Mountain Warehouse's founder on how he makes the high street work for his retailer

Tracey Boles
TV explorer who designs for Mountain Warehouse

Mountain Warehouse's founder and CEO Mark Neale believes that reports of the death of the high street have been greatly exaggerated. For him, it is very much alive and kicking.

The outdoor gear retailer opened 41 branches last year, and plans 40 more this year, both in the UK and abroad. Last Friday, the retailer revealed sales of £184.8m for the year to the end of February 2017, up 31 per cent on the year before, marking 20 years unbroken growth. Pre-tax profit was up 22 per cent to a record £19.8m.

As other retailers feel the squeeze or even buckle, how does he do it? “We are family friendly and accessible in many ways: location, price and service. Our logo is a compass and our ‘true north’ in the company is value for money,” he explains.

The business started in 1997, in a single shop in Swindon. Ten years later, it had grown to 40 stores with sales of £20m. But it was the downturn of 2008 that allowed it to grow much more quickly as stores became easier to find and canny shoppers were increasingly on the lookout for value.

These days, Mountain Warehouse has more than 260 shops and employs around 2,600 people. It sells around 17m items a year, from jackets and fleeces to rucksacks and sleeping bags. The tally includes 1m socks.

Neale's goal is to keep people warm and dry without breaking the bank. He explains: “We are for people who walk the dog, not for people who want to climb Everest. I want my mum to feel comfortable in our shops but also my 12-year-old daughter.

“We also sell skiing and camping equipment and gear for festivals like Glastonbury or for those on the Duke of Edinburgh award scheme. Our customers come in with a specific need and we try and fulfil it,” he says.

To weather-proof the business, he has gradually expanded into more summer clothes, particularly for children. This has included a collaboration with TV explorer Steve Backshall who has designed a range of kids' clothes with funky wildlife designs. Now, many customers first encounter the brand through its childrenswear.

With the exception of Kendal mint cake, Mountain Warehouse merchandise is all own brand and made in the Far East.

Online sales jumped 50 per cent year-on-year and now account for 25 per cent of all sales. However, Neale has traditionally found that the best way to reach target customers is via shops in England's market towns and cathedral cities, or in national parks in Scotland and Wales. Around 25 of his shops are in garden centres.

There are also several in London. New UK openings in the past year included stores in Winchester, York, Chester, Salisbury and Sherborne. “I do not subscribe to the death of the high street. I have a long list of towns that I want to open in.” He often finds himself next to the same brands including Joules, White Stuff, and Cath Kidston.

But it is not always easy to find the right locations. Neale has been after a suitable site in St Andrews for years; he is about to open a shop in Oxford after finally securing the store he wanted, 10 years after missing out on it. “A shop is for life not just for Christmas,” he says. The recent failures in the retail sector may throw up more opportunities.

Neale is also seeking to increase the number of stores outside the UK. After Poland, the Czech Republic is next on his list in Eastern Europe and he intends to expand in the North America after testing the waters in a suburb of Detroit. Last week, he opened shops simultaneously in Krakow, in Poland and Lethbridge in Canada. Germany is also on his list.

How will he fund the expansion? “Ourselves,” he says simply. Neale, who owns 85 per cent of the business, flirted with an IPO last year but abandoned the plan on market jitters due to the referendum, and on the dawning realisation that they did not need to pursue one to expand.

A serial entrepreneur, Neale launched Zakti, an activewear brand with its own shops, two years ago. They recently collaborated with Pussycat Doll pop star Kimberley Wyatt on the collection. What advice would he give to other budding businessmen and women? “Take the plunge when you can, before you have too many responsibilities. I started out as a management consultant and gave it up when I was 26 to open a shop.”

It has been a 20-plus year climb since then, but by most measures, he has reached the top.

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