Essex retail business set for growth thanks to Understanding Finance for Business

• Rawgarden - growing retail business in Essex
• Funding required to enable bulk orders and significantly increase profit margins
• £200k secured from bank with help of mentor as part of EEDA's Understanding Finance for Business (UFFB) programme
• Stock and warehousing now increased and the business is set for future growth

Essex-based Rawgarden sells an extensive range of garden furniture, barbeques, garden accessories and other related products through its website and onsite showroom. Employing a team of six full time staff and two contractors, Rawgarden sells both to the general public and to trade buyers across the UK, such as garden centres, local authorities, schools and hospitals. The company had grown consistently since it first began trading in 2000, and in 2009 had reached the point where additional funding was required to accelerate growth and realise the longer-term business plans of Managing Director Scott Canton.

'We had a lot of experience of buying in and selling garden furniture, and our trade business had been growing fast, but we wanted to manufacture more products ourselves so we could improve our profit margins while also specifying products which really met our customers' needs,' Canton explains. 'We also knew that our margins would be even better if we ordered in bulk. However, such large orders demand a significant deposit in advance, which we could only provide through funding. As a result, we decided to seek advice on the best way to achieve such funding.

Faced with a bewildering selection of business advisors - and with little means of judging the quality of advice on offer - Canton and his staff  signed up for Understanding Finance for Business (UFFB). 'Our expectations were pretty broad at this stage,' confesses Canton. 'As much as anything, we hoped to validate our business model and future plans.  I have been self-employed since leaving school, and our business is fairly self-contained, so it was also a great opportunity to meet other entrepreneurs, and business advisors, and talk about our goals.'

Canton soon realised, however, that more concrete benefits were on offer: 'UFFB works both ways - as well as attracting businesses looking for finance advice, EEDA also wants to identify companies which will really benefit

from their input. We were one of those companies, and the advice we subsequently gained was invaluable - and free.'

Rawgarden's management team attended two UFFB Workshops which provided guidance on forecasting and monitoring, equity finance and other funding options, and on how to present an application for Enterprise Finance Guarantee (EFG) funding. The company was then selected for mentoring and assigned to Bob Westrip, a former corporate banker and one of a number of seasoned business advisors within the team at St John's Innovation Centre which is delivering UFFB on EEDA's behalf.  'Bob was brilliant,' says Canton. 'He recommended changes to our existing business plan and helped us draft a loan plan, a document summarising key financials and related information. This makes it easier for a funding organisation to evaluate an application, thereby speeding up the decision making process. He also advised us on who we should approach for funding (which, in the end, turned out to be our existing bank). All of this saved us considerable time. Most importantly, however, Bob gave us the confidence to proceed with our plans, and we hope to keep in touch with him as our business grows.'

Rawgarden successfully secured EFG funding of £200k in late 2009, four months after beginning the process. The funding has been used primarily to secure the bulk orders required to improve profit margins, and to pay for the warehousing required to store the much bigger deliveries. These improved profits will help fund the future expansion of Rawgarden's trade business, supported by additional funding - applications for which are already planned.

Clearly, for Rawgarden, the UFFB programme was extremely helpful, and Canton is keen to recommend the process: 'The workshops were very rounded - the advice was focused, relevant and very high quality, saving us both time and money. We also made new contacts both within the advisory team and with other delegates, especially those working in skills areas where we lack expertise.'

Above all, says Canton, UFFB encouraged Rawgarden to fully develop its business plans, and provided the knowledge required to apply for future funding. 'Good advice is hard to get' Canton concludes. 'The UFFB programme has proved to be excellent, helping us determine what we need to do to realise our growth strategy so that we can build the business with confidence.'

www.rawgarden.co.uk