Today we meet Chris Smalley founder & creative director of Etelage.
This Week on So You Want To Start A Business Podcast:
In this interview we meet Christine Smalley founder & creative director of Etelage.
When Chris returned from overseas she had no job so she turned to her hobby to generate some much needed cash while she looked for a full time job. Little did she know that in just 6 weeks she would have an extremely viable business ….
Podcast Full Transcript:
INGRID: Hello and today we are talking to Chris Smalley from a business called Etelage. Hello Chris!
CHRIS: Hi Ingrid, it’s great to be here.
INGRID: Now we are in Chris’s home office so we if we hear some of the sounds of the suburbs we know what that is. It could be the sound of a dog or a cat or an aeroplane. It’s lovely to be here so thanks for inviting us in. Chris just to start with, when did you start your business, and just a word or two about how you would describe your business?
CHRIS: Yes sure. So the business I‘m in, I’m a jewellery designer and also a bead importer. We sell mainly online and through party plan and also through galleries.
INGRID: And when, sorry, why did you start your business first?
CHRIS: It was actually quite organic. I didn’t start with an idea. Back in 2002 I had a mid-life crisis at 30 and I’d returned from overseas, I didn’t have a job to return to, and so I decided to make jewellery and that would provide some source of income before I found a full time job. But I never got the full time job because my childhood hobby 6 weeks later – I realised I could make a living from it.
INGRID: And there’s quite a gorgeous story about someone happening to see one of your gorgeous pieces, isn’t there? That sort of gave you an entrée into another part of a business that you weren’t expecting.
CHRIS: Yes. Absolutely. My sister was wearing one of the pieces I had made, and she was at a gallery, and quite by coincidence, the retail buyer for the National Gallery in Canberra was there. She saw what my sister was wearing and loved it, and thought it was perfect for the gallery store in Canberra. And my sister replied ‘my sister made it’. (Laughs.) So they exchanged details and within 6 weeks of returning home from that trip I had my first client.
INGRID: The National Gallery!
CHRIS: The National Gallery. Yes. Quite some first client!
INGRID: Yes, amazing. So is that when you realised you were ‘in business’ or was there another point in your journey where you actually had a business? It wasn’t just about making jewellery that you were actually ‘in business?’
CHRIS: Yes, I mean the idea of being a jewellery designer sounds very glamourous but you clearly have to make it work. And so, well, I can repair jewellery, I can make jewellery, so I can teach jewellery-making, and I could sell in people’s homes, but I also like to sell in galleries. So there were two really defined markets I wanted to sell to. And so I sat down and one Friday evening I gathered the girls and I asked my girlfriends what they thought of my ideas. They loved it, and then we had to come up with a name, so with a thesaurus under the arm, we flicked through it and came up with the name Etelage.
INGRID: Which means?
CHRIS: It’s French and it means to adorn or to embellish.
CHRIS: So I guess that’s when the business was born, because I felt like I had something concrete to work towards. I had something specific. I had 3 year goals and I wanted to have consultants selling party plan. I wanted 4 consultants within 3 years, I wanted to have 50 stockists, mostly galleries and high end boutiques, and I wanted to open a retail store.
INGRID: Wow, so right from the beginning you had some very measurable key metrics for your business?
INGRID: That’s pretty amazing, because many people, particularly people who are creative, just want to make jewellery and just want to collect beads, and want to find out all the great things about it. So had you had some business training? Where did all that come from? You said you are a natural planner, but where did that set of goals come from? How many stockists, and how many……how did you know all that?
CHRIS: I knew exactly where that came from because both my parents were in small business so I grew up with a mum who had two hairdressing salons, and still managed to pick us up at 3/3.30 after school and she did all the baking and stuff like that, but she worked 6 days so she was in the salon on weekends. And my dad, he was in manufacturing and he used to manufacture 6 days a week so I was exposed on the weekends, on the Saturday to go to one of the salons, or go to the factory, and also they bought their work home, there was stuff that they would do like tax. I remember being 10 years old and sitting down back then, there wasn’t just a GST there was different taxes 10 20 30 percent, so I’d be on the calculator, calculating it. So from a very early age I was exposed to the runnings of a small business and the reality of a small business. Its very very hard work, but there were rewards, we travelled overseas which most of my friends didn’t do as children. So certainly that was a foundation, an as an adult I had absolutely no inclination of ever being self-employed. I thought no, I want to work for someone else.
