IN this week's SME Focus an entrepreneurial craftswoman explains how she has been able to build a global customer base for a business that she started only last year.
Name: Pauline Lothian
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What is your business called?
Pauline Lothian Designs
Where is it based?
What does it produce, what services does it offer?
We produce a range of luxury ladies' accessories and gifts, from larger items such as handbags and tote bags through to clutch bags, purses, and brooches. All of our products are made using Harris Tweed cloth sourced from the Outer Hebrides.
Who does it sell to?
Retailers and gift shops across the UK on a wholesale basis as well as via our own website, which has enabled us to court business worldwide. Without a doubt we have also been helped by the strong international reputation of the Harris Tweed brand.
What is its turnover?
We are still in our first full year of trading but we are profitable and sales are growing month-on-month.
How many employees?
I am currently a sole trader, both in the legal and literal sense!
When was it formed? 2013
Why did you take the plunge?
The decision to go into business felt fairly natural in the end. Pauline Lothian Designs essentially started off as a hobby at school craft fairs and similar events, but my products were selling well and the feedback was encouraging.
From there, having noticed that the market in which I now operate was fragmented, I thought it would be interesting to push myself and to see how far my products could be taken. The development of consistent branding and packaging then followed and the business started to take shape. I felt very comfortable with the idea of being in business for myself, having grown up in an Ayrshire retailing family.
What were you doing before you took the plunge?
I have always had a love of textiles and making things. As a child I wanted to be a Blue Peter presenter - in the days of sticky back plastic and before they had to be all adventurous! So producing things for myself, whether to wear or for my home, has always been a part of my life.
I graduated with an honours degree in textile and fashion design management from Heriot-Watt University in the late 1990s and subsequently gained experience in the retail sector via Jacques Vert and Marks & Spencer Group, where I specialised in visual merchandising.
This experience has certainly helped in terms of understanding what retail based wholesale customers are looking for.
In terms of Harris Tweed, I was given a one-metre length of bright pink cloth about a year and a half ago. I already knew a little bit about the famous fabric, but felt I needed to know more about exactly how it is made.
In doing so, I learned about the heritage, the skill of the weavers, the resurgence in the fabric's popularity and the fact that it's the only one in the world to be protected by its own Act of Parliament.
I've always tried to "shop local" and support independent businesses and the idea of using a fabric in my designs that is 100% Scottish really appealed to me. The first product I made was a make-up bag for myself - which I love! It's really important to me that the products I make, I also use and this has become a key product within the range.
How did you raise the start-up funding?
Being internet based, our start-up costs were fairly modest and our growth has been organic and self-funded. This was very valuable as it initially enabled me to get up and running using personal savings rather than expensive debt or external equity. The cost of trading on the internet is surprisingly low.
What was your biggest break?
The first time a retailer (Pretty Pink) agreed to stock my products was my biggest break. It is an intimidating prospect to be approaching buyers, so to get that first breakthrough was very valuable indeed and undoubtedly gave me the confidence to move forward.
What was your worst moment?
Although to some extent it is inevitable in any business, a cold corporate rejection can certainly hurt, especially when you genuinely believe that your products would have sold well in the outlet concerned. Like most people I have had a number of rejections, but I just try to learn from each one and move forward regardless.
What do you most enjoy about running the business?
I enjoy running my website. The internet is a great corporate leveller, and I love the idea that an entrepreneur with a micro-business and a shoe-string budget can compete directly with the "big boys" of retail and their multi-million pound capital expenditure and property budgets. Clearly their volumes are vast and I don't anticipate getting to that level any time soon, but when it comes to the sale of a single handbag to a single customer I believe that I can compete.
Our products are produced by hand in small quantities and I communicate directly with each of my customers, creating a sense of intimacy that is hard for the "production line" high street chains to replicate given their scale. In addition, I monitor the analytical data from my website very closely and can quickly and efficiently tailor my product offering directly to the interest implied from, for example, specific page hits. The website also gives us an international e-commerce platform that 10 years ago simply wouldn't have been possible within my budget. I still think it is remarkable when I see interest in our products from countries such as the USA, Canada, Finland, Russia, Japan, and Australia.
What do you least enjoy?
As an entrepreneur, my daily tasks extend far beyond the world of textiles and into almost every facet of the business world. I am the chief executive, chief financial officer, marketing director, production line, quality engineer, IT guy, photographer, and internal accountant all rolled into one. I have a love/hate relationship with this aspect of the job - on the one hand it is great to be learning new skills, but on the other hand it drives me to distraction when I cannot pick up a particular task quickly enough and there is no-one to immediately turn to.
What are your ambitions for the firm?
I would like Pauline Lothian Designs to fulfil its full potential, whatever that might ultimately be. I think that we have a great range of products and given the global popularity of modern Harris Tweed and the opportunities that are out there, I think there is quite a lot of market to go after.
What are your top priorities?
The continuing production of what I believe is a high-quality, attractive and consistently produced product range; the development of long-term relationships with retail partners, my website (especially internationally) and the Pauline Lothian Designs brand. And personal contentment and satisfaction!
What could the Westminster and/or Scottish governments do that would help?
Continue to recognise the value of innovation and entrepreneurism in the economy. In the aftermath of a financial crisis arguably caused by excessive debt and financial engineering, I believe that supporting smaller companies would help to foster a healthy re-balancing of the economy and would ultimately lead to more sustainable job creation. Such support could take the form of red tape reduction, tax incentives and technical assistance.
What was the most valuable lesson that you learned?
To surprise yourself by making things happen. It is often the case you can achieve more than you initially thought you could. In practical terms a relentless focus on quality is very valuable.
How do you relax?
Away from the sewing machine my husband and two young children keep me busy, although I do also enjoy gardening, walks in the country and periodically trying some new recipes.