Life of a bum
Wednesday, March 21, 2007/
Aussie Bum, which is a men’s swimming and underwear company that has gone worldwide very quickly. It started in 2001 and it’s already turning over $20 million. Founder Sean Ashby talks to AMANDA GOME.
Sean Ashby is 40, and is famous for starting Aussie Bum, which is a men’s swimming and underwear company that has gone worldwide very quickly. It started in 2001 and it’s already turning over $20 million. He talks to Amanda Gome.
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Amanda Gome: Now, when you started you were a bit of a wild child. You describe yourself as Kath & Kim country, you left uni before finishing, what made you start your own business in your early 30s.
Sean Ashby: I simply couldn’t buy what I wanted and believed that if I wanted it, then other people must want it as well, and this is basically the nylon, 100% nylon, Aussie cozzie, which I’m sure many people in the teenage years or adolescent years grew up wearing, either at the swimming pool or at the beach.
And what was your strategy from day one?
To be able to sell a few pairs of swim wear so I could go to the beach in the afternoon and be a bum.
And what happened?
Well I tried to sell it to people in Australia, retailers, and they all basically said I was a bit of a fool. Like hadn’t I heard of the word lycra or the modern man? I smartly refused to accept that no one would like this product so I decided to take it to the world.
What was your sales and marketing strategy back then, once you decided to take it to the world?
Basically I sent out samples to a lot of the media around the world. I was a personal trainer and used to go to the beach in the afternoon, so I was fortunate that I had some mates that I guess didn’t look too bad in a pair of swimmers and sent samples, sent some images, very iconic of Australia at the Bondi Beach, which is where it actually started from; and lo and behold somebody wrote a little snippet in an article in a London newspaper.
Well at that stage no one would buy the product here in Australia, except my mates of course, and this also was around the same time as big dot.com crash on the internet, so what do I decide to do? Oh I’ll start e-commerce. I’ll learn how to build my own e-commerce site and because we didn’t have the money to employ anyone or contract anyone, literally everything was done in house and the skills were acquired as we went.
You started with $30,000 saved up for a deposit on your house. How much did it take to build your site?
Nothing, because I did it. And that $30,000 went very fast. No one would buy here. I’d pretty much blown all of the funds, so I was really left down to ‘you’re either going to sink or swim’. So yeah, started the internet site and because it was at a stage when e-commerce was all failing, we became quite successful in developing that platform of business.
How did you make people aware of the site?
It wasn’t too hard when you’ve got something from Australia and it’s very iconic and word of mouth spreads quickly. You’re also selling something that’s not available in retail stores. Quite often the mistake that many people make is they believe that they can just open up an e-commerce site and if you build it they will come. The fact is if they can go to their corner shop, they won’t come.
If you swim at the local pool you have a network of friends and especially overseas, if somebody rocks up in a pair of swim wear called Aussie Bum and they’re 100% nylon swimwear, which lasts a lot longer than lycra does in chlorine water, people start talking and then also we definitely put our best foot forward.
We knew that very sexy sassy images will get the attention, or arrest the attention of the international public and really trade off the whole culture and lifestyle of Australia. So that combined with a lot of word of mouth and also having a really good quality product that’s made in Australia was a successful recipe for us.
Were customers buying a number of these bathers at once?
No. Some will buy one, some will buy three and that’s when we started to develop the range. We also then realised that this is very much a summer product so hence the introduction of the underwear.
What are some of the mistakes that you made?
You get all this advice. You get everyone saying you should do this, you should do that, and ‘oh no, this is the way to do it’. And when you’re in a very vulnerable stage you often take the advice without even considering is this going to be good for my business. You try and follow the pack. Quite often that is what spells disaster because you just become one of the pack and you don’t necessarily shine or stand out or you don’t necessarily have a brand that people want to talk about.
In realising that we make great gear we also were very focused on creating a personality for the brand, and again you can fall into the trap of as you get bigger the personality of the brand gets more and more remote to the actual customer or consumer.
So it’s been our real key focus to not only keep developing and growing the company but as well as keep it very raw and very original to it’s humble beginnings and people really enjoy that but they also really enjoy the ride that’s associated with seeing a company grow but seeing it grow into something that it originated from rather than growing into something that other people expect it to be.