INGRID: You were going to go the other path. Who’d have thought you would end up in your own business?
CHRIS: I know….
INGRID: So in those early days, how did you fund the business? Where did the money come from? So maybe the first question around that is, what did you need money for, and how did you fund it?
CHRIS: So maybe if I talk – the first few months, I was basically using a stash of beads I’d collected and inherited since I was a child. I’d been making jewellery since I was 8. And I had about 8 boxes, and when I say boxes, I am talking A4 paper boxes, so an incredible stash, and an amazing collection of beads. I was working through that quite quickly so I knew I had to source some more beads.
At the time there were 2 bead stores in Sydney and they sold very generic beads. So a bead was round and it was transparent, and that’s not my style at all. I like big flat bold surface areas, and I love opaque and organics and so I thought I’m just going to have to go overseas. So I made some inquiries and it was obvious to me to go to the Czech Republic, which is the hub of glass production for centuries. It’s an interesting story because the glass industry, even though it was post communism, it was still controlled by the Government, so pretty much if you wanted to buy beads or import from the Czech Republic you had to go through the Government controlled company, and you had to spend a minimum of $50,000 US dollars. So $50,000 US dollars at the time, and because you are talking about 13 years ago, was about $115,000 because our dollar was worth less than 50 cents. So to fund it, it was a risk I was willing to take clearly, because I’m in business now. I used the money I had put aside for a deposit on a house, which still wasn’t enough, I was short $20,000, so I went to the bank, I went to several banks, and it was very very interesting. They were all men that I saw. One thought I was opening a bed shop, not a bead shop, another thought it was a bread shop, not a bead shop.
INGRID: Oh Chris! (Both laugh.)
CHRIS: And the third one was really surprised when I arrived in a suit and how professional I was with my marketing plan, because he’d read it correctly. Clearly he’d read the documents, and he said to me, my initial impression was that you would be some bohemian roaming gypsy. So he was impressed and gave me the money. Yay.
INGRID: Fantastic. That was such a success story.
CHRIS: But these pre-conceived ideas……
INGRID: That was amazing, and that was phenomenal amount of money 13 years ago, to raise.
CHRIS: It’s huge.
INGRID: It’s huge. It’s a lot of money now for people -$120,000. Gosh.
CHRIS: Yeah, I would say that I am a risk-taker, and anyone who goes into business is naturally a risk-taker. A calculated risk-taker.
INGRID: And you are in business now so it was a good calculated risk.
CHRIS: Yeah, it’s great.
INGRID: Wow so that’s quite a funding story. Thank you. So you’ve gone on and done other things. You’ve expanded, you’ve grown, and you’ve had a retail shop. So did you borrow money again at different times? Or were you able to self-fund after that?
CHRIS: Yeah I self-funded. Pretty much the goals I set to achieve in 3 years, I pretty much achieved in less than a year, so within a very short amount of time I had four girls selling jewellery through party plan.
INGRID: So that was your 3 year goal achieved in a year?
INGRID: Wow, so inspiring Chris.
CHRIS: And I had a warehouse, oh I shouldn’t say a warehouse, it was a studio in a warehouse complex. And I remember I’d only been officially a few months old, and I had been officially trading from that space for 6 weeks. My brother shared the warehouse space with me and I remember he called me, on Boxing Day, and I was in Melbourne at the Boxing Day Test and he said to me, ‘oh are you opening today?’ No. ‘There are all of these women at the front door – what am I going to do?’ I told him ‘tell them to go away. We aren’t open for another week.’ (Laughs) That dawned on me then, wow, this is going to be big. And a couple of months later I opened my first retail store in Cronulla and I opened a second one in Newtown.
