Perspectives from ISB

The world’s four biggest fashion businesses today – GAP, Zara, H&M and Uniqlo’s are all family-owned. All the four firms were able to take advantage of cheap manufacturing in the 90s, in China and other Asian countries. Perhaps that huge entrepreneurial success allowed the family to keep control, with no need for outside shareholders.

Sweden’s H&M is in its third generation of family management, with Karl-Johan Persson as CEO. Doris Fisher, who co-founded GAP with her husband Donald is still on the board of the company, as are two of their sons. Zara is part of the Inditex group, owned by the secretive Spanish billionaire Amancio Ortega Gaona. Finally Uniqlo – or rather parent company Fast Retailing Co – is owned by its Japanese founder Tadashi Yanai who evolved the company from his father’s tailoring business.

Zara’s success is based on getting the latest fashions to market faster than anyone else. Uniqlo concentrates on staples that will never be out of fashion. H&M founder Erling Persson found a way to produce more cheaply than it had been. And the secret of GAP was to buy a small number of products and sell them in every possible size. The innovations at GAP and H&M were pure retail concepts. The product was almost immaterial.



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