Brand Acquisition Opportunity:

 

linensource

Offers Due Thursday, July 13, 2017 @ 5 PM ET

BACKGROUND

 Hilco Streambank is currently seeking offers to acquire the LinenSource® brand and related intellectual property assets including its trademarks, domain names and customer database (the “Assets”).

LinenSource® is a leading catalog and e-commerce retailer of bedding, sheets, and home décor products in a variety of original and uncommon designs. The LinenSource® mail-order catalog was first distributed in 1991.  Since then, the brand has expanded its offerings and its retail presence through the e-commerce website www.linensource.com. Today, LinenSource® is a well-trusted brand known for quality bedding selections including quilts, comforters, coverlets, bedspreads and fine-quality sheets in mix-and-match collections. In addition, LinenSource® offers a curated assortment of rugs, curtains and decorative accessories among its strong home décor product lines.

Current Situation

 LinenSource® is a member of the Bluestem Brands family of catalog and e-commerce retail brands.  Bluestem has made the strategic decision to divest the LinenSource® brand to focus its resources on the balance of its brand portfolio.  Acquisition of the Assets offers a buyer the opportunity to access an engaged and loyal customer base with a strong affinity for the LinenSource® brand and its product offerings.

An Engaged Customer

LinenSource® uses various channels to communicate with its customers including catalogs, LinenSource.com, email marketing and social media.   In FY2016, 13.1MM LinenSource® catalogs were distributed in 16 separate mailings to a total of 2.6MM unique addresses.  During that same period, LinenSource.com recorded just over 2MM total visits of which over 60% were first time visitors. These consumer touches generated sales through three order channels: web, phone, and mail.  Below are the LinenSource® household level buyer counts across all channels sorted by recency:

Transactions

Time Frame

Customer Database

LinenSource® maintains a database of over 2.2MM customer files with 485K opt-in email addresses and 1.63 MM physical addresses. The customer database contains an “Active” email list of about 111K email addresses that have interacted with LinenSource® email marketing campaigns within the last 18 months. LinenSource® communicates with its customers by email about four times per week, excluding additional trigger and transactional emails, averaging a 15.2% open rate and 1.74% conversion rate.

In addition, catalog distributions are sent to various subsets of the 1.63MM LinenSource® mailing address list throughout the year driving over 80% of total brand revenue. LinenSource® captures and tracks the following customer data fields: name, address, email, and purchase history among other data points. The customer database contains transaction data for the 3.6M orders fulfilled since 2003. 

Financial Data

LinenSource® generated $26.6MM, $23.5MM & $21.3MM in sales for FY14, FY15 & FY16 respectively through its web, phone, & mail order channels.  In FY2016, LinenSource® generated revenue of approximately $10.9MM through phone orders, $8.8MM through web orders, and $754K through mail orders. Approximately $17.8MM of FY 2016 revenue can be attributed to marketing through the catalog. Customers who receive the catalog have the option to complete transactions through any of the three order channels.

Demand by Channel

                                                                *Demand does not include ship revenue or returns,

                                                          but it does include cancels and adjustments for out of stocks.

Assets for Sale

Trademarks:

  • Linen Source®123
  • LinenSource®

Domains:

  • linensource.com
  • linen-source.com
  • linen-source.org
  • linensource.reviews
  • linensourcecatalog.com
  • linensourcecatalog.net
  • linensourcecatalog.org

Customer Database:45

  • 2.2MM customer files
  • 485K opt-in Email addresses
  • 1.63MM physical mailing addresses
  • 102K buyers in the last year; 190K in the last 2 years.
  • Average spend of ~$150 per transaction.

  

Access to an online Data Room with detailed diligence information regarding the offerings will be provided upon execution of a non-disclosure agreement.