While the start-up phase of a company’s life can be make or break, the next step in the evolution of a growing business can be even tougher. Breakthrough Clinic gives one company at a crossroads of expansion the chance to gain free advice on the possibilities for growth from an expert business adviser.

Company History
Brandedmedia is experiencing the sort of phenomenal growth that would make any business owner envious. In the three years since it was founded by managing director Sean Fergusson, turnover has shot up past £3 million and it’s one of the few profitable businesses in the market. It offers a bespoke service duplicating CDs and DVDs for a range of purposes, such as promotional products for large corporations, software CDs for distribution, film and TV DVDs for retail, and so on. ‘We’re producing more than one million CDs every week and about half a million DVDs,’ says Fergusson.

Brandedmedia’s popularity is evident from its client list, which reads like a who’s who of famous brand names such as Virgin, NTL, Apple, Sony and the AA. As Fergusson explains, ‘I think we hold on to big customers by offering a competitive price and a really good service – in my experience, you don’t often get both from the same supplier.’

Fergusson left school at 16 to work in retail, becoming an area manager with 35 staff at just 21 years of age. He went on to join a marketing communications firm and then a CD production house for four years, which is where he got the urge to start his own business.

‘I made them a lot of money and realised if I could do just 25 per cent of that with my own company, it would be a success.’

Giving up his six-figure salary, he set up Brandedmedia with a view to filling a gap in the market for a service overseeing the entire magnetic media production process, from concept through to delivery. ‘There were companies in Europe at the time offering either CD authoring or manufacturing, design and printing or packaging and fulfilment, but not the whole chain,’ he recalls.

Within eight months the company had hit £1 million turnover with net profit of 15 per cent, and last year saw turnover of £3.2 million with 12 per cent net profit.

Manufacturing is outsourced, which keeps costs down, and sales and account management staff are in-house. This arrangement enables Fergusson to concentrate on building a strong account management team. ‘I’ve got a fantastic team around me, who can be relied on to exceed client expectations.’

Brandedmedia employs 25 full-time staff at its head office in Basingstoke and up to 25 extra temporary staff when required. Fergusson incentivises staff in a variety of ways and is proud to reveal that only one member of the team has left since launching the business – and that was to go to University.

Current challenges
Fergusson started up the business using his own savings (he is sole shareholder) and organic growth has been funded from profits generated. Initially operating from a friend’s converted barn in Winchfield, Hampshire, within just a few months he was taking on staff to handle the volume of orders and even roped in his sister Fiona, who is now operations director. The business quickly outgrew this 750 sq ft property and went on to secure a five-year lease for its current 5,000 sq ft office in Basingstoke. However, it has outgrown this after just a year and plans are now afoot to move to new 9,500 sq ft leasehold premises in June. Fergusson admits organising this will take up a significant amount of his time, to ensure a seamless transition within budget. He also intends to hire more staff this year, doubling the sales force and account management team to meet realistic yet impressive turnover forecasts.

Believing that the business model can be easily replicated, Fergusson is keen to expand internationally. An operation is already running in Sweden and he plans to launch in Australia soon, relying upon his existing management team of three to help him drive this expansion. As separate firms with different shareholders, the overseas enterprises will initially buy from the parent company in the UK and utilise the existing infrastructure. Fergusson has no plans to exit the business in the foreseeable future, believing the company is nowhere near realising its full potential.