Examining young women's surf fashion in August - a dream assignment? Well yes, in part.

Background LDC took Stirling Group plc private in September. Stirling's main business is supplying Marks and Spencer, but it entered the branded clothing market by acquiring the Voodoo Dolls and Headworx brands in November 2001. Both brands sell urban and board-sports inspired youth fashion. AMR concentrated on the women's brand, Voodoo Dolls, which had been re-launched following significant investment in marketing and product design. Voodoo Dolls also offered a children's range, iDolls.

Feedback from retailers on the adult range was positive, but was only translating slowly into sales. The market appeared heavily consolidated around three major global brands, Quiksilver (Roxy), Billabong and O'Neill and competition for remaining volumes was stiff, with dozens of new brands arriving every season. Voodoo Dolls had ambitious plans to grow sales in Australia and numerous European markets and to take market share. AMR's remit was to look at the viability of these plans and advise on how best to achieve them. We were also asked to comment specifically on the prospects for iDolls. Given the tight deal-driven deadline, we had to work at the worst possible time of the year for retailers; it was both the peak sales and buying season and they had little market feedback on Voodoo Dolls' new winter collection, as it was not yet in season.

Approach Our first priority was to get to grips with the key issues. Voodoo Dolls needed volume and hence volume channels to grow and build share. However, it also needed to maintain the brand's "edge" and credibility amongst the grassroots and opinion leaders. Finding the balance was key, making this "the burning issue" within the industry. We focussed on brand and channel management.

First, we looked at the market to make sure that sufficient organic growth would be available to support Voodoo Dolls' volume aspirations. Despite a lack of market sizing data, AMR, working closely with industry experts and competitors, showed that the market potential was larger than management had estimated and that growth, whilst slowing, would remain in double-digits. Next, we needed to establish that Voodoo Dolls could compete for and win its share of market growth. A short series of interviews with consumers (including some on the beaches!) showed that the brand and products had appeal and that mass channels such as department stores and general sports chains did not dominate as retail channels. This was borne out by retailer interviews and store visits. We found that major retail chains and profile stores only dedicated retail space to surf brands with a strong track record in independent outlets and that volumes were mostly consolidated around the three main brands.

A more promising picture emerged withindependent retailers, a number of whom could deliver reasonable volume. Independent "youth and surf fashion" chains existed throughout Australia, where a strong mid-sized channel was well established. This channel was emerging in Europe. These stores sought out newer brands as differentiators and to rebel against aggressive sales tactics of the major brands. Strong second-tier brand positions were available and could deliver up to 40 per cent of a store's volume. It became clear that Voodoo Dolls should position itself to win secondary positions within independent retailers to build volume and share. This focus on the independent channel would also allow Voodoo Dolls to operate within relatively limited resources and to rectify some back-office problems.

On iDolls, AMR quickly discovered there was little synergy between the adult and children's lines. Customers' buying behaviour and retail channel preferences were different. Few retail channels sold both adult and children's clothing. Where they did, in large retail chains or department stores, there were separate buyers for the adult and children's lines and little brand overlap. Additionally, it would require a similar resource and effort to develop the children's brand as the adult brand.

Result AMR concluded that Voodoo Dolls' prospects were strong. We advised that it should focus its activities on key surf markets in Australia, UK and France and on taking share in the independent channel before setting its sights on greater things. On iDolls we recommended Stirling Group plc shelve plans to enter this market, which they did.

"We were really not sure who to use, but were delighted to work with AMR as they helped us focus our strategy in this complex market." Steven Bentwood, CEO Stirling Group

The day after AMR was commissioned on the project codenamed "Nappies", a strange device appeared in the office. Its owner, a proud parent, explained how the Sangenic works: "You insert a used nappy gently into the neck of the device, and it becomes enveloped in a substance like clingfilm. You release the nappy and twist the device's neck, which seals the nappy in the film. You close the device's lid and hey presto! no more smell, no more danger of other small children finding the offending nappy."

The inventors of the Sangenic were Dave Richards and Maurice Williams. With funds from an earlier business, they established Process Improvements in 1989, and gradually built up a business selling Sangenics throughout Europe and Japan, with a licensee manufacturing and selling in the US. Highly talented product designers, they had ideas and working models for a range of new products. Both Dave and Maurice were at retirement age, and they were discussing the sale of the business to George Cornelius, the MD of a key supplier, Niche Plastics. A leading private equity firm was impressed by the product, and wanted to evaluate its growth potential.

We quickly discovered that the prospects for Sangenic were substantial. Distributors and retailers were strongly enthusiastic, and many users were positively messianic: one US journalist became very frustrated during an interview with Bill Gates when the proud new father refused to talk about anything except his Sangenic! In fact the most difficult part of the project was obtaining agreement from Dave and Maurice to contact their customers on a disclosed basis. Even when we had successfully reassured them that no harm would befall the business, Dave was so sceptical that we would be able to hold sensible discussions with retailers in the run-up to Christmas that he actually bet his company that we could not speak at any length with five of them. He lost the bet, but somehow the share certificates never reached AMR's offices.

One of the outstanding issues about the business - the attitude towards Sangenic of the big nappy manufacturers - was resolved by one of those bizarre coincidences which would be hard to believe in a novel. Holidaying in Kenya, one AMR director happened to share a balloon safari ride with a Vice President of Proctor and Gamble. Once the director had convinced him that he did not work for Kimberley-Clark, the P&G man explained the relevant aspects of the P&G strategy.

In the event, the private equity firm did not finalise the deal, unable to satisfy itself that the proposed structure was the best way forward. But the story has a happy ending. The business was acquired by the Mayborn Group, which owned a very successful business in a related area. Dave and Maurice secured prosperous retirements, and George secured a key role in the new business.