here - Shipwire

THEINNOVATORS
from
CROWD
FUNDING to
CROWD
PLEASING
Who wouldn’t want a product endorsed
by celebrities such as Ashton Kucher and
Jamie Oliver? Annex Products can boast of
this. With demand from over 75 countries
worldwide, Annex Products began with an
interesting story.
22 ASPIRE AUGUST2012
STARTUP
Even if it’s only 75% of
what you would
classify as ‘good enough’,
just go for it.
Use other
people’s money
to get your
business going,
it’s better than
being stalled
altogether.
F
ounded by Chris Peters
(a former industrial designer) and Rob Ward
(a former toolmaker) in
Melbourne, Australia, Annex
Products took off with its first
product, the Opena® Case. 23 ASPIRE AUGUST2012
An iPhone case with an integrated
bottle opener, the Opena® Case
was - funnily enough - conceived
over a few beers. Launched using Kickstarter in June 2011, it
received 50% of its funding goal
within the first week. Word quickly spread around Australia, America, France, Japan, and Russia
and by the end of the first month,
the product received 188% of its
original funding goal. Not a bad
start to kick business off.
Realising its potential and with
hundreds of pre-orders to fill,
Chris and Rob then madly went to
work on sorting out tooling, manufacturing, packaging, fulfilment
and shipping. They used Shopify (an online e-commerce platform) to sell and Shipwire to distribute.
In late September 2011, the first
shipment of Opena® Cases were
sent out to the 578 Kickstarter
backers around the world. Chris
and Rob claim that their business
would probably never have got
off the ground, had it not have
been for these people and will
be forever grateful. As a thank
you, they paid special tribute to
the backers that helped them get
started by sending them limited
edition Opena® Cases.
To date, tens of thousands
of Opena® Cases have been
shipped to over 75 countries and
orders are still flooding in.
Annex Products also launched
the Quad Lock® Mounting System, an iPhone holder claiming
to be the lightest and strongest
mounting system available. It can
be fitted to cars, bikes, prams,
golf carts, shopping trolleys and
STARTUP
ing, the income stops. Whereas
products are always being purchased, you can sell them anytime and anywhere, depending
on the market of course.
Q
What were the first
steps you took to get
your business going?
We had limited capital so decided to try and launch our first
product idea (the Opena® Case)
on Kickstarter. After seeing the
amount of interest, we quickly
realised its potential and went
madly into production mode.
even fishing rods.
Annex Products sound gimmicky but they are functional,
popular and sell extremely well.
I chatted to them about why their
business began, what they’ve
learnt along the way and where
they hope to be heading with it.
Q
Why did you start your
business?
We started the business because we both saw an opportunity to do something for
ourselves and not for other
businesses. It was something
we grew passionate about very
quickly as we were genuinely
interested in it and saw poten-
24 ASPIRE AUGUST2012
We finalised the design of the
product, then sourced suitable
manufacturers, working out the
best tooling prices per unit to
create a good revenue stream.
We then looked into packaging options, then fulfilment and
tial to really take it somewhere. shipping for all the pre-orders.
Plus, our accountant basically
said, you can make more mon- We set up an online store using
ey if you invest 100% of your Shopify (an online e-commerce
time into the business rather platform) to sell and Shipwire
than trying to work in a full-time to distribute (incidentally, they
job for someone else and run it won the Shopify Build a Busion the side, which is what we ness Competition, which helped
were both doing when we first boost their business profile
started the business. Cha ching even more). A lot of our initial
marketing was done online so
– idea sold!
word spread very quickly about
We’ve realised that having a our business, both here and
product-based business means overseas.
we can build up our own busiWhat is it like being
ness, not other people’s, and
in a partnership and
can see the results. Servicewhat are the chalbased companies are all about
being reliant on staff being lenges that come with this?
physically present to operate.
However, when you stop work- We’ve known each other for
Q
STARTUP
many years and decided to
go into partnership as we had
similar interests and wanted to
combine forces.
We find being in partnership
works really well and haven’t
come across any major challenges so far. If anything we’ve
found it’s easier to build the
business having a partner. You
can bounce ideas off each other, you’re there to support each
other and complement the other’s skills.
It also helps if one partner
wants to take a break or a holiday, the other can just step in
rather than the business being
put on hold. We work really well
together. It helps if you have the
same mindset and commitment
to the business and the same
goals.
