Kevin House had a dream of starting a Japanese fashion boutique in London, but he had a few hurdles in the way; he didn't have any experience running a business, couldn't speak the language and had no contacts. Several years later, sheer perseverance and honesty have helped him launch a clothing brand and even have celebrities wear his clothes.
Here he talks about the challenges he faced in the latest startup profile of our The Investibles series.
1. What is your investment status?
Butikku has been trading for around three years, but has sought no external funding to date. In 2017, I expect to progress with a substantial funding round to support a step-change in scale.
2. Describe your business in one paragraph; what’s its vision and what problem does it solve?
Butikku was founded upon a simple vision of bringing the best of Japanese designer fashion to the UK and Europe. There is a wealth of design talent in Japan, and countless inspiring designers and brands, but they have virtually no presence in Western markets. Butikku aims to open the market for Japanese designers in UK, Europe and possibly even broader, and to become established as a major channel for Japanese design.
We’ve been selling premium designer womenswear for three years now, as well as quite a bit of original art, but beyond that we will grow to encompass all aspects of design and creativity, from clothing through to lifestyle goods, art, and health and beauty products. As a curator, not just an indifferent wholesaler, Butikku will retain a consistency of vision around contemporary elegance and high quality.
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3. How did you come up with the idea for your business?
Back in 2013, my (now former) girlfriend wanted to start a small fashion-related business, but lacked a clear idea for it. Acting initially as her mentor and advisor, I encouraged her to define a USP and through our conversation we uncovered that there was a quite surprising gap in the marketplace for clothing from Japanese designers. After doing some online research and taking an initial trip to Tokyo, we confirmed that there was no shortage of great designers and a genuine opportunity and it all went from there. She left along the way, but I was convinced of the vision and decided to carry on.
4. What’s your addressable market?
Today, Butikku offers only womenswear, broadly within the £2.7bn premium lifestyle clothing accessories and footwear sector.
Our focus is on AB (and to some degree C1) females; management-level professionals and high net worth individuals. That’s a sizeable audience of about 14 million women at the most inclusive count, but we’re aiming at those who have a very strong sense of design and style, coupled with confidence to not just follow the mainstream or name brands but to invest in quality that they can personally appreciate. This tends towards a slightly older customer than some premium brands, which have a more prominent brand image at their key attraction.
As a curator, not just an indifferent wholesaler, Butikku will retain a consistency of vision around contemporary elegance and high quality.
Our future scope will include men also and may broaden slightly in the demographic as different product categories may appeal to slightly different groups. But the basic attribute of a Butikku customer will stay constant – people who value good design and high quality with a willingness to pay a fair price for that.
5. What’s great about your team and do you have a mentor?
Butikku is still a very small business with only one employee – myself. Fortunately, my career and experience prior to this has been quite varied, so I’m comfortable working across all disciplines when I need to.
At times, I’ve had short bursts of hands-on assistance from others, for example in supporting the buying selection in Tokyo or staffing a pop-up shop and I’ve collaborated with numerous startup brands during pop-ups. I’m always looking for collaborators and partners, especially now I’m looking to fill a couple of key roles to help move things forward. I have a few candidates lined up, but nothing is finalised yet, so I can’t name them.
I don’t have a mentor. I’ve simply never found one but I welcome contact from anyone with luxury retail experience who might be interested in mentoring me.
I have gradually developed a sizeable network, primarily by being enthusiastic and by persevering and showing my personal commitment - I was always very honest and open about my situation.
I have however received lots of one-off advice from perhaps hundreds of people over the years, including many of my customers, who are generally experienced professional people, and are often very interested in the story and details of the business.
6. What key challenges have you faced and how have you overcome them?
It’s all been a huge learning curve for me. Before starting this I had no experience in fashion, had never traded with Japan and I had never worked in a B2C role, barely even in a B2C business.
But, I think dealing with the Japanese designers and brands was probably the key challenge: I don’t speak Japanese and had literally no contacts in Japan when we started. My first step was to seek support from the Japanese Export Trade Organisation (JETRO), who could at least arrange introductions on my behalf to people who otherwise might have ignored me. Through regular trips to Tokyo, I have gradually developed a sizeable network across the industry in Japan, primarily by being enthusiastic and by persevering and showing my personal commitment. I was always very honest and open about my situation; I shared in detail what I was trying to do and the serious challenges I faced, and I think that has earned me respect and trust. I’ve even made a few friends.
Nowadays I bump into people I know whenever I visit an exhibition or show in Tokyo; even if it’s a designer I’ve not heard of before there will almost certainly be somebody I know in the room or we will at least have an acquaintance in common. That connectivity and credibility make it much easier to develop new relationships too, even with larger companies.
