My First Million — Oliver Tress, retailer

Oliver Tress, 48, is the founder and managing director of Oliver Bonas, an independent chain of lifestyle stores that started out with one shop on London’s Fulham Road in 1993. Twenty-two years later, the retailer has 44 stores across the UK, offering products from contemporary jewellery and ladies’ fashion to gifts, homeware and furniture. There are plans to open another six shops this year.

Three-quarters of its collection is designed by a 15-strong team, led by Mr Tress. Based in Chessington, Surrey, the company employs over 500 people and turnover was £30m in 2013/14. Online purchases account for 10 per cent of sales.

CV:

Born: Henley-on-Thames, May 1967

Education: Marlborough College, Wiltshire. Durham University to read anthropology

Career: Spent several years travelling to Hong Kong buying bags and accessories to sell to friends, at fairs and markets, before opening Oliver Bonas, aged 25.

Lives: Clapham Junction, London. Married to Gina Coladangelo with three children: Talia, six, Bruno, four, and Layla, two.

Did you think you would get to where you are?

At 15 or 16 I thought I would have a global brand, and nothing could be simpler. When I opened my shop I did not have a grand plan. As my trading at markets and events had centred on Christmas, a shop seemed the next logical step. Almost no one then was doing the mix of products that we have.

The business came about because I was visiting my parents in Hong Kong several times a year, and university friends kept asking me to bring back watches and Chanel-style handbags, which they loved. I started shipping them over when I could no longer fit them in my suitcase.

Opening the shop was not that difficult. I had sat at my Amstrad computer and worked out the figures. The premises were not very big, nor in a prime retail area. The rent was £9,500 a year. Once I had opened the second shop, in Kensington, where the rent was £35,000 a year, I quickly found out my lack of business skills. At this point, 44 shops seemed a very unlikely possibility.

When you had made your first £1m did you want to slow down?

I remember the moment we had made over £1m profit several years ago. I felt that we had achieved workable economies of scale. I did not want to slow down, but accelerate. It was like a springboard, and very exciting. We could allow ourselves to think big, and decided to reinvest the money into building a design team. We started with a part-time fashion designer and a creative buyer. In August we took on our first jewellery designer.

What is the secret of your success?

Initially it was youthful confidence and enthusiasm that got me going. I had all-round skills while being amazing at nothing. I was just about able to keep the business afloat while I found people who were good at doing the things that I found difficult. I was bad at managing people and monitoring cash flow.

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Since 1999 I have had a business partner, Tim Hollidge, a university friend who trained as an accountant. He runs the operational side of the business while I focus on creative buying and new stores. We are the only two shareholders.

We found our niche in the marketplace as a design-led retailer. Current top sellers are a marble-top drinks trolley, a coral flower and coconut candle, a compact mango wood desk, and an alphabet washbag.

What was your best preparation for business?

I was not prepared. I was a trader who could understand the basic principles of retail, but beyond buying and selling my knowledge of growing a business was nil. Once I had worked out that I did not really know what I was doing, I just had to get on with it.

Do you have time for personal financial planning?

At home, my wife, who studied economics, takes over the personal finances and keeps track of our outgoings. I simply don’t have the time for it. There are no major financial decisions to make, and we are not extravagant.

What is your basic business philosophy?

We are in the business of making people happy, which means we have to design products. Maslow’s Hierarchy of Needs shows as a pyramid. Self-actualisation is on top, and basic needs are at the bottom. Our job is to move people up the pyramid, and give them higher levels of satisfaction.

What was the most challenging period of your career?

It was the transition from one shop on the Fulham Road to the second one on Kensington Church Street. Running two shops required management skills that I did not have, and the first six months in Kensington were tough. I did not understand how you finance a business, and paid for everything in cash that I had saved. I had an anxiety about money, because I did not have the buffer of a loan or overdraft facility. Cash flow was a constant headache.

I had this idea that people in Kensington were rich. I made the interior more like a gallery of unusual furniture and it barely looked like a commercial shop. So people came in and walked out. Six months in my friends told me I was crazy — and to replicate the first shop, which I did, and it worked. But I did not understand how to manage people, which I found very stressful. I did not know what roles to give them or how they should talk to customers.

Do you want to carry on till you drop?

I had this idea that people in Kensington were rich. I made the interior more like a gallery of unusual furniture and it barely looked like a commercial shop. So people came in and walked out

Yes, because I see the business as a creative outlet with ongoing expansion. At 60 I would still want to be fully involved but not in the day-to-day decision-making. It would be nice to have greater freedom in the way that I work and devote my time to specific projects. By then we would hope to be trading overseas, having in the region of 200 stores.

Have you made any pension provision?

I took out a pension when I was 28, on the recommendation of my housemate, a financial adviser. I have not increased my contributions for 10 years, though I did in the first 10 years. I don’t pay that much attention to the fund reports, but I carry on paying into it out of habit. Broadly, I see my business as my pension.

Do you believe in giving something back to the community?

Our company motto is Work Hard, Play Hard and Be Kind. Since 1993 we have supported many causes, from providing baby equipment and toys to an orphanage in Vietnam, to donating £2 from every fig-scented candle to Willow, a charity which brings special days to seriously ill young adults.

This winter we hope to raise £50,000 for Age UK from a fantastic woolly hat project. Each hat sold will raise £3 or £5 for the charity.

Do you allow yourself the odd indulgence?

Our indulgence was moving to a bigger home in Wandsworth in September. We barely had a garden in Clapham, but the new house has a bigger garden and more space downstairs. We might be able to build an extension. The mortgage will still be pretty considerable, as retail businesses are not necessarily throwing up a lot of cash. I am not a tycoon.

Do you believe in leaving everything to children?

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Oliver Bonas, the quirky retailer, aims to live up to its motto of “Work Hard, Play Hard and Be Kind” by promising to pay staff the living wage, a rate higher than the version proposed by chancellor George Osborne in his summer Budget.  The London-focused chain of 43 stores is the first high street retailer to make the pledge. Ikea, the out-of-town furniture maker, became the first big retailer to sign up to the voluntary scheme, pledging it would raise its minimum payment to £7.85 from 2016.

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No, not really. I believe that children should be self-reliant after lots of parental encouragement. I do have a will, leaving everything to my wife. I need to think carefully before updating it. What I’m really hoping is that as I get older some of my passions, like teaching young people wisdom, will become part of my life and I will put money into them. My inspiration for this would be The School of Life, run by Alain de Botton. I don’t want to have a large amount of money when I die.

Your most prudent investment?

It would be the £3,000 savings that I used to set up the first shop. I paid £1,500 upfront for the rent. Then there were four cans of paint, and a case of beer for my flat mates who helped me decorate. Add £60 for a second-hand till, and £200 each for signwriter and a solicitor. My logo and business cards I bought from Prontaprint. My great moment was on my first Saturday when I took £1,000. I remember driving home with a sense of euphoria that I have never experienced since.

How have you survived the recession?

We were hit hard when Lehman Brothers went bankrupt in 2008. For two or three weeks afterwards our sales were fine, but they dropped quite dramatically throughout the Christmas period. People wondered if the financial system would collapse here.

We sat down with the senior managers and decided we had to cut costs and increase sales. Tim’s idea was to do 100 things 1 per cent better, like the England rugby team who won the World Cup in 2003. It was an easy but powerful concept for people to grasp, and kept up morale. Everyone felt that they could do something to help. We managed to cut a lot of our costs after talking to suppliers. We gave every customer that came into the shops amazing service.

By April 2009, sales were back to normal. During the recession we were able to open another eight shops, because you could negotiate better terms with landlords.