5 things I learned from creating a multi-million dollar business in 12 months

My dad and mum founded McPhails Furniture back in the 1960s. He was a fourth-generation farmer and his career was looking promising, however, he wanted to carve out his own path and try something different. He decided to do that by purchasing a removals company and soon found that many of his clients were leaving their old, but perfectly fine, furniture behind.

Dad started to collect the furniture and sell it at the auctions every month. Soon, this turned into a business.

Over the past forty years, the business has changed a lot. As with anything, if you want to stay ahead of the game, you need to adapt and grow. My dad, unfortunately, passed away in his 50s and my brother Casey and I now run the show.

However, as with many businesses, when lockdowns hit in 2020, we were in trouble. No one was able to come to our store in Wangaratta, Victoria anymore. While we did have a website, nothing was driving people to the site. Casey and I were both going broke. We had to re-mortgage our homes and pull whatever money we could together to give the business one last crack.

It paid off. Our business went from earning $900,000 a year to $22 million. We went from a team of four to a team of 30, and from one Hino delivery truck to 12. We had to hire all the available sheds in town to house all of our orders, and we have since built a massive 8,000 square metre shed.

The five main lessons we have learned along the way

1. Facebook is king

One of the major things that we did was we started advertising on Facebook, on the local radio stations and in a few other places. We also started running a PR campaign, which has been helpful in terms of telling our story, sharing the trends within our space, and getting our name out there.

Facebook, however, drives a lot of traffic to our website. I find that the more I spend on there, the more I am rewarded. We spend around $100,000 a month at present, and it more than returns to us.

The key with Facebook is to test a few different ads to see what is working. Our flat rate delivery fee has been one of our most successful campaigns to date, as it is a brilliant offer to customers. However, we also do ads around sales, trends and any key pieces of stock that we want to move.

If you play the game right with Facebook, it can be a great lead magnet for you.

2. Our delivery system opened a lot of doors for us

We decided to change our delivery fee to a $59 flat rate, and customers loved it! The delivery fee for many furniture companies is often what stings people. This low fee was doable for us because we do our own deliveries.

The $59 flat rate ad that we ran on Facebook is the one that set off the business during the lockdowns. You will remember that there was a property boom, and an influx of people wanting to update their homes during that time. We were lucky that we got our act together as that was happening.

With regards to the deliveries themselves, pre-lockdown we had one Hino delivery truck that would deliver all the furniture. We now have 12 trucks, which means that we have a bunch of routes within a 1,500km radius from our store that we deliver to. That takes us from Melbourne to Canberra, NSW, southern QLD and more. We usually deliver within a two-week period, which is also unusual for a furniture company. And as we are delivering ourselves, we are happy to go to remote areas, such as farming stations, which is something that other delivery companies won’t always offer.

The ease of delivery is another thing that sets McPhails apart.

3. Give your customers what they want

My brother Casey and I still work in most aspects of the business. This means that we are often on the showroom floor, talking to customers and finding out what they like and what they want.

We design around 60 per cent of our furniture these days, and many of the designs come from conversations that we have had with customers on the floor.

4. Have enough stock on hand

As we have an idea of what is selling and what the customers like, we order as much as we can each time we place an order.

This means that we save money in shipping fees, and we almost always have stock on hand, which means that customers don’t need to wait 16 weeks+ for their orders.

5. Get a good team around you

There is no doubt that we are still learning every day and tweaking things within the business as we go. As a result, many of our office team members wear many hats.

It took a while, but we have managed to put together a dream team that is brilliant to work with. They are trustworthy, and many have been with us for years.

Being able to trust your team to get on with their work is a blessing, but as a manager, you need to set them up to be able to do that. Micromanaging is rarely a good approach, but being approachable enough so that your team feel comfortable asking you questions is also important.

This article was originally published in May 2023.

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