A Midlands soap manufacturer has experienced soaring demand for its products during COVID-19, with some supermarkets taking three months-worth of supply in just two weeks.
The Little Soap Company was launched in 2008 and has grown from home-based operations to a staff of 30 with an annual turnover of £1.2m in 2019.
Growing orders for its organic and ethical products from all major supermarkets, chemists and online retailers has resulted in a projected £2m turnover for this year, and up to £5m a year by 2023.
Emma Heathcote-James, founder and managing director of the Worcestershire-based company, explained how the lockdown had resulted in the “hardest, busiest” period ever.
Speaking in the latest ‘Aston means business: SMEs dealing with COVID-19’ podcast, Ms Heathcote-James said: “Soap’s more important to everybody and we know how incredibly fortunate we are.
“All our main outlets are supermarkets, and both their physical buildings and their dotcoms have remained open, all delivery services are operational, and we’ve had our own website.
“But a surge in orders doesn’t always correlate to fulfilled orders. We all remember the empty shelves just before lockdown.
“Like most businesses, we hold around three months’ stock, but as an example we delivered three months of stock to Asda in the first two weeks when everyone was panic-buying. We were suddenly left without stock to put back in for a lot of lines.
“We’re really fortunate that we manufacture in Britain and all our supply chains have remained open. But it’s been the hardest, busiest six weeks just to maintain the supply chain and keep up with that demand.”
Ms Heathcote-James praised supermarket buyers for improving relationships by cutting payment terms from as much as 75 days to as little as 24 hours, which had “massively helped” when the business was buying so much stock.
And she commented on how home-working, remote meetings and online administration had made huge and positive changes to how the Little Soap Company operated.
She added: “We have four awaydays a year, but we’ve now been having whole team meetings every Wednesday and it’s made us a lot more cohesive.
“I spend a lot of time on the road in quarterly meetings with all retailers, and each one is a day out of the diary. Retailers never wanted to do meetings on Teams [online], but all have had to now and all are commenting on how it works just the same, if not better.”
The podcast, presented by journalist Steve Dyson, also interviewed Mark Hart, Professor of Small Business and Entrepreneurship at Aston Business School, and he outlined why better payment terms were crucial.
Professor Hart said: “Cash is really important for any business and especially micro businesses. If you’ve got an invoice in the system as a large manufacturer or supermarket, then pay it within 24-hours. That’s about doing the right thing.
“If everybody did that it would ease a lot of pressure on the hundreds of thousands of small businesses across the country. Seventy-five days has been the norm in previous years and that’s just not acceptable.”
Speaking on operational changes because of the lockdown, Professor Hart added: “People have been working from home for weeks and it’s beginning to dawn on a lot of employers that rather than staff not being as productive they’ve got more connectivity.
“It’s happening across the world of work, in big and small businesses, in the public and private sector. This has shown that the amount of commuting and travelling is just dead time. If we can organise our business and activity better, we should just embrace it.”
Professor Hart also warned the government that it should plan the UK’s emergence from the lockdown very carefully, making sure it consulted the business community to ensure everything was ready.
Listen to episode 15 of ‘Aston means business: SMEs dealing with COVID-19’.
About Aston University
Founded in 1895 and a University since 1966, Aston is a long established university led by its three main beneficiaries –students, business and the professions, and our region and society. Aston University is located in Birmingham and at the heart of a vibrant city and the campus houses all the university’s academic, social and accommodation facilities for our students.Professor Alec Cameron is the Vice-Chancellor and Chief Executive.
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