Betta Living’s boss reminds us a bit of TV’s David Dickinson. But was his best transaction the Real Deal? Stuart Anderson hastily conceals his Ikea loyalty card as Noel Dean reveals...
Noel Dean, the proprietor of the Betta Living kitchen and bathroom chain, is an old-school salesman who cut his teeth at Burtons and Wade Furniture in Manchester city centre in the 1960s and 1970s.
“I’ve always been a salesman,” he tells EN. “I think in the UK it’s sort of a dirty word, isn’t it? But I think everyone’s a salesman and I’m quite proud of it really.
“If you’ve got integrity there’s nothing wrong with asking for the order, is there?”
Having supplemented his young family’s income by working as a Sunday salesman for kitchen companies Neville Johnson and Kitchen Queen while he was a manager at Burtons, and then enjoying the discretion Wade Furniture gave its salespeople to choose and price their own lines, Dean ploughed his life’s savings – some £5,000 – into setting up the English Kitchen Company in 1984.
The firm initially sourced its kitchen units from Bacup-based J&J Ormerod before opening its own factory in Oldham in 1987.
“We have been in the same building since ’87,” Dean says. “We’ve put an extension on it and we’re working on another extension now.”
The business, which now sells both kitchens and bedrooms, turned over £18 million in the year to 30 November 2009 and, says Dean, is on course to increase that to £24 million this year.
Sales are made out of 17 showrooms and from exhibitions in shopping centres around the country, and the firm either employs or contracts fitting and design work out to around 400 people in total.
Because of differences in pricing (kitchens cost more than bedrooms), turnover is, Dean says, split 51:49 in favour of kitchens but unit sales are 2:1 in favour of bedrooms. Profitability is similar for both aspects of the range – contributing to a modest pre-tax margin of about four per cent.
Between 1984 and 2001 Dean built up the English Kitchen Company to a turnover of £7 million, generated from six stores. Then he did the deal he identifies as his best.
Dean says he had known John Good, the owner of Stockport headquartered Betta Bedrooms, for four or five years and had been talking to him for at least 12 month before finally convincing him to do the deal that saw Dean buy the £4 million-turnover business – and its four showrooms – in 2001. He then changed the name of the merged company to “Betta Living”.
The price he paid remains undisclosed but, he says, “Like most deals, if you think it’s a fantastic deal afterwards then I don’t think it’s really a good deal. Maybe I feel I paid a little too much and maybe John thought he didn’t get quite enough. So it was wellnegotiated and I think we’re both satisfied.”
The price, whatever it was, was paid out of a combination of cashflow and a loan from NatWest.
In tandem with the deal Good also sold the site on which his own factory, in Stockport, was based to Tesco, so needed an acquirer who could accommodate his manufacturing operation – which Dean was able to do at his Oldham plant.
“I wanted to buy the business anyway because it had a good synergy with us,” Dean says. “The deal made a lot of sense to me because we could put kitchens in the bedroom showrooms and bedrooms in the kitchen showrooms, and then we could move the factory.”
And, as an added bonus, there were no nasty surprises: “What I would say about John, and he lives in America now, is that everything he told me about the business was as he said. You get all the lawyers [Dean used Stockport firm Gorvins] and accountants and you sign up to all the due diligence but it really wasn’t necessary.”