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The Sosandar recipe for triple-digit growth

Julie ali sosandar driv

Fresh from winning twice at the Drapers Digital Awards 2019, the two bosses of womenswear etailer Sosandar have their eyes on new product categories and global markets.

”We want to be a global one-stop shop,” says Ali Hall, co-founder and joint CEO of womenswear etailer Sosandar. “In five years’ time, we want to be doing what we’re doing now all over the world.”

The latest non-seasonal collection

The latest non-seasonal collection

It is this ambitious and forward-thinking attitude that caught the judges’ attention at the Drapers Digital Awards in 2019, and helped Sosandar to be named both Best New Online Business and Digital Team of the Year. Judges said the company, which was launched in 2016 by Hall and joint CEO Julie Lavington, was “a well-rounded business that executed its business plan brilliantly, resulting in an impressive growth story”.

Lavington and Hall now plan to take the brand’s glamorous but wearable womenswear worldwide, expand digitally, and enter new categories, but all at a steady pace that befits today’s tough market.

The start-up has snowballed since its inception three years ago. In its latest results, Sosandar – which is derived from the word for “beautiful” in Hindi – reported a 268% increase in gross profits to £2.4m for the year to 31 March. Revenue more than trebled, rising 228% to £4.4m compared with £1.36m in 2017/18. EBITDA loss was reduced to £3.5m in the period, down from £6m the year before. Gross margin improved to 55.5% from 49.4%.

Drapers meets the pair on a sunny morning at Sosandar’s headquarters in leafy Wilmslow, part of Cheshire’s “Golden Triangle” famed for its wealthy residents. The office is situated opposite an Aston Martin showroom. The Sosandar team moved into the 4,500 sq ft space in 2018, after outgrowing the building next door. It is already seeking to upsize again to accommodate its growing workforce, which has swelled from six at launch to 31.

Sosandar raised £6.3m when it floated on the London Stock Exchange’s junior Aim market in November 2017. In October 2018, it raised a further £3m through a share placing arranged by investment firm Shore Capital, before securing £7m via a new share issue this July.

“The IPO came about because we were starting to look for the next round of money, and one of our board members had a colleague who looked after a cash shell that had been wound down,” Lavington says. “He was looking for an interesting business to invest in, so we did what is called a reverse merger. 

“We had no idea we would become a public company. But from all the people we spoke to – the venture capital companies, the individuals who were clamouring to invest – we decided to go down that road.”

As their funding depends on share issues, their approach to growth – in terms of timing and amount invested – is cautious. Next, they plan to move into bigger headquarters in the town. 

Their five-year strategy focuses on two key areas: first, “nailing” Sosandar’s UK offering by launching into new product categories and investing in digital marketing to acquire more customers, and then expanding internationally.

Sosandar sells “ageless” own-label clothing in monthly drops. Created by an in-house design team, it is aimed at women aged between 20 and 60. Categories include dresses, denim, leather jackets, knitwear, footwear, workwear and occasionwear. Retail prices range from £25 for tops to £795 for outerwear, while footwear ranges from £75 to £120. It sells via its own website and, since June, on the marketplace of womenswear etailer SilkFred.

From print to prints

Hall and Lavington’s fashion experience, business nous and knowledge of what women want have helped them to build the fast-growing start-up. Following careers in fashion and lifestyle consumer magazines, Hall and Lavington were commissioned by TI Media (formerly known as IPC Media and Time Inc) in 2006 to launch a new women’s magazine.

They were given 18 months to work out where the gap in the market was and create a publication from scratch. The duo came up with Look magazine – a fashion and celebrity weekly – which launched in February 2007. Under editor Hall and publishing director Lavington, it quickly became one of the biggest-selling fashion magazines in the UK and transitioned into a large-scale digital business, too.

We saw an opportunity: this unserved segment of women who were graduating from fast fashion

Julie Lavington

From around 2010, Look launched fashion ranges with high street retailers, including Simply Be, Little Mistress, Debenhams, Office and Oasis.

“We were heavily involved in the designing, manufacturing, marketing and selling of the collections,” Lavington says. “That’s where we started this transition from media to retail.

“At Look, we saw an opportunity: this unserved segment of women who were graduating from fast fashion. There was no ecommerce brand targeting that market. When we started doing the ranges [with retailers], we knew it was the prime time to launch an ageless, trend-led brand at affordable prices. To cut a very long story short, we built a five-year business plan and went out to look for investment.”  

Hall laughs: “We raised money by doing tons of presentations. I think the funniest one we ever did was a Friday night in a church hall in Yorkshire. We were successful in raising £2m in start-up capital from private investors so that we could leave our jobs and set up Sosandar.”

In November 2015, Hall and Lavington left Look, which folded last year. They started to build Sosandar using the initial investment, before launching in September 2016.

20190515 drapers digital festival evening awards winners 7

Julie Lavington and the Sosandar team at the Drapers Digital Awards

Ecommerce experts

This joint media expertise and a 14-year friendship are what they believe is key to Sosandar’s success, but apart from their shared beachy blonde hair and lilting Mancunian accents, the co-founders could not be more different. Hall, clad in a Sosandar rock-glam leopard print mesh dress, is creative, while Lavington, sporting a pretty own-brand red floral dress, is a “financial data and spreadsheet geek”.

