The business formally started in 1922, when on their way to New York, the Berwins discovered Leeds, and thought it an ideal location. The company initially started to manufacture raincoats, however, due to prominent sales during the Second World War, they expanded and concentrated on suits, seeing it as a product of the future. At this time, Leeds was seen as the clothing centre of Europe. Foreign competition started to cause problems for the company, especially as they had invested more capital into management and industry, with cheap access to labour and materials. This left a third generation market in the UK, with ageing equipment and materials.

In the 80’s, they moved away from being an independent manufacturer (selling to individual customers), and sold their products to London based companies, the output 1500 suits per week. To survive, they had to sell to bigger retailers, and bought Langthwaite factory, which came with a garment division left by the previous owners. Production increased to 6,500 suits per week. Price became a major factor in keeping up with competition, so they invested more in brands (making items under the name of other companies, e.g. Ben Sherman), rather than selling private label (producing items with their own name), which left them with enough products to satisfy all types of customers.

Berwin and Berwin started making suits abroad in the late 90’s, and closed the factory in Leeds as a place of production. They expanded overseas and found an English owned company in Hungary who were willing to sell, for a nominal exchange. They employed 1600 people, and made 12,000 suits a week. This meant the factory in Langthwaite had to be downsized to produce 2,500 suits a week. Leeds became solely an administrative and distribution site, and now only employs 450 people in the UK.

Primarily, Berwin and Berwin supplies to the UK market that is non- Marks and Spencers. Out of all the manufacturers who supply to non- Marks and Spencers, Berwin and Berwin is the largest in terms of production and capacity. Berwin and Berwin supply to many high street shops, such as ‘Next’, ‘House of Fraser’, ‘Slaters’ and ‘John Lewis’, to name a few. A further 25% of all products are exported to outside the UK for sale in Paris. The Product The primary product manufactured by Berwin and Berwin is men’s suits. Other products include some ladies business suits. Of their own brand products, they manufacture men’s casual wear, shirts and ties.

Recently, Berwin and Berwin have decided to sell their suits 2-fold: Branded, and Private label. ‘Branded’ operates when the customer gives Berwin and Berwin the specifications and requirements for the suits, which are then made with the label of the customer inside it. ‘Private label’ suits are those made by the company, and then labelled with their own brand names; ‘Berwin and Berwin’ and ‘Daniel Hector’. It is clear from the results that the collection period is continually reducing, which means that cash flow and liquidity will be improving. These figures however would have to be checked against the official credit policy of the business, i.e. a credit controller in the accounts department, should be monitoring any overdue payments, and chasing them up. It must be remembered though, that having a long debtors collection period is often used as a viable marketing strategy.

These evaluate the financial stability of the business for the short-term by studying the relationships between current assets and liabilities. (‘Current’ implies less than one year) This ratio essentially shows the balance between cash and assets that will soon be converted to cash, and debts that will soon have to be paid into cash. Generally, the higher the value, the better, as a low value may mean that the business may not be able to pay off its debts. However, an extremely high ratio may suggest that the business is inefficiently using its long-term finance. Below is the calculation for the current ratio from 2000.