Fashnopsis:
- Scotta seeks investor for LatAm & Spanish growth: Menswear brand looks to partner for expansion in Mexico and Colombia.
- Investment over funds: Scotta prioritizes a long-term partner over private equity investment.
- Ecommerce on the rise: Online sales expected to grow, while physical corners see slight dip.
- Rebranding for premium appeal: Scotta revamps brand image to better reflect product quality.
- Spain still king, but LatAm & online on the rise: Domestic market strong, yet LatAm & online sales show promise.
Spanish menswear brand Scotta seeks investment partner to join the company and fund its ambitious expansion plan. The company aims to expand its presence in Latin America and strengthen its domestic market position.
Financing Growth
Scotta has primarily relied on bank loans to finance its expansion so far. This has enabled the company to establish a foothold in Mexico with three corners in Liverpool department stores, its local partner. Scotta plans to open seven more corners in Mexico by the end of 2024, with an additional five slated for 2025.
The company is also in negotiations to enter the Colombian market through the multi-brand channel. In Spain, Scotta recently opened its first franchised store in Valladolid and a new corner for its children’s collection at El Corte Inglés in Castellana, Madrid.
Seeking a Strategic Partner
In its search for funding, Scotta has ruled out partnering with an investment fund. “We are looking for a long-term partner who will allow us to continue with this expansion plan,” Scotta CEO Carlos Serra told Modaes. Serra remains the majority shareholder, holding 95% of Scotta’s capital, with Felipe Roca owning the remaining 5%.
Financial Performance and Outlook
The company closed 2023 with sales of €10.9 million, up 36% from the previous year, and EBITDA of €300,000. Scotta now aims to continue its growth and close the year with revenues of €14 million.
By channel, Scotta’s corners at El Corte Inglés account for 47% of the company’s sales, while online sales represent 12%. Serra expects the weight of e-commerce to increase during the year, while the share of corners will decrease slightly due to a slowdown in business in April and May. “These months have been a bit worse for the company, as the summer season was brought forward when we still had winter product,” Serra explains.
Rebranding and Professionalization
Scotta is also undergoing a rebranding process to elevate the brand and “match the product.” Serra explains that the company’s efforts have so far focused on creating a quality product, which they now want to communicate to the customer. As part of this professionalization process, the Catalan company has renewed part of its team, hiring Laura Palomo as General Manager.
Spain remains Scotta’s main market, accounting for almost all of its sales. However, by the end of the year, the company expects both its online channel and its Mexican business to boost sales.
Image Source: Scotta
