Episode 233: Creating UK’s Largest Gift Packaging Company with Rachel Watkyn
It is said that “Experience is the best teacher.” As you go through your journey, you will learn things that will prepare you for future challenges. In this episode, Rachel Watkyn talks with Adam Stott about her journey of building and success of the Tiny Box Company.
She shares how her traumatic childhood inspired her to keep going and pursue her passion for business. Rachel also talks about the challenges in business and life that made her strong and helped her create a sustainable business.
Rachel Watkyn is the managing director of Tiny Box Company, the UK’s largest online gift packaging E-commerce company, and Dragon’s Den most successful female entrepreneur.
She has been featured on BBC Radio, The Daily Mail, and numerous business and trade magazines and won the Natwest Everywomen Award 2020 and the Rural Business Award 2022.
Show Highlights:
- Find out how Tiny Box Company began
- The mindset that helped her overcome the challenges
- How she earned £4800 a month after her website went live
- The Dragon’s Den’s impact on the business; and
- Knowing your role and responsibilities as a leader
Links Mentioned:
Follow Rachel Watkyn on Instagram @rachelwatkyn and visit their website www.tinyboxcompany.com
Join the Ultimate Three Day Business Event and learn more Business Growth Secrets
Be part of our Facebook Group Big Business Events Members Network
Connect with me on Instagram @adamstottcoach
Transcript:
Please note this is a verbatim transcription from the original audio and therefore may include some minor grammatical errors.
Adam Stott:
Hello, everybody and welcome to Business Growth Secrets with your host, Adam Stott. I’m really excited today. So, got our fantastic guest with me, who is going to no doubt have lots and lots of value. This lady is somebody that has been known as one of the most female, successful female entrepreneurs to come out of the Dragons’ Den.
She has a company called the Tiny Box company, which supplies 1000s of businesses all over the UK, from small businesses to large corporate companies specializing in environmental products. For those of you that are listening, if you are in the E-commerce business where you do products or services, no doubt you will be familiar with Rachel and her business. If you’re not, this is going to be a great introduction. She’s got an amazing story. And I’m really looking forward to uncovering with you Rachel a bit about your journey. So welcome to Business Growth secrets, Rachel, how are you? Are you good?
Rachel Watkyn:
Hello. Thank you very much for having me here. I’m good. Thank you. I’m good.
Adam Stott:
You’re good. Great stuff. Okay, so the Tiny Box Company, should we go all the way back and kind of remember when this was just an idea in your mind, before Dragons’ Den before you started dealing with 1000s of businesses? What was your process for this thing? A lot of the people listening are either already running a company, there’s a lot of people that are startups and have an idea, but perhaps don’t act on it. So, I’d love to just hear right from the beginning of your journey, what it was like starting and growing the company from the idea phase if that’s okay with you.
Rachel Watkyn:
I started because I’d set up an early Fair Trade jewelry business and the idea was that the jewelry that’s created in Africa and third world places, for the UK market doesn’t quite hit the spot. So it was putting UK designs on jewelry. And it was actually my sister that said, what packaging are you going to use? Because if you’re putting ethics at the center of the jewelry, your packaging needs to reflect that good point.
And I approached so many UK manufacturers and said I want something that is sustainable, something that is recycled, and in small quantities, please. And they just laughed at me. They were like, well, the minimum quantity is 1000s per size of box lead time 12 to 14 weeks. And I was like why is it so hard? There must be loads of other small jewellers like me that just want air in boxes and just want bangle boxes and want to start off small and then grow. So why can’t you just buy them online? It was at the Spring Fair in Birmingham, which is like a huge retail trade fair. I remember sitting on the floor despairing and just going, you know what, we’ll do it ourselves. That was the start
Adam Stott:
That was the start. And again, I start spotting the opportunity there sounds like so did you when you were going through that? This is one of the things that we teach our clients, you know, where the pain points are, you know, where there’s a pain point there’s a market? Yeah. And eventually, you found a pain point, didn’t you? Hey, that we can’t get this product, we can’t get this service. Now when you started to go down the road of looking into that and you wanted to do it yourself? Was it difficult? Did you feel it? Was there some challenges or..