Hall says: “[Sosandar is] strong creatively, but also incredibly strong on the data side. It’s quite unusual to have that, and it’s down to having two co-founders with completely different skillsets.”

Lavington adds: “I think we’ve come at fashion with a really fresh eye. Because we came from a fast-paced media background, we’ve come at it from an entirely different angle, but with very strong retail skills.”

Anusha Couttigane, principal fashion analyst at retail consultant Kantar, says: “Sosandar is operating in an interesting space where its female audience has slightly more defined needs. Sosandar is meeting those needs because of the expertise of its co-founders.

“There are not an awful lot of players at that price point. A lot who have been in that space have struggled – such as Karen Millen and Monsoon – or fallen out of the market. They hadn’t evolved fast enough. Sosandar is in a much better position to do that.”

They are talented female entrepreneurs who work hard and care about making customers happy

Emma Watkinson, SilkFred

Sosandar has built a loyal customer base through social media, print and digital marketing.

The founder’s media backgrounds helped to gain initial traction, through their PR and stylist contacts. Collaborations with style bloggers and celebrities, including Amanda Holden, Holly Willoughby, and Fearne Cotton have helped amass a highly engaged and active Instagram following of 34,000.

Sosandar also offers a free monthly subscription brochure, featuring style advice, the latest collections and exclusive offers.

The team now wants to invest in acquiring further customers via digital marketing. In September, it made its first foray into television advertising, with a controlled test in the north-west with ITV. Its success has led to additional TV testing being undertaken in other regions in the next few months. Sosandar has also started to use out-of-home digital media for the first time: campaign advertising appeared across digital panels alongside station escalators at London underground stations, including Euston and King’s Cross St Pancras.

“Brochures and social media were our first marketing channels, and have always been a big part of our marketing strategy, but it is constantly changing and developing, and we’ve had to go up a notch”, says Hall. “Digital, outdoor marketing across the country is the next focus for us.”

The pair are also looking at other ways of capturing a wider audience.

Lavington says: “Sosandar is doing really well [on SilkFred’s marketplace], so we’re looking at potentially selling through other avenues, which could be on a wholesale model or selling through other [marketplace] websites.”

Emma Watkinson, CEO and co-founder of SilkFred, says: “Sosandar is a great brand for SilkFred because not only do they create pieces that are really wearable at an accessible price, they are also talented female entrepreneurs who work hard and care about making customers happy.”

Product push

The latest non-seasonal collection

The latest non-seasonal collection

Future plans for Sosandar include expanding into new product categories. 

The product selection has already grown from 80 styles at launch to around 600, but Hall says there are more untapped opportunities: “Extending the product range is massively on our agenda – both expanding the ranges we’re doing already and going into categories we haven’t gone into before.”

In May, the etailer hired a footwear and accessories buyer, Dani Nutter, whose CV includes stints at Footasylum and Office, to grow both the categories, and Hall and Lavington revealed during the interview that Sosandar will launch a bag collection for the first time next season. The size of the bag range remains under wraps, and Hall is tight-lipped about other prospective new categories.

“At this point we will stick to womenswear because we’ve barely scratched the surface,” Lavington adds. “But is there an opportunity to do other things in the future? Definitely. We’ve always thought there was an opportunity in menswear, kidswear or home. One of the reasons we picked a name like Sosandar is because it can be more than just women’s fashion.”

Bricks and mortar is another possibility. Lavington says: “At this point it’s not something that we’re looking into – we’re solely focusing online. If you have shops to fill, it becomes a whole different ball game. But never say never.”

Jon Reily, former head of ecommerce at Amazon and digital consultant at Publicis Sapient, says: “I would not be surprised to see Sosandar try [pop-ups], but it will likely be tempered in its experimentation as a result of its responsible growth strategy.

“Sosandar is somewhat unique among its competition as it has no debt, which is unusual for a digital pureplay company looking to grow. It operates purely off shareholder funding, which tempers how quickly, and responsibly, it can grow. If it continues to do what it’s doing today and expands into new categories that make sense for it to play in, it will grow organically, which is the best way.”

Once they have cracked the UK, the Sosandar pair hope to enter international markets digitally.

The etailer sources from manufacturers across the globe, including Turkey, the Far East, India, Spain, Brazil and the UK. International customers can make transactions on the UK site and products are dispatched overseas, but international orders currently only make up around 0.01% of sales.

“We have some sales overseas, but a very small number because we don’t market overseas,” says Lavington. “But there’s a long list of consumers looking at us all over the world and that’s without us marketing – we’ve even had someone in Azerbaijan. 

“That’s because the opportunity we’ve spotted – the way women feel about being unserved by the high street – is worldwide, so it’s about spreading that answer globally. We want it to be a global business. New territories are a constant discussion, but we still haven’t picked the right places.”

When the time is right, Lavington and Hall hope to grow this initially via Sosandar’s own website, and the key focus will be on marketing the brand in carefully selected foreign markets.

Sosandar is operating in a tough and highly competitive market, and many of its competitors have fallen short. However, having come at fashion with a “really fresh eye”, its founders have found a recipe for growth.

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