The fashion industry has undergone dramatic changes over the years, with waves upon waves of new trends aggressively disrupting the industry’s landscape in a profound way. In recent years, the “fast fashion” trend (describing the fast pace through which the latest designs are translated into affordable clothing) stands out as one of the greatest disruptors of the fashion business in the 21st century.
What is most surprising however, is that not only has fast fashion retailers become the dominant leaders of the fashion industry as a whole, but they are also more often than not family-owned businesses. In fact, family businesses make up the entire list of the world’s largest apparel retailers in the world, highlighting how the fast decision-making process that is unique to family businesses can be leveraged to revolutionise and dominate industries.
Take a dive into the list of the top five largest fashion and clothing retailers in the world (ranked by revenue, 2018):
5. L Brands
Country: United States
Revenue: $12.6 billion
Owning Family: Wexner
Founded in 1963, the L Brands family includes some of the world’s most recognisable retail banners, such as Victoria’s Secret, PINK, Bath & Body Works, Henri Bendel and La Senza.
The son of Russian Immigrants, Leslie Herbert Wexner, started with a single store named The Limited in Columbus, Ohio, and first-year sales of $160,000. He expand the business through a series of acquisitions, securing 100 locations by 1976, and a listing on the New York Stock Exchange in 1982. That same year, the company acquired Victoria’s Secret and their six locations.
Today, L Brands operates more than 3,000 stores with specialty brand sales in 80 countries and more than 800 franchised locations globally. Leslie H. Wexner remains the company‘s chairman and chief executive officer.
4. The Gap
Country: United States
Revenue: $ 15.9 billion
Owning Family: Fisher
The Gap was founded in 1969 by Doris and Donald Fisher in Ocean Avenue, San Francisco. The couple invested $63,000 into the company, which recorded an astounding $2 million in sales in just two years. The retailer soon began to aggressively pursue expansion in the local market, managing 25 outlets by 1973. The decades that followed would see the company expand under the leadership of the Fisher family into international markets and establish itself as a powerhouse in the fashion industry.
Today, The Gap controls five international brands – Gap, Banana Republic, Old Navy, Athleta and Intermix – and manages over 3,165 stores in 90 countries, with an additional 459 stores operating under franchise agreements. Although the Fisher family is no longer active in the day-to-day running of the company, they maintain a 44 per cent stake.
3. Fast Retailing Co.
Revenue: $18.2 billion
Owning Family: Yania
Fast retailing Co is a Japan-based fashion retailing company best known for its leading subsidiary UNIQLO. The company can trace its roots to 1949, when a tailor by the name of Hitoshi Yania founded a roadside menswear shop called Ogori Shoji. His son, Tadashi Yanai, began his career selling kitchenware and men’s clothing at a Jusco supermarket but soon joined the family business in 1972. In 1991, the company Fast Retailing Co and was listed on the Hiroshima Stock Exchange. Three years later, it became the fastest-growing retailer in Japan, making Yanai Japan’s richest individual.
Today, Fast Retailing Co is a leading player in the fashion industry with revenues of $18.2 billion and was ranked 32nd on Forbes Most Innovative Company in the World list for 2018.
Revenue: $22.7 billion
Owning Family: Persson
H&M is the second largest fashion retailing company in the world. Founded in 1947 by Erling Persson in Västerås, Sweden, the store (originally called Hennes) was a women’s clothing specialty retailer. It later expanded to include menswear after the successful acquisition of men’s clothing brand Mauritz Widforss. The acquisition also resulted in a change of name to Hennes & Mauritz, which was later changed to H&M for easy pronunciation as the company began to expand into international markets.
Today, H&M controls global brands such as H&M, COS, Weekday, Cheap Monday and Monki and operates 4,739 stores in 71 markets, with 47 online markets. The company continues to be actively managed by the Persson family, with Erling Persson’s son Stefan leading the firm as Chairman of the Board, while Stefan’s son Karl-Johan works as President and CEO. The Persson family also collectively controls a 46 per cent stake and retains 74 per cent of the voting rights.
Revenue: $28.8 billion
Owning Family: Ortega
Inditex, best known as the owner of Zara, is the largest fashion group in the world today, with revenues of $23.27 billion. The family-owned business can trace its beginnings to 1975 when Ortega Amancio, together with his wife Rosalia Mera, founded a small clothing retail store in A Coruna, Spain. Originally called Zorba, the store was forced to change its name to Zara when it was discovered that another business went by the same name. In the 1980s, the company implemented a new design and distribution method that drastically reduced the time between design, production and arrival at retail sites, incorporating emerging computer technology in the process.
Ever since, Zara has been at the forefront of the fast fashion revolution, operating a highly efficient supply chain and inventory system, allowing the latest designs from fashion shows in New York, Paris and Milan to be rapidly translated into affordable clothing sold at Zara stores across the globe within just 15 days. Inditex also manages a number of other brands including Zara Home, Massimo Dutti, Bershka, Oysho, Pull and Bear, Stradivarius and Uterqüe, for a grand total of over 7,400 stores across 96 countries worldwide.