Founded in 2016, Total Tiles is a fast-growing tile retailer. Although it has one showroom in Ipswich, its e-commerce platform sits at the heart of the business strategy, alongside high quality customer service and care for its own people.
Total Tiles feature at number 44 on this years’ edition of The Sunday Times Virgin Atlantic Fast Track 100 league table, which ranks Britain’s 100 private companies with the fastest-growing sales over their latest three years.
We spoke to Colin Winterburn, Operations Director at Total Tiles.
Can you tell us about your growth and the journey your business has been on over the past 12 months?
The last 12 months have been an enormous challenge. We have doubled in size in terms of revenue and people employed – and that’s because of COVID-19 and its impact on e-commerce businesses. People haven’t been buying from bricks and mortar, they have been buying online.
We started our business journey properly in 2016, and based our business on a few founding factors: being honest and transparent with our customers and looking after our own people. That’s been the greatest influence on the growth we have had.
We were growing at about 40% organically year on year until March 2020, when COVID-19 came and changed all that. We have been on a 200% growth curve for the last 12 months.
In what ways have you had to react and adapt your business strategy to COVID-19?
As talk of a national lockdown started we anticipated a ramping up of business and traffic to our website, but probably not to the extent it happened. We had to get a lot of temporary staff into our warehouse. And at the same time as trying to increase our capacity, we had to ensure all customers and staff were kept safe. So not only were we doubling capacity, but we were doing it while maintaining a social distancing policy as well.
In terms of meeting demand, fortunately we took the decision about a year ago to increase our stock holding. Most retailers work from between eight and 12 weeks’ stockholding in their warehouses. We moved to 12 to 16. For most products, we have up to four months’ stock. So given any catastrophe or sudden spike in volume of orders, we are in a position to deal with that. Fortunately, in March, that really saw us through.
Most of our products come from Spain, with some coming from the Ukraine, the Far East and other places. The factories in Spain were initially told to shut down for two weeks. Then their production could open, but their offices couldn’t. A lot of our competition and a lot of people in our sector suffered quite badly, because they are more ‘just on time’ suppliers – whereas we are much more well-equipped to deal with issues in the supply chain.
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Looking forward, how do you envisage recent months might impact future growth?
Our board of directors ask ourselves that question every day and we look at all kinds of data and metrics. There’s no rhyme and reason to the KPIs and metrics we use in the business at the moment. The patterns we look for in the data are scattered.
But I think that the e-commerce market, and the migration of customer shopping from bricks and mortar to online, has probably advanced four to five years [in recent months]. I suspect it will drop back a bit, but we’ll still have a net gain from where we started pre-COVID-19.
What about your people strategy? Has it been easy finding the skills you need to scale your business?
At the start of this year we had 20 or 29 people. We now have 57 full-time employees. The rapid growth in headcount brought its own challenges. We have gone from the small business categorisation into the medium. Once you go over averaging 50 full time employees, there’s extra bureaucracy and red tape that comes with that– an awful lot more back office work. If you are starting out in business, I’d advise you to take some time to make sure you are building the processes, procedures and policies you will need along the way.
We had to adapt very quickly. But I’m very proud that we got our National Living Wage accreditation this week. So not only are we growing, but we are growing in the right way and doing the right thing by our people as well.
We are a bit of a headhunter. In terms of our customer support team and our sales team, we look for industry-specific people – what you might call ‘tile people’. People that have got a good knowledge of the tile industry. There’s a lot of technical stuff they have to know. We go out to the marketplace and look for people with those skills. In terms of our ethos, our philosophy, our processes and our operating model, we can equip people with that.
We have now developed an online training portal, not just for product knowledge but for processes and procedures as well – everything from health and safety to the Bribery Act. Staff can log on to the training portal through their own account. Some new material we will say needs to be covered within a timeframe, but most of the content is used like an encyclopaedia, for reference.
We are also in the middle of putting the product information into a content platform for our website, so customers will be able to access it as well.
How have you fared from an operational cashflow perspective? Do you feel government measures provided enough support?
Because the increase in business was so sudden, that gave us a cashflow injection. That has allowed us to support transport companies and other suppliers. If they ask us, we will pay them early. Most accounts with suppliers have payment terms between 30 and 90 days, but a few product suppliers have come to us and said they will struggle because most of their customers were bricks and mortars. We have said, ‘no problem’. We will pay cash in advance if that helps them get through this phase.
I think the Government could have been more considered in its approach and taken a longer-term view. The Chancellor was in a difficult position and the scientific guidance was changing all the time. It’s not a position I would have liked to have been in. But I know a lot of tradespeople that have really suffered through this period and they perhaps could have been given more support from the outset.
What do you see as the main barrier for your business’ growth over the coming 12 months?
The market is going to get ultra-competitive. We saw an opportunity and were early to the party. Because of COVID-19, bigger players are now looking for other revenue streams and they are seeing how lucrative the online market can be.
Other obstacles could come in terms of budgetary restraints. The Government has spent a tremendous amount of money getting us through this period and they will be looking to get that back – whether it will be through taxation, I don’t know.
On top of that we have got Brexit. If we don’t get a deal and go to WTO tariffs, we are looking at 5% import duty – so that’s 5% on everything we buy from Spain. That would be a real challenge.
There are also issues at Felixstowe port. The shipping agencies say that when they get to port they need to know they can berth, unload and move on. At the moment they are reporting 10 day delays, which is not financially viable for them.
Brexit will add to that problem because many companies that would traditionally ship by road won’t risk running through Dover. They will revert to shipping containers and we will see lots more volume and more red tape. That will be where our four months’ stock strategy serves us well.
What do you see as the main opportunity for your business’ growth?
Diversity in the product mix is a huge opportunity for us. In recent years there have been developments in tile technology, so you can get 20mm thick porcelain tiles which can be laid externally. Already this year we’ve seen that part of the market take off.
And we have got other marketplaces we can exploit. When you look at e-commerce, people tend to think about your own website, but there are lots of marketplaces like Amazon, eBay and others that are ready to be explored.
In the first quarter of 2021, we will be looking to relaunch our underfloor heating brand, which we think we can grow by about 30%-50%.
What advice could you share for other business leaders?
At the moment, what we’re doing is we are planning for every eventuality.
You have to stay true to your own vision, but try to envision what can happen. What’s the worst scenario? What’s the best scenario? That’s always stood us in good stead in the past.
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