Rachel Watkyn:
When I was broke… Always a bit of a challenge. I’d moved back to my parents due to ill health. So I was living in their house and trying to do everything from my bedroom. And I didn’t really know where to start. I’ve got a degree in Business Studies, but I worked in software, you know, up until like the age of 30. And I think coming from a really fast-paced environment of now was what blew my mind about the fact that I had to wait 12 to 14 weeks for a box, you know, it just didn’t make sense.
So, the first thing I did was enrol with the British Library, because I discovered all of the marketing reports that I could possibly ever want. We’re all there for free. So, all of the Mintel reports, Keynote, geodata, you know, it’s all there. It just means painstaking hours or of going through, and I did all my research there probably took me about three or four months, to put a business plan together and conclude that there actually totally was a market and it wasn’t my imagination. And the rest is history.
Adam Stott:
Oh, that’s pretty cool. So, you went to the British Library? I mean, how did you feel about the point where you’re saying you had ill health? You haven’t got much money? You’re doing this research? I know the mindset of a lot of entrepreneurs starting out, you’ve got all these challenges in front of you. What made you keep going, what made you keep pursuing it was only part of what it was like, I don’t know. I don’t know if this is the right thing to do. Were there any self-belief issues for you? Or where were you at? What was on your mind? What was your mindset at that point?
Rachel Watkyn:
So from the year 2000 to 2004, I had hit rock bottom. I got a mysterious illness as a result of an appendix operation that should have just been routine. I’d lost everything. I’d lost my house, I lost my car, a partner had walked out on me. I had nowhere to go. When you’ve hit rock bottom, you lose that fear? Because, yeah, well, where else can you go? And, it was just a hunch and a sort of drive inside of me. I don’t know where it comes from. But just like this gut feeling that I knew it was right, and even though other people were telling me that it was a grave mistake, I really felt I had nothing to lose.
Adam Stott:
That’s brilliant. And most people take action based off of because they want to gain well because they’re in so much pain, they just want to change their circumstances. So it sounds like you had some real big drivers there to just change where you were at. You know, without a doubt. And that’s, that’s awesome that you took that action. I think it’s quite inspiring. You know, certainly, for the people that are listening and mentality, you’ve got nothing to lose when you’ve got someone up and loose, quite dangerous, isn’t it? Right? So what happens next, you go out there, you get, you start making these connections? What’s the journey, the business? What are the other sorts of the next steps and the next stages? What happened next?
Rachel Watkyn:
Well, the parents were living in. It’s a squinted building in a squint, which is for old people without any money. It’s a house. My dad’s job was as a warden, so he looked after it. One of the trustees said to him, “oh, your daughter can’t run a business from there because it’s a charity”. And it was like, “Oh if I’m now going to go to the next level, I’m going to have to go and get my own premises”.
So that was really scary. I was like, “Oh, I got rent now”. Still didn’t have any product. But you know, it was all in the pipeline. And then I was out seeing a friend of mine and bumped into a guy called robbing banks that was looking to buy a box of all things. got chatting with him. He was a well-known broadcaster at the time. It’s had a bit of an alcohol and drug problem, gone into rehab. When I met him, he said, I just want to do something different.
I talked to him about what I was doing. He sort of said, can I come and work with you? So then there were two of us. He quickly realized within a space of a few weeks that it wasn’t for him that he wanted to be back in broadcasting, he was used to being in the public eye. So he applied to Dragons’ Den and didn’t tell me because he knew that I’m not a public eye person. And he knew that I wouldn’t go along with it. But he thought that if he got us there then I just have to.
So that was in September 2007. And we still had no products. We weren’t alive. He then went off to Australia for about six weeks to find his girlfriend. So I launched the website and the business in November 2007. And, it was amazing. You know, I contacted so many people to say my website’s live. Please take a look. And I set myself a target. It was grueling, but I set myself a target of 120 contacts a day. I love that. And, I made myself do it and I wouldn’t let myself go home until I’d done it. And my website cost 4800 pounds the first month.
