Taking on the big boys
Wednesday, June 27, 2007/
At the age of 27, Helen Jarman left a job in transport and logistics at Australian Air Express and started her own business in a very competitive and very male dominated industry. PODCAST: She talks to AMANDA GOME.
By Amanda Gome
At the age of 27, Helen Jarman left her job as business development manager for Australian Air Express and started her own logistics business, Infoactiv, in a very competitive and very male-dominated industry. She talks to Amanda Gome about building Infoactiv to turn over $4 million and employ 17, and about the big changes she has been through in her eight years in business.
to listen to the interview.
Amanda Gome: Can you tell us why you started the business, what niche you saw?
When I was working at Australian Air Express I really started to understand in detail what the company’s requirements were, what their needs were in supply chain, what we were meeting as a company, where we were falling down, where the gaps were and so forth.
It was a little frustrating at the time because I could only focus on one part of their supply chain and in many ways, not have the ability to address any of the other issues that they had on a broader scale. It’s that sort of solution that I was looking to put in place and to be that one contact one relationship and provide more holistic end-to-end solutions. That for me was far more exciting.
Then when you left at 27 to start your own business, what sort of funds did you need to set it up?
I started it in a very unusual way. I didn’t have any capital, I didn’t have any savings, I didn’t have any assets against which to borrow, and I didn’t have any clients.
It was very cold. Unlike perhaps what a lot of people might do, I made an absolute rule that I would not approach in any way any of the clients that I’d had in the past. I felt ethically that I would simply start fresh and so it was a very slow start. So I had to fund it very slowly so we would just sort of live off odd jobs, ad hoc jobs, transportation and shipping jobs for different companies before really a year later we landed a large contract. That was really the start.
Did you have any employees in the beginning?
Yeah, I did. I had one other person from day one and was sort of working on the side to fund that. Within the first year I had three, four people and then we managed our growth fairly slowly and then it doubled after we took on a major contract.
What happened then because had three major changes over the eight years you’ve been in business. Describe your strategy and what happened to your business model.
Day one we started with a transport focus. Customers would come to us to organise shipments. We would organise their shipments and bundle our services into that transport cost so we were in many ways buying and selling transport. Very broker style.
Then the next change came along and where we started to invest in a lot more technology, so technology is solution and providing that [back up] service was the next major change.
The third major change was moving to more broader service offering right across the supply chain when the concept of multi-party logistics was born. We looked at more the vendor management and supply chain management rather than the buying and selling of transport because transport became less of a focus and it became more about technology and expertise. So that’s how it’s broadened.
And then what’s been difficult for each of those three changes over that time?
It would easily be funding. At the time we didn’t really know about a lot of the resources that are available now. We were funding all of that and, gosh, we did it so hard. We didn’t really need to do it that hard, in hindsight.
So what would you have done in hindsight?
Well, in hindsight, I would have definitely accessed a lot more of the business and Government network and grants and assistance that are available now.
Back then I felt that I needed to do everything myself and I just became very head down rather than sort of reach out to the many networks available now that I utilise now. I just wish I’d sort of wised up to that.
What are the networks that you use now that you find valuable?
Well, I’m very much part of the YEO (Young Entrepreneurs Organisation) network, the Entrepreneurs Organisation network as well as CEO Institute. We’re now working with the Australian Government, Austrade and so forth. Their new exporter development program, that’s going to be fantastic for us. Also working under a lot of their grants so, as I said, accessing a lot more of what’s available. We never did that before.
So you’ve got 17 employees now. Were you bigger and have scaled back? Are you more focused on profit now or… what’s happened?
When we started after a year we’d landed a major contract. That major contract was Hewlett-Packard. HP was the first big company I suppose to take a gamble on us, I guess, and extend a contract to us. It grew from there by referral through into their suppliers and their customers and so forth.
We ended up then having a business that was around the $4 million mark but it was concentrated in very few hands and from a risk profile that wasn’t very good and we were focusing on topline….
Very few contracts?
Yeah, very few contracts. So over the last two years we’ve said: OK, let’s have a look at who our customers are. What industry he’s in, what percentage of business that customer offers. Is it profitable? What’s the bottom line result? What’s the effort involved to maintain that account. What can we automate? What technology’s relevant?
All those sorts of things that have given us a lower turnover than what we had before but certainly net profit margins are better, so it’s great. That to me is a better result than strictly top line growth.
OK, and how many staff did you have at your peak when you were growing fast?
We were probably four more people. So I have four less people. I have better line results and I have less risk, more customers, diverse industries so I’m much happier.
Being such a young age starting a business in such a competitive tough industry, what have you learnt about leadership?
Definitely very, very good at being very open with your staff. Delegating as much as you can. Getting as much down to system and process as possible, in many ways replacing my function as soon as possible. Not taking ownership of everything and leaving people to do what they do best. Stay focused. Not buying into the negative.
And what’s been one of the biggest management mistakes you have made?
Definitely concentrating on topline turnover and not understanding enough about the quality of that business and protecting ourself from when change happens. The ups and downs of business have been much harder for us because we weren’t focused in the right way on our financials.
We weren’t marketing very well. We didn’t understand enough about marketing, brand marketing etc. We’ve got a lot better at that. These are costly mistakes and when the good times are good. When the bad times hit it’s really hard to… it can cost yourself years of profit.
