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THE SUNDAY BUSINESS POST: Michael Murphy reflects on the ‘steep learning curve’ involved in establishing a start-up

January 11, 2017 Profiles and Interviews

‘I thought I had seen it all,and then I set up my own business’

 

Michael Murphy reflects on the ‘steep learning curve’ involved in establishing a start-up

 

Michael Murphy worked with Bord Bia for two decades before leaving to set up his own company, M&J Nutrition, last April with his wife Jane. The couple have developed the ProU range of yogurts, with added protein, calcium and Vitamin D. Here, Murphy details his experiences setting up one of the 20,000 start-ups incorporated in Ireland last year.

Six months ago, my wife Jane and I launched ProU on the Irish market. Since then, we have been on one of the steepest learning curves I have ever encountered.

Having spent over 20 years as a Bord Bia executive, most recently with responsibility for 11 markets, I thought I had seen it all. Then came the decision to leave it all behind and launch our new venture.

What followed has been an exhilarating baptism of fire. We have hit speed bumps along the way, but some quick footwork and a dose of good fortune have put us back on track. Although we are still in our infancy and there will undoubtedly be more twists in the road, there are already some learnings which may be of value to those setting out on the start-up journey.

1. Distribution is hard

We decided to focus initially on the geographic area of Dublin. Our aim was to begin with a manageable area which would allow us to quickly resolve any teething problems and scale up when the time was right.

What surprised me was the complexity of getting our product onto supermarket shelves and ensuring those shelves remain stocked. Again for the sake of learning, we chose the ‘direct to store’ delivery option. With that came some challenges, including renting a chill van at the 11th hour to meet an order and regularly making deliveries ourselves to ensure ProU was always on shelf. We even considered buying our own chill van at one point, but prohibitive insurance costs quickly put a stop to that.

The aspect I underestimated most was the time it takes to adequately service stores. In theory, you could get around all your stores on either the northside or southside in a day. In reality, with traffic, back-of-store congestion, limited windows for deliveries, temperature checking and so on, I could rarely cover more than ten stores between 6am and 3pm.

Add rain or a bus strike and this number could be halved or worse, meaning we missed delivery slots, which affected supply. This experience gave me a whole new appreciation of ‘central distribution’, the model used for over 90 per cent of food going through the multiple retailers.

The solution? We set about finding the right partners – Kamaro in Dublin and Killowen in Wexford – who understood distribution, had the right attitude and temperament to navigate associated challenges and could effectively merchandise ProU. So take time to plan your distribution, understand what is needed and identify who is best placed to ensure your product remains on shelf.

2. Don’t go it alone

I am happy to say that in many ways, Ireland has become an entrepreneur-friendly country. There are certainly still some challenges, particularly in terms of lending, but in the round, individuals are really excited about and supportive of entrepreneurs.

Every time over the past few months that I picked up the phone, met a contact for a coffee or ran into someone at a networking event, I was invariably met with wholehearted support and encouragement. I quickly learned to ask for advice, help and guidance.

In some situations, you might already have the answer but it is great getting that feeling of reassurance. It builds your confidence and conviction. It is like putting extra fuel in the tank.

As a start-up, do not be afraid to pick up the phone or button-hole that successful businessman or woman who can potentially help your business. At worst, they will direct you to someone else who might be able to help.

Having spent over two decades with Bord Bia, it will not come as a surprise that I am also a firm believer in state agency support. From Bord Bia to Enterprise Ireland to Teagasc and the Local Enterprise Offices, I don’t think there is another country in the world that has got such a supportive entrepreneurial platform so well geared towards start-ups.

The SuperValu Food Academy and the Tesco Taste Bud programme have only added to this supportive ecosystem.

3. Store staff sell your product

ProU Yogurt is now on sale in 35-plus supermarket outlets, mainly SuperValu and Tesco. While this is great, I have learned that getting “on shelf” is only the start. Consumers need to be able to find your product, whether deliberately or by accident.

Making time to get to know store staff, ensuring they understand your product and listening to their advice is critical. These people guide consumers daily, so they need to know your unique selling point. I have found staff to be particularly favourable to Irish-made produce, which is key when you consider that they are at the frontline in terms of consumer interaction.

I welcome being challenged by store staff because I always come out of it better. A week after launching in Tesco, a chilled-unit manager contacted me to “get that shelf restocked this afternoon or else . . .” He cared enough to show ‘tough love’ and the store is now one of ProU Yogurt’s best-selling supermarkets. Store staff can be your greatest ally, so make time for them.

4. Target your audience

Our primary target audience for ProU is those of us well past our 20s with a bias towards women. However, I regularly have my head turned by our younger consumers. So should I change my focus to younger consumers who understand the protein benefits message?

While our target audience is going to require some education in this regard, I think ultimately it will be a sustainable market as this demographic has a real need to take care of bone and muscle health, and they have the resources to buy the product.

My advice is to know who your target audience is and keep focused. Don’t try to keep everybody happy, it won’t work!

5. ‘Irishness’ sells

People are often surprised to hear the satisfaction I get from doing in-store tastings. I am energised by talking to consumers and hearing their feedback on our yogurt. You learn so much – what people think of your product, how they use it and what’s more, what they would like from it. Of course, we all lead busy lives and engaging consumers for a tasting amid their weekly or daily shop can be a challenge. Initially my opening lines were about ‘fortified yogurt’ or ‘healthy bones and muscles’. I quickly realised that nothing resonated more than highlighting ProU’s ‘Irishness’.

Consumers care about provenance and supporting local and Irishness is a definite pull factor. Make sure your Irishness message gets out there. It needs to be underpinned by quality.

Ensure your packaging and communications support this message and consider involvement with Love Irish Food, a partnership we have found to be particularly valuable.

6. Focus on what matters

As a start-up, you have a million and one things to do. Often, it is only you or if you are lucky like me, there may be a second hand to help. You will never run short of things to do, so prioritising those tasks that affect your business’s survival is paramount. Focusing on the important issues enables you to conserve energy.

I have been guilty of letting my energy levels hit rock bottom. You can maintain those high levels of intensity for a period but it will always catch up with you in the end.

When starting a company, balance is key – you need to take account of your work, your family and your downtime to ensure you keep all the balls in the air.

 

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