ParcelHero E-tail Hero #1: Lootybag

Debra (Debs) and Terry Scanlon were Army officers when the husband and wife team took the plunge into civvy street and launched Lootybag. Based from home in Shrewsbury, Shropshire, Lootybag design and make kids’ fabric party bags, swim bags and wash bags, along with a range of handmade prezzies to fill them with. Nick Buglione of ParcelHero sat down with the Scanlons to find out more.

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What inspired the idea for Lootybag?
Debs had been making fabric party bags and swim bags for our daughter Ella and our friends and family began to request for them for their own kids and their parties. We both wanted a new challenge and a better quality of life working from home with flexible hours we could fit around our daughter. Lootybag was born in April 2011.

Do you have other jobs as well?
No, not unless you count being a mum, housewife, schools runs, supporting sports teams and ferrying kids to an endless round of activities, clubs and parties!

Did you do a lot of research before you took the plunge?
Debs enrolled on a ‘start your own business’ programme with WIRE (Women in Rural Enterprise), we completed a full business plan and carried out thorough research on our potential competitors, evaluated USPs, went through all the pros and cons, ran a customer questionnaire for, planned a marketing strategy and forecast our cashflow. We chose to specialise in luxury filled bags – perfect for the busy mum who has very little time and wants her filled party bags delivered tomorrow, ready to hand out and with a bit of the wow factor.

Who does what at Lootybag?
Debra designs and makes all the bags and personalises them as well as handling the customer service side, manages the stock and looks after the shipping. She is also the photographer for the product images. I manage the website, keep the site optimized, look after customer reviews, manage our social media and am the buyer for all bought in stock. Not forgetting tea boy and washer upper! As you might guess, we both pitch in packing orders and cutting up the fabrics. It has worked well, we both complement each other and have naturally slipped into our respective roles.

How did you fund the business start-up?
We used our own capital but we also applied for and were awarded a business start-up grant from Shropshire County Council. This was key to launching our first website, a WordPress ecommerce website. After 12 months we changed to a Magento ecommerce website and a year later this was refurbished to be more mobile and tablet friendly. Each website was built by local website designers. We also sell via handmade online market places sites Etsy, Folksy and Misi which opens up Lootybag to global sales.

What was your biggest challenge launching Lootybag?
Living without a wage for two years while the business became established. We tightened our belts, lived frugally, didn’t have a holiday for three years and hoped for the best.

How do you locate and target customers?
Our products are high end luxury handmade products and our party products in particular are aimed at busy mums with a high disposable income. We use social media, and Twitter in particular. Word of mouth is invaluable for a business like ours. Every bag has a tag with our website address and a personal recommendation. Customer retention is important and over time we have built up a committed band of repeat customers.

How do you market Lootybag?
As well as social media, we are very active on Members of Mums business directory, WiRE (Women in Rural Enterprise), Enterprise Nation Hotfrog, Mumsnet and Netmums business directories, UK business directory and Essex’ Mums website.

How did you source suppliers?
We make our own fabric bags sourcing fabric from suppliers in the UK. The gifts for the bags are sourced from a wide variety of suppliers found by sheer determination and hours searching online. We also talked to other people who run craft or party businesses. Luckily bags are not considered toys or garments, so although they are made to very high standards we do not have to go to the time and expense of getting them CE certified or garment tested.

What’s next for Lootybag?
Our sales and popularity continue to grow at a pace. Our aim is to constantly increase sales and customers. To help achieve this we will be considering improvements in the website to make it more professional and customer friendly, introduce worldwide shipping (currently only UK) and introduce more efficient ways of producing our products. We currently work from home and are getting too big a business to run from home now so we are looking at a business unit and employing additional staff.

You launched when the country was in recession?
We began our business during the economic downturn and at a time when families were feeling the pinch and apparently had less disposable income to spend on luxury goods. However, we have shown that customers are looking for, want and will pay for handmade quality products. Party bags rarely happened when we were little but these days Mums and Dads want the best for their children and for birthday parties in particular party bags have become a ‘must have’.

From your experience with Lootybag, what are your tips for future E-tail heroes?
Do your research thoroughly before you spend any money on your idea. Believe in your idea but don’t expect overnight success. Hard work always pays off followed by being smart in everything that you do. Try to always see things through the eyes of your customer. When things go wrong, go above and beyond your customers’ expectations to put it right – a good reputation will repay you handsomely. Last but not least, have a little bit of luck!

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