Toytown, the family run toy retailer based in Newtownards, was established with a small shop on the Castlereagh Road, Belfast in 1979.
Forty years on it is one of the largest independent toy retailers in the UK and Ireland with 235 staff working across 33 stores, including 10 outlets in Northern Ireland.
While much of the retail sector has endured one of its most challenging years, Toytown has seized new opportunities for growth and the company has opened five stores since August – in Poole, Worcester, Lisnagelvin, Uxbridge and Abbey Centre in Belfast. Five further stores are planned for next year.
Alan Simpson, owner and managing director of Toytown, says: “We’re a very successful and well-run business. We have always reinvested to ensure we can work through periods of tougher trading. We started the year in a strong financial position but when our stores were closed overnight due to the coronavirus lockdown, its impact on our cashflow was immediate.”
That is where Bank of Ireland UK stepped in. “We have been a Bank of Ireland UK business customer from the start and have worked with Aaron, our business manager for the last 10 years – we have a good relationship and that’s never been more important than in this year,” Alan says.
“We made a request to the bank for support which we would not ordinarily need, and they were very quick to respond and ensure we had all we needed to help us navigate the challenges of Covid-19 so we could come out as a strong business the other side and we have.”
Aaron McAuley, business manager, Bank of Ireland UK says: “With lockdown looming Alan was immediately concerned about ensuring his March payroll and that stock already committed from manufacturers, which was at sea, could be met from impacted cashflow.
“The Bank provided an initial emergency working capital overdraft of £1m. This ensured that the immediacy of staff wages for March and April would be met without issue, pending the UK Government Job Retention Scheme coming online, as well as paying for stock already en route.
“The bank also approved a £500,000 Stockline facility to be there in case of need for future stock procurement needs.
“The principal support was then provided via a £1m term loan supported by the Coronavirus Business Interruption Loan scheme (CBILS) which, depending on the duration of Covid-19 and lockdown, the impact on the retail sector generally, and a range of assumptions about staggered recovery, would be sufficient to see the business through the next 12, 24 to 36 months.”
Alan says: “Over the 12-week lockdown from March to June, the business was close to £2.5m down on sales but with our busiest trading period ahead of us from October through to Christmas it was crucial we were supported and ready to meet our customers’ needs when we reopened and I’m delighted the bank could help us in that endeavour.”
When Toytown reopened many of its stores in June, there were signs of pent up retail demand as trading was above expectation. Toytown’s focus has always been on physical stores but since the pandemic they have invested in a new website with an increased offer for customers to ensure online business is secured.
Alan’s three sons have followed him into the business with roles in accountancy, buying and logistics and he believes the strength of their operation is in fine tuning their offer and their ability to adapt quickly to changing circumstances and to seize opportunities as they arise. Citing purchasing of stock or taking leases on new premises as examples, he says as a small family business they can make instant decisions where larger retailers may need months of planning.
“Bank of Ireland UK have been incredibly supportive right through our journey. They have shown confidence in us and helped us to grow to this level,” Alan says.
Aaron says: “I am delighted we were able to support Alan and his management team in the early days of the pandemic as they protected jobs and secured the future viability of the business. The business has not only been able to protect its immediate future but seized new opportunities and opened new stores. With prudent financial management and Alan’s reputation within the Toy Retail industry I am sure there will be more to come.”