In just 21 years, Roses Only has gone from a one-store start-up business to a ubiquitous brand that has earned the nation’s trust.
In the process, founder James Stevens has shown himself to be a shrewd brand-builder who leverages off his understanding of the potential customer base and an innate skill to use media to his advantage. Not a bad effort for a guy who had no master plan to be an entrepreneur.
“I didn’t know what I wanted to be,” he admits. “I didn’t plan anything. I’m a terrible planner.”
While he jokes that his inclination towards self-employment may be linked to his half-serious belief that “I wasn’t employable”, in reality Stevens concedes that becoming a business owner had been hardwired into his DNA courtesy of exposure to his family’s flower enterprise in Sydney.
“I grew up in a family business. It was almost expected of me to order people around. That’s a horrible thing to say, but I hated seeing my dad’s money being squandered … I would point out the things that I saw being inefficiencies from a pretty young age – the things that would irk my dad.”
That early operational involvement had a big impact in shaping Stevens and the business he would later create.
“We grew up in a retail environment where you had to serve people quickly on a railway station otherwise you’d lose a sale … So from the back of the store I would actually call out ‘service please, can you go out the front and serve’, so I suppose I took it upon myself to lead a little bit.”
The family business exposure at a young age would later prove invaluable.
He explains: “I essentially worked in the family business throughout my schooling life. From about the age of 15 or 16, in a particular set of school holidays, my father had taken a leasehold, separate from the family flower business at Town Hall station, which was sitting idle and so I actually took the liberty of opening that store.”
Already with a keen understanding of the customer on the run, Stevens quickly demonstrated an inherited ability to spot a market opportunity.
“I realised there was a bit of a gap in the market for people to buy a one-off piece of good quality fruit for lunch,” he says. “There were a few fruit barrows around, but there were no fruit shops per se in the city and then you had a few of the supermarkets that actually sold fruit. But with all due respect, they did a terrible job of sourcing good quality fruit.” (History often repeats with entrepreneurs, and some years later Stevens would extend his ‘Roses Only’ brand to include ‘Fruit Only’ and ‘Hampers Only’.)
Still barely out of school, Stevens was proving his mettle.
“In 1987, while I was at uni, I actually extended that store and we also bought a neighbouring takeaway food business and it became a very, very large business which I set up at the age of 20,” he says. “We’re talking about a business that probably had a turnover of around $2 million at the time.”
Trained as an accountant in his early adult life, Stevens spent only about six months in his chosen profession before the call of the entrepreneur got to him. The business bug had well and truly bitten and in 1993 Stevens set up his first store outside a major metropolitan railway station in an office building in Sussex Street, Darling Park, which still exists today and is the only bricks-and-mortar site in the Roses Only Group.
“It’s just our way of staying in touch with retail,” he says.
Two years later, the opportunity presented itself to secure a prominent corner spot in the heart of the CBD in Chifley Plaza, a construction project launched by entrepreneur Alan Bond before he went broke.
“I think they were struggling to get tenants at the time,” Stevens reveals. “I didn’t want to do a generic flower shop – that was pretty common. I wanted something that was going to stand out and be different and someone had mentioned that they’d seen a flower business in New York that only sold roses and that’s when the penny dropped.”
It represented the convergence of a great idea and a young man who had been socially engineered to understand the flower-buying customer.
“For years and years, people walked into my parents’ stores and for special occasions the men would always buy long-stemmed roses,” he says. “So what I wanted to do was to be the aggregator or the place that specialised in that particular little niche. There were other specialities within industries already, such as Just Jeans in the clothing game and we’ve all become quite specialised in the retailing environment over the last 20 or 30 years.”
As mentioned, Roses Only did not come with a master plan, but Stevens did implement a strategy that drew from his innate sense of customer profiling and what they want.
“There was no plan other than the fact I wanted to target men, time-poor men, who had a credit card,” he explains. “That was the target market and so I thought I’d target the Financial Review as the media I would advertise in.”
That newspaper put his product in front of the lawyers, accountants and finance professionals who were the key to Stevens’ success. Better still, his was the only flower shop advertising in that space. Reflecting on that experiment, Stevens admits he went hard on the advertising campaign and believes you cannot pursue promotion half-heartedly. Yes, it was a gamble, but it paid off.
