Entrepreneurship Zone: 05 February 2024 :: Building a South African clothing business, with some help from a rugby captain

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Entrepreneurship Zone: 05 February  2024 ::  Building a South African clothing business, with some help from a rugby captain

 


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 <mailto:coordinator2 at zitf.co.zw> Freedom of Movement is a South African clothing and accessories brand co-founded by the Boezaart brothers. With South African rugby captain Siya Kolisi as a minority shareholder, the company has expanded to 21 stores and has a growing international presence. Jaco Maritz speaks with co-founder and CEO Léan Boezaart about how they built the company and the business of fashion.


The article covers the following topics:

·         How Siya Kolisi, South African rugby captain, got involved with the company and ended up becoming a shareholder;

·         FOM’s origins from a small 10m² room in the university town of Stellenbosch;

·         The changing dynamics of influencer marketing;

·         Why Boezaart would have moved into footwear sooner if he could do it again; and

·         The difficulties associated with starting a clothing brand from scratch.

In 2017, Siya Kolisi, then a rising star in South African rugby but not yet the national icon who would lead the Springboks to two Rugby World Cup victories, walked into the offices of Freedom of Movement (FOM), a young leather bag startup. During the visit, Kolisi’s attention was captured by a new shoe, the Vellie, which the company was about to launch. The shoe, a modern reinterpretation of a traditional South African design, immediately appealed to Kolisi, leading him to offer to appear in the promotional video.

Aided by Kolisi’s involvement, the shoe quickly became the company’s top seller.

Léan Boezaart, FOM’s co-founder and CEO, says Kolisi’s relationship with the company started as a friendship with the founders and evolved from there. At first, FOM gave Kolisi some free products now and again but he never demanded payment for promoting it. “Initially he did everything because he just liked what we were doing,” Boezaart says, adding that Kolisi was keen to explore how he could work with the company on community upliftment projects.

The following year, the company collaborated with the rugby star on a FOM X Kolisi branded green Vellie. A portion of the revenue from the sales was allocated to constructing a rugby field in Zwide, a disadvantaged community in the Eastern Cape where Kolisi was raised. FOM subsequently expanded the Kolisi line to include bags and apparel. By this point, the company had begun paying Kolisi a royalty for each sale in the Kolisi range. Boezaart notes that while the royalty percentage was small, it started to add up to quite a significant amount.

The partnership eventually culminated in Kolisi acquiring an equity stake of about 4% in the business. “Something that’s super important to him is to feel that he’s part of this thing now. With all his other commercial arrangements, people are paying him money to use him and he didn’t want to feel like that here. He wanted to feel like he’s part of it. And he’s still super involved in all our projects,” explains Boezaart.

Towards the end of last year, after Kolisi lifted the winning trophy of the 2023 World Cup in Paris, he joined the French rugby club Racing 92. Boezaart says this ties into FOM’s European expansion plans. He believes Kolisi will play an important role in growing the brand in Europe.



Siya Kolisi wearing Freedom of Movement’s Vellies shoe range.


Stitching together a brand


The origins of Freedom of Movement trace back to when Boezaart’s younger brother, Roal, was a student at Stellenbosch University, situated outside Cape Town. In 2011, Roal began making hoodies and t-shirts for Stellenbosch’s student residences, leading to the formation of Clockwork Clothing. His goal was to offer more attractive apparel for university and school students. The following year, he was tasked with creating merchandise for the reunion of his university residence, Wilgenhof. He found someone who could make a leather satchel with Wilgenhof’s logo embossed on it, which was sold to attendees of the reunion.

Meanwhile, Boezaart was completing his chartered accountant articles at Deloitte in Cape Town. Upon qualifying at the end of 2011, he opted to pursue a career in golf and joined the Sunshine Tour, a local professional golf circuit.

In late 2012, Roal invited his brother to join the business, and he accepted. Initially, they continued producing apparel for educational institutions but soon realised this direction did not align with their vision. Thus, the duo redefined their company’s mission: to establish a proudly South African lifestyle brand. They decided to start with leather products and operated from a small room of about 10m2 in Stellenbosch. “We bought a leather machine, got a craftsman called Benjamin from the Eastern Cape, got him to move his whole family to Stellenbosch. And we sat him down and said, ‘Right, let’s make a leather bag’,” Boezaart says.

