Clayton Smith, co-founder of arty gift store The Poi Room, talks about the $5,000 cash bonus he used to start his business over 10 years ago.
What does your business do?
The Poi Room is a unique New Zealand made art gift store which only features products that are designed and made in New Zealand, with a bent of making a difference to the people further down the chain. We pride ourselves on supporting the art industry and local artists. We started trading in November 2007.
What sparked the idea?
My wife Melanie-Jane and I wanted our own destiny. We were working in the corporate world and the drive was that we wanted some say over our future. We looked at some franchises and other business formats but eventually decided we were smart enough to do it ourselves.
We travelled extensively overseas in our twenties and came back and travelled New Zealand.
We rocked into little towns and met artists and craftspeople, and there were stores that we liked which were motivation, we thought: 'Let's get into retail'.
We had a passion for art, and I had a passion to be in business.
How hard was it to get the business up and running?
It started with $5,000, it was a bonus I got from work which I was going to use to buy a boat with, to go fishing, but instead of that we threw it in to the business. All it really got us was some business cards and a travel fund, but we put our business plan together. We didn't have a brand at that point - we had the concept - and put a touch board together. The initial investment was spent really quickly. It took us a year to pull it all together before we even opened the business. $5,000 was the kickstarter but altogether it must have cost $200,000 to $250,000 to start it.
How big is your team now?
The size of the team fluctuates but it generally sits at around 10 people. We have more over summer and as different projects are going on. Melanie and I are the directors and shareholders and we also work in the stores to make sure they work and work properly and that our supply chains are fully supported at the back-end.
What are your long term plans?
We re-benchmark our plans every few years. We looked at a bit more expansion but realised that maybe we need to be a little bit more focused on the business leads we've got with our two shops in Newmarket and Ponsonby. We've found that with too much growth our suppliers get wobbled. For us, growth in the next stage, is to help our suppliers in terms of their business and their business mentoring. I'm not going to say we're going to grow to seven or 10 stores because I don't think we will, but I can see a great future for the business. Yes, we'd like more stores but they will be carefully considered because we now know how the business works.
Surround yourself with good people because those are the people who want the best for you in business.
The retail landscape is changing drastically, how are you combating this?
Everything now has to become more collaborative. Recent collabs we've done include things like packaging to promote an artists' work. One artist did a line of blankets for us last year, we've done work with Samantha Burgess who did a range of bed ware - again using artist Jodie Clarke, so we bought a manufacturer and an artist together. We do collabs and then we move on to the next one.
What's the biggest struggle you face as a small business owner?
Personalities. Customers, employees, landlords, bank managers, suppliers, everyone. We deal with a huge range of personalities so you've got to be aware and have an understanding of people, and that's with any business - not just retail.
What advice do you give others thinking of starting their own business?
Take advice. Not every answer is the correct answer, and it may or may not suit you in your business, but do open up and listen to people. Surround yourself with good people because those are the people who want the best for you in business.