Another market-defining strategy the propelled the Roses Only brand was a tie-up with leading broadcaster Alan Jones in the 1990s.
“Alan Jones was becoming a reasonably powerful force in radio on 2UE so we decided to go with Alan and I think that that gave us a broader spectrum of business people – upper and middle management within corporations – who might have listened to the program, who also had a credit card and could afford a dozen roses.”
While the ad costs were significant, management did not spend outside its budget and was determined to build the business’s name.
Outside brand, the other perennial strength of Roses Only has been the behind-the-scenes support of a family that trusts their son’s judgment.
“I was very fortunate that mum and dad are very, very supportive of any decision that I make and I hope that I can be as supportive to my children in years to come,” Stevens says.
“I’ve made plenty of mistakes, but they’ve still supported every decision. Nonetheless, I’ve made a lot more decisions that are right than are wrong – and Alan Jones was one of the right ones.”
Stevens believes trusting his own gut feel has served him well since his school days at Town Hall station. Another part of his competitive advantage is a strong network. He is a member of the Entrepreneurs’ Organisation, a global alliance of more than 7500 business owners in 38 countries, which gives him access to contemporaries who are also building businesses. The sharing of ideas and business war stories helps Stevens shape his own business strategies.
“I’ve always had a lot of people around me who I speak to and then I just gather my thoughts, but ultimately you’ve got to make a decision and I’m the person that makes that decision,” he says.
On experts and the use of focus groups, Stevens is not a fan.
“Focus groups are a waste of time and if you don’t understand your business, you might as well close the doors now,” he advises. “You’re the focus group – you need a good gut feel for what’s happening and what your customers are doing, but at the same time we measure this in lots of ways. We get responses now online from people who aren’t shy to tell us if there’s something wrong or if they’ve got a suggestion. We put response cards in our packs with a free reply paid post – we want to hear from customers.”
Roses Only Group once directly employed about 120 people but has cut that figure to roughly 80 full-time equivalents following a change of business model that utilises fulfilment partners in areas outside Sydney and Melbourne. It is part of a strategy that emphasises being lean and agile, and not ignoring the challenges of the unknown.
“I think at all times you need to avoid getting carried away if you see a bit of strength in your business and in your numbers because you just don’t know what’s around the corner,” Stevens warns. “Always be ready for this and have enough there as a buffer for the out-of-left-field things that can happen in any business. When people ask me ‘how’s business?’ I’m always cautious because I’ve had so many slaps in the face.”
Over the years, Stevens has changed as an entrepreneur in the face of new and evolving challenges.
“I just think the stakes are bigger,” he observes. “When the stakes are bigger, you become a little bit more cautious … you do grow from experience and you gain wisdom.”
Asked if his business success story can be put down to marketing, the product, the service or the business model, Stevens struggles to split the key drivers.
“I think it’s a combination. I don’t think it’s the business model necessarily, but I think it’s 100 per cent attention to service, 100 per cent dedication to quality and I think those things go hand in hand. But then you have to raise awareness of these key offerings. At the moment we’ve got to raise awareness of what we’re doing in the hamper industry. I think we’re revolutionising the hamper industry because people traditionally think that hamper is just food in a basket. We have the most amazing music hampers after doing a deal with the likes Sony Music and various other music companies such as Universal. We even have book hampers.”
On what the University of New South Wales gave Stevens that has helped his business dream come true, he points to its gift of making him think.
“A little bit of formality and a little bit of thinking outside the square have been important to me,” he admits. “Universities are always created to make people think and it’s more than making you work out the equilibrium price. It’s a time of learning, it’s a time of mixing with other young adults and it’s the talkfest of ideas that is probably a lot more important than what you learn necessarily in lectures and tutorials.”
Some academics might take issue with Stevens on that score, but the formula has certainly worked for him and the Roses Only Group.
This article was originally published in Savvy – Understanding the Entrepreneur. In Savvy – Understanding the Entrepreneur, we have put some of our finest tertiary-educated entrepreneurs, who also happen to be graduates of the Australian School of Business at the University of New South Wales, under the success detection spotlight.
Savvy – Understanding the Entrepreneur explores the minds of our best business achievers who reveal what they’ve done to build a great company.
To order copies of this book, please visit: http://shop.switzer.com.au