INGRID: Newtown. And that’s where we first met in your Newtown store. So if you look back through those early days, it doesn’t sound like there was much that you could have done differently. But was there anything that stands out that you could have done differently if you’d had the time again?
CHRIS: Hmmm, yes, I was an island. The idea of networking or collaborating was such a foreign concept. Yeah, that’s something I definitely would do differently, its obviously too late now, but I am really enjoying now working with other creatives. Just for example, there’s the Sydney film festival, and there is a really great fashion documentary called Iris. It’s about this amazing women in New York, she’s 93 years old and she’s more than just a fashion dame of New York society, she is a really passionate stylish women whose been collecting beads, curating, styling, bargaining in all these exotic places for decades. And I am really inspired by her story, and so I’ve collaborated with another local artist, she’s a clay artist. And we’ve come up with a workshop where over 3 weeks you make a whole lot of faux beads. So they look like turquoise, jade and amber and that’s with Robyn. Then the girls, I presume they are all girls in the workshop, they will join me and they string up their own one-of-a-kind necklace.
CHRIS: Yes and we are doing it in a gallery so there are 3 people on board. Where generally I would have done it in my own space and employed an Etelage tutor, and things like that, which is in the past. It’s not because I wasn’t open to it, it’s just that I wasn’t exposed to other people in business except my parents. I didn’t have any friends who were self-employed. Yeah.
And I think the other thing was I had was a really good practice of every 3rd day finishing early, every 3rd weekend having off, and every 3 months going away.
CHRIS: And you need that, you definitely need that. And somehow that got lost, and I think that I made the mistake because I’d travelled so often sourcing beads overseas, it was like I was away 3 or 6 weeks a year, and it was kind of my holiday. Big mistake. Working is NOT a holiday.
INGRID: No, it’s not. And even if you take the extra day and do something nice, it’s not quite the same, because you go away with a different mindset and atmosphere.
CHRIS: I think you need to go away, you need to find breaks and you need to look after yourself, you need to move, you need to eat well, and you need to regenerate and you can’t do that if you are constantly in work mode.
INGRID: Yes, in work mode. Its interesting how in the last couple of years there is a much heightened awareness about eating healthy and being fit, to be business-fit not just being able to be resilient, and sell and add up your numbers and knowing what your products are, but having a holistic approach to your business.
CHRIS: Yep. And maybe that’s why you need to do a marketing plan and factor in your personal goals as well. And because often we are so focussed on the business we are not actually taking good care of ourselves.
INGRID: And it requires 20 hours a day, or 12 hours a day, or 8 days a week. (Both laugh.)
CHRIS: My business is now 13 years old and I would say that initially at the beginning I was working 70-90 hours a week. I see that almost literally. The idea of your creative work having the same milestones and demanding the attention that a child needs, so as a start-up you will be working long hours, but if 10 years down the track you are still working those hours there is something really really wrong.
INGRID: And your good example there, is that you have other people working with you. One of the mistakes people make is wanting to do everything themselves.
CHRIS: You just can’t.
INGRID: In those early days did you do your own bookkeeping and administration yourself, or did you work around that?
CHRIS: I grew exponentially, so within a very short period of time I had 17 staff, I had a forklift, I had a warehouse, two retail spaces, two retail store managers, I had a general manager. I had someone come in 4 hours a day just to do admin. I had a bookkeeper.
INGRID: Yeah, cause there are people who try to do all of that themselves, so good for you. So we’ve talked about something you’d done differently, is there something you wish you’d known from the start? That’s a slightly different question. Is there anything not that you’d done differently, and you were well prepared for because of your family background, and a lot of people get into business and they just don’t realise certain things. Is there anything that happened in that first couple of years that you wish you’d known was going to happen?
