Entrepreneurs - Jane Rafter

Part-time office manager Jane Rafter produces a confident pitch for her luxury, customised sandals, reporting sales of £37,000 in her first year of trading.

Peter Jones asks whether she has a registered design patent on the product and Jane replies that she has a patent pending, one that should be granted in the next six months.

Theo Paphitis discovers that it is on the interlocking bead system that connects the uppers to the base of the sandals.

Peter then asks Jane about her profit margins and Jane replies that her costs are £45 per unit, and that she sells on to boutiques for £60 and to customers for £120.

James Caan interjects at this point that the costs are far too high.

Duncan Bannatyne wants to know about her three year projections and while she confidentally rattles off figures for the three year period she becomes unstuck when Duncan asks whether the figures include a salary for herself. The fact that she cannot put a figure on her salary in Year 3 suggests to the Scot that she cannot possibly know what her costs might be.

Deborah Meaden adds to the London based designer's woes by pointing out that while the sandals look fabulous they are not very comfortable and while she attempts to adjust the strapping on Deborah's sandals Duncan decides to walk away.

He points out that people don't want to have to read how to put a pair of shoes on once they purchase them - and for that reason, much as he likes Jane personally, he is out.

Peter Jones is quick to follow suit. For him the bottom line is that the business will not make money - there are similar products available at a fraction of the cost on the High Street and for those reasons he is out.

Theo Paphitis wants to know how Jane will spent the £75,000 investment.

Jane says she wants to move production to India so as to bring costs down and increase sales.

James Caan asks how much she thinks a move to India might mean and Jane predicts it could bring costs downm by a third.

The Dragon sugests this could mean her wholesale cost would then be £20 and she could retail for £40.

Deborah Meaden intervenes and says that while she could overcome a ill-fitting sandal in the Den, she feels there is less wriggle room for her as an investor to make money and for those reasons she is out.

Theo says the product can be replicated and the pricing is wrong. However he is prepared to make her an offer - half the investment she is after for a 20% stake. The offer is dependent on her reducing her production costs and increasing her volumes to retailers.

James Caan thinks Jane has a beautifully made product and is prepared to match Theo's offer on the same terms and conditions.

Jane is being offered the money she came into the Den seeking but will need to surrender 40% of her company. She attempts to negotatiate the equity but to no avail - in the face of Dragon intransigence, she agrees to the deal on the table.

The deal done in the Den:

Theo Paphitis and James Caan: £75,000 for a 40% equity in Slinks.