Taking a naturally Australian approach to starting up
You might not expect two men in their 20s to be the driving force behind a new skincare company, but Brack Norris and Michael Oliver are very much in their element.
Based in Perth, Norris and Oliver are the founders of Uandi Natural, which offers natural ingredients sourced from native Australian plants.
The business was founded in March 2010, but it wasn’t until the end of 2010 that a business plan began to develop.
Norris talks to StartupSmart about how his skincare company is different from all the others.
What prompted you to launch Uandi? What niche did you identify?
The idea behind Uandi Natural was conceptualised in Broome, Western Australia in 2010.
I was approached by a friend named Kim Harris, a Nyoongar man who had just completed a Certificate IV in bush and herbal medicine.
He was really excited about the benefits that native plants could have on the skin and was taken by the idea of sharing these benefits with everybody that he possibly could.
When doing research into the idea, we found that there were a couple of other brands that used native Australian plants in their formulations, but nobody possessed a strong brand that reflected this Australian provenance and having effective natural products.
How did you fund the business?
The business was funded completely though investment. Initially, this was the investment of two of the three founders.
We invested $30,000 to fund all the initial costs that were involved in developing the brand and the products in order to get it to a stage where other people would be willing to take the risk because they were investing in something tangible rather than an idea.
Over the next 12 months, we raised a bit over $100,000 in order to take the product to market.
We invested a lot in the overall look of the brand and products, which meant that we racked up quite a large graphic design bill.
This included design of the brand, design for five products (containers and boxes), and the design and development of our website.
Product R&D was also an expense because I thought it was very important to get the best possible products that produced results.
We then had to get all our packaging manufactured, which involved large minimum order quantities of each of our five products and their boxes.
There are also a lot of little costs that add up including things like insurance, postage/shipping of packaging and finished products, website merchant fees, barcodes, etc.
How do you promote the business?
We started out trying to promote the business through social media, in particular Facebook.
We decided to run a free sample giveaway for launch through our website and Facebook to get people trying the product.
We soon found out, however, that there are people out there who post any and every free sample offer on websites with a huge number of users that love free things and have no intent to purchase.
We also discovered that as a new skincare brand, Facebook did not influence buying decisions and was only proving useful as a tool for brand-building and awareness.
We now promote the business with PR and have found this to be the most effective form of promotion.
PR is great for reaching a large audience, and is very cost-effective in relation to many other forms of promotion as you are only paying the retainer fee for the agency and generally providing stock to support promotions.
We have had some great success with radio promotions in a number of different states, online and offline print media, and also a small TV presence on the LifeStyle YOU Channel.
How do you stand out in the market? What’s your point/s of difference?
We stand out in the market by being distinctly Australian. It’s Australian provenance, which shines through in the brand imagery as well as in the products themselves, was specifically designed to take advantage of the extremely positive view of Australia in the global marketplace.
With the intimate bush plant knowledge held by indigenous Australians, and active botanicals and natural ingredients, Uandi Natural products provide a pure and natural skincare experience.
How many staff do you have?
This is a tricky question because we don’t actually have any staff – not even me.
Our business model is built around contracting the services that we need. This includes everything from graphic design to manufacturing and, in my case, company management.
I guess if we reduce this down to people with Uandi Natural business cards, we are looking at five people.
What are your revenue projections for 2012/13?
We have been working very hard to secure a listing with a large retailer in the UK over the last six months, which we are hopeful of securing in the near future.
Given this, we are projecting revenue of $300,000 for this financial year.
What has been your greatest challenge and how did you overcome it?
We have had to overcome a number of challenges. The greatest was probably getting the correct setup for the management of the company.
This was a huge challenge because it involved the resignation of one of the founders who held the position of managing director and then a redefinition of everybody’s role within the company in order to get the company performing.
It was very challenging to go through a process such as this whilst also trying to keep our close personal friendship intact.
It should be said, however, that although this particular founder is no longer the managing director, he is still an important part of the team and provides a valuable skill set.
What’s the biggest risk you face?
At the moment, the biggest risk we face is the failure to expand our distribution beyond what currently exists.
Cashflow is absolutely essential to us at the moment and the failure to continuously expand our distribution to generate this cashflow will lead the business to failure.
Is there anything you would have done differently?
If I were to do all this again, I would be a lot more focused on developing relationships and opening dialogues with key retailers in a number of different distribution channels.
In the early days of Uandi Natural, the focus was on purely targeting the one or two distribution channels where we had decided we wanted to place our products.
I believe that we were much too exclusive in this approach, which hurt us in terms of initial growth.
What advice would you give to other young entrepreneurs?
My advice would be to find business mentors that are interested in you both personally and also in what you are trying to achieve.
By building a support network of people that you can turn to for advice – be it advice about a particular situation or to gain a better understanding of the challenges that lie ahead – their expertise is invaluable.
In my case, I have five people with vast experience in a number of different areas such as management and finance that I am able to turn to for advice.
I seem to encounter new challenges on an almost daily basis.