Hobbyco mulls sale
Australian toy and hobby retailer, Hobbyco, has posted six per cent growth in sales to more than $10 million over the last financial year, and is considering options for its future ownership structure.
The two owners, Michael Wall and Paul Parker, have decided to investigate a range of options for the future ownership of Hobbyco, including an initial public offering, trade sale or injection of capital through the addition of new shareholders.
Both shareholders are keen for Hobbyco’s footprint to be expanded across Australia through licensing, franchising and online development of the chain’s brand name.
“Michael and I are getting older and we want to pursue other interests. As a result we are happy to step back or step out of the business, which we and many other Sydney hobbyists have held close to our hearts for decades,” said Parker.
The 79 year old, three store Sydney-based chain has grown since 1935 from a small toy shop into a mecca for children and hobbyists.
One of the main engines of growth for the group’s sales this year has been Lego, which boosted its sales through Hobbyco by 20 per cent.
Wall, MD and 50 per cent shareholder of Hobbyco said the company had shown strong growth off the back of Lego and was also performing strongly with its wholesale operations now supplying more than 200 customers.
He said other strong performers in its more than 30,000 products for sale were remote controlled planes and helicopters including drones.
Hobbyco has a strong following from mature customers among the more than one million visitors to Hobbyco’s three stores at QVB, Macarthur Square, and Rhodes.
Parker, merchandise director and the other 50 per cent shareholder of Hobbyco, said one of the key factors in our consistent performance has been our ability to manage the wide range of products the hobby industry has to offer.
“We operate a powerful, inventory tailored computer system, which provides us with live up to date figures, allowing us to maintain a balanced stock level”, he said.
Wall bought Hobbyco in 1989 from his employer Burns Philp and was joined by Parker in 1994, after he left a senior position with Woolworths.
Hobbyco has stuck to traditional toys, rather than venture into the highly competitive and fashionable range of electronic gaming, which have helped to develop and maintain customers’ fine motor skills.
Apart from Lego, the retailer also sells ranges of “nostalgia” products, like Meccano, Airfix plastic kits, Scalextric slot cars, board games and puzzles.
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