Understand your starting up risks
“If you’re thinking of starting up a business from scratch, it’s really important to understand the risks that are involved,” says Synapco Managing Director, David Ussher
The Technology Valley Gracefield based polymer customer moulding business was established in 1981 by David.
“I didn’t really understand the risks, and had to go through a very steep learning curve, which had significant consequences from both a family and business point of view.
Statistically the majority of new business start-ups fail within the first five years. The reasons are many and varied, but getting good impartial marketing and financial advice from trustworthy sources is critical for success.
He gives an example of someone who may have developed the best gizmo in the world from a great idea - but that getting it to market is a lot more difficult than people might expect.
“In our case, we thought we saw a great opportunity in the domestic kitchenware market, especially for a superior quality heat-resistant rubber spatula,” David says.
“We talked to various people, including a local distributor. Everyone said they supported our brilliant concept. Moulds were ordered (arrived six months late) and the moulding machine purchased from the USA, all at significant cost for our small fledgling business.
“Initial orders from the appointed distributor looked promising but not spectacular. We knew we had to broaden our horizons to get volume.
“Australia is our closest significant market, so samples were packed and we jumped on the plane to Sydney. After meetings with several supermarket chain buyers, it because very apparent they would not deal with a single product supplier, and suggested we find an Aussie distributor who could add it to their kitchenware range.’
“The crunch came when one distributor agreed to talk to us. They had just landed their first consignment of rubber spatulas produced in Asia which were a carded 3 pack blister offering.
“These landed in Australia duty paid at a significantly cheaper price than our non-carded, non-wrapped single unit. Our realisation that we had missed the boat with Asian kitchenware about to swamp the Australian market was a bitter pill to swallow.”
David says that on reflection, Synapco failed to establish or understand the risks from Asia.
“Had we gone to Australia before committing to the spatula production mould we would have saved ourselves a lot of heartache,” he says.
“Fortunately for us, we were able to redirect our focus into industrial componentry which quickly became the mainstay of our business. In a couple of years we will be celebrating our 40th year in operation.”
(Picture: Synapco managing director David Ussher with a poster of the SafeWaste wheelie bin closure it markets)