Growth Management: Surviving fast growth

KYLEE DAVIS: Insidious Fix 10 years on is a more savvy business.

As a business grows, the challenge is to keep your finger on the pulse

Still only in their early 30s, business owners Jason Crawford and Kylee Davis have been through the mill. They started their knitwear label, Insidious Fix, 10 years ago in a blaze of glory, after winning the prestigious Benson & Hedges Supreme Fashion Award. They were then only students, in the same class at AIT studying textile design.

After their win, the business shot into life with orders from the country's biggest retailing names, and speed continued to dominate this young company's spirit throughout its first five years.

It grew and grew, from an operation where two owners did everything - Kylee handling the creative side and Jason looking after manufacture, to one with 35 staff, across two factories and a retail outlet in Newmarket.

Its overheads were huge, and so too were the stress levels. Something had to change, and most things did.

"We were on this oneway track that bigger was better," says Kylee. "We were growing phenomenally each season, and we didn't have our finger on the pulse.

"There came a point in the sixth year when we realised that if we wanted to be around long term and achieve our dreams, we needed to be a lot smarter about what we were doing."

Among the ruthless calls they had to make was to close the profit-draining Newmarket shop, with the loss of six staff.

The marketing budget was also slashed, by bringing the management of the website inhouse, and by toning back on big-budget merchandising ideas. "I think we were extravagant in that area," says Kylee. "We developed these big themes every season; one year it was `fashion emergency', and we did 12 different swing tags to go with that. The next season it was all based on food and the swing tags represented the colours in the rainbow, with names like jelly tip, honey and avocado.

They were great ideas, and if we were a huge multinational business that could afford to sustain them, it would have been fine. But to do an exercise like that it was costing around $5000 a season, and it was hard to value the return."

They also managed to merge two factories into one, through the introduction of some very simple systems, and now find they achieve better production output out of one.

The basic solution was to improve workflow by being able to better track where garments were at in the making process. First up the simple whiteboard made a difference, now a computer network is compounding the gains.

Insidious Fix celebrates its 10th birthday this year, and still the feeling you get from its owners is of a business that is young, fit and healthy.

It continues to gain national recognition, the latest tribute being its inclusion in The New Cool business exhibition, a Westpac-sponsored initiative that profiles New Zealand's new generation of "street-smart and savvy entrepreneurs", which launched in Wellington this month.

Last year, at Air New Zealand Fashion Week, it won the trade and export growth award, entitling it to $16,000 of business class travel. Kylee says she has been very careful in her plans for how to maximise the travel prize.

Some of it has been invested in a trip to Melbourne, which led to the idea for a new label, Esoteric, aimed at a 35+ market (the Insidious Fix label has always been associated with youth culture). The rest of the prize will be spent on visiting Asian markets where the company already does business.

Kylee sees that international travel will becoming increasingly important to the growth of the company.
"I suppose this far into it, I have realised the importance of seeing what is available, and what people can get for their money. Up until now, with a niche product, maybe we haven't needed to be that concerned by competition."

Lessons learnt:
1. Participate in, and maximise the value of awards.
2. Partnerships help to share the workload, and offer opportunity to combine complimentary skills.
3. Post start-up - think smarter, not bigger.
4. The next stage - reinvent the product.