Adam Stott:
Do you know why? I absolutely love what you just said because I think this is probably one of the big missing pieces for business owners. There’s just no outreach. They expect things to come to them. I think I’ll build a website. Now people are going to trip over and buy stuff. I’ve created this product. I’m just going to post on social media and hope somebody sees it. Without actually doing the outreach that you did, I love it. Yeah. And that discipline as well, which is really important. You’re saying you have to discipline. I think these are all really good lessons for people.
Rachel Watkyn:
On Thursdays, I run free clinics for people that are struggling with their business or whatever. And you’re right, people set up a website, and then they just expect the traffic to flood in. So I use the analogy of when you’ve created a new website, you have created it in the backend of some hidden industrial estate. But no one knows it is there. You have not created a website on Oxford Street. Yeah. So in order for you to get your website in Oxford Street position, you have got to date just come on away continuously with outbound stuff to bring people to you.
Adam Stott:
One of the things that we’ve been doing recently, one of our we have a program called Social Media monetization. And one of the biggest aspects of it is about understanding how to go out and chat. And which is exactly about starting conversations with people. So those people can actually understand that you exist, and build a relationship with them. And, of course, by building that relationship, you’re gonna bring people on, so that’s awesome. So you do 5000? You first said your first month, I believe, which is great. Yeah. See, I imagine you are feeling pretty good by now? And are you starting to, you know, in your mind, you’re believing in the business more you feel more confident. And what happens next.
Rachel Watkyn:
Christmas comes, we have quite a busy Christmas, and in January and February 2008, I walked into one of the biggest recessions in history. There’s like, oh, I didn’t see.
Adam Stott:
This in 2008, as well. Yeah. Beginning in 2008. And around the corner, you just see it coming, right.
But it was great for us. i It never occurred to me that because we were providing packaging, really, for the cottage industry, the cottage industry started to thrive, because everybody needed additional income, they needed to be more creative about raising money. So candle makers, jewellery makers, soap makers cropped up everywhere. And so actually, we thrived and the recession helped us. But we had to pivot quickly to target that market.
And what we did as well, like, is it unethical, I don’t think it is. We created our own competitor. Because we knew that we were onto something, and we knew that other people would move into the market quickly. So we sent out recycled gift packaging, as our own competitor. And the phone came into us and we just offered really bad service from that customer, or sorry, from that company. To Tiny Box. But it kind of works because it stops the noise in our area. If that makes sense. You know, the web.
Adam Stott:
I’ve never heard of that before, certainly, you know, a… Oh, great. Okay, that’s very interesting. I’ve never heard of that before. Right? So they’re very good. So that worked for you. And you start to build the company more. And you go and grow. So what point does Dragons’ Den come into the equation? What happens then?
Rachel Watkyn:
So Robin comes back from Australia on a rare day when he’s in the office, the phone goes and it’s the BBC Dragons’ Den saying, we’ve got your application, what would you like the money for? And of course, I had no idea what they were talking about. And Robin was in the office just go black in black. It says, Oh, well, we need more stock, bigger premises, bla bla, went for a screen test.
And then the next thing I knew we were invited onto the show. didn’t see it coming. Because I thought we didn’t need to start trading. It was filmed in May. So we’ve been going for six months, we had nothing patentable, no trading history, no knowledge of our industry whatsoever, because I’d worked in software. Actually, on paper, we were a terrible investment opportunity. So when two of them said yes, completely through me.
Adam Stott:
And how so? Why do you feel that you’ve got that investment? If you didn’t stack up on paper? What was it about you? Because I actually see a lot of things that you were doing right one you added the fun target market. You had some, probably back then. I mean, it’s more of it now. But certainly USP and environmental, environmental sustainable recycled products. I think back then certainly because that’s all time ago now it was very, very niche and not mainstream back then was it at all? So you had that and you had some trading history and you’ve got a brand name as a brand name, always the Tiny Box Company.
