Name: Helen and Alice Sturdy
Age: 24 and 28
Business: Alice Caroline Ltd
Type of business: Handbag and Accessory Design
Start date: 10/02/04
Website: www.alicecaroline.co.uk
When did you first decide you wanted start your own business?
We decided to set up the business in January of last year. Helen had just finished a law degree and Alice was finishing off a PhD in breast cancer research. Alice had made some handbags and sold them at the student union in Sheffield and had done really well. We’ve both always been very interested in fashion and design and both wanted a change from the course we had been on.
Tell us about your business
We sell handbags and accessories to retail customers via the website and also to trade customers via shows and our brochure.
Was it your first business idea and where did it come from?
It was the first time either of us had decided to set up a business from scratch. Helen had had some experience in the retail trade, becoming a partner in a Florist in the year after she left university. It came partly from the confidence we got from the small stalls Alice did in Sheffield but more importantly from feeling like we knew what we wanted to make and knew we could design and make it well. Alice is an extremely good artist and has also always been good at predicting trends as well as having a good scientific brain. Helen has creative strengths but is also good at problem solving and finding a way to make things work.
Was your decision to start a business inspired by any other companies or individuals?
Our father is a farmer and a businessman and so we grew up open to the idea of entrepreneurship. Helen’s partner Pete is a successful entrepreneur as well so we certainly did have quite a lot of positive business influences around us. Another big inspiration and guide was a book Alice found called “Anyone can do it” by Sahar and Bobbi Hashemi, the creators of Coffee Republic.
What makes you think there’s a market for your business?
We wanted to make a product that we and our friends would want to buy and would be able to afford. We love handbags and just really thought that there is always room for well designed, original and affordable handbags and accessories.
Once you’d decided to start a business, what did you do first?
We decided to register as a limited company fairly early on, knowing that that limits our liabilities as individuals and it also lends a bit more credibility to the name. We then decided to set up the website and begin buying fabric and working out how to get the bags made up on a bigger scale than doing them all ourselves.
What research did you do?
We already knew a lot about the fashion and shopping side of things. We always read all the fashion magazines and know roughly what’s out there. Likewise we knew a fair amount about sewing and designing having always done it for ourselves.
We also did some research into how people market their products both to trade and retail customers. A friend of Alice’s works in PR and was really helpful on that side of things. She now does all our PR.
What advice did you seek?
We heard about business link and did ask them a few things but mostly we wanted to know specific things about manufacture etc which they found it fairly hard to answer.
We talked to local fashion colleges and read quite a few entrepreneur books – Richard Branson’s autobiography is great in terms of making you feel better about any problems you encounter, his were so huge! We did have quite a strong feeling that we didn’t want to talk too much to business advisors etc because we wanted to do things our own way and to discover how to do things based on our own research and discoveries rather than what someone else told us.
It does mean at times it feels like we’re reinventing the wheel but it also means we have a very strong understanding of what we’re doing and of the reasons behind the steps we take.
What other help did you get?
The internet is obviously a brilliant and completely essential resource. Talking to lots of different people is also good really good as long as you have confidence enough not to always listen to them.
Does the government need to provide more help to people trying to start a business?
Business Link is a really good government resource and I think really probably covers about as much as you could expect the government to do in terms of advice. Financially they provide a bit of a break in that they don’t charge corporation tax on the first £10,000 profit you make which is also good.
The Prince’s Trust is another vital and really good resource for start up businesses in terms of money and advice.
Talk us through the process of writing your business plan.
We just worked out what we wanted to know in terms of very roughly how many bags we would have to make to make any money and how much money we might have to invest to begin with.
We also looked at gross margins and cost of sales figures to try and work out whether what we wanted to do was at all financially viable. We also estimated all the potential outlets we could sell to (taking into account the fact that you can’t really sell our sort of product to more than one shop within a given area).
How useful has your business plan been and do you think you’ll stick to it as your business begins to grow?
It was definitely useful to begin with because it gave us the confidence to start and feel like we could potentially make something work. We have a reasonably strong picture in our heads of what we need to do next to keep up and on top of things so our plan is constantly evolving in our heads. Financially, our initial business plan is less and less useful since it was based on figures really plucked out of the air.
We had no idea what our actual sales would be and what would affect those figures. We keep re-doing it every so often, inputting new figures and looking at new possible scenarios.
How much did it cost to start the business?
Our initial investment was relatively low, owing to the nature of the business. There were no large capital investments to make really. Our initial outlay was on the fabric and the manufacture of the first lot of bags which came to about £2000 if that.
We have invested a lot more than that since then but it has always been an outlay and then some kind of return from sales, never a huge capital payout.
How did you fund this?
We funded it mostly from our own savings and also from a loan from our father. We were very lucky to have had that backing from the start.
Similarly, how are you funding your running costs until the business takes off?
In the same way. We also have a nice bank manager and an overdraft facility.
Have you made any provisions for business not being as prosperous as expected?
We did a worst case scenario sales projection to see what state we’d be in financially if we sold very little. Because our initial outlay didn’t need to be too big, we have been able to build up as we go along and have never really had a massive debt hanging over us. Thankfully our sales have been a lot better than our worst case. If they hadn’t been then I guess we would have had to keep borrowing and keep a close eye on why things weren’t doing so well..
