How Two Founders Started A $5M/Year Business Selling Beach Towels

Published: November 18th, 2018
Andy Jefferies
Founder, Dock and Bay
$450K
revenue/mo
2
Founders
12
Employees
Dock and Bay
from Sydney, New South Wales, Australia
started September 2015
$450,000
revenue/mo
2
Founders
12
Employees
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Hello! Who are you and what business did you start?

I’m Andy, co-founder of Dock & Bay which is an awesome new lifestyle brand selling travel apparel, fitness, and beach accessories for those who love exploring this awesome world.

We sell towels, swimwear, ponchos and hair wraps, always with a cheeky touch of colour because we don’t believe in taking life too seriously. It’s just more fun that way.

We reinvented the towel to be sand-free, quick dry and super absorbent while staying compact, because no one wants a towel that takes up all of their suitcase space.

In our first full year of business, we had a turnover of $92K and this year we’ll be turning over $5.4m.

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What's your backstory and how did you come up with the idea?

Personally, I always knew I would have my own business. I watched my dad run his own recruitment agency from a young age and I loved the freedom that came with being your own boss. Even though I studied Business Management at Leeds University in England, I didn’t start my own business straight away as I needed to find something I was passionate about first.

Don’t be put off by the big picture, doing all the small steps first allows you to get started. Things like deciding on a company name, registering your company, purchasing your domain, designing a logo... All of these small steps can get you inspired and help you move forward with your goals.

Ben and I came up with the idea after we had been traveling a few years ago. We hated using soggy, bulky towels that took up your suitcase space and had a weird odour after a few washes. We wanted to create a towel that didn’t hold you back from exploring, and all of the other quick dry towels we found were small or had dull colours. We didn’t have any expertise in this space and we both worked in finance at the time, so we took a huge risk, packed in our jobs and started researching manufacturers to make our dream towel.

Quitting our jobs was a big decision but it wasn’t done on a whim; Ben and I worked in banking together in London so we had some knowledge of finances for the venture. While I had to borrow $40K from the bank, Ben had the money saved up (clearly he’s older and more responsible than me...) and we launched our business in the UK in September 2015.

We made a prototype design (which was less fancy-looking than it sounds, made from a pulled down curtain) and ordered samples from various factories and manufacturers from China.

how-two-founders-started-a-5m-year-business-selling-beach-towels

It sounds weird, but I carried around those sample towels everywhere I went to make sure they worked in all situations. I showed the product to friends and colleagues asking for their opinion and once Ben & I were satisfied, we uploaded the towel on Amazon. We sold 100 on the first day but I’m pretty sure most of those sales were my mom.

We launched in the US three months later in December 2015 and in Australia soon-- after that.

Describe the process of designing, prototyping, and manufacturing the product.

We didn’t have any experience with any of this stuff - design, manufacturing, accounting...

The process was very much randomly pulled together. We had our designs made abroad through a company called UpWork, a freelancing tool where businesses and independent professionals connect and collaborate remotely. Then it was a lot of going back and forth sending feedback on the samples we received. It wasn’t a slick process at all since we honestly didn’t have any experience so it was very much trial and error before getting a product Ben and I agreed was right.

We actually made out that we were a bigger company than we were to the manufacturers so they took us more seriously. They say fake it ‘til you make it, right? We wanted to make sure each part of the product was exactly how we wanted it and we were sent rope samples for the bags, stitching samples, material samples… I remember we actually spent a week staring at our screens agonizing over towel colours and then once we were satisfied, the sample was sent to us and the colour was completely different in person. It was all a massive learning curve.

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We kept all of the decisions between Ben and myself because it can get over complicated when you ask for too many opinions. I’ve seen others become too clouded by other opinions that you actually lose sight of the product you originally wanted to make.

When we started, Ben and I initially gave $10K each to make our first order, creating the website and for basic marketing costs. We created a few adverts on Amazon but the majority of the costs went on product orders. We could have potentially patented the printing method for our towels as it’s quite unique but chose not to purely due to costs. We weren’t that bothered about patents since it’s more important to keep designs new and fresh anyway, especially in retail.

Describe the process of launching the business.

Ben is the man behind setting up our website. We used Wix.com when we first started but it was quite basic without any fancy features. All of our photography was done by Emma, Ben’s (now) wife and the products in our imagery really stood out.