Rachel Watkyn:
Yeah, it was because the jewelry company that we were initially going to do, I’ve named the tiny difference company, because you can’t change the world, but you can make a tiny difference. So that’s how the tiny box company name came about. But as to why they invested, I think they just felt sorry for me. You know, I was asking for 60k. So, 30 grand from Sierra and 30 grand from Peter, and I think they do. They just felt sorry for me and thought it’s got to be worth a punt, you know, like, like betting on a racehorse, which he’s taking it’s probably got no chance. But you know, you just feel sorry for it because it looks a bit limp.
Adam Stott:
Well, I think there were certainly a few things that were good. So what was it like working with them? And how did you know what happened next week?
Rachel Watkyn:
Well, he didn’t pan out as I imagined. Because I hadn’t, the filming was done in May. Of course, on TV, it’s just verbal. Then the due diligence process starts and they start looking at our customer base, supplier base, see, you know, the whole business model. I was invited up for the afternoon with a whole team of their experts, not daunting at all.
And we went through the whole business model, and at the end of it CEOs, the right-hand man said, “You know what, we just can’t afford you the money and maybe to run the business”. So where I’d naively thought I was going to get mentoring. They said in your particular instance, we think that you know what you’re doing. So just go and do it. And so that was quite scary. And why did you feel that it went that way? Well, they obviously believed in me when I didn’t.
Adam Stott:
Before you had a good handle of it, you were doing the right things. So you had to use the money. What do you’ve got? So was that the first time you had a bit of capital into the business?
Rachel Watkyn:
Yeah, I mean, before that, I’ve got a bit of money leftover from when I’d had to sell my house. But now it meant that we could really upscale, I got my first member of staff, and Robin left the day of the filming and went back into broadcasting all amicably. But yes, I got my first member of staff, and we bought a printing machine. So I learned how to print boxes. The rest went on the stock. Then we moved premises.
And it was aired on September 10th 2008. And it blew the business up big time. Yeah, the phone didn’t stop ringing. And I remember describing it like I was skiing down a black ski slope when I’d never skied before, just totally out of control. But, you know, it was great. It was great publicity. And what the dragons gave us was instant credibility. Yeah, absolutely. Yeah.
Adam Stott:
Okay, so that really increased the sales, you know. So there’s a big journey now from 2008, to where we are now and what’s happened during that period? Because that’s massive, did you get much more help? And so as you grew and things became more successful did SEO or patrons get involved helping you more? Was it regular meetings or anything that went on like that?
Rachel Watkyn:
We now have a very different relationship. And the way it works is they, they lead me to run the business, they don’t interfere until I go to them and say, “Guys, I need help with this”. And it and it’s very specific help because they know then that they can add value to the business. So for example, we got hacked really badly back in 2019. Our website, there were just no orders and didn’t know what had happened. spoke to all our techie guys, no one had a clue. And you had the age-old situation where your web development company was broke, blaming the host company, the host company saying it’s the development company.
And I actually didn’t know where to go with it. It’s one of those moments in a business where you’re just like, I just remember just sitting there crying, thinking, I don’t know what to do. And it was at that point, I was like, “Okay, I’m gonna phone CEOs ecommerce director”, and he was absolutely brilliant. He was straight on it. And he got the problem solved within a few hours. So that’s why they really add value.
Adam Stott:
Yeah, giving you that extra help. So what’s happened now with the business is gone and continues to go from chatter now I know you associate over 100,000 customers now.
Rachel Watkyn:
So yeah, yeah, we’ve grown consistently and quietly, we’ve just been one of those background companies that’s just gone up and up and up. I think our average growth has been about 46% year on year. Over that time period, we’re now turnover last year was just short of 10 million 100 staff. We bought a factory down in Cornwall and we’re currently looking to move again, we keep outgrowing places, it’s very inconvenient.
Adam Stott:
What are the long term goals for the business? Do you love running the business? Do you ever want to sell the business? How do you feel about it?
