The White Company: Chrissie Rucker
The entrepreneur reveals plans for a £100m business
Two London hotels. Each with a team of store staff down for a training weekend. One offers fantastic customer service – lovely bath products, bath robes, efficient room service etcetera. The other offers a miserable experience – no towels, beds not made properly, malfunctioning key card, no bath products, ordered coffee failing to arrive. Neither team knows they've been set up.
This is how The White Company's Chrissie Rucker works and sums up why her 12-year-old business turned over just shy of £50m last year. Customer service and quality products for great value are the three principles she has built her white empire around.
The training initiative was the brainchild of the company's head of retail, and when the two teams met the next morning, still unaware of the cunning ruse, it prompted a fantastically lively and open discussion about the value of Rucker's founding ideology. If they hadn't understood beforehand what The White Company was about, they certainly did after that.
Her business isn't particularly unusual in claiming great customer service and good value. Execution is what makes it more than an empty promise. If you say your company's this or that, you've got to back it up. And she does. In spades.
Starting her business
The White Company wouldn't have existed if a designer department store Rucker entered had given her what she desired. Faced by a snooty shop assistant who doubted her ability to buy from the more expensive range and made her feel distinctly unwelcome, she decided she could offer more, for less.
It no doubt helped enormously that her partner, Nick Wheeler, had already started his own mail order shirt business – you've probably heard of Charles Tyrwhitt. So, only 24 and an assistant health and beauty editor for Harpers & Queen, Rucker sold shares left to her by a grandmother, pooled some cash and started-up with £20,000. At Harpers it was her job to organise shoots and pages of editorial, so putting a brochure together was a cinch, she recalls. “From November 1993 onwards I wrote to exhibition centres – NEC, Olympia, Earls Court asking for past trade show catalogues. Between November and March I secured a supply base using UK-based people or importers. I started with a very small range – the brochure was only 12 pages and featured china, towels and bed linen, among a few other things.”
That left her with five grand. With her publishing skills she put together a business plan and a press release, sending it to all the journalists she knew. Then she scribbled down a mailing list of 800 names, including her mother and mother's friends.
The week the brochure was printed the Financial Times picked up her story and penned a piece. “The phone lines went ballistic, and in the space of three days I had another 1,000 names and addresses. Journalists loved the idea – no-one else had done anything that was just white.” It's an interesting point. Henry Ford famously said, “Any customer can have a car painted any colour that he wants so long as it is black.” That was before consumer choice became a real selling point.
It seems incredible that quality white items were a commodity, hard to find. And to have an entire business around a colour and succeed remains unusual. But scarcity or uniqueness, after all, are among the most valuable assets you can have.
She was packing a couple of orders a day from a rented attic room where she'd set up a small office. “It was fine until the boxes started arriving and filling the spare bedroom and bathroom. By the time the kitchen was full, Nick had had enough. I moved it into a warehouse and took a spare room in the back of his office. My sister helped out, and in the beginning we looked like a couple of blonde bimbos loading up a Mini Metro and queuing up in the Post Office with enormous boxes.”
All pretty standard entrepreneurial fare, you could argue. Equally, her admission that there was no early formal strategy is common. “I was incredibly young and naïve. I had an idea and left on a whim. I had no formal business sense – just young and gung-ho.”
Like her husband, she chose mail order – a national market with a relatively low overhead, she reasoned.
From mail order to retail
The perception of mail order, even 10 or 15 years ago was that it was cheap, poor quality and mass marketed. Boden, Racing Green and Wheeler's Charles Tyrwhitt helped change that. A 28-day wait dropped to two or three, and the new kids on the block shot for the more affluent market.
As a result, The White Company grew by over 40% each year for much of its first decade. “For the first eight or nine years we recorded amazing growth,” she says. “The product range broadened. From bed linen and towels it became a complete lifestyle brand.”
The original 12-page brochure is now 148. And seven years in, the business opened its first store – slap-bang opposite the back of John Lewis' Peter Jones department store just off Sloane Square in ABC1 heartland Kensington & Chelsea. It was a move borne of necessity, she says. “More and more customers were coming to our warehouse, and it was difficult to give them the experience they should be having.”
