By Simon Duddy, Editor, Logistics Matters

SPEAKING AT a Q&A session on November 11, Kane, Boohoo founder and group executive director at Debenhams, said the business had been through challenging times.

“I would say we bought too many brands too quickly. We over-expanded and took on too much warehouse,” she said. “We should have consolidated some brands into labels.”

Kane said every brand had been given the same treatment, including its own app and website, even though they were at very different levels. “In hindsight, I wouldn’t have put the same effort into every brand. My learning is to focus on the most important wins.”

The group has since cut its warehouse network from five sites to one. It has also gone from running lots of websites to five “powerhouses”. Kane described the last two years as transformational.

She said logistics is the biggest barrier for online fashion businesses that want to grow. It is easy to set up a brand, but the hard part is working with logistics partners. “Many brands will get to a stage where they struggle to scale up. You’ve got to think about the SKU count,” she said.

Debenhams Group now runs as a marketplace that holds little cash or stock. “Sitting on 20,000 SKUs for six weeks is difficult,” Kane said. Partner brands plug into the platform and handle their own fulfilment, while the group takes a commission. Because it holds no stock on those sales, the group makes a 100% gross margin on them.

Kane said consumer expectations have changed completely over 20 years. “If they want it tomorrow, deliver it tomorrow,” she said.

“Shoppers are now more comfortable trying clothes on at home, so easy returns matter. So do pick-up points and lockers. There is this whole service industry for the customer that wasn’t there 20 years ago.”