After spending more than 30 years in the marine industry, including a stint as the build captain on Greg Norman’s yacht, Brendon Westerhout and his wife Deirdre saw a gap in the market for nautical leisurewear.
In 2008, Shock & Oar was born as a WA-based business selling polo shirts, T-shirts, cargo shorts and jeans online.
The couple was soon supplying stock to local boutiques before opening up a store in the tourist town of Fremantle, famous for hosting the America’s Cup in the 1980s. Brendon talks to StartupSmart about negotiating all things nautical.
What gave you the idea for the business?
Towards the end of my career in the marine industry, I worked as the build captain on Greg Norman’s motor yacht.
At the end of the building process, I was talking to the build engineer about what we would do when we got back home, and my wife nicknamed us Shock and Awe.
We thought that was an interesting term to use; we thought we might be able to use it for something or do something with it.
Four years later, my wife and I were throwing ideas around and converted that initial name into the name for the brand that it is today – Shock and Oar.
We started researching opportunities to go with the brand and came across a few nautical and lifestyle brands, but they were all overseas.
We researched further and discovered there was no Australian nautical leisurewear brand. We saw that as an untapped niche for Australia.
What was the process from there?
It was a difficult process because it’s not an industry we were from. My past is in project management, so we applied a project management system to it.
We generated lots of lists and compiled some into our business plan. We also ran brainstorming sessions – one lasted four days.
We nutted out everything that we thought we might need to find out about. The internet helps. We also talked to people and did a lot of questionnaires.
The design process we were not too fussed about. We knew what we wanted because we had either seen it or bought it ourselves overseas.
Our brand isn’t trying to reinvent the wheel – we go with classic designs. We did a deal with a designer for awhile, who put us on to one of the manufacturers.
We started dealing with wholesaler importers and then started dealing directly with manufacturers from overseas.
The manufacturing side was, and still is, difficult. There are good people out there and there are bad people. It’s a matter of going through the motions and realising [a partnership] wasn’t going to work out for one reason or another.
We’re currently dealing with three manufacturers but we’re still dealing with wholesaler importers. We wanted to keep that spread of dealing direct but also with wholesalers so the business doesn’t fall over from being over-reliant on just one.
How long did it take to secure good manufacturers?
I think in our case it was lengthy partly because of the global financial crisis. We set up our business when things were relatively okay but things started deteriorating after that.
Speaking to manufacturers, we were initially told they couldn’t deal with us because our orders weren’t large enough. So we lost time, and time is money.
As the global financial crisis continued, people were only too happy to complete smaller orders because their own business was drying up, so it was a mixed experience.
How did you fund the business?
It was self-funded and still is. We’ve spent about $250,000.
We find ourselves at a bit of a crossroad because of the want and need for expansion. We need, and will continue to need, more financial resources to take the next step [and expand overseas].
If that doesn’t come, we’ll continue on the path we’re on now, with more products and a better operation.
We understand that venture capitalists will only look at companies with a certain turnover, so we need to keep talking to people and knocking on doors.
What’s your biggest challenge?
People are not spending as much as they used to. We’re generating good interest but we need to turn that around into the buying cycle.
We’re optimistic people will start buying again but we aren’t in control of the buying public – we consider that to be our biggest hurdle.
However, we do have multichannel selling methods. Our website tends to feed off the [offline] store in gathering the customer more than the one time.
Our store in Fremantle attracts a significant percentage of tourists who come in, get a look and feel for the brand and can then take a leaflet with them and visit us online.
We have also expanded our online presence with the brand’s inclusion in three new eCommerce websites. We are also looking to move clearance stock through an eBay store.
What are your growth plans?
From the outset, Shock and Oar was designed to be an international brand. We plan to carve our niche in the US and European yachting markets.
The brand’s move into the international yachting market will involve a multipronged strategy of online, wholesale and direct marketing and sales to yachting stakeholders.