Rachel Watkyn:
Well, we keep reaching pivotal moments. And I sort of think, okay, now is now the time to sit back and then something else happens. It’s like, No, it’s not time yet. This year, we’d like to do 12 million-15 million next year, 20 million year three. So that’s the kind of plan we looked at, sort of going for massive growth through private equity.
But right now, the next couple of years is about really strengthening the management team. Because we’ve grown so quickly. The management team have never had time to sort of breathe and, and, and get their position. I was likening it this morning to creating a fire. And, and you know, you sort of start your fire and you put your kindling on and then you put the bigger logs on. And if you start putting giant logs on the foundations can’t take it and you just put the fire out.
Adam Stott:
Yeah, it’s a very different proposition run in a six-figure seven-figure and eight-figure business. So you all need different things at different stages. Obviously, growing to the first millions, that fast pace, you know, understand how to get the marketing, right, get the conservative, it’s an eight-figure, I’m a pretty different animal. So what have you noticed in terms of that growth? What have you had to become better as a business owner lobbying to talk about what you need in the business? Right? Which, of course, you need the management saying, you’re going to need the obviously the systems and the processes to be much better. But what about you, as an individual, as a business owner, going from six to seven to eight figures? How have you needed to grow as an individual?
Rachel Watkyn:
Massively. When you start the business, it’s all about you, you are the business, you know, if you’re having a bad day, then the sales don’t come in. It’s really hard-edged. And then as more people come on, you suddenly realize that you’re responsible for them as well. So if you’re in a bad mood, it reflects on everybody. And, and it’s like the butterfly effect. Because in a small office, especially if they feel it is viable for you, they will react.
To some it’s not just you that’s not selling, it’s everybody else that’s not selling. And so it’s almost kind of like being an only child, and then suddenly having to go to school and play with your playmates. But making sure that everybody’s happy. And then when you get to the next stage, you actually end up like a teacher, because you then are responsible for their livelihoods for bringing the best out of people. And I’m really passionate about personal development and want people here to progress.
Adam Stott:
Cool, you’re passionate about personal development, it’s actually difficult to get other people passionate about personal development, that’s something I do in my company, I’m gonna hire someone, I actually, there’s something that I’m really looking for, I’m interviewing them because I want people to want to grow because if not want to grow. I don’t want people to want to come and come to work or die at work. I just want to, you know, look forward to the weekend. That’s not the sort of person I want. I want people that want to have a fire about what we’re doing, you know, and I think it’s difficult because a lot of people that aren’t actually naturally like that.
Rachel Watkyn:
And what happens as soon as the business hits a crisis. As you get bigger, well, even when you’re little everybody looks to you to solve it. And the pressure is on you to sort of make sure that you’re reassuring everybody else. And you might be having kittens inside thinking how am I going to get out of this? But I guess it’s this you know, on a much I’m not comparing myself because it’s a much bigger scale, but it’s like being Prime Minister, you know, doesn’t matter the turmoil that’s going on around you. You’ve got to sort of try and keep a cool head and preferably not talk about Peppa Pig.
Adam Stott:
Yeah, absolutely. Then that’s the thing, though, when you do something like that, the faith dissipates so quickly, you’ll have the most loyal people that have loved you for a long, long time. And then you go and do something absolutely stupid, and you drop the ball. And all of a sudden everyone’s looking at your guns, you know, see right issue, right? Yeah. And that out creeps in. And that’s obviously something you don’t want in your company. 100%, really important, isn’t it? Yeah, leadership.
Rachel Watkyn:
I think as well, that as you get bigger and bigger, it’s trying to bring people in that are better than you. You know, sort of accepting that, as an entrepreneur, you have limitations. And that if you can bring in somebody in marketing and finance, you know, or around you, that’s better than you in those areas. It’s sort of creating a balance of listening to them, because they know more than you, but also keeping that helicopter view of what works for the overall organization. And I think that becomes a skill.
