IN this week's SME Focus we hear from an entrepreneurial former bank worker who found new markets for some of the whisky produced in Scotland's distilleries.
What is your business called? Hannah Whisky Merchants
Where is it based? Inverkeithing, Fife
What does it produce, what services does it offer?
Hannah Whisky Merchants is an independent bottler and sells deluxe rare malt or grain whisky through the brand name Lady of the Glen. So far I have released four whisky variations and my latest came from a distillery which no longer exists (it burned down in a fire in 2004), its a 21 year old Littlemill. All my products are individually numbered and presented in gift bags.
Who does it sell to? My website customers come from all over the UK. In Germany, my product is sold at whisky festivals. I'm really proud that my customer base is so mixed; I receive emails from young enthusiasts, older whisky buffs and I'm pleased to say it's not gender specific, I get feedback from women and men in equal measure, which is great.
What is its turnover?
My turnover in nine months was around £23,000.
I'm happy with that considering the business has been run on a part-time basis until recently.
How many employees?
There are two people involved in running the business. My beautiful wife helps me to prepare orders, accept deliveries and on occasion appears at special events like tastings. I run the operation daily, preparing orders, marketing and managing all the other business activities.
When was it formed?
I formed the business in late 2012 and it was a part time operation until recently.
Why did you take the plunge?
My dad, who is a bagpiper, introduced me to whisky with his incredible collection when I was much younger. He had amassed the collection over the years through gifts by piping at weddings, funerals and other events. It illuminated our house and inspired me to be part of the industry someday.
I learned a lot about whisky and whisky drinkers from the pubs I worked in at university.
The idea for bottling a cask was given to me in 2009 by someone at the Oran Mor venue in Glasgow after I had completed my alcohol licence with the intention of going into the whisky business.
When I investigated the industry I found an opportunity through certain distilleries which were providing almost their entire stock and output for use in blends.
I was aware that 90 per cent of the industry is built on blends but we lose some really rare and brilliant whisky to foot the demand. With this knowledge I felt that I could start a business which would get these rare casks before they were used in blends and sell them as a deluxe whisky in a single malt or grain like they deserve.
The brand was to be very important to compliment this high quality product, so I created something I thought was different from other independent bottlers. I took inspiration from brands like Jo Malone perfume because I felt they had something which celebrated a culture, was modest, informative and contemporary.
Getting to where I am now was about perseverance by following through and chasing up contacts.
The first products I sold were a malt and a grain whisky from the Invergordon and Benrinnes Distilleries. I was very fortunate to acquire such high quality casks and from then on I've managed to get access to rarer casks. My next release will be a 26 year old Bunnahabhain.
Finding my business customers has been easy because I know where their shops are and where sellers can be found.
However, persuading them to buy and getting in touch with the buyer is always tricky.
What were you doing before you took the plunge?
Working in a bank, it was not enjoyable.
How did you raise the start-up funding?
In the beginning I used my own money to start up the business because at no point would banks lend to me. I did get guidance and courses from organisations like Business Gateway and Scottish Enterprise but little in the way of financial aid. In the last few months I've been able to take on running my business full time thanks to the support of The Prince's Trust Scotland.
What was your biggest break?
A gentleman from Germany sent me an email in Mid 2013 enquiring if I had ever thought about exporting to Germany. He said he liked my brand and after tasting some samples he was very happy with them. He then ordered over half my stock and I was exporting to Europe. After that I got more confident and I contacted one or two businesses in the UK to sell the remainder of the stock I had and they lapped it up because this German customer had ordered so much.
What was your worst moment?
There's been a few. When I first had the stock I sold hardly anything for six months because I struggled to get a unique bag made for my product and I was unwilling to sell and advertise until the product offering was finished. It was difficult personally because I could see family and friends losing confidence in me and the idea and that hurt too but I persevered and I got a break after the design had been completed.
What do you most enjoy about running the business?
The learning. I feel like I learn an actual new usable skill each day, such as export laws in Germany.
What do you least enjoy?
Preparing large orders for outside the UK where the duty has been paid in the UK. This task for me requires removing hundreds of duty stamps using a combination of hot water and elbow grease because those stamps are stuck on good.
What are your ambitions for the firm?
I want my business to have a reputation for the highest quality whisky and I want to increase the portfolio on offer while increasing the sales. I want to progress with my suppliers and current customers because they supported me to begin with.
What are your top priorities?
Increase the ready-to-sell whisky portfolio; create a larger portfolio of whisky to age in reserve; export to more European countries; take on staff; fulfil my voluntary commitments.
What could the Westminster and/or Scottish governments do that would help?
Provide more funding to cover travel expenses and accommodation for individuals who want to attend exhibitions and industry related events for their business. I believe with additional funding people network to find more customers and get relevant feedback on their products or services direct from customers.
What was the most valuable lesson that you learned?
To speak to suppliers and customers honestly and frankly. Don't over promise and create false expectations.
How do you relax?
When I have time I play my guitar. I've had three tutors because of my work schedule.