7. How have you funded your startup and why did you choose this route?
To date, Butikku has been fully self-funded from my own savings, with a little additional support from family. The initial investment was relatively small, although top-ups have been needed from time to time as the pop-up model gives a very bumpy cashflow.
The self-funding path was largely opportunistic – I preferred to retain the freedom and flexibility that this allowed me while I learnt about the marketplace and developed my ideas and gained experience. Having now worked through that phase, it feels right (and necessary) to bring in external investment for the first substantial growth phase.
8. How do you market your business and how successful has it been so far?
Honestly, marketing is not one of Butikku’s strongest areas unfortunately, although it’s something we’ll be prioritising in future. I’ve just begun a collaboration with a business university, but otherwise I’ve managed marketing myself up until now. I’ve had a little success in getting coverage, including features from TimeOut and Metro, and occasional write ups in lesser-known online magazines or articles. I’ve also had celebrities wearing our clothes at red-carpet events and a couple have agreed to wear Butikku’s selection on a recurring basis, but unfortunately those have not come to pass in reality.
In Japan, there was a small feature about Butikku in the Yomiuri Shimbun (the world’s highest circulation newspaper!) and I’ve been interviewed and featured by Tokyo Fashion Week and briefly in a documentary by NHK on one up and coming Tokyo-based designer.
Butikku was shortlisted for the Excite Awards by Toucan and Time Inc in Autumn 2016.
Our organic social media following is still quite small. Customers visiting our pop-ups typically proclaim no interest in social media at all and so we focus instead on growing our own mailing list as that it is their preferred way to be informed.
9. What are your plans for the future?
Butikku was always envisaged as a channel for bringing a wealth of high-end Japanese design to the West. The strategy for doing that includes roles as both a retailer/showcase and as a facilitator (ie. some variation on a wholesale, distribution or agency capacity).
After several years of learning the ropes, testing the consumer appetite in London and developing strong relationships for our supply chain in Japan, that vision remains clear and compelling. The planned next phase is establishing a large permanent Japanese designer and lifestyle destination store. As a high-profile showcase for Japanese design, with a strong appeal not just to Londoners but also to the huge tourist industry (tourists sales have been large in our pop-ups), it will serve as the cornerstone of the larger venture, whilst also being profitable in its own right.
When I’ve had a close collaborator I’ve found it much easier to work on the more intangible and long-term aspects than when I’m working alone.
There is work to be done, but the aim is to launch a fundraising round around the middle of this year to support that step. In parallel, we’ll be looking to further develop the relationship with our many brands and associates in Japan, which will most likely see Butikku more closely involved in the development of the supply side.
10. If you started again, is there anything you would do differently?
Probably everything! But there are two major things I would prioritise that I didn’t before:
First, building a core team as early as possible. Butikku has largely been developed by me personally, with relatively little supporting input from others. I’ve learnt a great deal that way, and it’s allowed me to steer the business in the direction I want to, without external pressure, But it’s probably also meant that I’ve been less disciplined than I would have been with others constantly challenging me, and has also been a constraint on the rate of progress. Working alone is also pretty tough motivationally, and during some stints when I’ve had a close collaborator I’ve found it much easier to work on the more intangible and long-term aspects than when I’m working alone. So definitely I’d look to address that team much earlier.
Second, I would invest heavily in marketing and promotions from the very start. It’s always been an area in which I’ve hesitated to spend much, due to a lack of confidence in the ROI and a scarcity of funds to risk. But a major conclusion from my review is that although many women love our offering, the biggest constraint on progress has simply been getting exposure to larger numbers of them. Pop-ups are a contribution to that, but to get high footfall requires either an amazing location and timing (which is both very difficult to find and expensive) or external promotion. I think strong promotion is really the key.
11. What advice would you give to entrepreneurs that are starting a business?
I get asked this question often, especially from would-be entrepreneurs who walk into one of my pop-ups, and I probably always give a different answer. I think the advice that everybody needs is different depending upon where their own weaknesses or blind spots lie – there is no single most important piece of advice. Except perhaps to ask for advice from as many people as you can, and consider which pieces feel most aligned and applicable to you and just as importantly, which ones don’t.
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Journalist and editor with nine years' experience covering small businesses and entrepreneurship (ChrisGoodfellow.net). Follow his personal twitter account @CPGoodfellow and his events business @Box2Media. He has written for a wide range of publications in the UK, Ireland and Canada, including The Financial Times, The Guardian, The Independent and Vice magazine.