How I Left Corporate Life To Start A Yarn Business
Hello! Who are you and what business did you start?
I am Sue Blacker, Managing Director of Blacker Sheep Limited.
Our business spins the wool from sheep, goats and alpacas to make yarns for people who produce the fibre themselves and take it back to make and market yarn-based goods through The Natural Fibre Company and we also have also our own branded Blacker Yarns knitting and crochet yarns.
We sell Blacker Yarns mainly direct through our online shop and also through selected stockists across the world. Over half of our Blacker Yarn sales are to countries outside the UK and half of those are into the USA so we are very much an international business.
What's your backstory and how did you come up with the idea?
I originally was a customer of our Natural Fibre Company spinning service, where I had the fleeces from my pedigree Gotland sheep flock spun into yarns.
There is only one piece of advice really: keep at it and don’t be discouraged! But always listen because you are never the only person with good ideas.
Before the sheep I had been in business and finance in the City, returning to my Cornish roots to get jobs in community, economic and environmental development. Then we ran holiday cottages, with the sheep to keep the grass down, and I had always knitted since childhood.
So I had a mix of business, farming, investment banking, public relations, secretarial work and marketing in my background and was also lucky to receive a grant to fund an MBA degree at Cambridge University in 1998.
Then one day I saw the Natural Fibre Company owners mention thinking about the future in one of their newsletters, and I had been looking for a business to own and manage for a long time, so I approached them and after a lot or research and business planning bought the name, assets and stock of the business, and the rest is History!
That is to say: history happened after persuading the retiring owners that I could do it, my family that I should do it and then doing two years of development work, market research and business planning, finding premises, learning about machines, applying for grants and, eventually, succeeding in convincing a bank to support us.
Then we were able to move in and set up from September, 2005, which was supposed to take 6 weeks but actually took around 6 months before we could actually start production. Because the business already existed, I was able to do a great deal of market research with the customers, which showed there was scope for growth, particularly with additional services.
Take us through the process of designing, prototyping, and manufacturing your first product.
At first we continued the existing services of woollen spinning, though we immediately added mechanised rather than hand scouring. Scouring is the first process which cleans the fleeces, removing grease, sweat and dirt.
Then we gradually added worsted spinning and dyeing, while also at one stage we did batts, and also even weaving. But we had to be realistic and the working capital requirements and operational complexity meant that we were spreading ourselves too thinly so we had to reduce and focus in order to get things done and begin to try and make profits.
- Batts are for felt making and we found this was not cost effective. This service is provided by some other much smaller spinning mills.
- Our weaving looms were great, but like batts required to much floor space and cost so we now work with outside weavers when our customers want textiles.
- Worsted spinning however, is very important and we are the only specialist mill doing both worsted combed yarns and woollen carded yarns under one roof. This gives our customers a better choice on the most appropriate style of yarn for their particular fleeces.
We have quite high fixed overhead costs due to the size of building needed to house our 40-foot long machines, so getting to profitability took several years and we are not always able to sustain margins due to needing to train new and replacement staff and also the continuous escalation of input costs.
We also have organic processing to the Global Organic Textile Standard accreditation, re-inspected annually, as well as the many requirements of health and safety, environmental protection, GDPR for IT management and many more requirements to meet as a manufacturer.
We also set up new websites, both of which have had several makeovers over the years, obtained trade mark protection for our logos, designed knitting patterns and did a great deal of photography, as well as attending trade shows and festivals.
We researched the USA and Europe markets as well and have gradually built our customer base across the world.
In some ways we are “simply” making yarns, but the processes are not simple and each stage must be right in order for the next one to work - so to get accurate weights of packages of yarn, we have to sort, scour, blend, card, comb, spin and finish accurately before we put the yarn into weighed, dyed, labelled skeins in bags.
Our processes are best explained in film and we have just put a new film to show all of this on Youtube.
Describe the process of launching the business.
We originally bought the equipment and stock, and were generously allowed a year or so to pay for these from the previous owners.
The bigger costs were in moving and adding to the plant and equipment and then the rent on 10,000 square feet of production space. We have since added 5,000 by means of a mezzanine floor as well.
We started by transferring part of the production so that we could finish yarns spun in Wales, but gradually we move and commissioned all the machines, including some replacements and upgrades. Over the years we have steadily replaced pretty much every machine we started with, to increase capacity or capability.
We have mainly financed this with a mix of some grants, bank loans and also investment from individuals and organisations. We re-capitalised the business in 2012 to re-finance and in the longer term we have always been under capitalised, which is probably true of many small businesses in the UK - our banks are not generous and have a charge on our home, and investors want quick returns, which are less feasible with our type of business. We are looking to gain additional investment going forward, and we hope to involve both staff and customers as investors in the future as we believe this will provide a more stable longterm attitude and support.
Since we inherited customers, many of whom we still have 13 years later, there was no formal launch for our commission spinning business, but for Blacker Yarns, we worked on an e-commerce site, loads of photography and initially much advertising in magazines, although today our marketing is almost entirely via social media, including Ravelry, the specialist platform for knitting and crochet.
