Fjällräven (1960), company review

Plus, the new newsletter plan for 2025..

Hi Outdoors Crowd.

OK, slightly different this week. 2 emails. And a big welcome to our 263 new subscribers since last week.

Ever wonder what the difference between an income statement (profit and loss) for a D2C eCommerce business vs a wholesale business vs selling on a marketplace might look like? Well, very different is the answer. They may as well be different businesses in fact, and this is why it’s so hard for young businesses to do them all properly, while being profitable.

For instance, you obviously give away margin when selling wholesale to retailers, but you don’t incur the 20%+ marketing cost the D2C businesses frequently do. And although you give a lot of margin to Amazon, for example, when selling in marketplaces, they serve as top of funnel and offer a higher conversion rate. But does all of this pan out in real life financial statements? It might surprise you. Having an intimate understanding of these differences to your P&L / income statement is absolutely critical.

I’ll send some examples and delve further on Thursday, so keep an eye out.

PS - if you’re new here or have been forwarded this email, you can read previous posts and sign up for the newsletter here: https://dereksdeepdive.beehiiv.com/

“At some point in life the world’s beauty becomes enough. You don’t need to photograph, paint, or even remember it. It is enough.” – Toni Morrison

Now, it’s 1,000 words on Fjällräven. This is a brand that has amazed me, ever since I first discovered the ‘Arctic Fox. ‘

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The Humble Beginnings of Fjällräven

Fjällräven’s story begins in 1936, the year Åke Nordin was born in the northern Swedish town of Örnsköldsvik. Growing up amidst the breathtaking landscapes of Västerbotten, Åke’s childhood revolved around the outdoors. His early years instilled a deep appreciation for nature, along with a hands-on approach to solving practical problems. This mix of curiosity and ingenuity would later become the foundation for what I think is one of the world’s most iconic outdoor brands.

At just 14 years old, Åke embarked on a hiking trip that planted the seed for Fjällräven. Frustrated by the clunky, uncomfortable backpacks of the time, he returned home determined to create something better. Working in his family’s basement, he built a wooden frame from thin plywood and sewed a canvas bag to attach to it. This design not only reduced the strain on the wearer’s shoulders but also distributed the load more effectively. Åke’s backpack quickly gained popularity among local outdoor enthusiasts, and he soon realized he had stumbled upon something revolutionary.

Åke Nordin

Founding Fjällräven

In 1960, Åke officially established Fjällräven—Swedish for “Arctic fox,” a creature admired for its adaptability and resilience. Starting in the basement of his home, Åke launched his business with just one product: his innovative backpack. With its practical wooden frame and durable materials, it quickly became a favorite among Swedish adventurers.

The name Fjällräven was more than just a nod to Scandinavia’s wildlife; it reflected Åke’s deep respect for nature and his belief in creating gear that could withstand the harshest conditions without harming the environment. The Arctic fox’s qualities of cleverness and endurance became a fitting metaphor for the brand.

Expanding Beyond Backpacks

By the mid-1960s, Fjällräven had established itself as a reliable name among Sweden’s hiking community. Åke began expanding the product line to include other outdoor essentials. The turning point came in 1968 with the launch of the Greenland Jacket. Originally designed for an expedition to Greenland, the jacket was made from a tightly woven fabric called G-1000, treated with a wax coating for water resistance. Lightweight, durable, and versatile, the Greenland Jacket became a bestseller and a blueprint for Fjällräven’s future offerings.

Another breakthrough product came in 1978: the Kånken backpack. Initially developed to address back problems among Swedish schoolchildren, the Kånken was designed with a simple rectangular shape, two shoulder straps, and a small logo patch on the front. What began as a practical solution quickly evolved into a cultural icon. Today, the Kånken remains one of Fjällräven’s most popular products, beloved by outdoor enthusiasts, commuters, and fashion-conscious consumers worldwide.

Interesting side note: A few years ago Kånken was even officially designated as a piece of applied art by Svensk Form (The Swedish Society of Crafts and Design) remarking that Kånken is something more than just a functional object. Its design has its own identity now, and has remained consistent.

