When Nikki Tyack and her previous business partner launched Esque Online in 2013, they knew nothing about the online space or ecommerce. They weren’t coders or website designers. They weren’t social media experts.
What they did have was a network in the interior design and architectural world, including high-end suppliers, experience in the industry, and a willingness to be sponges and learn everything they could about ecommerce.
The rest they would wing while they worked out South Africa’s fledgling ecommerce space.
Eight years later, Esque Online is an established and successful online retail store specialising in furniture and décor that delivers nationwide.
These are Tyack’s lessons in launching an online business with R60 000, no external funding, and building a brand that does over R1 million in turnover per month. Finding the right idea
When Tyack finished her degree in sports sciences in 2009, she was sure she was entering the right profession. What she didn’t know was that she wouldn’t spend a day practicing as a sports scientist. Instead, her future brother-in-law offered her a job in marketing, and she took it as a stop gap while she looked for a job in her new area of expertise.
“What I didn’t expect was how much I would love marketing our products to architects, interior designers and property developers,” she says. “I realised that I loved the industry and I loved working with people.”
The rest, as they say, is history. After two years Tyack resigned. She married her husband and felt that working for his brother-in-law was keeping things too close in the family, but she wasn’t ready to leave her new-found passion.
“A friend who was an interior designer had an idea to start an online furniture and décor store. We had no idea what we were doing, and ecommerce was fairly new in South Africa, but we decided we had nothing to lose. I’d worked on our website in my previous position and had a vague idea where to start, and my partner owned an interior design business and had strong relationships with architects and suppliers. The rest we would figure out.”
Tyack and her business partner recognised two of the most fundamental success factors in any start-up: you need a network that you can leverage and a willingness to learn.
“I borrowed R30 000 from my husband and my business partner added R30 000 from her business. That was it – our start-up funds were R60 000.
“We spent the next eight months researching different ecommerce platforms, watching online tutorials, reaching out to suppliers and attending ecommerce expos and events,” she says. “We also did extensive market research. Even with all of this in place, we knew we would be tweaking and adjusting our site and our offering once we launched.”
Tyack and her partner partnered with Shopify
to launch the first iteration of Esque Online. “Shopify was very new in South Africa. They hadn’t even launched here yet, but we connected with the team in the US and they were incredible. The level of support they offered was excellent, and they also sent us a lot of information and articles on small start-ups. It was through Shopify that we learnt about the dropshipping model, which is what we built the business on.”
Dropshipping is a retail model in which goods are collected from the supplier and delivered directly to the customer. “Using a dropshipping business model meant we didn’t need to purchase or hold stock ourselves, which meant we could bootstrap the business, even though we were focusing on niche high-end furniture and décor,” explains Tyack.
The challenge was that dropshipping was new to South Africa as well, and so Tyack and her partner needed to educate the suppliers they approached so that they understood the model and were willing to try it.
“We didn’t get the model right overnight,” she admits. “We had to learn that we could only work with extremely reliable suppliers, and it took time for the delivery businesses we contracted with to understand the model as well.
“Our relationships with our suppliers are also extremely important. We work hard to keep each relationship happy and healthy, which builds trust and gives us the confidence we will be able to deliver on our customers’ expectations.”
Transportation also presented challenges. “It’s now standard practice for different elements of orders to be collected from multiple suppliers, collated and delivered to a customer as one order, but when we started we were going completely against the grain of what delivery services were used to. A customer could order dinnerware, a vase, a table, and chairs from four different suppliers situated across the country, but everything had to arrive at the same time. Logistically, we had to work hand in hand with the companies we contracted to while we got it right. It didn’t happen overnight and we sometimes do still deliver in separate deliveries depending on what items have been ordered.”
Building a loyal customer base
Today, Esque Online’s model and working with multiple contractors, including suppliers, transportation businesses and a marketing agency are standard practice, ensuring the business keeps its overheads low and can focus on its core – being a technology business that sells and delivers furniture – but the journey (and success) did not happen overnight.
“When we launched in 2013, we thought we would see fireworks and the orders would come streaming in. Instead, we had incredible family and friends supporting us, but that was about it. It ended up taking two years before either of us could begin drawing a small salary from the business – and that was a day that we celebrated, believe me.
“We learnt that simply turning on an online retail store doesn’t mean customers will find you – or trust your brand. That takes a lot of time, hard work and understanding who your customer is and where you’ll find them.”
It took between two and three years for Esque to start building a loyal customer base and for the brand to become known within niche high-end décor and furniture circles.
“There were pros and cons to launching when we did. On the one hand, the ecommerce space was new for everyone, which meant we had time to learn as platforms and tools developed. For example, nothing was integrated. You had to work on Facebook, Instagram, your website and any other platform independently. Now, everything is integrated and there are sophisticated tools at anyone’s disposal. This means that there’s a bigger learning curve when you start today, but you can do so much more.
“For us, the biggest first step was figuring out who our customer was, and how to reach them. It’s easy to come up with an idea and it’s exciting and creative to commission a graphic designer to create your brand identity. It’s even easy to build a website – you can launch next week if you want to.
“But who is your client and customer base? What are their interests? Where do they live? Where are they shopping? What other industries are targeting them? Where does your brand need to be for them to see it and engage with it?
“These were all touchpoints we needed to learn and test. It’s a process that doesn’t happen overnight, and because we weren’t social media or marketing experts, we were learning from the ground up.”
Mastering supply chains has also been a steep learning curve for Tyack. “How readily available are your products? It’s not enough to have them on your site, you need to be able to get them to your customers.
