Catching up with Meli Melo

Own a slice of luxury fashion brand, meli melo. This luxury handbag manufacturer is getting huge demand pull from China which represents over 30% of its business today and is growing substantially. Join the other 52 investors who have invested so far in just a few days since the campaign launched.

Tell us about your business and your USPs.

We design and manufacture luxury handbags and accessories for men and women with our outsourced partners in Florence, Italy.

Our USP is that each bag has an eye-catching design, accompanied with versatile handle functionality, allowing each handbag to be worn in multiple ways. Chic and understated, meli melo gives you the confidence to showcase your own individual style.

What sets you apart from your main competitors?

We compete globally with brands such as Marc Jacobs, Sophie Hulme, Alexander Wang, and Philip Lim. You can find our handbags displayed alongside these well-known names in any department store.

We consider ourselves different because we produce high-quality and uniquely-designed products made in Italy, yet at an amazingly affordable price. Quality is key for us in this affordable luxury proposition.

Why is this the right time for investment?

We have achieved a huge amount with little to no budget. We raised just £150k in 2013, and grew the business to £5.5m at our peak in 2017/18, before deciding to part ways with our wholesale agent, as we realised the company was going in a direction we had not initially intended. This has resulted in improving our Gross Margin for Wholesale by 5% year on year for two years.

How will you deploy the investment from your campaign?

We are already beginning to optimise our new growth strategy with the support of our new Chairman, Richard Styles, who started working with us in July. Our Digital Marketing has had a 4:1 investment return consistently for the past five years, but with reallocation of funds we have taken this up to a 6:1 return, and we believe we can increase this to 8:1 as we optimise our spend allocation further.

Until now we have never had significant funds to leverage our growth plans, and so we believe now is the time to build on our data further and advance our new customer acquisition strategy. For example, in Affiliate channels we are now getting 10:1 returns consistently, and so we simply need to spend more to acquire new customers. At the moment our efforts are bringing in over 88% new customers, and we are also driving a fantastic repeat purchase rate of 21% with a customer lifetime value of £800. We have some really exciting statistics here, but now it’s time for us to grow.

How confident are you about the future and do you have any concerns over Brexit?

We are really excited about the future and are confident that we have a strong business model going forward. We are very much a data-driven brand at our core; we remain agile and open to exciting opportunities and understand how to convert this into revenue.

We have just sent the bags to Nordstrom, and have also been approached by a major Airline Distributor. This was a breakthrough for Anya Hindmarch, who produced travel kits for first-class passengers, and so we are confident this will be an impressive milestone for the brand.

Brexit should be on the radar for all UK companies, and we think the SME sector is underprepared about the potential impact. Despite being a small company, we have made contingency plans in the unlikely event of a hard Brexit to move our warehouse to Florence in Italy, next to our outsourced manufacturers. We have also advanced all our production so it will already be in the UK in February 2018. We believe interesting opportunities could arise out of Brexit, and we are excited to see where the future will take us.

You can invest in meli melo today, just head over to the investment opportunity here.

Investments of this nature carry risks to your capital. Please invest aware.

Doug Ker

Guest author: Doug Ker CEO at Meli Melo

After 18 years in the City, and an MBA under his belt, Doug left the world of Reinsurance as Head of Operations for a $2bn revenue NYSE Listed Insurance firm. In 2013 he joined forces with his wife Melissa to create luxury handbag company meli melo.