Their first item, a hand-stitched and hand-dyed briefcase proved too labour-intensive. Recognising this, they pivoted to producing two backpack models, which were quicker to make and more appealing to students. The backpacks quickly became popular, leading to a substantial waiting list. To meet this growing demand, the company expanded its operations, hiring additional staff and relocating to a larger facility in Stellenbosch from where they could produce around 20 bags daily.

For the first two years, Boezaart still played golf and took on part-time consulting work to pay the bills. He eventually decided to focus entirely on FOM. “I didn’t play good enough golf to make a lot of money … We had Freedom of Movement slowly by surely getting into a bit of a rhythm where we could turn this into something big. So in 2014, [I] basically stopped the golf thing … and was selling leather bags as a [qualified] chartered accountant before I knew it.”

FOM was funded completely organically, with no loans or external funding raised. “[We] started the business with R80,000 (about US$4,250) of our own money, and then grew it from there,” Boezaart notes.


Building a retail network


In 2014, FOM began supplying goods to an interior retailer in Pretoria, where the brothers were raised. However, when that store closed down, FOM decided to take over its space, marking the opening of its first retail outlet. Unlike their current approach of meticulously analysing trading densities and ensuring economic viability before opening a store in a shopping centre, Boezaart says they made a “bit of a gut call” to launch the outlet.

“It’s quite daunting, especially in the beginning when you have to get into a lease agreement. [The] minimum term is normally three years, some even want five years. And we couldn’t forecast past the next three months,” he notes.

At this point, FOM’s range was still primarily leather-focused: laptop bags, a satchel, a briefcase, ladies’ handbags, and some wallets.

By the end of 2014, it launched its second store in Stellenbosch – also a modestly sized outlet to minimise overheads. The brand opened its first mall outlet in the Mall of Africa in Johannesburg, one of the largest shopping centres on the continent. Initially, FOM’s store was in a “terrible location”, close to the bathrooms by an exit that nobody used, but eventually, it moved to a better space.

Nowadays, FOM has 20 outlets in South Africa and one in Namibia.

E-commerce has also become a significant component of the business. According to Boezaart, the company’s online sales surged during Covid, a time when customers in FOM’s target demographic had disposable income but limited outlets for spending due to closures of restaurants and travel restrictions. With clothing stores in South Africa shuttered for an extended period, these consumers shifted their focus to FOM’s online platform. “We acquired so many customers during Covid,” he says.

FOM has further extended its reach to the UK, home to a considerable South African community. In the UK, the business operates exclusively online, outsourcing warehousing and logistics to a third-party provider. A dedicated managing director oversees the UK operations.



A Freedom of Movement retail outlet in Pretoria.


Diversifying into shoes and apparel


Boezaart recognised the need to diversify FOM’s product line, given the challenges of growing a business primarily focused on high-quality leather bags, which don’t have frequent repeat purchases.

In 2017, the team therefore ventured into footwear, opting to update the veldskoen (colloquially known as a vellie), a traditional South African walking shoe crafted from leather uppers attached to a leather footbed and rubber sole through stitchdown construction. “The vellie … [is] a very popular South African product but it’s kind of looked similar for a very long time. So we reimagined that and came up with our version of a vellie – we still call it a vellie but it’s not really the traditional veldskoen,” Boezaart notes.

He says the Vellie’s success, in part due to Kolisi’s endorsement, elevated FOM from an artisanal bag brand to a recognised name across South Africa.

Two years ago, the company launched a line of sneakers, which has since become its leading revenue source. Footwear now accounts for over 50% of the business.

In addition, FOM has introduced a variety of other apparel items, including shirts, jackets, and pants for both men and women, which currently represent just over 20% of sales. The company has also expanded into watches and sunglasses.

If he were to start the company again, Boezaart says he would have gotten into footwear much sooner. “We were hanging on to this bags dream for too long … although there’s a big market for it, it’s very difficult to scale,” he says, adding that he wishes they understood sooner the importance of encouraging repeat purchases from customers who have grown fond of the brand.