With revenue now of $20 million, how many employees have you got?
We’re up to about 35.
And then you outsource everything?
We’ve got three different manufacturers and they just manufacture Aussie Bum. One of the unique things about our company is we manufacture every week, so we don’t necessarily manufacture in seasons, and this is often been I guess one of the failures for Australian manufacturing in fashion is a lot of these manufactures are buoyant with business for only 12 weeks of the year for example, and then the rest they’re meant to survive on their own devices. But for us, our manufacturers enjoy weekly work that allows them to employ people full time, offer stability and security.
So where are you manufacturing?
We’re manufacturing in Sydney.
Well actually it’s been again one of those original beginnings that I’m refusing to budge that if we can make a product, and there’s some products that are somewhat easier to make than others, so like underwear and swimwear it really isn’t. It doesn’t take a genius to make this gear, and sure I can make it in China for a tenth of the price that we manufacture it here, however my attitude is that I’m quite comfortable to absorb those overheads or those costs simply because ours is original and unique.
You must be doing OK to be able to do that.
Your profit margin?
Very very… well we were very fortunate that we don’t have any bank loans. We don’t owe anyone any money and we probably work on a very different business model to a lot of traditional manufacturing companies who really are being dictated by the buyers of department stores and the terms that they set, you know, it really crucifies them even before they get their foot in the front door. For us, thankfully we have created a business model that we’re not necessarily dependent on the buyer and that allows us to create new and innovative ideas that quite often are more traditional buyer would be very nervous about stocking.
Fantastic. Now what percentage of total sales is from the US now?
About 25 to 30%.
That used to be 40%. So you’ve expanded elsewhere?
Oh hugely. Like the big growth areas naturally through Europe. In Europe for example you retail in Selfridges. We’ve just signed up Harvey Nichols, Printemps in France, Ce la vi, in Germany, Olsterhouse is another major German department group. Brown Thomas in Dublin, but in the Asia region Taiwan has become significantly successful along with Japan. And Brazil was the big surprise for us this summer. We finally cracked it into that market and what that does, it levels out other market shares, but America in proportion to the rest of the world is still trading extremely well.
And how’s Australia going?
Really good. The good thing is I think it’s because (1) we don’t retail in Australia apart from one little store in Byron Bay, which we did because it was more of an emotional decision for a couple of girls that tried to open up a store there and felt like they were beaten out of town because they couldn’t get the brands they wanted, and we provided our brand to them and they’re today a very successful operation there.
So why wouldn’t you do more retail in Australia?
Well we do do retail via the internet. People that want to buy the product. You call it a total shopping experience, because on our website it’s not just about selling the product it’s also about selling the culture, the personality and the lifestyle so people tuned in… people tune in to our Aus Bum TV, which are highlights behind the scenes and really us being real. It’s like the spinal tap of men’s fashion. We don’t take ourselves too seriously and we show that to the world as well.
So you don’t have any trouble fronting as a personality in the business?
Well I don’t have a big ego. I wouldn’t say that I don’t have any trouble but at the same time I’m very proud of what our company’s achieved. Naturally I’d like a stand in 25 something.
It gets tiring holding that belly in doesn’t it!!
Well the funny thing was in America we did a reality show, the Janice Dickenson Modelling Agency, and I guess your listeners will soon see that we out realitied reality TV and the huge huge events are unfolding literally right now where another major underwear brand tried to pay this production company to defame us and thankfully we’ve got the true story and so we’re definitely.. we’re not shy in saying what we think but also we’re not shy in standing up for what we believe in.
And can I just ask, where are you going to now? What are your plans? You’re starting to grow into a pretty big company.
Yeah, to be quite honest we don’t… Because we’ve got nothing to compare ourselves against like in Australia we don’t have retail stores as such and our brands don’t… doesn’t sit on a department store shelf in comparison to others. We very proudly go into Selfridges and we’re the number one underwear selling brand in that store at the moment and that you know, is kind of like very inspiring and very motivating when we come back to Australia, but at the end of the day when we come back to Australia we walk into our business and we’re just Sean or Guyon or people that live in our own little world.
Do you own the company outright with a few employees?
