SME Focus: As business owners grit their teeth in readiness for a challenging couple of years, it is worth remembering that many firms in Scotland have plenty of experience of dealing with tough times.

As business owners grit their teeth in readiness for a challenging couple of years, it is worth remembering that many firms in Scotland have plenty of experience of dealing with tough times.

This week, we highlight an award-winning textiles entrepreneur who founded her business at a time when many big players were being laid low as the Scottish industry was buffeted by overseas competition.

Rosemary Eribé provides a lesson in resourcefulness and adaptability that could inspire many hopefuls. However, she warns that with money getting increasingly expensive to come by from banks, late payers could be an even more unwelcome irritation than usual.

Name: Rosemary Eribé.

Age: 47.

What is your business called? Eribé Knitwear Design.

Where is it based? Galashiels, Borders.

What does it produce? Luxury knitwear and accessory collections for ladies and men.

What services does it offer? We design, produce and promote the Eribé brand worldwide. International designers such as Paul Smith and Margaret Howell use our design archive for their own collections; they also buy from our collection. We then knit for them. Labels such as Prada and Hermes have worked with us as well.

To whom does it sell? We have built up a loyal customer following which buys from us every year. We even receive e-mails from their customers (the end user) asking if we still produce styles from 10 years earlier because they wear it every day.

Experience has taught us that once someone wears one of our products they come back for more. Our hardest task is the first sale. If anybody knows how to make the first sale to the end user easily, I am very keen to learn from them.

In 2008 we have sold so far: Japan 7%, UK 30%, Europe 44%, US 20%. These figures will change as we continue to sell and we expect sales in the UK and Germany to increase.

Last year, it was Japan 10% (previously 38%), UK 45% (previously 22%,) Europe 29% (previously 28%), US 16% (previously 8%.) Japan has dramatically fallen, in line with the very weak yen and their internally difficult market economy.

The low sales in the US were due to our efforts being targeted more in other countries, a decision made due to the weak dollar.

However, we have two new large customers that have started to work with us despite the exchange rate. Americans like to buy made-in-the-UK products despite our higher prices.

What is its turnover? Between £400,000 and £500,000.

How many employees? Six in-house, but this increases to seven and eight in our busiest months.

When was it formed? In 1986.

Why did you take the plunge? They say the first job you have is the most important, as it can form your attitude when you are young and impressionable. After leaving school, I really didn't know what to study. I was very young in my class and had finished my "A" levels at 17. I was desperate to leave the country and travel but I didn't have the money so needed to find work.

My mother, who is German, found me this sort of paid working apprenticeship in retail management advertised in a German magazine. I started work age 17, selling wooden and fabric toys, books and natural fibre clothes, socks, tights and underwear. They were difficult to find in those days.

However, my schoolgirl German was too bad so I was sent to another, smaller shop that sold biodynamic food. Within three months I had learned German fluently so that I could return to the toy and clothes shop to look after the mail order catalogue and sell to customers.

In retail, you learn a lot about human nature. In time, I was able to know fairly accurately if someone who walked in the shop was going to spend a small amount, a large amount or nothing; be easy or difficult and demanding.

Very often the most demanding customers spent very little and used up a lot of my time. I learnt about the process of ordering, displaying and selling and gained confidence.

In the end I opened and ran a small shop for them - selling only textiles. They could see that was my preferred interest and knew that I wanted to learn about what happened before it arrived at the shop. I was fortunate that they had these three departments, however small, as this is where I discovered my interest in textiles.

However, as I had a boss who was difficult to work with I decided I would need to work for myself to make a happy working environment.

After two years working in retail, I went on to study textile design at the former Scottish College of Textiles in Galashiels, Scotland; an excellent course where we learnt the theory as well as the practical.

It was very demanding, requiring hours of practical projects outwith college hours. I loved every minute and worked hard to learn everything I could from all the many departments. I was privileged to get a first class and the Dr Oliver medal.

However, I will never forget the shock of arriving in Galashiels - a tiny town - after living in an interesting city like Hamburg.

After leaving college with the usual students' overdraft, I convinced myself getting a job with a wage could make it more difficult to leave that security later on in life. My college lecturers all discouraged me, saying I was mad, but I took the plunge into continued poverty and a life of adventure, learning and hard knocks.

How did you raise the start-up funding? I was very fortunate to persuade several men in suits that I would survive the business world if they let me participate in the graduate enterprise course run by Stirling University and the then St Margaret's College in Edinburgh. They gave us a crash course in business and helped us write our first business plan with cashflows.

I also managed to get some funding to do market research, which enabled me to fund a very small collection, which I sold in London while carrying out "live market research". This helped me persuade my bank manager to give me an overdraft facility of £500 to get me up and running. This was the first push to help me get going. In January 1986, I officially started the business with a fashion show held in London at a sales showroom run by Scottish Enterprise.

I continued to do as much research as possible, phoning up competitors in the Borders to ask questions about markets or on how to do something that I didn't know. I learnt one step ahead of doing - the hard way.

I now know why my lecturers told me to get a job and make the contacts. They were right, it would have been the easier way and I would have had more money. But somehow, I don't regret it.

What was your biggest break? Japan in the late 80s early 90s. I had done my research - Japan was the place to sell designer knitwear. But I couldn't quite work out exactly what they liked; so I made a collection comprising little groups of ideas: yarns, moods and knitting techniques. Intarsia cashmere was the product that took off.

On my return, I worked hard designing a complete collection of cashmere hand intarsia garments, often getting up at 5am to get peace and quiet. One morning, around 8.30am - I had all my designs covering the floor on my sitting room when I looked up, startled, to see two smartly suited Japanese men, equally embarrassed to see me partly clad still in my pyjamas.

The outcome was hugely successful. They loved to see all the many designs and we worked for many years together until the Japanese bubble burst in the mid-90s.

What was your worst moment? Discovering one day after dispatching half of a £24,000 order to a German distributor that they were dishonest and fraudulent.

What do you enjoy most about running the business? I love working with all the many people I work with; business colleagues, hand knitters, suppliers and customers. I also love the variety of work and its challenges, guiding the business through change and, above all, designing knitwear and anything that can be knitted.

What do you least enjoy? Filling out tax forms and the increasing paperwork that goes with legislation, rules and regulations. Makes me sometimes want to give up.

What is your biggest bugbear? Customers that don't pay; or take months to pay after lots of hard work. Luckily that doesn't happen often.

What are your ambitions for the firm? To have a company where all of us can have time, money and fun while still learning and developing ourselves and the company. We are working on it with lots of success.

What are your top priorities? Understand our customers; look after our customers; find new ones; improve our systems so we can achieve the above effortlessly; work together harmoniously.

What could the Westminster and/or Scottish governments do that would most help? The rise in fuel costs will lose us business as our costs will be too high for the export markets. If the UK is to continue to compete in the global market, the government needs to recognise the extra costs we incur - one being fuel, another being high bank charges (short-term borrowing is now 9%) - and address these problems urgently.

What was the most valuable lesson that you learned? Every problem has an advantage or a benefit. Find it and the problem can become an opportunity. Perseverance pays eventually, but you need to recognise there is a price.

How do you relax? I love dancing. Luckily, I am married to a man who just loves parties. I enjoy going for long walks over the hills and dales, cycling, swimming and reading.

Most evenings, we eat at a round table with seven or eight people and share our fun and jokes of the day.