Rather than follow the typical corporate career paths, James Wakefield and Robin McGown got sick of reading success story articles like these and waiting to be a part of their own.
Now after four years, their $10 million online menswear store InStitchu has put them right in that situation.
InStitchu allows men to design custom-made suits online, chuck in their measurements to have it tailored and have the suit delivered in a couple of weeks. They’ve also got showrooms across the east coast where customers can come in and have their measurements done which can be stored in an account for all future online suit orders.
The duo, who met at university, founded the company in 2012 when they were 23 after they struggled to put together a wardrobe for their new corporate jobs and realised they wouldn’t be the only ones in the same situation.
“At first we ordered suits for ourselves, but once others started to ask where we got them from, we realised we could make some money out of these,” Wakefield said.
“We said to all our mates we’ll give you cost price suits so we were be able to develop a relationship with a supplier,” McGown added.
The pair soon realised it was going to be a challenge to find a supplier who would be willing to work with small volumes at first. But with some persistence they inked a deal with a business who was willing to invest time in the startup, and everything has since fallen into place.
Wakefield at the time was working as a stock broker for Macquarie Bank.
“I was completely transparent with everyone at Macquarie that I had this side business, which actually worked well because a lot of the guys ended up buying suits off us,” Wakefield said.
“It kind of spread from there, then those guys we would supply to would have other guys ask them where’d they get that suit from and it would just keep going.
“We started pop-up stores, partnered with cafes and restaurants to try and get our name out there, eventually finding a permanent location in Sydney.”
This is where McGown’s background came in handy. Before InStitchu, he was working at CBRE after graduating from UTS with a property economics degree.
“Working with locations, especially with lease lengths has really tapped back into it [his property background],” McGown said.
“We made sure with things like our showrooms that we didn’t get stuck in long term, expensive leases, and instead found spots for a short term ones so we can move around and adapt if need be.”
What made it even more appealing is that they realised they could do the business with no initial overheard costs.
“Our customers order the suit, then we’ll order it from the factory, whereas a traditional retailer has to go out and buy all the inventory and stock it,” Wakefield said.
“Because we’re not carrying big overheads we don’t have to charge over the top to offset those risks.”
For them, the GFC hit at just the right time. The big suit factories in China were receiving less bulk orders from overseas, so they had to adapt their business models to survive. This meant that smaller players such as InStitchu could convince factories to produce made-to-order suits at a relatively inexpensive cost. Despite this, they’re still being made in just the same places big name suits are.
“When you go over to the factories in China, you see big name European brands being made right next to ours,” Wakefield laughed.
Striking deals with high quality, made-to-measure garment manufacturers in China, the duo’s store is able to undercut the big guys by thousands, selling tailored suits for between $400 and $1000.
There are three showrooms in Sydney, Melbourne and Brisbane where customers can come in, get measured up while picking out their fabrics and suit design then they can submit their order from there. However, the online factor of Institchu is what sets them apart.
After getting your measurements, you can load them up in your account on the website, so when you need your next suit you can order a tailor-made design right from your computer.
If the suit needs alterations, InStitchu will offer to alter it for free, and if it’s still not right, they’ll give you a full refund.
“The average customer is reordering their next suit every 122 days,” Wakefield said.
That’s important, because if a person is more likely to re-order a suit, they’re more likely to recommend it to a colleague or friend. And for InStitchu, word of mouth is a major avenue for their growth.
Initially the guys wanted it to be an online only business, but customers began requesting the ability to have their suit fitted before ordering. This is where the current business was born.
Their first showroom was in the Sydney CBD on Erskine Street, but as the business has grown, they now have a suite in the trendy 350 George Street building in Sydney’s Martin Place as well as in Melbourne and Brisbane.
All of their locations are purposely there for businessmen who make up the majority of their sales, with the pair even setting up pop-up stores in big office buildings.
“Building management love it,” Wakefield said.
“It’s so hard to attract new tenants, with buildings now offering services such as dry cleaning and food delivery, having suit fitting is just something else they can use to attract new business.”
While the pair have no real computing background, the use of payment systems such as Braintree have made it really easy to get it off the ground and integrate with just the help of some freelance web designers.
With the Australian expansion in full swing, the pair say their next step is to try and break into the US market.