Tuesday, August 7, 2012/
Dean Ramler founded the online furniture website Milan Direct with his school friend, Ruslan Kogan of Kogan.com, with the aim of bringing affordable designer furniture to the masses.
The business now has a turnover of $12 million a year and Ramler has plans to expanding into Europe, the United States and Asia within the next three years.
He spoke to SmartCompany from London, where he was attending the Olympic Games and checking in on Milan Direct’s UK warehouse.
Dean Ramler: Co-founder and owner, Milan Direct
So Milan Direct has expanded to the UK – how is that going?
We’ve been in the UK for three or four years now and have expanded the business, without any staff on the ground here. We do have a warehouse outside London, but all customer service is managed back in Melbourne. Within a few months of setting it up, Milan Direct was a multi-million pound business in the UK.
The UK market makes up 30% to 40% of turnover, but both our UK and Australian markets are growing at the same speed and we are seeing major growth from Europe, with European customers purchasing from our UK site. We are just about to launch a new website in Australia and the UK as, at the moment, customers in Europe can’t purchase directly through the website, they have to email us and we invoice them manually. The new website will have drop downs for each European country, so it will make it easier for those in Europe and we expect to see more sales coming up.
Why did you make the move to expand into the UK and Europe?
We made the decision based on massive demand for our product from the UK, so we jumped on and used the free tools that Google provided and compared our top 20 products and we figured out UK customers were searching much more than Americans for our products even though it was a smaller population. It was a success from day one and the products Google said would sell well have.
Our whole strategy is based on the data that Google provides and we have a list of 10 countries to expand to based on that. We know in the US that office chairs are very popular, so we might expand into the US just on the basis of office chairs, as we are more likely to succeed that way. We tend to do a lot of research and make a lot of objective decision based on fact, so it takes the guess work out of online.
What are the 10 countries you plan to expand to?
Without giving too much away, the United States is still very attractive and Asia is very attractive plus there are several other countries which have similar demographics to Australia. Milan Direct has a really broad range of office furniture, home furniture and outdoor furniture. In Australia we are really competing with Ikea and Harvey Norman, so the offering is really suitable for a number of countries. It’s just a matter of resources. We don’t want to spread ourselves too thin. We pride ourselves on having 24/7 customer support and we can only do that by running a purely online store; it doesn’t matter which market we operate in, we have staff around the clock.
Having been through the process in the UK, what will you do before expanding to another country?
We do due diligence to find the perfect partners. For example, we know what we need from warehouse and freight. We need partners who can match our service and price levels as well. Now we have rolled out in Australia and the UK, we know what our prices are.