A combination of trend-led product and a personal connection with customers has propelled fitness apparel brand Gymshark into triple-digit growth. Drapers meets founder and chief brand officer Ben Francis and chief executive Steve Hewitt.
Casually clad twentysomethings clutching laptops are enjoying the spring weather when Drapers arrives at fitness clothing brand Gymshark’s new headquarters in Solihull, just outside Birmingham. The 42,000 sq ft building is home to space-age nap pods, a virtual reality games area, a hairdresser’s salon and, naturally, a gym. Instagram-worthy slogans such as “Work hard, stay humble” and the cheekier “Don’t be a dickhead” adorn the monochrome walls. It is the dream office for a fitness-focused millennial workforce.
Gymshark moved into the custom-built base from its former home in nearby Redditch last month. GSHQ, as the building is known, is a milestone on the brand’s journey from teenage start-up to a retail force to be reckoned with. While a student at Aston University in 2012, then 19-year-old Ben Francis founded Gymshark with his friend, Lewis Morgan. Francis did not complete his studies, and instead choose to focus on the business. Morgan left to pursue other opportunities in 2016.
The brand is known for its affordable, figure-sculpting gym gear for men and women. Trend-focused products come in technical fabrics – seamless ombré women’s leggings and sports bras have proved a hit for spring 18. Retail prices on its transactional website range from £20 for vests to £80 for parkas.
Today, Gymshark employs more than 160 people and is headed by chief brand officer Francis and chief executive officer Steve Hewitt, who joined in 2014.
“We built this place for two reasons,” explains Hewitt. “The first part is about our guys coming into work and being wowed every morning. We want to give the team a facility where they can maximise the talent they have. The second part is about recruitment. If we’re going to move to the next phase, we need to attract and recruit world-class talent.”
Turnover for the 12 months to 31 July 2017 more than trebled by 217% year on year to £40.5m, compared with £12.7m for 2015/16, and is set to hit £100m for its current financial year.
Profit before tax rocketed to £8.2m for 2016/17, up from £1.1m the previous year. This earned Gymshark the number 46 spot on research company Fast Track’s list of the 100 private companies with the fastest-growing profits in 2017. With total sales growth of 112% over three years, Gymshark is also number 12 on Fast Track’s 2017 list of companies with the fastest-growing sales – which it topped in 2016 with three-year sales growth of 193%.
“It went straight in at number one on our Sunday Times Virgin Fast Track 100 ranking in 2016,” says Richard Tyler, editorial director at Fast Track. “The City’s retail analysts think the company Ben and Steve have built is one of the most innovative retailers they have seen for a long time.”
Analysts are not the only ones who are impressed: Gymshark took home the award for Best Pureplay Etailer – Turnover Under £50m at the Drapers Digital Awards last week.
Gymshark has carved itself a niche in the crowded sportswear market by building a relationship with its customers that stretches beyond just clothing. It understands precisely what its core demographic of fitness-addicted 16-to-25-year-olds want, as well as who inspires them.
We want our team to be as accessible as possible to the wider Gymshark community
It has created a highly engaged following through its network of fitness influencers. These “Gymshark Athletes” include social media stars Robin Gallant (669,000 Instagram followers), Nikki Blackketter (1.8 million) and Steve Cook (2 million). They promote the brand via social media content, and travel the world with Gymshark to meet fans. Francis talks about the “Gymshark family”, and these ambassadors become an integral part of the brand.
“One of the examples I always use is that if I wanted to meet, say, a Nike[-sponsored] athlete, the closest I’m likely to get to them is if I pay to go a football game and see them from the stands,” he explains. “We want our team to be as accessible as possible to the wider Gymshark community.”
This has been crucial, says Fiona Paton, a senior retail analyst at market research company GlobalData: “Gymshark has used fitness stars wearing the brand and promoting it online with great success, allowing it to reach its target market directly.”
Natasha Fish, head of fashion at research company Stylus, agrees: “There’s a much bigger push taking place around engagement [in the sportswear market]. Really savvy brands are tapping into the power of influencers and focusing on creating engagement strategies.”
As well as engaging personally with its audience, Gymshark sells direct to the consumer – it has no wholesale stockists. The model stems from its early days, when Francis, who had previously built several websites and apps, launched the site to sell fitness supplements. It moved into clothing after he struggled to find the kind of fitted gym gear he wanted, so he taught himself to sew and screen print.