Adam Stott:
And even those, those people better actually look at the moves with common sense, isn’t it? Because even though a lot of the time, they know more than you know, what they’re doing is, are they applying common sense and the overall business picture to their move, right?
Rachel Watkyn:
And as you get bigger, without doubt, the departments will silo. And as the business owner, it’s your job to sort of bringing them all back from their different classrooms, back into the assembly.
Adam Stott:
To build that culture, yeah. But since you’ve had an incredible journey, you know, so actually, there’s so many, you know, tips here, you mentioned, before we started that you’re launching a new range, which I thought was really interesting. Do you want to mention that? It’s pretty cool.
Rachel Watkyn:
Yeah, so last year, a friend of mine who runs a sustainable equine clothing range, that’s for humans, not the horses, was talking about her idea and talking about whether she wants to invest where to go with business. So we were just looking at it, and we were looking at the sustainable clothing market. There’s been so much noise about a lot of the big brands, you know, all of their returns, just sending them to landfill.
All of their non-sales, burning them or sending them to landfill rather than giving to charity. And, and it makes you realize that the whole clothing industry needs readdressing, the model doesn’t work. It’s not long term. So when my friend said about the sustainable equine range, I said, Well, what about the whole activewear market? There’s the whole sportswear market, who is the leader in sustainable activewear, and we were googling it. And all that kept coming up was newspaper articles about the top 10 small brands, there were no websites there.
So I was like, well, where’s JD sports, but just for sustainability. So the lady though, had the equine brand joined forces with me. We launched air activity in March. And it is taking, we’re not we’re not a marketplace, we are buying the brands ourselves. And we are… Yeah, it is a one stop shop to buy all of your active wear from different brands in one place. That’s all sustainable.
Adam Stott:
Right? Well, I’m sure that you know, with your experience and understanding that you’re gonna make a great success of it. And it sounds fantastic. You know, it sounds great. Because like I said, this again, you spotted something in the market. It’s not there, which is what it’s all about, isn’t it and bringing it all together. So a lot of people want that now, isn’t it? Should it be released? So people can sort of look at what you’ll be launching in March.
Rachel Watkyn:
Well, yeah, yeah. That’s the plan. It’s very scary. I’m scared.
Adam Stott:
I’m sure it’d be a great success.
Rachel Watkyn:
But I’m scared.
Adam Stott:
I know now. But now I think it’s been, you know, fantastic. To hear the journey, the story, and a lot of the tips that you’ve given and you know, and some guidance there for people to to certainly go and look at growing, where’s the best place for people to get in touch with you, Rachel, what’s the best thing to have an Instagram page or?
Rachel Watkyn:
I do have an Instagram although I’m learning. I’m one of the oldies, it’s like suddenly, I really need to learn Instagram. But yes, you can find me on @rachelwatkyn or www.tinyboxcompany.com
Adam Stott:
Certainly don’t check out the Tiny Box Company you know, they’re doing great things and especially if you’re listening to some of this E-commerce business or small business, the ones products or packaging, your place to go pretty much on you, you know, so 100%. You know, so be great for people to go and check you out there. Well, thank you ever so much for coming on Rachel, we loved hearing the story. I loved hearing new growth . You know, your team does some amazing things. And obviously, as a business owner, you don’t get don’t pat yourself on the back enough to take a company from nothing in difficult circumstances, to building it to an eight figure company in a short space of time. Well done. Amazing, amazing work.
Rachel Watkyn:
Thank you very much. And thanks for having me.
Adam Stott:
It’s been an absolute pleasure. Thanks, everyone. And that concludes our episode today. Go and check Rachel out at the tinyboxcompany.com. And if you’re an ecommerce business brand, or anyone that needs products or packaging, certainly the place to go. And thanks for listening to today’s episode of Business Growth Secrets. If you haven’t already, make sure you subscribe to we’ve got bringing you awesome interviews and also up to date of what’s happening with me, my business, big business events and so much more on of course, go and leave us a five star review. Thanks for tuning in everybody. I look forward to seeing you next week.
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