Mountain Warehouse founder Mark Neale explains the thinking behind his new women’s ‘athleisure’-wear brand and retail chain Zakti.
“Why do yoga pants have to be so expensive?” This is the question that Mountain Warehouse founder Mark Neale asked himself, prompting him to set up a new brand and chain of shops aimed at sporty women.
“I genuinely don’t know why yoga pants are so expensive. It’s a very curious market in that regard”
Mark Neale, Zakti
The brand, called Zakti, initially includes about 350 product lines covering gym, yoga, running, cycling, skiing, dance and swimming kit. Prices range from £5 to £250.
“I genuinely don’t know why yoga pants are so expensive,” Neale tells Retail Week. “It’s a very curious market in that regard.”
Neale is looking to capitalise on the growing ‘athleisure’-wear sector, which is driving the £6bn UK sportswear market. The launch will set it in direct competition with the likes of fellow British retailer Sweaty Betty.
Zakti, which means energy and strength in Sanskrit, also boasts its own stores. Two opened in London earlier this month – in Islington and Chiswick – while an ecommerce site is already live.
The Islington site is 3,000 sq ft across two floors, and Chiswick is about 1,800 sq ft on one floor.
Looking ahead, Neale reveals that up to 10 more stores are planned for London and the home counties, with other major cities such as Manchester and Leeds also expected to be targeted. However, he declines to say what figure he has in mind for a total store estate.
For the time being, Neale will remain focused on establishing the Zakti brand, especially among the blogger community.
Growth market
Neale said he was attracted to the “fast-growing” sector as the current offer is predominantly at the higher end of the market.
It has taken around a year to develop the products, which are being sourced from the same suppliers in Asia that Mountain Warehouse already uses.
Though Neale says the products will be competitively priced, it is not going down the discount route.
The stores have a premium finish, benefiting from the £1.5m being invested in the brand. “We think our shops look as good as a lot of others in the market,” he says.
Looking ahead
Zakti will do particularly well online, Neale believes. The Zakti website offers free delivery for orders over £30, as well as free returns.
“Sales online will be quite a high proportion, potentially around 50%,” he says. “The core customer is very online-savvy.”
While Zakti will initially only target women, Neale is also looking to launch a men’s range next spring.
“It won’t be as big – around 100 products,” he says.
Neale also envisages the brand working on an international basis. “We have Mountain Warehouse in Germany, Poland and Sweden, and we see Zakti working in all those places and beyond,” he says.
And with the global market for fitness and leisure gear now totalling $35bn (£23bn), there is plenty of scope for growth.
From toy shop ‘disaster’ to international empire
Mark Neale jokes that it took him 10 years to become an overnight success. Mountain Warehouse was his fourth attempt at setting up a business, including failed attempts at establishing a toy shop – “an absolute disaster” – and selling roller blades.
But since setting up Mountain Warehouse in 1997 with £40,000 capital, the former management consultant has developed an impressive empire, now boasting more than 220 stores across the UK, Poland and Germany. It clocked up a 25% increase in full-year profits to £12m in its last financial year and by the end of this year, the retailer will have opened 34 new stores.
A physics graduate, Neale’s mantra is offering accessible products that are value for money. “I tell our staff I want my mum to feel comfortable in our shops, and she’s 73,” he explains.
With Zakti, he clearly feels there is a gap he can exploit. And it ties into his belief that there is plenty of life left in the high street. “We don’t subscribe to the ‘death of the high street’ argument,” he says.
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