Going Global

Fjällräven’s success in Sweden laid the groundwork for its international expansion. In the 1970s and 1980s, the company began exporting its products across Europe, earning a reputation for quality and durability. By the 1990s, Fjällräven had made its mark in North America, Japan, and other markets.

The early 2000s marked another significant chapter in the brand’s history. Fjällräven became part of Fenix Outdoor International AG, a parent company that evolved when Fjällräven became interested in purchasing other outdoor-focused brands like Primus, Hanwag, Royal Robbins and Globetrotter (which was news to me before researching this!) This strategy provided Fjällräven with the resources to scale its operations while maintaining its commitment to quality and sustainability. Today, the brand is sold in more than 50 countries and operates flagship stores in major cities like New York, Tokyo, and Berlin.

fenixoutdoor.com

Interestingly, as the parent evolved, Martin Nordin, the founder’s son, ha retained 52% of the voting rights.

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Financial Growth and Success

Fjällräven’s financial journey mirrors its rise as a global outdoor powerhouse. The brand’s products, particularly the Kånken backpack and the Greenland Jacket, have driven significant revenue growth over the years. As part of Fenix Outdoor International, Fjällräven contributes substantially to the group’s financial performance.

In 2022, Fenix Outdoor reported net sales of €759.2 million, with Fjällräven accounting for a large share. Despite economic challenges in 2023, the company’s revenue remained robust at €739.4 million. The Kånken backpack alone has sold more than 3 million units globally, solidifying its place as a cornerstone of Fjällräven’s success.

However 2023 saw a slight downturn and 2024 H1 figures show further drops, reflecting the industry as a whole. Q2 was ‘a disappointing quarter’ as described by the Executive Chairman. “The second quarter did not come in as expected and proved very challenging.”

As expected, eCommerce is growing within the brand, and it is suggested that Fjällräven itself is faring better than the sister brands within the group.

ecommercedb.com

Sustainability at the Core?

Sustainability has been a cornerstone of Fjällräven’s philosophy since its inception, to be fair. Åke’s early commitment to durability and repairability laid the foundation for the company’s (and other company’s) modern sustainability initiatives. Today, Fjällräven is a leader in eco-conscious outdoor gear, using recycled, organic, and ethically sourced materials in its products.

One of the brand’s most notable innovations is its reintroduction of G-1000 fabric, now available in an eco-friendly variant called G-1000 Eco. Made from recycled polyester and organic cotton, this fabric maintains the durability and performance of the original while reducing environmental impact. Fjällräven also encourages customers to extend the life of their gear through repair services and re-waxing workshops for products like the Greenland Jacket.

The Arctic Fox Initiative launched more recently. This program funds environmental projects around the world, from wildlife protection to climate research, and engages communities to reconnect with nature. But, there is room for improvement according to goodonyou.eco

Legacy of Åke Nordin

Åke Nordin’s influence on Fjällräven cannot be overstated. Even after the company’s acquisition by Fenix Outdoor, Åke remained a guiding figure, ensuring that the brand stayed true to its roots. He passed away in 2013, but his legacy lives on in every Fjällräven product.

Åke’s philosophy—"gear that lasts a lifetime"—continues to resonate with customers worldwide. His commitment to creating functional, sustainable, and timeless products has positioned Fjällräven as more than just an outdoor brand; it’s a symbol of Scandinavian ingenuity and respect for nature.

A Bright Future

The brand’s ability to adapt to changing consumer preferences, while staying true to its core values, ensures its relevance in an increasingly competitive market. That word again - authenticity. Whether it’s designing new eco-friendly materials or inspiring a new generation to explore the outdoors, Fjällräven remains a trusted brand.

From a teenage boy’s wooden-framed backpack to a global outdoor brand, Fjällräven’s journey is a testament to the power of vision, ingenuity, and a deep connection to nature.

Keep an eye out for Thursday’s newsletter when we’ll dive much deeper into the P&L / income statements for eCommerce vs wholesale vs marketplaces. There is a lot in it that should be useful to anyone that’s new to selling online, or wanting to scale.

As usual, thanks for reading and I hope you find value in the newsletter. If you do, please share. It helps a lot. Also feel free to reach out directly with any thoughts or feedback at [email protected]

Happy camping.

Until Thursday, go n-éirí leat!

Derek.