There are now 12 stores nationally, three franchise outlets in Dubai, plus two Selfridges concessions and one in Allders. The stores stretch from Bluewater and Guildford in the south, through London, Birmingham, Manchester and Leeds to Glasgow and Edinburgh in the north and out to Bath in the west. In addition, the company diversified in 2004, introducing its first Little White Company products for children. There are now two stand-alone stores and plans for more.
Driving through the retail slump
It's been an unqualified success, with sales exceeding targets by 30% last year and now representing 20% of total turnover. One of the key advantages to the business has been the shift in customer profile. The average age has dropped, with Little White inevitably attracting pregnant women and young mothers, opening up a new generation of buyers.
The main group is still 40-plus, but diversification has made the company more of a cradle-to-grave brand, not that Rucker would be likely to use such a phrase. It's also enabled her to introduce flashes of colour inspired by her children's interests, such as space, cowboys and pirates – she has a son and three daughters between the ages of nine and two. Like-for-like retail sales, including Little White's, were up around 4% on 2004-05 figures, which Rucker was relatively happy with, bearing in mind the sticky climate. “It wasn't quite where we'd have liked it to have been,” she says. “But a lot of people have seen minus 15%.”
Like-for-like retail sales this year are already up 9% (across all channels the figure is 39%), making for a sunnier outlook; although she won't be taking anything for granted. “You've got to be so careful with those statements. Easter was at a different time last year, so of course like-for-like we're looking fantastic. But we're ahead of budget, so I'm very happy.”
Since the move to retail in 2001, the company has worked hard to keep things fresh. The product range changes every three weeks, bar the staple white items. Rucker also recruited her old boss at Clarins, where she was a press officer, to take charge of customer events, such as offering champagne, nibbles, product demonstrations and having models in to show off the clothes. These events, she says, boost interest and loyalty and support her ethos of providing a sanctuary for people with stressful lives. She's not stopping there, either, and recently agreed a £3m unsecured bank loan to fund four more stores, two concessions and an enhanced back-end.
The multi-channel approach
Exceeding the stores' performance, the company's overall sales growth was 25% to March 2006, which was close to budget despite conditions. Rucker puts it down to a true multi-channel approach where each channel – mail order, retail and online – gets as much attention as the next. “We have very specific marketing for the web, retail and mail order. The three areas of the business talk to each other, though, and we've got customers that shop all three ways. I went to a conference that illustrated how multi-channel customers spend more – you're making it incredibly easy for them.”
Mail order accounts for around 38% of sales and “has boomed”, while 37% is taken at the tills, trades sales to interior designers add another 3% and an impressive – and rising – 22% is generated online. It's a part of the business Rucker is particularly pleased with, and the site now boasts the company's entire range of more than 2,500 products.
She introduced a ‘flick-able' brochure, an innovation in UK online retailing to make life easier for those more used to mail order. Every picture and piece of text in the ‘brochure' has a hyperlink to take you through to full details, proving that more showy elements on a website can also be practical for the user. “I saw one on a US website. I think we're the first here to do that. The thing about a website is you can't turn the pages and have to click through everything. It's a very different way of shopping.” Shoppers preferring to use the site as they would others can do that, too.
Rucker has also just hired someone for the web to decipher the psychology of online and mail order customers. “It's all about understanding each customer cell and how they respond. We are constantly looking at which marketing activities work.” This means assessing which click-throughs work, whether customers react more to £10 or 10% off and spending more on search optimisation. The pay-per-click affiliate marketing scheme through TradeDoubler – a European leader in affiliate management – is effective, with commissions of up to 10%. And blogs – where regular contributions are made to a form of online company diary – have also helped to increase traffic since the site was relaunched six weeks ago.
To ensure a coordinated and integrated approach, she has hired a marketing agency for select projects. “Until now I have always driven the marketing, offers and customer-facing side,” she says.
Keeping customers happy
The VIP loyalty scheme is another ploy that's proved powerful. “We believe passionately in looking after the best customers and segment them by how they buy and when they last bought [0-6 months, 6-12 months, and 12 months to 2 years]. Those that haven't bought for a while are targeted so as to reactivate them. Customers are expensive to recruit, so it's important to look after them.”
