The Entrepreneur: Rob Halliday-Stein, BullionByPost
The man behind the leading online gold dealer on building a £120m company, complacent business owners and gripes with corporation tax
Founder: Rob Halliday-Stein
Description in one line: The UK’s leading online bullion dealer delivering gold and silver bars and coins through the post.
Previous companies: Previously worked at Asda, and Dolland & Aitchison opticians
12 month target: £120m
Describe your business model and what makes your business unique:
- The first bullion dealer in the UK to offer live online pricing and free insured next day delivery.
- Excellent customer service has been made a priority to ensure rapid growth and repeat orders.
- Profits have been reinvested into the business and spent on marketing, with close sales on return on investment (ROI).
What is your greatest business achievement to date?
Starting a business from scratch with just £10,000 and building it up to a company with a £120m turnover and a workforce of 17.
What numbers do you look at every day in your business?
I look at sales for vanity, margins for sanity, and new customer numbers to make sure we are still growing.
To what extent does your business trade internationally and what are your plans?
At the moment most of our sales are based in the UK. However, we have clear goals to expand into European markets and are taking steps to make this a reality in the near future.
Describe your growth funding path:
I started off without any outside investment, funding the business with £10,000 of my own money. I then reinvested all cash generated organically.
What technology has made the biggest difference to your business?
Clearly the internet, as without it I wouldn’t be running an online business! However, more specifically, PCs are so cheap as a business tool. For a modest budget, the average computer can be used to set up and run a business and website, whereas years ago, this would have cost tens of thousands of pounds.
Where would you like your business to be in three years?
I would like the business to have a turnover of £250m and a profit of £5m. I would also like it to be recognised as the undisputed number one online bullion dealer in the UK, with a substantial market share in most European countries.
What is the hardest thing you have ever done in business?
Probably letting someone go. I liked them but it wasn’t working for them or the business and although it was a difficult decision, it was the right one.
What was your biggest business mistake?
During a particularly busy time when the price of gold went up very sharply, we stopped taking orders. We were so busy and got caught up in not being able to make our next-day delivery promise, but in hindsight this gave some of our competitors a foot in the door. Instead, we should have done a better job at managing customers’ expectations and carried on taking orders.
Piece of Red Tape that hampers growth most:
Corporation Tax. I don’t mind paying it but the way the rate jumps up from the threshold of a small company to a larger company is crippling on cash flow. It means that companies initially pay for 12 months in arrears at a low rate. Then within the space of about three months, they can suddenly be faced with paying 18 months worth of corporate tax at a higher rate.
What is the most common serious mistake you see entrepreneurs make?
Often when business is going really well, entrepreneurs assume that it’s all down to them and can get a bit complacent. Yes, you may have come up with a great idea, and executed it well, but there are always external factors such as timing and little of bit of luck, which should be taken into account too.
How will your market look in three years?
I think the market has the potential to be much bigger than it is today. I expect the number of people in the UK buying gold for investment to continue increasing. If, for example, there is a resurgence of the banking crisis, the market will be much bigger than it was in 2008/2009 when we started because a lot more people are aware of the ability to buy gold now. I think the old-fashioned established bullion dealers will struggle to still be in business though as they haven’t moved with the times.
What is the single most important piece of advice you would offer to a less experienced entrepreneur?
Make sure you understand the market in which you operate and what works and what doesn’t work.
It was a two-seater Aston Martin, which is now up for sale as my partner and I have recently had a baby, and now need a more practical car.
Executive education or learn it on the job?
Learn it on the job. There will be a lot of things that you’ve never done before, but they can’t be learnt from a book.
What would make you a better leader?
I think I would be a better leader if I listened more to customers, suppliers and employees.
The Beermat Entrepreneur by Mike Southon. I found it a useful tool for understanding how to grow a business, and the steps you need to take to go from a start-up to a bigger company.