I’m the founder and Guyon who came into the company a couple of years later, he’s also the partner in the business. The reason for that is that I’m good at some things and I’m really terrible at others and I think any good company needs a ying and a yang and I’m one extreme version and Guyon’s the other extreme version.
Now working across time zones must be exhausting.
Yes. Well it’s just come back from a three and a half week trip overseas and you do acclimatise to it in some respects but I think the biggest challenge is acclimatising to the different etiquette and cultures that you can be on the phone to seven different countries literally one after the other and with each culture or country, you really do need to respect the customs and sometimes you can get a little bit confused. For example in Africa.. so you’re talking in China and you’re saying ja ja and you forget that you’re.. that’s yes in South African. And I wouldn’t say I’m the best in that area.
And just, on the website, what have you learnt that works well? What can you tell our listeners and readers about some tips to develop an e-commerce website?
I think the first rule is that you need to give people a reason to come back. It’s one thing to be able to advertise to get them to your site, to buy your product or even just to visit it. But you also have to create something that gives them a reason to come back. The second part is…
And what do you do?
…I give them stories to tell. Give them pictures to show, give them places to see, give them experiences they wouldn’t experience.
So you’re giving them content in a way.
Yeah, and then the other part is that in today’s world…. money used to be king of everything. Today our currency is more in the language of what can I communicate to other people that’s going to make me relevant in my world or group of friends so being able to give them information or give them something that they can be having a coffee four hours later and go, oh you should have seen this that I saw. Or oh God, that was a kak, you should have been… they made absolute twits of themselves and it was so funny. I think you’ve got to be very real and also accept the fact that we’re in the age of reality and creating a myth or trying to create a perception of something that you aren’t, people that are internet savvy will see through it very quickly.
What if you haven’t got the kind of… I mean very few people would have the kind of personality or the skills maybe to do what you’re doing. Do you think that or do you think it’s something you can develop? People can see through it if it’s not real.
Well you have to be… like if you look at how this company started and I started it because I wanted something. And I believed that everyone else wanted it and I believed in that and I also was facing a case of OK, you’re either going to blow all the money you saved and you really are going to become a bum, so it’s fight or flight and with any business it’s always good.
You know, you hear so many people that love to talk. Oh I’m going to do this one day. Oh yes, I’m going to start up a business ra ra ra, and then you get the other people that actually do it, and you know, it’s not necessarily the turnover of the business that really motivates me or inspires me especially when talking to other people.
It really is the stories of the challenges and how they’ve overcome them and to some people, they could listen to the story and go oh, big deal but the metaphor often in a lot of these stories to me is what really inspires me and it’s no different with what we’ve done. That is, it’s not until somebody says to me, this is what the business is now turning over Sean, and even I’m quite surprised. But then I get back on my own little billycart and I’m off in another world because it’s still to me is just an adventure. Not necessarily I’m out to become the biggest which I’m not I should say, or have the company, the absolute. I’m just quite happy doing what we do and we’re fortunate that the rest of the world are enjoying it as well.
What have you personally… what’s been the biggest personal challenge for you?
People go and train to be CEOs or train to manage and lead people and when you’ve created a company that has such great potential naturally you want to lead people and have direction and it’s just like growing up all over again. You make your mistakes. You learn from them.
But you also have to be a lot more mature and I guess wise and sensitive to the business world today, and I wouldn’t say I do it perfectly however I think any business where the underlying tone is the passion and commitment, that I think is what I’ve had to learn to be able to share with other people.
Did you ever have any cash flow problems?
No, well see we were really… I wouldn’t say I was really smart, but because I didn’t have any money, and whatever money I made went back into the business and so we grew progressively and while typically you’d have people that would invest large sums or you’d have capital from a bank or something like that, for me it was like if I made $20 then I could spend $10.
And if I spent $10 back on the business I’d make $30. And that’s always been the practice for the business and so our foundations have grown very traditionally but also with great strength so we’ve never gotten ahead of our own self worth so to speak. The other big issue, the other big mantra for the company is, if our business fell in half tomorrow in turnover we would still remain very profitable and very healthy and that has always been the way we run the business.
So any talk of selling, floating, anything like that? Private equity around?