VIP customers have to have bought within two years and are entitled to a special offer each month, specifically connected to the season, as well as the first copies of new brochures and early notice of sales.
At least 450,000 receive 10 brochures a year, but as is often the way with mail order, many of the 600,000 on the full list haven't bought at all. The aim is to convert their enquiries through the smaller, more compact catalogue. The company also rents lists, sending taster brochures, and places inserts in magazines. Inevitably, keeping on top of this is crucial. “There's a natural cycle, and if they haven't bought for a long time, we don't mail them so often. Regular buyers get all brochures, and the biggest ones. The key is to send the right size to the right person, otherwise the cost outweighs the benefit.”
It's certainly the case, Rucker says, that pricier models and photographers equate to more conversions, and just as she did at the outset she still plays an active part in the process. “I always sign off the models and shoot location. I see all mood boards before they're shot, proofread the brochures and write quite a lot of copy.”
The art of delegation
Beyond that, she's become artful at delegation. “In the olden days I was a total control freak. I went on a delegation course, and it was a life-changing moment. It taught me an enormous amount. Handing over responsibility is an important part of job satisfaction. I had to learn how to brief properly, but the more you hand over the more they enjoy their jobs.”
Even her role creating brochures is largely entrusted to the creative director, but for obvious reasons. “He's me in men's clothing. The team threatens to buy him a blonde wig and call him Chrissie,” she jokes.
It's been five years since the delegation course epiphany, and the senior team is now comprised of an MD, an FD and directors in merchandising, HR, retail, marketing, customer services and the creative side. “I was starting to have a crisis juggling work and children and put a lot of focus on building the management team.” She also employs an unofficial chairman – “the City's golden boy and the chairman every VC or private equity house wants to have”. And then there's husband Nick.
As well as enabling her to work more from home – she splits time between London and the family pile in Shropshire – the structure is designed to compensate for her deficiencies. “I'm not a figures person,” she admits. “I'm absolutely crap at that side and hopeless at operational management. I'm definitely a product person.”
Getting the infrastructure right
There have been times when the back-end needed to catch-up. That's why last year was one of consolidation and recognising it was crucial. “We're just having two years of re-investing. Once we get over this year where the focus is customer service and training, we'll start going back up. In our three-year plan we go to 8% and then 10% on profit levels. It's that rollercoaster – where you make loads of money, then you re-invest.”
Much of last year was spent moving from a 30,000sq ft warehouse where a marquee was erected during busy periods to a new £1.3m 100,000 sq ft base more capable of feeding 30 stores and up to 6,000 orders a day. “As everyone tells you, it's the most painful experience you'll go through, and in hindsight, even budgeting for 20% growth was probably too high.”
It's always worth being prepared for the unexpected, as Rucker discovered. “We had this horrendous situation where the pipe carrying data from our west London offices into the warehouse wasn't quite big enough. The pipe ran under another person's business and in total it took six months to have the new one put in.” Throughout that period the company had the inconvenience and expense of biking despatch notes from the call centre in London to Northampton in order to send the parcels.
In addition, the warehouse had to close for four days for a complete stock-check. “To fulfil, we built stock up in all the stores, put stock aside, so the lorry just had to pick it up. Our new operations person planned it brilliantly. We were only shut down Thursday and Friday for the customer in terms of despatches.” The company also picked the quietest time – Spring – to carry out the work. “If you have glitches it can hamper your productivity. Thankfully now it's all up and running smoothly, but I wouldn't move again in a hurry.”
While upgrades continue on warehouse systems and IT, it is now largely geared for growth. Sales are already up on last year and turnover is likely to exceed budget, with the company's financial director re-forecasting from £56.6m with 3.5% net profit to closer to £58m with 6% profit three months in. “We re-forecast every quarter, and every pound certainly counts,” she says.
Beyond this year the company has a top line five year plan, then a three-year plan “with a bit more beef”. In five years, depending on whether the company tackles the US, it expects to reach £110m. “We could grow faster, but I'm interested in strong, solid growth.” Meticulous, as ever.
The White Company: In brief
Name: Chrissie Rucker
Company: The White Company
Proposition: Lifestyle products, in white
Turnover: £49.5m to March 2006