What have been the
biggest
challenges
with running your
business?
Q
Distribution has been the biggest challenge with our business so far. Sourcing good
distribution suppliers is very
important and making sure they
are trustworthy and know what
they’re doing. If you go with a
company that’s working with
other big brands then chances
are they’re doing something
right.
perhaps there was something
not quite right. The company
promised too much but couldn’t
deliver. The model was good
but they didn’t seem to know
how to implement it. Lucky for
us the company we were liaising with got taken over by another company and we had an
opportunity to get out of the
contract.
Cashflow is another challenge
we face at times, as it can limit
progression of our business. It’s
very important to keep a track
of your finances constantly and
be able to monitor where they’re
at. Not having a good cashflow
could affect our production.
Another challenge we’ve had to
consider is when competitors
copy our products. Again, this
comes down to trust with suppliers and knowing who to work
with. Apparently the average
time for a product to get replicated is about twelve months.
Because we had so much exposure online and word spread
so quickly, our products started
to get copied within ten months.
But copying is a form of flattery
and it was obvious our products were doing well.
Unfortunately we lost five
months throughout the process
(which we’re trying to catch up
on) but it taught us a few things,
such as not to put all your eggs
in one basket. We should have
had them prove to us they could
Have there been any deliver on smaller elements,
major lessons you’ve rather than talking about the
learnt so far with run- whole package, before proning a business?
gressing any further.
Q
At one stage we were negotiating a large contract with a big
retail company. It seemed too
good to be true and after only
a couple of months we thought
25 ASPIRE AUGUST2012
We’re currently trying to move
into the retail space which is
proving to be a bit challenging.
Retailers don’t seem to want to
talk to you if you only have one
STARTUP
or two products. They probably
think of you as a one-hit-wonder
and are not willing to take the
risk until you’ve proven you’re
successful. We’ve learnt you’ve
got to have a fairly good profile to be considered and more
range than just one or two new
products.
Q
What sort of marketing do you do?
Luckily we’ve been able to whip
up demand and hype through
social media, blogs and viral
marketing. The success of this
has certainly helped launch and
profile our business, as well as
public relations. It has a lot to
do with our target audiences.
For example, with the Opena®
it’s mainly 18-36 year old males
purchasing who like gadgets
and spend time online. The
Opena® was easy to pitch it as
it had a bit of a WOW factor, especially for the guys who love a
beer. It was a bit quirky, a bit different and aligned strongly with
the alcoholic beverage industry
26 ASPIRE AUGUST2012
plan ahead. Cashflow can be
your biggest challenge at times,
so make sure you’re frequently
monitoring your finances.
Raise capital if you have to. Use
other people’s money to get
What are your top 5 your business going, it’s better
business tips?
than being stalled altogether.
If you have an idea just
start it – starting is the hard- Annex Products next prodest part. It may not be perfect uct due to launch soon is the
but you’ll learn as you go and Holda™ Case, aka the Playa™
things change. Even if it’s only Case, an iPhone case with an
75% of what you would clas- integrated discreet storage
sify as ‘good enough’, just go compartment. Although initialfor it.
ly created to hold credit cards
Back yourself, believe in your- and cash, it was cheekily also
self and what you can achieve. promoted as a condom holder
Look at your strengths and use on April Fool’s Day this year.
them.
Dubbed the Playa™, a YouTube
clip, which went viral, helped
promote it. It featured a young
guy named Chris who owes his
regular conquests to his special condom holder. Apparently
“Chris is getting laid every day
thanks to the Playa”.
For the sexually active, sexually hopeful, or those seeking a
compact unit to store iPhone,
cards and cash, look out for
Holda™ Case (aka the Playa™
Case - depending on how you
want to use it) on the market
very soon.
which is always an interesting
industry.
Our marketing online has proven to be pretty successful so far
and reasonably cost-effective.
Q
Don’t use excuses to not be
pro-active about starting or
progressing your business,
such as ‘I don’t have enough
time’, or ‘I don’t have enough
money’.
From the beginning of setting
up your business, use a good
accounting system or software.
It’s so important to keep a track
of where your finances are and
Elisa Limburg is
Creative & Managing
Director of events and
marketing agency, elevents. She has worked in
marketing communications for
over fifteen years in events,
marketing, PR, promotions
and film/TV production.