CHRIS: I had such an amazing first few years that my experience is quite different then when I speak to others in business. So I was being written up in all sorts of accounting magazines, but it doesn’t last forever, and you see different crazes. This year its cupcakes, then we will see another craze. I think for me I really saw an opportunity with the whole bead thing and it suddenly exploded. But we are not still in that phase, and I may not see that ever again. So my business looks quite different now to what it was. So no, I don’t think so.
INGRID: That’s great – thank you. So apart from yourself and the man at the bank that lent you the $20,000, who do you see as being of great assistance to you? It’s not necessary to mention names, but just in the context of what they did? How have other people been involved in your business and have helped you?
CHRIS: I have had incredible staff. And one who was with me for 9 years who is now working for Chanel in Paris- I felt absolutely privileged that someone with the skills and ability that she has, that she would work for me and for so long.
And you learn from your staff. There are skills I don’t have that my staff has. I’ve also been really encouraged by my parents, who were my only sounding boards. And they gave great advice, and it was the conversations that clearly I would never have had with them as a child, and that was really lovely to actually sit down and often ask for advice, knowing that they had been successful business people.
My accountant is more than just an accountant, he is really into the idea of building a business. So when you are meeting with them, it’s not just about your profit and loss, or your balance sheet, it’s about your marketing plan and being accountable. So I think that’s great, it’s been really good because it just reinforces what I do naturally. But I am a good starter, but sometimes not a great finisher. So that keeps me accountable.
INGRID: So having people around you to do the finishing was important?
CHRIS: Yes, I have the ideas, all these ideas, we can do this. We can do this and we can do that. Yep.
INGRID: And then someone has to help put them together. And that’s where the team comes in.
INGRID: And some of those people who are the good finishers see a good idea and help you put it into action, so having those people around you can be so helpful.
CHRIS: Yes, exactly.
INGRID: Great. So what’s one thing, if somebody came to you and you said they had an idea for a business, you meet people all the time now, so there is never been a better time to be in your own business as right now, cause all kinds of people can start businesses. So if someone came to you now and said I’ve got this idea for a business what do you think? What would you say to them?
CHRIS: I’d say, so who are you selling it to? I would think if you can’t answer that question it’s not a viable business, so in my business I identified 36 different niche markets. And so I mainly have within that niche market, I may only have 3 people, or could be business to business, or retail, but they are a very significant part of my income stream. So, how I sell to, say for example, the theatre companies and the stylists and the designers who work on film, that’s a very different audience to my retired weavers for example. And they are going to be different again to those who want an ‘instant grat’ creative project who dip in and out of different crafts and are not loyal to one craft. So you really have to know your market, you have to know what they look like, not physically…well actually even sometimes physically. You know I can picture in my mind exactly who a particular niche market will look like, what they wear, where they will shop, how they travel, how they shop…
INGRID: What magazines they read, what they watch on TV?
CHRIS: And that will make a successful business. If you try to sell to everyone then you aren’t really selling to anyone.
INGRID: That’s actually interesting – about 36 different niche markets? So they are quite clear even though there are lots of different people, each of them has their own customer avatar. So it could feel like you are selling to a lot of different people but you are quite clear about how you sell to each of those. Because often people will say, for example, I met someone the other day and asked them who was their target customer, and they said, people building a small business. Well there are 18000 small businesses in Sydney, so how can you target all 18000? But you might have different aspects, like you said, so anyone who wants a bead….well….
CHRIS: Yeah yeah.
INGRID: But by knowing the 36 different groups of people who want beads and what they want to use them for, then you can target your …….
CHRIS: I guess my 3 broad groups are we sell beads; we sell ready-made jewellery; and we offer workshops. So that’s kind of the broad – but that’s so general, and so I could make the mistake that I could just sell my workshops to everyone, cause clearly I can’t.
INGRID: And different people want different workshops.
CHRIS: Yes, so there are those who are ‘instant grat’ crafters so they want very creative, fast paced 1.5 hour workshops with cupcakes and champagne, so the whole experience. Where a serious beader will want a whole day step by step, break down the technique, and are a very different audience.
INGRID: They want to know where the beads come from and so on, where the others want a glass of champagne.