Yeah, I guess it’s more a case of if we were doing this and it was all about money, then we would have sold to the first bid that came in. If I said that substantial brands or other bigger publicly owned companies have not made their intention known… have made their intention…
What are they offering you? Just share it with me.
Put it this way, I had a company recently and I said look, I don’t think you can afford it and they said but do you know that we turn over this, and I said like I said, I don’t think you can afford it. Mind you I’m being a little bit of a dingbat. A bit arrogant in that respect but it really is about…
You’re allowed to, to a big company.
Well I’m having fun. And everyone here, like just came back from a whirlwind trip. I got to go to Africa and see an amazing jungle or whatever it is. Not everybody with a company like mine can do the things that we’re getting to do. So we’ve only just started… we’ve built the engine. We’ve built an amazing car so to speak, so I want to drive it around the block a few times.
What are you doing to take your website to the next stage? You’re a real Web 2.0 aren’t you?
Yeah, the real web 2. The future is really video in terms of like with our.. with most websites, very static in terms of imagery and that and now people are moving in to multimedia. More interactive. Because the bandwidth and people being able to… what they can watch or download is increasing so we’re about to take our website from being somewhat static into a multimedia and to that point we’re really investing in our content but also in showing our reality and allowing people to get in behind the scenes and really feel like they’re a part of the company but also they’re a part of the decisions that we make. And that’s going to get people coming back every day to see…
So what, you’re going to be on show, sitting in the boardroom table, having lunch, giving… you know, you didn’t answer that phone call.
Yeah, well we’ve literally, we’ve just extended our company.. sorry our premises and the whole thing has been fitted out that allows us to broadcast. We’ve got a full gym. We’ve got a café. We’ve got chill out areas.
Aussie Bum life.
Yeah, but it’s also… we definitely live by what our image is and so in that we want people to share in that so people will get to see highlights of what happened in the company. The good, the bad, the ugly. And it will also be you know, we are the… we’re spinal tap. We really don’t take it that seriously and I think other people when they see how the company’s run, will see that it’s a very successful company, but it’s also quite funny.
Do you think, how successful would you have been just with the bathers without this other side.
I think any company to survive today it needs to evolve and adapt to the market conditions and the opportunities that present themselves. If we had just stayed in swimwear and stayed very niche in one particular product, category, to be quite honest I think I’d still have a very happy lifestyle. The only difference is that I would sell my few pairs of swimwear in the morning and after dropping the cheque off in the post I’d be heading to the beach and whilst that way I’d be taking a bus to the beach, in this instance, now, I’m taking a helicopter.
Oh come on, let me dream.
How has your wealth gone? Did you make the BRW young rich under 40? Or weren’t they smart enough to put you on?
No, I don’t buy into any of that. Like we recently had the Discovery channel commissioned another production company in London to do 20 of the most successful rich or entrepreneurial companies in the world and we were asked to be a part of it and whilst it’s a great honour and really very flattering, it also wasn’t us because they wanted… we want to see you driving an Audi. We want to see you doing this, and my attitude was yeah but I actually just like having a pie and a beer and they said ‘oh you can’t do that’.
Aren’t they silly. That would have been great.
Yeah. I’ll tell you the funniest one was on a Qantas flight. I travel… because I travel quite a bit, and thankfully I get to travel first class now and before I knew that the chairman of Qantas gets to have a meat pie. He can ask for a meat pie. So that to me was like heaven because I really don’t like the high end cuisine so I ring up and I’m a… what do they call it, a Platinum customer or whatever and I said I’d like a meat pie. ‘No you can’t have that’, and I was like ‘why?’. And they said well if you’ve got a special dietary requirement we can give this to you.
It’s called the Aussie diet you require.
I know and the thing that totally floored me was I was so organised, and this time I rang two weeks ahead, and I said look, all I want is a couple of meat pies and I’m happy. I’ll shut up. I’ll got to sleep and couldn’t be done. So what do I do. I bring my own meat pies. And I travelled first class and I had a wonderful trip and the staff on the flight were wonderful but the funny part is, I don’t think the world has woken up to people that are maybe successful or are good at what they do. They don’t necessarily live the life that other people expect they should be living.
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