Dreams: Mike Clare
The debate on whether a university education or general experience best prepares you for entrepreneurial success rages on. Mike Clare, founder of the successful beds chain Dreams will definitely side on the life experience side.
With a brother at Cambridge, a young Clare had something to prove – and prove himself he did. Two decades since opening his first shop in Uxbridge, Clare now boasts more than 150 stores across the UK with an annual turnover in excess of £160m and currently has his sights firmly set on the international franchise market.
“I was always coming up with little business ideas to make money,” says Clare. “While at college, I used to buy massive boxes of condoms and then sell them to the other students individually for twice the price. I’ve just always loved the excitement of trading.”
After leaving college at 18 with a business diploma, Clare started working for a furniture retailer in the beds department and gradually clawed his way up to managerial level. “If I’d landed a job in the carpet department I’d probably be the leading carpet retailer now,” he jokes.
At the age of 30, with a pregnant wife at home, Clare decided he’d had enough of being an employee. “I found a small store in Uxbridge that was in a terrible state, but the rent was cheap. I worked out I needed about £25,000 to start up. I had about £1,500 of my own cash, and sold my car to raise some more. I borrowed some on my credit card and told them it was for a kitchen refurbishment.”
He scraped together £10,000 and the bank matched it. “Once I raised the £20,000 I thought, ‘well the suppliers will just have to wait a bit for their money’. A lot of people don’t like the idea of starting a business in debt but sometimes you’ve just got to take that risk and work hard.”
Clare started up the Sofabed Company in 1985 and within two years he had a further three stores. After a while he decided to branch out from sofabeds. “We had a choice between selling sofas and selling beds. Beds took up less space so we could stock more. Also people aren’t as fussy about the look of a bed. They’re easier to sell – so that’s what we went with.” He changed the company name to Dreams, and hasn’t looked back since.
Clare describes the early nineties as Dreams’ most difficult time. “There was a bit of a recession and we did struggle but we got through it.” Developing a successful formula was the key, although Clare admits it wasn’t a strategic approach as such.
“I would look for a new store that was to let and negotiate really hard with the landlord. We’d order the stock, have a grand opening, get a cake in the shape of a bed, invite the mayor to the launch, then move on to the next site. It wasn’t really a plan, we just did it.”
While Clare didn’t plan too far ahead, he had no doubts Dreams could become a national brand. “I actually imagined that the company would grow to even bigger than it is now. I wasn’t doing it to just run one shop. A proper entrepreneur is never satisfied. I’m always thinking, ‘there’s someone else in that rich list that’s got more money, or someone that owns more stores’. That’s what gets me up in the morning.”
Dreams now delivers 6,000 beds every week, from its 100-strong fleet of vans. “It’s a necessary evil,” says Clare who describes distribution as the company’s biggest challenge. But ever the customer service enthusiast he can turn even his biggest hurdle into a way of making the company stand out.
If a Dreams driver delivers your bed in the rain, he’ll put on a special pair of slippers to avoid leaving a messy trail. “You’ve got to focus on customer service if you want repeat business,” evangelises Clare. “The slippers cost us virtually nothing but it’s all the customers can talk about after they’ve had their bed delivered.”
The same rules apply to his attitude to staff. “Recruiting and keeping good staff is hard but we find ways around those problems. The main thing is you can’t skimp on salaries. It’s worth paying 10% more for an employee that’s twice as good.”
The future for Clare and Dreams looks promising, and it appears his ‘fifth child’, as he describes it, is still growing. The company is now branching out into the international market through franchising.
“It’s not easy, and a lot of businesses do fail,” he admits. “But it’s not as complicated as a lot of people think either.”
He’s similarly undaunted by the threat of competition. “You have to accept it’s part of life. Sometimes they win the battle and sometimes we do, but there’s certainly space in the world for more than one bed company!”