We then went to Bigcommerce but we needed something that could handle multiple warehouses, currencies, and countries. Ben set us up on Magento which provides us with everything we need.

Our very first day launching the towels was our biggest day of sales for the first few months and we sold out in three months. A big lesson for us was understanding timelines better. It was important to spread the word with family, friends and use social media to attract new audiences.

We underestimated the success of our products and initially missed the Christmas shipping deadline meaning all of our products arrived after the holidays. At the time, we thought our stock levels were plenty and didn’t think we’d need to re-order anytime soon but, as a result, we missed an entire season. Then another delay came along; we hadn’t realized that manufacturers in China close during February for Chinese New Year - an error we definitely won’t be making again! Plan for success. If things start going well, you should have a plan!

Our sales soon picked up again in Summer 2016 which was our first full season. We initially launched with two designs (across many colors) and expanded with more 18 months later. We needed to wait due to the cost of gaining new high-quality designs, only to realize later that you could actually buy designs for an affordable price that could be used on products. Now we’re releasing lots of new colours, designs and products. We’re definitely always learning.

Biggest lesson during launch? Make sure someone is inspecting your stock before it leaves the manufacturer. A third of our stock from our first order was faulty when arriving with our customers but we had already paid for it. A lot of time and money was wasted fixing the problem.

Since launch, what has worked to attract and retain customers?

In product, the power of online marketplaces like Amazon has been a huge game changer for us. To gain that extra reach and exposure is priceless and something we wouldn’t have been able to achieve on our own. We built our success and product awareness from Amazon and using their Lightning Deals, Buy It Box and seasonal promotions, we can get our products in front of hundreds more people than we would be able to from our own website.

Use the power of social media to your advantage, it’s amazing what you can achieve with a well-focused advert. They can out-perform any other form of marketing with great exposure to people quickly and cheaply.

Social media adverts is also a great tool for small businesses as you can reach a lot of people without using too much time or money. The power of these adverts mean your products can be in front of people’s faces all the time. We use our professional lifestyle photography to show our products (a bonus of having half the team living by Australian beaches) and they instantly look great by the pool or on the beach. We find lifestyle images work a lot better than cut-outs as our audience like to envision the products in use. Reviews and showing influencers with our products work well too.

Launching new products, keeping your offering fresh is also essential. It wouldn’t give us as much business to simply sell towels as the need to purchase more isn’t as strong as a consumable. We’ve just launched quick drying hair wraps, for example, which changes the game for us as it’s not a season-based product. The hair wraps are light, compact, absorbent and combats frizz. They can be used at the beach or pool so they fit well into our brand, but also are perfect post-shower so they can be bought all year round, and it introduces us to the beauty market.

With new products comes the ability to retarget existing customers, new customers and new markets. Even if it’s the same product with a different purpose or new design.

We sometimes work with influencers to gain extra exposure and produce fresh, high-quality content. This summer we did the Colour of Summer project where we chose six brand ambassadors from a competition who fit the Dock & Bay aesthetic and flew them out to Bali for a week. It was so much fun!

We had different activities happening each day like cycling through rice fields, hiking to waterfalls, sunrise yoga, and a massive pool party - we even had a private chef! All inclusive for our ambassadors, all in the name of creating great content for our blog, imagery, and video archives and firming our status as a real, up and coming brand!

How are you doing today and what does the future look like?

At the moment we have a total of six employees, including myself and Ben!

We’re quite good at looking like a big company when there’s only a handful of us behind the scenes. Based in Australia, Ben looks after the logical side of the company and his wife, Emma, is a photographer and handles all of our video shoots, photo shoots and editing.

The rest of us work together in London. We have an in-house designer who works on our product design, marketing assets and website; there’s also a community manager who looks after our customer services, social media comments and feedback. We also have a marketing manager who creates a stir around our product launches, promotions and is always on the lookout for new opportunities with influencers, media and adverts.

In the short term, we’re looking to expand our product range to be more than just towels. We’d love to create travel-friendly products for camping, hiking and the outdoors in general, plus products for the gym, exercising and anyone with an active lifestyle (or at least aspires to have one!).

Long term goals include growing our market share to be the top seller of beach towels, gym towels and travel accessories overall. We’d also like to grow into more markets as reflected in our short term goals, and grow our presence in more countries. In turn, we’d love to build up our team to handle it all! We’re always looking to keep the brand slick, fresh and new. Reducing our carbon footprint is also important to us. We’re always looking for ways to help the environment and do our bit for Mother Nature (and David Attenborough).