CHRIS: Yeah. Yep. (Laughs)
INGRID: So in terms of what you’d ask someone who wants to start a business they clearly need to know who is going to buy their product. So a couple of questions about your personal characteristics and the characteristics of a potential start-up. What, I say 3, but if there are others you need to mention, but what would you say are the 3 characteristics that have held you well in the last 13 years?
CHRIS: I think being authentic – it creates integrity, it builds your brand, also having a clear vision of what your brand is, and how that sets you apart from other brands. I think that’s really important, and as a designer over the years I’ve got a very distinct style and I feel I own that style. It’s not someone else’s style, its one that I’ve build over the years and years of developing that. Did you ask for 3?
INGRID: Yes. You mentioned authenticity…..
CHRIS: Well that’s my first one, authenticity and developing your own style. The second one would be reach for the stars but you also have to have a plan, you need to set goals and be accountable. So yeah, you know, you can dream big. I dreamt big, I achieved far more than I ever thought I’d achieve. And yeah, you need to have something to work towards, so dream big but be accountable. That’s my second thing.
And the third is a question. Ask yourself every week how did I build my business? So it’s really stepping out of your business and not working in it, and often we think we can’t afford it. You can’t afford not to. You won’t see growth if you are always working in the business.
INGRID: And you ask yourself something every day don’t you?
CHRIS: Yes, so what have I done today to build my business? That might be overwhelming for some people starting out so probably once a week is good. But it could just be 5 minutes, it could be just following up with someone you exchanged business cards the night before, just follow them up. Or it could be social media, putting something on Instagram, but just do it every day.
INGRID: And is Instagram something you use?
CHRIS: I do. Yes it works well for my product.
INGRID: It’s very visual.
CHRIS: Yes, and we post to our twitter feed and also to Facebook through Instagram. It’s great, it’s timesaving.
INGRID: They all link together.
CHRIS: When we first started you had to do them all separately, so now it’s great.
INGRID: So do you notice when you put something in particular, can you see a spike in sales, or ….
CHRIS: Definitely spikes. Yeah. We always use hashtags and there are certain hashtags where we see spikes.
INGRID: And do you track that?
CHRIS: Yes we track it. And also we look at time of day, so there are times of day that are optimum for us to be posting. And it’s interesting the amount of really quite big designers from the States who follow us. And you think, oh wow they are following a designer in Australia. So that’s nice, because the fact that I haven’t been following them, and they are following me, is interesting.
INGRID: They are curious as to what you are doing?
CHRIS: Yes, what an amazing opportunity now for start-ups. When I started there were no online selling platforms, no social media, you know, there was nothing. There was the Vogue Forum, the online forums, and I remember there was alot of chatter about what I was doing on Vogue.
INGRID: But in the early 2000s we were only just getting going with emails and websites.
CHRIS: Yes, we were still faxing!
INGRID: We were faxing.
CHRIS: I mean people today wouldn’t even know what a fax was.
INGRID: Yes we’ve seen technology come and go in our lifetime. I can remember that first fax being incredibly exciting. (Laughs) So if that’s your characteristics do you have any others because I know I constrained you to 3?
CHRIS: No, I’ll leave it at 3.
INGRID: Ok, so for a start-up that is thinking of starting up, what do you think are the essential characteristics they need to have? They need to know who their customer is, but what about them as a person? You mentioned a whole lot of different things, but what do you think is the key?
CHRIS: I think one really important thing is believe in yourself. And surround yourself with people who believe in you. Whether that’s your accountant, your web designer, your marketing person, make sure that they believe in it as much as what you do. Yeah I think that’s the biggest thing. Yes, be really confident and trust your intuition.
INGRID: Trust, like you said. And you were telling me earlier about some things that happened recently and that you are really following your intuition in regards to that. Because sometimes you just know things.
CHRIS: Yeah, should I share that story, a little bit about it.
INGRID: Yes, if that’s ok with you.
