BOOHOO, the pioneering online fashion retailer started by Mahmud Kamani in 2006, has been a stand-out success story, a result of Mahmud’s foresight when the internet was beginning to transform retail in the early 2000s.
Already supplying clothing chains across Europe, he was keen to set up his own label and trade online, where there were fewer overheads and where he could sell more quickly and cheaply directly from the warehouse.
Mahmud, who followed his father into the clothing business, has already built his own brands in Pinstripe, Starsign and Jogo, while supplying to the likes of Primark and New Look, and knew how to create and sustain brands in the sector. It’s no wonder then that Boohoo, which he launched along with business partner Carol Kane, attracted a valuation of £700million when floated on the Alternative Investment Market in March 2014.
The group celebrated its 15th anniversary last year by outlining plans to create 5,000 new jobs off the back of an investment programme worth over £500m across the UK over the next five years. As it expanded from a single brand in 2006 to a group of 13 world class brands today, the Boohoo group has also grown its global appeal, with almost half of its sales now coming from the US and Australia markets.
Boohoo has bought up a string of companies including NastyGal, Oasis, Coast, Karen Millen and Dorothy Perkins over the years, but their acquisition of the Debenhams brand and website last year, following the collapse of the 242-year-old department store chain, has been a ‘transformational deal’, especially for its significance to the wider British retail landscape. Boohoo has relaunched Debenhams as a marketplace in October 2021, aiming to create the UK’s largest marketplace across fashion, beauty, sport and homeware.
Among the Boohoo group brands, PrettyLittleThing is a special one, founded in 2012 by Mahmud’s sons Umar and Adam whose inspiration has been their father’s success with Boohoo. Selling womenswear, footwear, accessories and beauty products aimed at the age group 16-24, PLT, as it is also known, gained significant traction, and Boohoo bought a 66 per cent stake in January 2017. Three years later, it acquired the remaining 34 per cent stake in a deal that could be worth up to £324 million.
Boohoo’s entry has indeed helped the business to grow exponentially, as it posted net sales of £516 million in the year to February 2020, compared with £55m in 2017.
Umar continues to lead PLT as chief executive, while Adam has shifted his focus to the family’s property business. Mahmud’s youngest son Samir is the chief executive at boohooMAN, which launched its debut collection of non-fungible tokens in December 2021, making it the first brand of its kind to launch a digital collection.
With an active customer base of 18 million worldwide, the group has enjoyed strong revenue growth of 41 per cent in the year to February 2021, reaching sales figures of £1.74 billion. As per its Economic Impact Report, Boohoo’s operations added £559.4m in GVA to the UK economy in its 2020-2021 fiscal, supporting an estimated 8,050 full time equivalent jobs. The gross value added (GVA) equates to around 4.4 per cent of the total UK clothing and footwear retail sector.
While clothing retail has been hit hard by the lockdowns and restrictions imposed to fight the Covid-19 pandemic, Boohoo has traded strongly through the pandemic, but the group has been beset with supply chain problems.
After newspaper allegations about working conditions and low pay at factories in Leicester that supply the group, the group commissioned an independent review, and in September 2020, accepted all the recommendations. Later in November, the group appointed retired judge Sir Brian Leveson to independently check its ‘Agenda for Change’ programme.
The 17 recommendations from the independent review were broken down into 34 deliverables as part of the Agenda for Change, and in September 2021, Boohoo said it has completed 28 of these items, which are governed by a KPMG review cycle.
As part of the measures, Boohoo has published details of its UK manufacturers and its international factory list. It donated of £1.1m to the newly launched Leicester Garment and Textile Workers Trust, which aims to address some of the immediate and future needs of workers within the local garment industry.
“We have made some mistakes but over the past 14 years, we’ve got more right than wrong and we’ve a very fast growing business,” Mahmud told in December 2020 to the UK parliament’s Environmental Audit Committee. The group had ended relationships with dozens of suppliers and factories in Leicester since late 2019 for violating its code of conduct. At the same time, Mahmud has reiterated his commitment to the city. But, he expressed before the MPs how he felt of being unfairly singled out for choosing to support the UK manufacturing. “For us to move out of Leicester, it’s very easy for us to take all our production offshore,” he said. “Lots of people in the fashion industry have moved offshore. We are still here and sometimes, sometimes, it feels like we get punished for it, just sometimes.”
The Kamani family arrived in Manchester as part of the 1968 exodus of Asians fleeing Kenya. Mahmud’s father Abdullah started out making clothes to sell locally, and the enterprising man, whose family originally hailed from Gujarat, soon was importing from India and Africa.
At the hearing, Mahmud described himself as “a market trader who had been very fortunate” and learnt “the ethics of hard work” from his father. As he presides over one of the fastest growing retailers, his definition of himself is a pretty accurate validation of the old saying that hard work and luck are both directly proportional.