How to Start Up: in a retail niche

  1. Made of Carpet
    Christian Annesley

    Christian Annesley Contributor Full Member

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    In association with .UK

    The next installment of our How to Start Up series looks at how to make headway in a manufacturing and retailing niche.

    It might sound like a specialist area, but the potential for even an unfunded startup to make a success of selling goods online has never been greater. It doesn’t have to involve manufacturing either; it could simply be that the business sells cleverly sourced goods for a certain audience  and uses an ecommerce site or marketplace as key sales channels.

    UK Business Forums spoke to Irina Bragin of Made of Carpet, a boutique carpet-bags and accessories business based in London, about how she developed and launched the business in 2010, and what’s happened since.

    The market opportunity

    Bragin’s original, long-standing career was in graphic design. She got thinking about the market opportunity for carpet bags and accessories seven years ago, when she wanted to buy a Victorian-style carpet bag herself.

    “I couldn’t find anything out there,” she says. “There were a few options  I found that were inspired by the concept of a carpet bag, but they weren’t made with the right materials. It got me thinking right away about the potential market.”

    Bragin did her homework first, spending a year or more scoping out the market and looking at options for sourcing of suppliers and more, as well as learning about good business practices, the challenges of protecting intellectual property and more.

    “The main challenge, ahead of all others, was finding the right supplier,” says Bragin. “In the end I found some great carpet suppliers in Belgium, but it took time to build up a strong working relationship. And that still left me with the challenge of sourcing a company to make the carpet bags from the carpets and bag clasps I’d sourced. That took another eight months. It was not easy.”

    A product but few sales

    The next challenge for Bragin was to sell her unique products, and here she says she learned some things the hard way.

    “I have good web and design skills. So I originally thought I could create a good website, advertise online and in other contexts and use a marketplace like Amazon and that would be enough for sales to flow. It turns out I was wrong.”

    Bragin says the challenge of driving sales online meant she ended up putting a lot of time into understanding the relative strengths of the rival ecommerce marketplace platforms and knowing how to navigate them effectively.

    “I tried all the options – Amazon, Alibaba and Rakuten being the main ones.  I ruled out eBay early on as it wasn’t right for a fashion brand. These days I’m mainly an Amazon advocate, I have to say. It works for different territories, is easy to administer and target your options and it really delivers. The other platforms I explored I found  harder.”

    And what in particular has Bragin learnt along the way about the ecommerce opportunity?

    “Well, you need the right focus and the right advertising mix – pay-per-click, in particular – allied to a strong and optimised web presence, and you need your Amazon marketplace offer working in your target territories.  

    “I remember one error I made, when I printed 35,000 cards with a discount code on them. I distributed them at trade shows and I sold one bag with that discount code!”

    In fashion too, Bragin says you need to work at making the right associations and work out how the key trade shows and catwalks work - “you have to put in the effort to get the results,” she adds.

    What about finance and support?

    On the question of finance, Bragin has always trodden a cautious path and strongly argues it makes sense as you grow an ecommerce offer.

    “I have built this business up without any substantial funds, and kept out investors all the way through. I think in fashion especially you need the confidence to go on your own journey, so if you do get investment it should be a silent partner who won’t interfere,” she says.

    When it comes to learning and advice, Bragin says she relies on the fashion-business consultant Toby Meadows:

    “Toby talks a lot of sense. He has run his own fashion businesses and knows his stuff. For me, that’s all I need.”

    Retail versus wholesale

    About half of Made of Carpet’s revenues come from the website and nearly another third via Amazon. The remaining roughly fifth of sales is through wholesale deals with independent retailers and it is something Bragin wants to build.

    “Every direct retail sale is for two-and-a-half times more than the wholesale deals, so for some it might not work, and several of the wholesale trade shows are also dying these days. But I still think there is a good opportunity here for Made of Carpet. If you get your products in the right independents they can do well and the flow of steady business it generates is worth it. It’s a nice part of our story on the website, too.”

    Social media – be in the game

    Bragin says that for a small ecommerce business like hers it is not worth working excessively hard at social media to drive sales, but she still says being on social media and being active is something the business must do.

    “It’s speculatively really, but it’s part of how you build presence online. In fashion, you need a company presence on Facebook, Twitter, Instagram and Pinterest, and you need to keep your personal Facebook page professional too,” she says.

    What next?

    Made of Carpet’s turnover is over £120,000 a year and growing, and it's built a strong reputation and partnerships across the fashion industry.

    “We are now quite established,” says Bragin. “However, we work in an unusual niche, and getting strong supplier relationships is never going to be easy, even though I’m from Ukraine originally and speak several languages, and am happy to roll up my sleeves and work at every relationship.

    “As with any business, you just have to keep at it and good things will happen. I’m confident about the specialist products we make and I know there is a market for them. I just need to keep working and keep reaching out and forging new relationships to keep on growing.”

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