This direct approach, Francis and Hewitt argue, allows Gymshark to control its own destiny, by collecting and acting on customer feedback. Although both recognise the advantages of working with retailers – Hewitt says JD Sports is “absolutely smashing it” – Gymshark’s ongoing triple-digit growth means it has no current plans to explore wholesale, or to open its own bricks-and-mortar stores. It is therefore able to stay nimble and take “brave” decisions larger brands would be unable – or unwilling – to chance.
“It may be a product decision – it may be that there’s a trend just about to evolve or evolving,” says Hewitt. “The big brands will look at that and say, ‘OK, great,’ then go through a whole lot of red tape to sign it off. That might take six months. Then they’ll spend months delivering that product to market. We’ve got the ability to get that product to market in eight weeks, if we really want to do it, and we’re not compromising on quality.”
Francis agrees, pointing to Gymshark’s 2016 World Tour, on which it travelled to the east and west coasts of the US, as well as within the UK and Ireland: “We didn’t make a single sale. All we did was meet with the fans. For a more commercially driven business that would not make any sense, because we spent hundreds and thousands of pounds on flights and hotels – for literally zero return. However, what we learnt about the fans and the business doing something like that makes it well worth it for us.”
Hewitt and Francis make a good team, and say their strengths lie in different areas. Francis concentrates on product design, branding and marketing, while Hewitt looks after “everything else”, as he puts it. Key decisions are made with Gymshark’s board, which includes chief strategic officer Paul Richardson and chief operating officer Chris Perrins.
The business prides itself on having an open, accessible working culture, rather than locking its senior team away in distant corner offices.
Francis and Hewitt come across as approachable and down to earth, and good-naturedly endure some light teasing from passing members of the Gymshark team as they pose for Drapers’ photographer around GSHQ.
A keen football and tennis fan, Hewitt has held senior positions at Reebok and Adidas. He started at Gymshark as a consultant in 2014, before becoming managing director in June 2015 and CEO two years later.
My job was to put foundations in place, so the business could grow in a sensible, sustained manner
“The analogy I give is that the guys had built a house and had already started to put a couple of extensions on the house, but actually, the foundations weren’t properly set,” he says. “My job was to put those foundations in place, so the business could grow in a sensible, sustained manner.”
Although Francis says welcoming Hewitt into the fold was easy, letting go of other parts of the business as it grows has proved more of a wrench: “With Steve, it was a very gradual process – it was one day a month [as a consultant], then two days, and it went from there. We instantly clicked, so it wasn’t an issue. Funnily enough, the biggest issue for me was going from doing everything, within reason, to doing a lot less.
“Because I have a development background, I really enjoyed doing a lot of the IT stuff, so to see someone else doing that did feel like having my heart ripped out at first. But as soon as you trust those people and realise they are better at something than you are, it becomes a lot easier.”
The next phase of growth will focus on international expansion, helped by the new office, which the brand hopes will bring global talent to Birmingham. Although it already sells to 177 countries, its next ambition is to become “more local on a global level”.
“Our trading team’s view is UK- and US-centric. Those territories are a big part of our business, so we need them to keep doing that, but we need more people,” Hewitt explains. “If we’re really going to work locally, globally, we need to live and breathe that. We do a very good job in some markets we’re in, but in terms of the scalability opportunity, I’d say currently we’re a ‘two out of 10’ business.”
Francis adds: “Yes, we do sell internationally, but I wouldn’t deem us as truly global yet. We’ve dipped a toe into international markets but recently we’ve understood that having people from the countries where we’re trying to build a presence [working for Gymshark] is so important, because they know so much more about the market and the trends.”
Brazil, China, Japan and Russia are all on Gymshark’s shortlist of prospective new markets, although a firm decision has yet to be made.
Hewitt and Francis obviously love what they do, and both admit that they rarely, if ever, switch off from all things Gymshark. Despite being proud of its rapid growth, they are equally clear there is still plenty left on their to-do lists.
As Hewitt puts its: “Most businesses doing what we’re doing with an average employee age of 26 would be high-fiving each other every two minutes. What we’re good at instilling is that, yes, we’ve done great, but there’s still so much more left in the tank.”