Hawick-based knitwear firm Lyle & Scott, which was bought last year by the investment group Harris Watson, is to be split in two in a radical reorganisation which will see the design operation moved south from Scotland to London.
Robert Kimpton, chairman and managing director, said yesterday: ''We have two distinct businesses - brand development and knitwear manufacturing - and the restructuring will give us better management focus on those two activities and direct our investment much more clearly.''
Lyle & Scott, which increased turnover to more than #30m last year, claims to be the biggest producer of lambswool knitwear in
the UK.
Unions representing
the 230 production workers at Hawick are expressing concern, however, at a move that will see the Liddesdale road factory in a free-standing role. This will require it to seek its own customers in addition to providing continued production for Lyle & Scott.
Kimpton said: ''The two divisions will no longer be joined at the hip and will be freed up to fully exploit their potential, rather than hiding behind each other.''
Marketing, design, and development will continue to operate
as Lyle & Scott from the new
London headquarters. The
Hawick production plant will be known as Elaness Manufacturing. Elaness, which also has a small garment-finishing plant in Kelso, at present devotes 85% of its production to Lyle & Scott products, with other output going to ''own-label'' customers, such as Johnstons of Elgin and Edinburgh Woollen Mill.
Both divisions will continue to be controlled by a single board, still headed by Kimpton.
Lyle & Scott has just emerged from an uncertain two years, during which it was sold by Courtaulds to the Sara Lee Corporation, which quickly put it on the market again. The
company was bought in December for an undisclosed sum by UK investment company
Harrison Watson, which, said Kimpton, has given the management team free rein to pursue a strategy which includes the development of a successful
niche market in golf wear endorsed by Lee Westwood.
Lyle & Scott has also built up licensing agreements in Japan, Korea, North America, South Africa, and Australia. This week, Kimpton is flying to China to sign a deal which will put Lyle & Scott departments in stores in Shanghai and Beijing. He said: ''There is a lot happening with the brand world-wide.''
The GMB union, however, says it has serious concerns about the future impact on the borders workforce of the manufacturing division standing on its own.
John Farries, district organiser, said: ''The contract market is desperately cut-throat, with an increasing number of companies sourcing cheaply abroad. We will be monitoring the situation closely.''
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