CHRIS: Ok, so yes, I have really great traffic to my site, about 6000 hits a week, and I wanted to work more on converting sales. So I bought in someone who was recommended and we met and I told her my story, and so she had a really good understanding of the business, and what I wanted to achieve, and then she came back with a whole lot of advice which I wasn’t really that keen on. I thought that was kind of the opposite to what I expected her to say. But I thought no, I trusted her, as the expert with a lot of experience, so I agreed to making the changes. So we made changes to the website over a 3 month period, and it was disastrous. Absolutely disastrous. Sales plummeted the other way. So they went down and not up. We’ve since rectified the situation, and after 13 years in business, I didn’t trust my intuition, so it was a big lesson.
INGRID: Because somebody was presented to you as an expert and a guru as the person who knew, so that’s hard when you are starting out as well because you don’t have 13 years to draw on, so we do tend to trust these experts and gurus. But as you said you are back on track again now.
CHRIS: Yes back on track!
INGRID: Can you just talk about one of things I thought was lovely, is the way you’ve done partnerships? You mentioned the partnership with the ceramic bead-maker, but you’ve also started a lot of partnerships with your local community. You were part of the local Newtown community having a shop, and you had restaurants and bars involved, and you still do that. Can you just talk a little bit more about partnerships, because creating partnerships with people is quite powerful for anyone in business, whether it’s a start-up or later. Do you have a couple of those examples?
CHRIS: Yes sure.
INGRID: Thanks Chris.
CHRIS: Since about 2005 we have created different packages for hens, where they can celebrate in a way that’s memorable and fun and age appropriate for grandmothers, aunties as well as their girlfriends.
INGRID: And a hen is…? In case anyone is listening who doesn’t know what a hen is?
CHRIS: Ah ok, a hen is a woman who is about to get married. And it’s a celebration,
INGRID: And the hen party is quite something.
CHRIS: It’s quite something and it’s a big thing. And sometimes in the past it has spiralled out of control with lots of drinking but I think now it’s a different experience, not just drinking, and it includes everyone. So back in 2005 we introduced packages, but we only had them in our stores in Cronulla and Newtown, and so the idea was come and make jewellery, have some champagne and cupcakes and then go out. And in Cronulla and Newtown we are on the doorstep of the most amazing bars and restaurants, so then I thought, why not create a themed package and work it around, say a Middle Eastern restaurant. Let’s do a ‘sex in the city’ kind of bo-ho under the stars, cazbah pillow, room experience, candles, and banquet and jewellery making, and have the jewellery making themed to that. Like big chandelier earrings with turquoise beads and embellishments. We have different themes now and they work really well. We are, in a small bar working on a big bench that works well, we’ve got an old world vintage afternoon tea which is lovely, so that’s more kind of vintage and delicate jewellery, and we also have a Great Gatsby high tea.
INGRID: That would be fun. So it’s such a great example of using themes and relationships and partnerships.
CHRIS: And we make it easy for them, by working with these restaurants it enables us to have bigger parties so now our average booking is, the number of guests is 17, whereas before our limit was 14. So it’s made it possible for us to have bigger party bookings and it’s also made it possible to again, know your target market and target differently. So someone who wants to do a vintage quite dainty afternoon of jewellery making is going to be different to someone who wants a moody outdoor under the star experience. So we’ve packaged them differently for introverts and extroverts and it’s also allowed the venues to promote their venue. So they have 17 girls coming once a week or fortnight, we do on average about 3 hens’ parties on a weekend. So they are regularly getting our girls through. So potentially in that group there are other girls getting married so they’ve got an idea of maybe coming back.
INGRID: So it really builds other businesses and creates employment.
CHRIS: And it’s keeping money within the Newtown area.
INGRID: Oh Chris we could go on talking for ages and ages couldn’t we? Is there any one last thing you’d like to say?
CHRIS: Ah, I’d say just do it. Yep just do it. You won’t regret it. I love being self-employed.
INGRID: That’s great, thank you so much for your time today.
CHRIS: Pleasure. Thanks Ingrid. Bye.
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