R. Griggs Group Limited

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R. Griggs Group Limited

Cobbs Lane
Wollaston
Wellingborough
Northants NN29 75W
England
(44) 01933 665381
Fax: (44) 01933 664088
Web site: http://www.drmartens.com

Private Company
Incorporated: 1911 as R. Griggs & Co. Ltd.
Employees: 3,800
Sales: £250 million (US$ 500 million) (1997 est.)
SICs: 3143 Men’s Footwear Except Athletic; 3144 Women’s Footwear Except Athletic

Privately-held, family-owned R. Griggs Group Limited is the maker of the world-famous Dr. Martens brand of footwear and clothing accessories. One of England’s leading shoe and boot manufacturers, R. Griggs has steadfastly refused to join the growing trend of moving production overseas, insisting instead on maintaining the majority of its production facilities in its traditional Northampton base, itself the center of England’s footwear manufacturing industry. Indeed, while Griggs has pursued an aggressive investment and modernization program, its shoes are still crafted essentially by hand by the company’s 3,800 employees—many of whom are still paid by the piece—in some 31 manufacturing plants. Together the company produces more than one million pairs of Dr. Martens shoes and boots each week. The company’s sales are also buoyant: from 9.6 million pairs sold in 1996, the company expects to sell more than 12 million pairs in 1998. The company estimated its 1997 sales to reach approximately £250 million.

While the Griggs family’s reputation for quality footwear reaches back for nearly a century, it is the Dr. Martens brand that has made the company’s fortune. Produced under exclusive license since 1960, Dr. Martens have been the favored footwear not only of England’s industrial, mining, and public services work force, but also of its rebellious youth. Among the “mods” of the 1960s, the “punks” and “skinheads” of the 1970s and 1980s, and the 1990s grunge fashion followers, Dr. Martens have gained a lasting, and worldwide popularity, to the extent that, in the late 1990s, more than 75 percent of the company’s sales were generated internationally, in over 70 countries. Yet, if Dr. Martens brand has become a primary symbol of the world’s youth culture—with a recognition rate among the top 100 brands worldwide—the company’s extensive line of styles have also found their way onto the feet of such world leaders as the Dalai Lama and the Pope.

The secret of the Dr. Martens success is its famed air-cushion sole, as well as its high-quality uppers. Boasting of its footwear’s extreme durability and resistance to the harshest industrial environments, the company even goes so far as to offer a five-year guarantee against the premature aging of its shoes. This reputation for quality, in fact, longed served as the Dr. Martens brand’s main form of advertising. Only since the early 1990s has the company instituted an active brand marketing strategy. The success of its marketing activities—conducted through subsidiary AirWair Ltd.—is clear: between 1990 and 1997, the company’s sales increased more than five times. In the late 1990s, the company also moved to bring its distribution activities in-house.

Griggs produces some 500 styles of Dr. Martens boots and shoes. Its leading model, the 1460, however, is also its oldest. The 1460 accounts for approximately half of all the company’s sales. Some 50 percent of these sales come from the 15 to 25 year-old age group. Another ten percent of sales are provided by the company’s industrial division and its “Getta Grip” and “Impact” brand names. In addition to footwear, Griggs has capitalized on the Dr. Martens name by launching a line of clothing and accessories. Since 1994, the company has also operated its Dept. Store, a six-story retail store in London’s Covent Garden. The retail store, which also serves as a consumer research and testing grounds, has been a success, prompting the company to begin plans to open additional retail stores in other markets, including its primary European and United States markets, as well as in the Middle and Far East markets. The R. Griggs Group remains a firmly family-owned company. Fourth-generation Max Griggs is the company’s president, while son Stephen Griggs serves as the company’s chairman.

Early 20th-Century Founding of Griggs

While the Dr. Martens brand would come to define the Griggs Group after the 1960s, the company had already built a reputation for quality footwear going back to the turn of the century. In 1901, Benjamin Griggs and partner Septimus Jones formed a partnership for producing boots in Wollaston, then already a primary center for England’s shoemaking industry. Jones and Griggs eventually split up; Jones formed his own company, called Septimus, while Griggs, joined by son Sebastian, created R. Griggs & Co. Ltd. Over the next 40 years, Griggs would craft a reputation for the quality of its work boots. In the early 1950s, the next generation of the Griggs family took over the company’s direction, with William Griggs serving as the company’s leader. Under William Griggs, the company added a new dimension to the quality of its boots, adopting the Goodyear Welted construction method for attaching the soles. For that venture, Griggs formed Wollaston Vulcanising Co. Ltd., a cooperative with other local shoemakers. By then, Griggs could already guarantee its boots against premature wear. In 1955, Max Griggs, son of William Griggs, joined the company.

