has great growth potential,'' he said.
The companies will retain separate identities but are co-operating on product development, with designers collaborating to produce original ranges.
David Whitehead & Sons turnover has climbed 25 percent from R378 million last year to R475 million as the market has picked up. Furnishing fabrics account for one-third of its 24-million meter production a year. The balance is sold to South Africa's top apparel manufacturers, who are scrambling for local textiles to meet the requirements of the Africa Growth and Opportunity Act (Agoa).
Jack Kipling, chairman of the Clothing Industry Export Council, said many more opportunities were being created for local textile manufacturers, who were gearing up to meet the challenge of supplying the continent's apparel industry when the exemption allowing lesser developed countries (LDCs) to source fabrics from outside eligibile sub-Saharan countries expired in September 2004.
The Act, intended to promote the textile and clothing industries in sub-Saharan Africa, gives eligible countries the advantage of exporting duty- and quota-free to the U.S.
Magni said exports are key to the future growth of the company.
''While output has increased 30 percent over the past 18 months, David Whitehead is focusing on producing better quality products, rather than on increasing volumes,'' he said.
David Whitehead has established cordial relations with the Southern African Clothing and Textile Workers' Union. F&FI