What have you learnt about marketing and branding?
It’s just so important to stay visible in the market, visible among your peers, visible even just within your staff. Visible to your customers and the industry. So so important. It’s giving people that reason to believe and we weren’t. We were just a secret. There’s no point having the best service and technology if no one knows what you’re achieving.
And so what do you do now. Like how do you stay visible to your peers?
Plenty of PR. PR and being at trade shows and marketing and case studies and testimonials and press releases. Wherever possible telling our story. Those success stories of customers, etc, asking for referral, being active, finding new trends and setting new standards in the industry.
Now what are you doing to grow in the next few years? You’re exporting?
Yes. Absolutely. Growing in Asia is our biggest focus. We’ve only got a couple of customers who are truly Asia Pacific customers where we’re actually managing vendors’ inventory and processes and systems in each country in Asia. Mind you we do all of that out of Melbourne. We have a multi-lingual help desk here that supports all of that activity and some of our customers now are starting to talk to us more about what we can do in Asia Pacific which is great, so they’re starting to really understand the power of the concept and the technology developments that we’ve done have aided that as well.
And so how have you gone about getting those contracts. I mean have you leveraged off here or have you gone cold calling over into Asia Pacific?
We’ve leveraged off here, yeah. A lot of decision making for the region is still in Australia, otherwise in Singapore. They’re the two main areas for us for developing relationships and sourcing contracts. It’s still kept within the region.
And so what do you ask your partners to do? To recommend you to people, introduce you?
Absolutely yeah. And to our customers. Constantly being visible to your customers and telling them what success you’re finding in other customers that they can leverage from. I mean the cost of leverage is so important. For example we have about, let’s see, about five technology customers and with one customer in particular we were doing quite a lot of work in e-waste and recycling which is a growing area for us.
E-waste is a fantastic area for us. And so really to tell that success story to our other customers and find that they’ve also got the same problems and the same issues and can readily leverage from what we’ve been doing so it’s sharing that expertise. Sharing their thoughts.
Now how has your industry changed and where’s it going? What are the big changes that you see coming?
Well there’s certainly been a lot of buy outs. It’s amazing, this industry since I started has just really got smaller and smaller. I mean it’s just… the big guys are just gobbling up everything. There was a lot more choice I suppose for customers eight years ago. Now it seems they do business with one company and it ends up being bought by another. It’s just amazing the dominance of… especially in Asia Pacific the dominance of three or four or five players and you know, it makes it much harder for us to exist as a niche.
And what do you think is going to happen? Is that going to continue?
I think it’s definitely going to continue yes. Very much going to continue and for example if DHL aren’t constantly buying something people are wondering what they’re doing. It’s definitely going to continue.
So have people approached you?
What’s your attitude to selling?
Oh we would definitely sell at one point. I think we’ve still got a lot to realise yet. I mean I wouldn’t consider it inside of three to five years. There’s just so much we need to achieve and my exit strategy’s not that short term.
Right. So what do you want to achieve over the next three to five years. Do you want to be double your size?
Absolutely we do. Yes. Double our size, far more profitable, more agile, risk and sustainability are big issues for me. Big concerns and so that’s something we’ve done a lot better out in the last 18 months. To continue to improve on that.
We want to expand in e-waste and recycling as I mentioned before is definitely a growing area because we’re really starting to develop some serious expertise in that and develop definitely a good reputation for it and become the ‘go to’ for that in the industry. Continue to develop in technology and expand in Asia Pacific. Growth is definitely the focus for the next three years.
What about online? Are you doing anything online?
Absolutely yeah. Always doing something online. A lot of our services to customers we automate for them and we’re doing a lot of web design and data hosting, data warehousing and now analytics and reporting and pushing that to an online self service sort of model for customers to give them visibility and control in their business.
And what’s your favourite gadget as an owner of a medium sized company?
Yeah, I love the gadgets. Isn’t it funny, it’s the simplest things. I’ve got the most amazing IT set up. I’m still waiting on the Apple iPhone. Looking forward to that next year. That’s going to be my next gadget but I’m a super user when it comes to IT. My house is almost like a second office. I’ve got a Telstra exchange box in my garage. I’ve got three 22” screens all set up. I’ve got wireless mouses and wireless keyboards and I’ve got… I’m on a WAN and yeah, I go a bit nuts with that really.
And why is that all necessary? Just so you’re connected?
Just love it, yeah. Love the internet, love technology, just love to feel connected, love to create and have everything at my fingertips and I like everything to be fast and big and powerful. Hilarious.
It’s a male-dominated industry. Is that changing? Are you finding it easier to be a woman running a business in that industry?
Yes I do. I do. Yeah. Definitely. I think that’s definitely changed. When I first started it was really a problem but then you know, it still happens every now and then. I tend to tag team with my GM and we sort of suss out where the affinity lies. If they prefer to sort of deal with him or me it doesn’t sort of bother us so perhaps one of us will generally take the lead in the relationship.
I think it’s easier also for a company like ours now because three years ago a multi-party logistics company was unheard of. But with the entrance of a lot more IT companies in supply chain there’s been an acceptance in the last 12 months of companies doing business with SMEs.
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