The company’s turning point would come at the end of the 1950s, when, through the Wollaston Vulcanising cooperative, it signed an agreement to become the exclusive worldwide producer of an entirely new type of sole developed by Drs. Klaus Maertens and Herbert Funck of Germany. The pair had begun work on their invention in the postwar years, after Klaus had broken his leg on a ski trip in Munich. Walking had become painful, and Maertens sought a means to provide a softer landing for the foot, in order to minimize the shock of each step. Inspired by developments in the automobile industry, Maertens was determined to adapt the pneumatic concept to the shoe. Maertens’ first efforts involved, in fact, cutting apart tires and sewing the pieces to the shoe itself. While this helped minimize the impact, walking remained painful for Maertens.

By 1947, however, Maertens brought his idea even closer to the automobile industry. He next sought a means for trapping air within the sole, which would provide a similar pneumatic cushion. For this step, Maertens would be aided by colleague Funck, who was a director of a small electrical appliance company. Instead of cutting up tires, Funck instead used raw PVC rubber, which, shaped by molds much like those found in waffle irons, could produce soles containing pockets ideal for capturing air. Attaching the soles to the shoe, while at the same time sealing in the air pockets, was achieved by doubling the sole; the first layer was sewn directly to the shoe, while a second layer was heat-sealed to the first.

Maertens and Funck took out a patent on their invention and next sought a means of commercializing it. Their first customers were former soldiers and wounded civilians from World War II, who, like Maertens, suffered from leg injuries that had made walking painful. Word of the invention soon spread beyond Germany’s hospitals, and the partners found ready customers in the country’s factories and mines. With sales growing, Maertens and Funck began looking for an industrial partner capable of meeting the demand for their soles, while also able to provide distribution beyond Germany. A Swiss company, Grosse, became the first to produce the Maertens sole under license. In the 1950s, Grosse had opened a factory in Wollaston, producing for the British market. By the end of the decade, however, Gross had gone bankrupt, and the Griggs company purchased the Wollaston plant.

Griggs was impressed by the Maertens sole; Maertens and Funck, for their part, were encouraged by the Griggs company’s reputation and its guarantee of quality behind its footwear. In 1959, the two sides reached an agreement for the Griggs company to take over production of the Maertens sole. Under the agreement, Maertens and Funck received royalty payments for each pair sold, while Griggs received exclusive U.K. rights to the process. Perhaps in response to the Grosse failure, Griggs also established a sales strategy, based on slow, targeted growth.

In Step with Fashion in the 1960s

Originally called Dr. Maertens Air Cushioned Soles, the spelling of the surname was soon anglicized to Martens. The first pair of Dr. Martens boots were produced on April 1, 1960, and the “1460” became the company’s primary—and for many years only—model. By the end of that year, Griggs sales had topped £250,000.

Griggs continued to target its traditional work shoe market, adding new models, such as the three-eyelet Gibson shoe, bringing the Dr. Martens sole from the mines and factories onto the feet of post office and subway workers. Yet, the company hardly seemed aware of a growing new market that was eagerly embracing the Dr. Martens boot. The rise of England’s youth culture in the early 1960s, particularly the so-called mod movement championed by the musical group The Who, had made the 1460 part of the standard ’uniform’ of any self-respecting rebel. While the impact of the mods on Griggs’ sales was would remain somewhat minimal—by 1970, the company’s revenues remained under £700,000—that culture would help give rise to a later surge in popularity for the boots. Dr. Martens boots remained almost exclusively a British product during this time; less than six percent of sales were made internationally.

Company Perspectives:

Without compromising their traditional values Griggs are positioned at the very forefront of footwear technology. It is a positioning which is a key element for a Group and a brand which is constantly reaching for new frontiers of quality, comfort and style.

The growth in sales, however, had enabled Griggs to make a number of strategic investments. During the 1960s, the company bought out the rest of the Wollaston Vulcanizing cooperative. Over the next 20 years, the company would also buy up many of its neighbors, including Septimus. Far from putting these companies out of work, the growing success of the Dr. Martens boot would enable these businesses to remain in operation, and for Wollaston to remain a primary focus of the British shoe industry.

By 1980, Griggs’ sales had jumped to nearly £22 million. A new generation of youth, among them a subculture known as the skinheads, had discovered the efficacy of the 1460’s steel toe. Moreover, the appearance of the punk music and fashion movement in the mid-1970s brought the 1460 to an ever-increasing audience. As the British-inspired punk scene—and its corresponding fashion—spread beyond the United Kingdom, Griggs’ international sales too began to grow. In 1980, foreign sales neared one million pounds, representing only 4.4 percent of the company’s total sales but having been achieved nonetheless with no marketing effort on the company’s part. In fact, the company would continue to rely on word-of-mouth for its advertising throughout the 1980s.