Outsourcing manufacturing


Initially, FOM made all its products in-house. However, it soon became clear that too much time was being devoted to manufacturing rather than on building the brand and developing new products. Moreover, there were established leather goods factories with years of experience that could produce better quality. Consequently, FOM moved its leather bag production to an established factory in Cape Town, which set up a dedicated production line for the company’s products. A couple of FOM staff members were stationed on the line to oversee the process. “We could then shift our focus to growing and scaling the business and not focusing on the manufacturing details and elements and staff issues and all those things that take up time,” Boezaart says.

These days, as FOM’s product range has expanded significantly, some products, like the Vellies, are still made locally, but much of its manufacturing is outsourced to factories around the world. For example, its sneakers are produced in Portugal, sunglasses in Italy, and for its watches, the movements are made in Switzerland while the casings are assembled in Shenzhen, China. Lean underscores the extensive global travel to trade shows undertaken to source these manufacturing partners.

He reflects on the substantial challenges new fashion brands face in establishing a robust supply chain. Standing out from competitors requires offering a quality product, yet the top factories with the best machines and skills for producing these quality items are often out of reach for brands that cannot place large enough orders. “If you have this dream and vision of building a clothing brand from scratch, your barrier to entry is extremely tough because you can only really start partnering with factories if you can meet their MOQs (minimum order quantities). And you won’t get into the proper factories of the world … if you can’t order high volumes … I’m glad we are past that and we can meet the order quantities but it took a while, it took a long time,” Boezaart notes.


Shifting dynamics in influencer marketing


In Freedom of Movement’s early years, Instagram was relatively new, and the company successfully leveraged it to promote its products. Influencers were given products for free in exchange for promotion on social media, without any direct payments.

However, Lean observes that this strategy has become less effective as Instagram has grown more saturated. He points out a growing inauthenticity in influencer marketing, as influencers often indiscriminately endorse products. “Now people see way past it; they don’t take it seriously if they can see that it’s just sponsored content.” Currently the company focuses on working with influencers who align with its brand, rather those who have the most followers. “You can actually get a lot more out of smaller, micro-influencers that just like the product and want to be seen as someone owning this product,” he adds.

Boezaart admires Patagonia for how it has grown a massive global brand while staying authentic. “They are so authentic in the way they communicate and connect to customers. That customer connection that they’ve managed to establish is unbelievable and that’s sort of my number one focus – making sure that Freedom of Movement connects to our customers. If we don’t connect we are just selling products and if you are just selling product, you are going to lose in the end game,” he notes.



Freedom of Movement’s head office in Cape Town.


‘You don’t need a magical idea’


Boezaart attributes part of the company’s success to the complementary skill sets he and his brother Roal brought to the table. With him as the numbers guy, and Roal, as the creative force, they had a unique package not often found in startup fashion businesses.

In recent years, the company has transitioned from a family-run operation to a more corporate structure. Boezaart emphasises that establishing a proper framework, clear reporting lines, and an HR department has become crucial for managing its workforce of over 150 people. The company now also has an executive committee and a board, which includes seasoned retailer Charl Cronjé, the former head of South African clothing chain Ackermans, whom the brothers were introduced to through family connections. “He’s brought a lot of knowledge to the table that I need because I’ve never really had someone to look up to – a mentor. We were just running with this thing, and now there is someone who’s seen this movie play out – we need that.”

While the company has found its stride in recent years, Boezaart says the initial five years were particularly difficult. In those early days, the brothers led a modest lifestyle, with their first self-issued pay cheque amounting to around R8,000 (about $425), which, as Lean points out, was hardly enough to live on. During this time, Roal shared accommodation with friends, and Boezaart, who married in 2012, supplemented his income with consulting work to make ends meet. “It was tough because you start comparing yourself to other chartered accountants who are now buying houses and cars and whatnot, and you are sweating it out … But we fully believed that we could take this thing to the next level … You don’t necessarily need a magical idea. I mean, we didn’t reinvent the wheel, leather bags have been around for years. But we took a leap of faith and backed ourselves.”



Léan Boezaart, CEO of Freedom of Movement

 

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