Q&A: Søstrene Grene CEO Mikkel Grene on its rapid UK expansion and the power of franchising

Søstrene Grene is a family business – tell us how it began and at what stage you got involved. 

I’ve been involved all my life. It’s family-owned and family-operated; we’re really the second generation now. I’m the CEO and my brother’s our creative director. We own it 50/50.

I’ve been CEO for 11 years but, in the beginning, my parents had the office in the house, so we were always really involved and everything was discussed over the dinner table. 

My parents bought a building on the high street and ran all kinds of businesses at the time. But they needed to come up with something for the first floor, to get people up to it. So what they came up with was this really quite extraordinary store, which was quite unique – is still quite unique. I remember several times when I went there with my parents and we helped do whatever needed to be done in the store, then we’d fall asleep in in a cardboard box in the corner. It was a small business back then and it really kept on like that for many, many years.

Do you think being involved in the business from a young age makes it easier or harder to be CEO?

I see it as a huge advantage because it runs in the blood. It’s part of our heritage and upbringing, what we carry with us from our childhood, and it’s just such a big part of our life. So it becomes really natural just to live this lifestyle and to create the whole culture. 

You’ve been expanding across Europe with franchises, but you also have company-owned stores. What’s the mix looking like now?

We have 35 stores that are 100% owned by us and we also have some stores that are joint-venture-based operators. So about half the stores are either owned by us or partly owned by us, and then the other half are purely franchise-driven. 

What’s the advantage of the franchise model?

My father started out with franchising back in 1989. It was brand-new back then and the idea was that there should be somebody in the store who owns it, so they are really invested in it personally and financially, and they should also have a long-term perspective on operating it.  

Today that’s still the main reason it works for us, especially when you’re entering new countries. We have these local people that really are passionate about the stores, they have this ownership and they also help us make sure that we localise the concept.

When you first arrived in the UK, you opened in non-traditional cities before looking at London. What was the reason behind that? 

We decided to have an opportunistic strategy, where we opened in the places where we found a good location, rather than saying: ‘OK, now we do London’ or ‘Now we do Scotland’. 

We find a lot of good options in smaller cities and suburbs with much lower rents. That has worked out pretty well for us because when we opened in a very large city, like in the middle of Manchester, for example, it would take several years to get the brand awareness up unless we opened a lot of stores. Because we do have a limited marketing budget – it’s not like we have a huge run of TV advertising – so that’s slowly working to spread the message. If it’s a small city, we will get brand awareness really quickly because there are a lot of cities where high streets are suffering, stores are closing and people are leaving, so when someone decides to open in their city they will really roll out the red carpet. 

Where do you see the biggest opportunity for growth in the UK? 

We hope to be all over the place – we really want to get our stores around a lot of different cities all over the UK – but obviously the big one is London. We’ve been looking a lot at opening inside London, so we’re starting out in the suburbs and working our way in. It’s pretty expensive still, but now it seems like we are getting there slowly.