Who would have thought that one of the UK’s most successful businesses, would be one where everything is sold for a pound!
Steven Smith is the Founder of Poundland, one of the UK’s most successful retailers. Established in 1990, Steve has worked hard to build his empire, now 27 years later you can find a Poundland on nearly every high street across Britain.
Steven started his working life alongside his parents when he was just 14 years old, helping out on the families’ Bilston market stall. It was during this time that he realised it was often the cheaper products that made more money, this motivated Steven to set up his own shop and was the inspiration behind the idea of Poundland. Steven set up his first store when he was 17, alongside his wife, Tracey. Working hard all day and night to make the store a success.
Steven works by an amazing theory: ‘if you get the pricing right, everything sells and that there is no such thing as bad products, only bad prices’. This theory launched Poundland into success and has also transformed the way many people shop. As a result of his hard work and determination, Stephen has won several awards including UK Entrepreneurs of the Year.
I reached out to Steven as his strong work ethic and innovative thinking provides not only an inspiring story but also offers great advice for Start-ups and entrepreneurs. Here’s what he had to say.
Getting to know Steven Smith:
What was the biggest challenge you faced when starting your business?
When I started Poundland in 1990, we only had 648 products to sell for a pound therefore the offer was not great. However, on the opening day alone we took £13,000. An issue of being a new and a small business was that many suppliers would not deliver the products to us as we did not have any buying power. So, to surmount this we hired a van and went around all the suppliers all over the country to find products ourselves.
Many entrepreneur’s in the start-up phase feel like their product and/or services are not good enough, what advice would you give to help them overcome this?
Don’t ever give up, keep pursuing your ambition and find other people that believe in what you are doing to create a supportive network.
If you don’t believe in what you are doing, why should anyone else? I believe that there are no such thing as bad products, there are only bad prices. You have to find the price the products will sell for, get some buying power behind you and then source the products so that you can make a profit. My first brand product was WD40. When I first bought it, we paid 99p and sold them for £1 each over a few months. We even sold more than Halfords and then sourced them so that we made our margin. This then got us into other brands.
What is your top tip for people starting a business?
My advice is find what type of business are you interesting in doing, work for someone else in that industry first and then work out what would you can do to be unique and different before starting your own business.
You had an unorthodox pricing strategy. What advice would you give to Start-ups when price setting?
As I have said, I live by the theory of there being no bad products but only bad prices. You will need to experiment with your prices to make sure you that you get it right. Another piece of advice I’d like to give to Start-ups when looking at their pricing strategy is to learn from your mistakes – it is a work in progress.
Who trained and influenced you?
My dad trained me up on Bilston market and this is where the original idea for Poundland came from, anything that came out of its original box was sold in a cardboard box for 10p.
What were the biggest wastes of time when starting/growing a business?
The biggest waste of time when starting my own business was trying to convince people that the concept would work. I had difficulties when beginning because suppliers would say yes to supplying to us in person, but they would not do this until they could see the concept actually worked. When starting your own business, you also want to make sure you choose your employees and connections well – you want doers not talkers.
What are your favourite business books or resources?
Although I have just written my own book called ‘Stephen Smith: The Story of Poundland Story’, I have never really read a book from start to finish.
Steven’s story shows that determination and willpower really does make a difference when starting your own business. He also points out how pricing strategy is vital for all businesses – you need to find the right price through experimentation and market research – what will work for your products and services? Check out our blog on pricing strategy to get you started.
Thank you to Stephen for taking part in this interview and giving his top tips for starting your own business! You can find out more about Steven and his amazing achievements by visiting stevensmith.com