Simon Duffy is at a loss when asked to explain why Britain’s trade performance remains so weak. Three years ago, the government promised that exports would double to £1 trillion by 2020. Fast-forward and any prospect of achieving that goal seems hopelessly remote — the value of our goods and services sold abroad remains at about half that level.
The failure to encourage more smaller but fast-growing, companies to expand beyond their domestic market is one of the reasons behind the UK’s continued poor performance internationally. Mr Duffy is co-founder of Bulldog, a male grooming business that’s among those bucking the trend. It expects to make more than a third of its projected £12 million turnover this year from sales in 14 countries.
“It’s difficult to say why more companies don’t give it a try. Maybe it’s because Britain is often a big enough market in itself and a strong domestic base is comfortable.
“There is no divine right for a great company in the UK to be successful overseas, you have to make it work. It comes down to ambition. It requires an open mind and being adaptable and hungry.” Neither though, is boosting sales overseas for smaller companies “rocket science”, Mr Duffy says. When Bulldog embarked on its first foray abroad in 2010, he recalls being pleasantly surprised at the relatively smooth process.
With some help from UK Trade & Investment, the government’s export agency, the company picked Sweden as its debut international market and set about finding a distributor. It is now outselling cosmetics giants Gillette and L’Oréal in stores where all three are sold.
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“That’s a great example of what a small business can achieve. Now we’ve got a different challenge there — to be the market leader, not just a challenger brand.”
Scandinavia has a lot to recommend itself as a market for first-time exporters, Mr Duffy believes: close to Britain geographically and in terms of business culture; big enough to deliver decent sales volumes but not large enough to be disastrous if things go wrong; and “the people are nice”.
“You are there and back in a few hours, their English is perfect and it is not daunting in terms of size. It’s a great place to learn.”
Bulldog, which is based in west London, was set up by Mr Duffy and co-founder Rhodri Ferrier in 2006 to produce moisturisers and face washes made from “natural ingredients”.
The company enjoyed significant success with an outsourced model which saw it operating in markets around the world and building millions of pounds worth of annual sales despite having a tiny workforce.
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However, Mr Duffy says that the company stretched the concept too far. “As a small business, at first you are all generalists. As we’ve brought specialists in, you zoom ahead and achieve so much more. Hiring specialist people pays back dividends. We should have figured that out sooner.”
That said, the company still has a philosophy of working slightly under capacity, which the 38-year-old says boosts productivity. “Companies work better when they are one person down than one person too many — one person being a bit lazy rubs off on everyone. When people feel there is more work than capacity it keeps people happy and busy. But the challenge for any fast-growing business is pace of growth and managing your resources.
“Can your systems scale at the same pace? You need to hire ahead so you’re not parachuting people into a frantic situation.” Bulldog is stocked in outlets including Boots, which brings plenty of global attention in itself, Mr Duffy says. Any business that is good enough to get its products stocked in a leading British retailer is likely to receive approaches from overseas distributors, he argues.
However, companies should be very cautious about who they choose to work with, he warns. “Retailers come to the UK to see what’s successful — if you are in Boots, people from overseas will notice.
“Once you reach a degree of profile, you will certainly get interest from overseas. You need to figure out where the real opportunities are — is it a hobbyist looking for a brand, or someone with real resources and infrastructure?
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“We’ve turned down opportunities to go all over the place. We take more satisfaction from becoming a meaningful competitor in a handful of markets than being small in lots of markets.”
It is also better to pick the right distributor and retail partners and then take your time to build sales, rather than going hell for leather for turnover, Mr Duffy says.
“We try to go exclusively with a key retailer in each market to establish ourselves and learn about local expectations, not just try to be the biggest.”
That approach has paid dividends in Asian markets, including South Korea. Taking things slowly made Bulldog realise that simply replicating its European products there didn’t work. “Men are massively more into grooming in Korea. Now we’re launching with Korean specific products.”
South Korean men have been dubbed “flower boys” for their appetite for cosmetics, meaning that there’s a significant male market for skin toners and BB creams — blemish or beauty balms — that most western men would run a mile to avoid.
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Bulldog’s “keep it simple” approach to exporting extends to insisting on selling in sterling.
Whichever market you are in, there will be unexpected pitfalls, Mr Duffy warns: “In north Sweden, it was not realising what might happen to our products when they’re on the back of a truck and it is minus 50 degrees Fahrenheit outside.”
It’s far from an easy ride, but he believes more British businesses should consider giving exporting a try.
“You have to get out there and give it a go, without trying to do too much at once,” he says.
“It does bring extra pressure. But working through that brings an enormous amount of positivity. You broaden your horizons, stress test your business and have great new experiences. It is a very rich journey.”