We recently created a fully biodegradable bag to send our products in, our swim shorts are made from 100% recycled plastic bottles and our active towels are 30% recycled plastic also. Plus lots of R&D going in the background to how we can continue to change for the better and quickly!

Through starting the business, have you learned anything particularly helpful or advantageous?

I’m quite open-minded to try anything and I love taking risks. If it works out, you can earn big rewards and grow rapidly. If not, it simply becomes a mistake you learn from. Mistakes are never a bad thing. It’s always important to notice mistakes, learn what you need from them and move on.

Ben is very technical and logical; he’s great at making the business clogs keep moving at all times and as efficiently as possible. He’s constantly looking at ways to make the business run smoothly and more efficient. Ben loves to read all the comments from our customers and makes it his mission to fix any problems so they don’t happen again.

The big thing to remember with businesses in the product world is keeping on top of your cash. As your business grows quickly, you have a desperate need for cash to buy new product to keep up with orders. If you potentially miss a whole season of stock because you aren’t ready with cash, it’s a missed opportunity to grow.

Our best decision was launching products both on our own website and Amazon. If your brand or product is different with a unique selling point (and an affordable price), you can use Amazon as a successful tool to be in front of a bigger market, something we wouldn’t be able to do on our own website.

Another tip: Use the power of social media to your advantage, it’s amazing what you can achieve with a well-focused advert. They can out-perform any other form of marketing with great exposure to people quickly and cheaply. It blows my mind that you can sit in your office and sell through multiple warehouses all over the world without needing to physically be involved. The power of the internet, eh?

What platform/tools do you use for your business?

We run adverts from various platforms including Amazon, Facebook, Instagram and Google so we rely on those sites to provide in-depth reporting on our spend, impressions, clicks and ROAS. The e-commerce site and blog is run through Magento which is connected to multiple warehouses to handle all shipping, returns and exchanges.

For team discussions, we live on WhatsApp, Slack and Skype which makes it easy to communicate and send feedback on designs, content and new products to our team members based in Australia. Trello is also great for digital To Do Lists and keeping track of what everyone is working on.

What have been the most influential books, podcasts, or other resources?

I used to read a lot of business books like Oversubscribed and Rich Dad Poor Dad which were really good.

My main inspiration came from growing up with my Dad’s business as I used to spend Saturdays with him and so it got me excited about having my own thing (even though I just used to play games on his computer).

I’ve always wanted to have my own business for the freedom and my mixed love of traveling and hatred of working 9-5.

Advice for other entrepreneurs who want to get started or are just starting out?

A lot of budding entrepreneurs can procrastinate because starting up a business seems like too big a step.

Don’t be put off by the big picture, doing all the small steps first allows you to get started. Things like deciding on a company name, registering your company, purchasing your domain, designing a logo... All of these small steps can get you inspired and help you move forward with your goals.

how-two-founders-started-a-5m-year-business-selling-beach-towels

I also recommend finding a business partner who shares the same passions and interests as you. It works really well if you complement each other with different strengths. If you’re in business by yourself, it can become quite daunting, frustrating and lonely - no one wants that. It’s great to have someone to bounce ideas off of each other and help you make decisions. I believe in start a business with others with an equal shareholding (even if it was your idea), costs and responsibilities otherwise it can start a bad playing field and may come back to bite you all later down the line.

A big mistake I’ve seen others make is not being open to new ideas, or even not giving things a go because it seems daunting. Some businesses do well by playing it safe but it can be quite slow and you miss out on big rewards by taking a risk. Don’t be afraid to try new things. You can always stop them quickly if it doesn’t work out and you can learn from it and move forward.

Are you looking to hire for certain positions right now?

We’re looking to expand our business quite rapidly and in the past year have hired an in-house designer, marketing manager and now looking for a full-time sales manager to provide new sales strategies, manage our accounts online and with wholesale retailers plus building a network of sales agents in our core markets across the US, Europe and Australia.

Where can we go to learn more?

Check out our website at dockandbay.com for all of our stripy product goodness, plus there’s lots of inspiration and posts on what we’re getting up to on the blog. We’re pretty social too, showing our face on all the usual places like Instagram as @dock_and_bay, on Facebook and Twitter @dock_and_bay.

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Left: Ben, Right: Andy