King of Shaves gears up for global expansion
Fast Growth Business Awards winner Will King slices up his empire and gains £4m backing
Award-winning shaving brand King of Shaves is to demerge from KMI, following £4m investment to fund its assault on the global razor market.
Will King, who scooped top honours at last month’s Fast Growth Business Awards, announced the strategic demerger this week, which will see him become CEO of the King of Shaves Company Ltd, while business partner Hiten Dayal will head up KMI.
Dayal will manage KMI’s portfolio of 15 other successful brands, which includes licensing deals for Ted Baker fragrances and Fish and Angelfish hair products.
The King of Shaves Original Shaving Oil, which King formulated himself, was the first product to be launched by KMI in 1993, and its range of oils and gels is now the second bestselling brand in the UK shaving prep market, behind Gillette.
The launch of the Azor last June, the first British-made razor in over 100 years, marked the company’s entry into a £3-4bn global market for razors and blades, of which Gillette and Wilkinson Sword control around 95% and Gillette, worth $60bn, is the clear leader.
Around 600,000 Azor handles have now been sold, equating to almost 10% of the UK market, which is worth £400-£500m.
King said the new structure would help raise brand awareness, as well as helping them to realise different aspirations for the two businesses - taking King of Shaves global while KMI continues to focus on the UK.
He told Growing Business: “At the end of last year, I sat down with Herbie [Dayal] and said look, we’ve got two businesses here. We’ve got a King of Shaves growth business, which requires lots of money to be spent on sales and marketing to accelerate its sales. It needs to be run for sales growth, reinvesting the profit, because it’s a unique brand in that it’s only got two competitors.
“The other business needs to be run for sustainable sales growth, with a decent profit growth being booked every year. You simply don’t need to invest marketing spends at 20-50% of sales to do that.
“Simply put, I’ve got to raise more money, and spend more money, on globalising the King of Shaves business, and Herbie will work out which brands to acquire or license, and how much money to spend on developing those brands, but to develop those profitably.”
King of Shaves also announced inward investment of £4m from King’s brother and fellow shareholder Doug King, co-founder and chief investment officer of Aisling Analytics, which manages one the world’s largest commodity funds. This will help fund launches of the Azor in the US, Japan and Brazil later this year.
KMI’s sales topped £61m last year, and King is now looking for further investment to drive King of Shaves’ sales over £100m in the next few years. He said the new structure will provide clarity to investors.
“Everybody knows what King of Shaves is, they get that, but you try and talk to them about the 15 other brands we have and they often don’t get how they fit with a razor brand,” he said. “Simply explaining a King of Shaves investment, brand growth and exit story makes a lot more sense.”
He added that he will look for a partner that understands the brand.
“We can’t do it in the way the guys at Innocent have done it [signing a partnership deal with Coca Cola]. Clearly that’s something we can’t do with Gillette. But in the same way, there are plenty of other global multinationals out there who I’m sure understand the profitability and the growth piece of the razor and blades business as much as I do.”
© Crimson Business Ltd. 2009