Branding a Lifestyle in the 1990s

As Max Griggs took over the company’s direction, son Stephen Griggs became the fifth generation to enter the family company in 1980. Griggs continued its acquisition of its struggling Wollaston neighbors, adding the factories and workshops of such names as Septimus Rivett, Humphrey & Smart, Dentón & Stuart, Bayes Bros., Phillips Brothers, GW & R Shelton, Luther Austin Co., John Pick & Co., Sundy Shoes, and others. While England was riddled by an extended economic crisis, stemming from the Arab Oil Embargo of the early 1970s, with unemployment on the rise across the country, the success of the Dr. Martens boot enabled Griggs’ to keep the Wollaston shoe industry’s work force working.

The mellowing of punk music into what was dubbed New Wave brought the Dr. Martens boot to an even wider audience, both in the United Kingdom and abroad. Such ongoing transitions in the music scene helped build the company’s sales. Moreover, while the 1460 continued to sell strongly to Britain’s industrial work force, a surprising new market was developing: more and more women were wearing the Dr. Martens shoe. This trend would continue to build throughout the 1980s and by the next decade had firmly established the Dr. Martens as ’must-have’ fashion accessory.

In the late 1980s, Griggs’ string of acquisitions had given the company not only a growing work force—some 1,500 by 1990—but also a collection of aging production equipment among its 30 or so plants and workshops. Among the shoe industry, a new trend was developing, that of closing domestic plants and moving production to cheap foreign labor markets, such as in many developing Asian countries. Griggs, however, refused to join the trend. Instead, the company began a massive and sustained investment program, upgrading its plants and machinery. In 1989, Griggs would spend more than £1.6 million on capital expenditures. This figure would continue to rise each year through the 1990s, nearing £4 million in 1992, and topping £6 million in 1996.

Through the 1980s, Griggs’ nearly doubled its annual sales, posting 1990 sales of £38 million, including nearly 15 percent from overseas. The 1990s, however, would end the company’s 30-year history of modest growth. By 1997, Griggs’ sales would top £250 million, and the company would forecast a rise in sales to more than £300 million by the year 2000.

If punk and new wave subcultures had brought Dr. Martens to wider numbers of youth, these audiences nonetheless remained rather small. In the late 1980s, and especially in the early 1990s, however, a new music scene appeared and quickly broke through into the mainstream music markets. “Grunge” would adopt not only its musical inspiration from the earlier punk scene, but also some of its fashion sense, particularly its choice of footwear. Dr. Martens became the de rigueur boots and shoes of an entire generation of youth, boys and girls included, not only in the United Kingdom but worldwide. Grunge would also bring Dr. Martens to the United States, a market that had previously shown little interest in the British-made boots.

If Griggs had long relied on word-of-mouth and the fortuitous adoption of its boots—still wholly centered on the 1460 model—by successive generations of youth, the company was determined to build an active marketing program in the 1990s. The company created a new marketing subsidiary, AirWair Ltd., and set out to expand its line beyond the 1460. By 1991, the company was ready to target not just the youth and work markets, but the entire family, introducing eight new product families. Based as always on the Dr. Martens sole, the company’s new products would introduce a entirely new variety of colors and patterns. By the late 1990s, the company could boast some 500 models of Dr. Martens boots and shoes. At the same time, Griggs began to develop an advertising strategy. Recognizing the youth appeal of the Dr. Martens brand, the company would avoid mass-marketing tactics, and instead practice a micro-marketing strategy—including sponsorships of concerts and music tours, and even release of its own compact discs—targeted at its core market. During the 1990s, Griggs would also extend the Dr. Martens brand name into a ’lifestyle,’ developing and marketing a line of brand name clothing and accessories, ranging from t-shirts to cosmetics. In 1994, the company opened its first retail store, called the Dept. Store, in London’s Covent Garden. The six-story complex would serve as more than a retail sales space, becoming a consumer testing and research ground for the developing Dr. Martens line.

As Griggs built its brand image, it also took steps to restructure its distribution. While the company had long relied on a network of primarily British wholesalers to distribute its boots both in the United Kingdom and abroad, in the 1990s Griggs began to bring distribution in-house. The move would enable the company more direct contact with retailers and therefore closer contact with the demands of its customers. Grouped under the AirWair subsidiary, the company created several new AirWair units in the United States, Canada, and Germany. By 1998, the company had taken control of almost all of its distribution, often acquiring its former independent distributors. The change in the Griggs company—now led by Stephen Griggs as chairman—had been dramatic. Sales had grown nearly five times in less than a decade, while foreign sales had risen to account for more than 75 percent of the company’s total. With a strong brand image, and the cross-generation appeal of its Dr. Martens sole, Griggs looked forward to a future of walking on air.

Principal Subsidiaries

Dr. Martens Dept. Store Ltd.; R. Griggs & Co. Ltd.; AirWair Ltd.; Dr. Martens Sports & Leisure Ltd.; AirWair USA Ltd.; Dr. Martens AirWair GmbH (Germany); AirWair Canada Ltd.; Dr. Martens AirWair USA LLC.