Latest News

Re-energising an existing business can be as complex and difficult a task as starting from scratch. Christine Sharma has done this very successfully, with the help of advice and support from innovative chartered accountancy practice Hayes Knight.

As featured in Idealog Magazine Mar/Apr 2012. Download this case study.

Christine knows an opportunity when she does business with one. She was supplying clothes to Kiwi fashion label Ruby back in 2007 when she got the feeling that what Ruby really needed, was her.

"The inspiration came with the vision to develop Ruby as a design-led business that we could supply as a wholesale model into retail," she says. "At the time a lot of brands had lost their direction and Ruby already had a niche following that could be expanded on."

Ruby now has seven boutique stores as well as a healthy list of other stockists, including three in Australia. Hayes Knight was brought on board in 2009. Christine was looking for an external advisor who would take an active part in the business, as well as ensure the financial governance was airtight. She found both in Hayes Knight's chief executive officer Matthew Bellingham.

"When I first met Christine, Ruby already had a great brand and loyal following but was under-capitalised and desperately needed to expand its footprint in order to make the business model economic," he says. "Like the vast majority of small- and medium-sized businesses in New Zealand, they also had a very ad hoc method of decision making.

"My assessment of their initial needs was that they needed a solid strategic plan so we all knew where we were heading, then we needed to bring in reporting disciplines and a robust decision making processes. Finally, the businesses needed additional funding so that it could be developed to its full potential."

Christine says: "We had a casual coffee with Matt and could see the true meaning of their company tagline 'accountancy beyond the numbers'. We liked his synergies with our business model and felt we were on the same
wavelength. Matt had a good understanding of our overall business model."

Some of the changes were quite simple. For example, Matthew set strict board meeting dates for the year and ensured all business and financial reporting was ready to go through at these points. "Once we had the board in place, we were able to upgrade and improve the reporting functions, not just financial accounts but budgets and forecasts, as well as sales and
inventory reports," says Matthew.

"The improved information made it possible to make good decisions around expansion opportunities."

Christine says the initiatives helped to create discipline and a more ordered format for running the business. But much more than that, Hayes Knight's input helped create the successful business culture that is driving Ruby's growth.

"Over time we have developed a harmonious relationship, one that is built on mutual respect for each other and the different strenghts we bring to the table," says Sharma. "It is therefore a safe place for us to challenge each other's ways of doing things. This results in subtle changes that at times have had major impact. I believe the value of trust in a board for improving the business is immeasurable."

Matthew agrees. "I love working with Christine and the team at Ruby because they have so much passion for the industry that they are in. It is immensely satisfying to see our decisions at board level being implemented
successfully in the business."

That said, this is a real business - and like any real business, it hasn't always been plain sailing.

"I think all businesses go through some difficult phases," says Sharma. "The passion for what I do, as well as having such a dedicated team around me, keeps me going. I would never give up!

"You have to be the master of flexibility in this market and alter things to make them work. With the arrival of a lot of the Australian chain stores, there is no room for complacency. I believe that a lot of the old-style New
Zealand businesses have been really challenged and the old way of doing things is no longer going to result in sales."

She says that aside from this disciplined approach to business, passion for the product is the key to success, along with the ability to communicate with your team and keep them on target. And of course, great help.

The moral of the story, says Matthew, is to get the right support around you. "We have been through an incredibly difficult time over the past three to four years and retail has been hit hard. Having said that, there are some phenomenal success stories of companies getting it right. Get great reporting, and measure everything!"

Shareemail+1