“Seven years down the line and Covid-19 really showed us how at risk supply chains can be. With limited raw materials available, many factories were not able to fulfil orders. There will always be surprises and challenges popping up, and you need to be prepared for them. You also need to maintain strong and transparent relationships with your suppliers so that you’re aware of any difficulties they are facing as well as your customers.”
The biggest lesson that Tyack and her partner learnt as a start-up was that they weren’t an online furniture and décor store. Instead, they were a technology business that sold furniture.
“We were touring Yuppichef’s offices and Paul Galatis, one of the founders of Yuppiechef, said that they were an IT company selling kitchen ware. The penny dropped for us then and there. We were constantly on the back-end of our website, watching Shopify and Youtube tutorials and learning basic coding, but we hadn’t framed it in that way. The quicker you can understand that you will be sitting behind a computer, coding and focusing on the backend of your website, the quicker you’ll find yourself in your reality and you can push forward and build your business. It was a critical mindset shift we had to make.
“It also changed where we invested any additional growth funds. If there was something we couldn’t do, we contracted developers so that the experts could handle it – our website is our business. And once the brand and customer experience became too big for the basic Shopify templates, which is an excellent start-up tool, we invested in a more sophisticated ecommerce template and built it up ourselves as well.” From start-up to scale-up
Moving from start-up phase to a scale-up or growth phase requires a shift in strategy and focus as well.
“Two years ago, I bought my partner out and my husband joined the business as chief financial officer,” says Tyack. “Focusing on growth shifts the way you do things, and even though we’ve never received outside funding and the entire business has grown organically, we’ve needed stronger financial and operational controls to be put in place.”
One of the biggest shifts Tyack has made is outsourcing Esque’s marketing. “As a start-up, funds are limited, and we did the best with what I had. I’d been in basic marketing and I learnt as much as a I could about social media, Facebook and newsletters, and we grew our base slowly but solidly.”
As soon as it was possible to start outsourcing certain functions though, Tyack took the opportunity. “There are so many experts in their fields freelancing today. Tapping into their skills instead of hiring in house, or worse, someone performing a critical function such as marketing as an add on to their other roles, makes sense if you’re serious about growth.
“In 2019 we consolidated everything we did and moved it all from various freelancers to an agency, and we saw an immediate uptick in traffic and sales. We should have made the move a lot sooner. It makes sense to invest in growth, and sales and marketing are growth engines.”
Another key shift has been operational. “When my husband joined us a few years ago he took us from a start-up that was focusing on day-to-day operations to a far more structured business built on excel spreadsheets, analytics, data and sales reports. He also helped us understand pricing in a different way.
“We had already learnt that you need to price for your market. For example, our market appreciate quality, and if something is priced too low, the expectation is that it’s not good quality and they’ll look at a different product. There is a real science to pricing though, and the correct data and insights are important in finding that balance.
“Today, we’re a blend of understanding the customer experience and knowing this market, and data and science.”
The platform and customer base that Tyack and her partner built over seven years meant that the business didn’t just survive the global pandemic, it thrived.
“Business is always a mix of luck and preparation,” says Tyack. “When we closed for five weeks during the initial Covid-19 lockdown in March 2020, we weren’t sure we would survive. Instead, as soon as all online retail was able to reopen, we were well-positioned for growth.
“We had a loyal customer base who was suddenly investing their overseas holiday funds into refurbishing their homes, and we were their go-to brand. We were online, reliable, reputable and high-end. And we had the supply chain and network to deliver a supplier product and customer experience. Everything came together, and for the first time we broke the R1 million per month revenue threshold. We’d come very close a number of times, but we’d never crossed the line. During lockdown and beyond we began averaging 300 orders per month. Our average order size is between R6000 and R7000. We were perfectly positioned for the uptick.”
Tyack’s goals going forward are simple. With one record year under her belt, she will continue to push forward and pioneer. “Amazing new local suppliers have emerged and supply chains are becoming more focused on staying local instead of relying on international materials. We source from South African companies and there’s never been a better time to support local, invest back into the country and boost our economy’s growth.” 3 lessons in growth from Esque Online 1. Pay attention to your user experience.
In the online space, the user experience is crucial. Excellent photography gives your customers a sense of the products you’re selling since they cannot experience them in person. A seamless online experience is also important, so invest in a platform that supports your needs. If there are multiple colour and style options per product, for example, a more sophisticated platform is required. 2. Hire slowly and fire fast.
This was one of the hardest lessons that Tyack and her business partner learnt. In their early days they hired a bookkeeper who appeared perfect. She handled their accounts and was involved in admin across the business. It took them eight months to discover that all was not what it seemed – paperwork didn’t always make sense and orders and numbers did not align. When they finally asked for all the records, their bookkeeper disappeared, never to be heard from again. “We still don’t know how much we lost,” says Tyack, “but we also know that we got off easy because it happened while we were still so small. We learnt the lesson and our turnover was still low. All in all, the best way to learn such a difficult lesson. Today, we take our time to ensure we are hiring the right person and that our values align.” 3. Stay focused.
“A few years ago, we ran a very successful pop-up store in Dunkirk Estate in KZN when the restaurant launched at the Clubhouse. The problem was that it completely took our attention away from the platform, which was our actual business model. That shift in attention also happened at the same time as our bookkeeper was defrauding us. You need to focus on your goals and keep your attention on them. Trying to do too much at once dilutes your focus – and your success.”