The number of boarded-up shops on the average British high street has tripled in the last year. So it's not the best time to own a department store, you might think. But Holly Tucker, 32, isn't worried her department store is online.
Notonthehighstreet.com, which Tucker co-founded with her friend Sophie Cornish in 2006, is seeing sales double each year. And she has achieved it by creating a place where small businesses that have been pushed off the high street can sell their wares.
The daughter of a financial director with General Electric, Tucker first started earning her keep at the age of 12. At 5am each day, she'd force her father to drive her to their local pub in Berkshire, where she worked as a cleaner. "It was probably illegal. But I made £3.50 an hour," she says. She ran a tuck shop in her teens and by the time she was 25 was running a firm organising fairs for small businesses to sell their goods. That's when she hit on the idea of an online marketplace.
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"We were doing these events in church halls around west London, but companies were travelling from all over the country without knowing what the return on their investment would be." Meanwhile, with "25 mobile-phone shops on every high street", consumers were struggling to find the sorts of unique products or gift ideas they would once have found in independent stores. The internet offered a solution.
Tucker and Cornish raised £70,000 each via loans, savings, friends and family. Opening their first office which "backed on to a building site" in Sheen in south-west London, they launched in April 2006, signing up 94 small businesses that Tucker knew from her days running fairs. These companies, which made everything from jewellery to homeware, paid a joining fee, plus a percentage of any sales made.
In its first year, Notonthehighstreet turned over £100,000, helped in part by the pair's imaginative public relations tricks.In 2006, they hand-delivered Christmas stockings, stuffed with products from the website's small businesses, to 100 journalists. By the end of the year, that led to £2m worth of press coverage (in terms of what it would have cost to fill the equivalent column inches with advertisements). "With no marketing budget, we had to be creative."
In 2007, they launched a catalogue with a circulation of 100,000. That figure doubled last year, when the business hit £1m in turnover in October. They also raised money from venture capitalists: £400,000 at the end of 2007 and £1.2m last year through Ventrax. But the pair still own the majority share in the business. This year, Notonthehighstreet is set to exceed its £6.5m turnover target as it produces three catalogues with a circulation of one million, filled with products from 2,000 small businesses.
Tucker is certainly optimistic the firm's 2010 sales target is £13m. "We are still on this growth trajectory and looking to launch in Ireland next year." Of course, she's not immune to the pain consumers are feeling. "We have suffered from the recession. But I think people will never stop wanting to give a gift."
Jody studied at the University of Limerick and she has been a senior writer for MoneyWeek for more than 15 years. Jody is experienced in interviewing, for example in her time she has dug into the lives of an ex-M15 agent and quirky business owners who have made millions. Jody’s other areas of expertise include advice on funds, stocks and house prices.
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