Our early site was not very different from the current one but our most recent re-design has also aligned The Natural Fibre Company and Blacker Yarns more closely.
Below is an earlier version of Blacker Yarns.
Since launch, what has worked to attract and retain customers?
We have found that the best thing to do is deliver quality, and this is usually possible, although since all sheep breeds produce different wools, there is enormous variation in what is possible and appropriate for each one. This is also true for mohair and alpaca.
In order to do this, we spend a lot of time and words in explaining to our customers what they can expect, given the fibre and this also applies to Blacker Yarns, which are specialised and very individual.
So we have a blog which has described each stage of the journey from fleece to yarn, as well as a wide range of advice sheets, apart from our website, regular newsletters, and the other social media. Our blog strategy is actually rather simple: we try to write articles on what customers have asked us or else on what we are doing or thinking about our woolly world. We have also been on national television in programmes ranging from farming to children!
We find that some of our yarns are regularly purchased as they are more standard, while some are designed to be one-off limited editions and attract attention until they run out, and these are therefore sought after as more collectable. Knitters and crocheters like both novelty and tradition! So we need to address both requirements. We do an annual customer survey and publish the results and we also closely monitor our competitors in order to try and maintain a good understanding of changes in our marketplace.
We collect customer names at shows and have sign-up messages on each page of our website and also we find that Ravelry and Instagram are the most effective at getting Blacker Yarns more widely known at present.
One major change since 2005 has been the proliferation of email - when we started we did most things by post but not any more! This of course has also been followed by all other social media, where we have a growing presence. We still find that our own newsletter audience, collected over the years through direct contacts, has been the most effective channel.
How are you doing today and what does the future look like?
At present, we are on something of a plateau with things going a bit sideways - demand for yarns is relatively flat due to economic uncertainty and a flattening outlook.
We need to review and re-shape things to move forward again, so are pausing and drawing breath. This is something that seems to happen to a business roughly every 4-5 years, so is not a surprise, but we have to take the time and effort to get things right.
We do have high enquiry conversion rates, and returning loyal customers and we have some 10,000 people on our mailing lists, all organically generated. So we have a strong base and we are well known in our industry, both in the UK and also elsewhere.
At present we are around 6 times the size of the business in 2005 although our highest year was 7 times, so initially, we want to resume the upwards trend.
Through starting the business, have you learned anything particularly helpful or advantageous?
I have recently written a blog item about things we planned to do but then did not do or stopped doing and also things we had not expect to do but have in fact done. We always need to adapt to change in the market place in order to survive and grow sustainably. See https://www.thenaturalfibre.co.uk/blog/thoughts-about-truth-trust-values-and-future
We generally work in partnership and our most successful wool yarn, Blacker Swan, was created by working with a farming partner, whom I have yet to meet! He is based in the Falkland Islands, so although I have met his family I have not met him - this trust was grown by working together and seemed quite courageous, but has worked so well that we are now working with the people who took over his flock when he retired. So we also have longterm suppliers and customers and aim to keep this going over time.
Our biggest challenge at present is our own staff, as we have had several experienced workers decide for various reasons to move on so re-building the team and skills base is quite a challenge and has led to lower output and productivity than we need at present. We are getting there!
What platform/tools do you use for your business?
I love Excel and work things out in it, from lists to plans to budgets, to staffing structures, to new ideas and pros and cons. We also, of course, use all the social media. However, in the end, the telephone and physical meetings are crucial to establish and build trust.
Our online shop is Magento and works well for us and our mill site is Drupal - both being freeware. In addition, we have a bespoke bar-code related stock recording system and use Sage accounts with a link from the shop direct to the accounts.
We find basic Office does a good job for us still, though we keep looking at options for more integrated customer relationship management and also for stock management.
Of course, we are also lucky to have Ravelry, the specialist site for knitting and crochet and to work closely with many sheep breed societies, so our tools are slightly specialised.
What have been the most influential books, podcasts, or other resources?
Apart from the resources found during my MBA studies and continuing development through the Chartered Management Institute, I have been inspired by the Savory Foundation, by Anita Roddick and by the organic and environmental movements, together with some amazingly wonderful farmers and craft workers.
I am continuously inspired by our staff team and our customers.
Advice for other entrepreneurs who want to get started or are just starting out?
There is only one piece of advice really: keep at it and don’t be discouraged! But always listen because you are never the only person with good ideas.
And I always do quite a lot of market research and analysis prior to making important decisions so that I can then revisit both if it works and if it does not, and do it better next time.
Are you looking to hire for certain positions right now?
We are currently still recruiting production workers and are close to appointing a marketing assistant following interviews in the last week.
Where can we go to learn more?
These two sites are linked and also have links to our Facebook, Instagram, Twitter and Ravelry accounts. We also have subscription options to our two mailing lists on the home pages.
If you have any questions or comments, drop a comment below!
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