SMALL BUSINESS
09.11.14 / 9
With great responsibility, comes power
NEIL DANTON
Investments in
the community
can improve
your bottom
line, discovers
Sandra O’Connell
CORPORATE SOCIAL
RESPONSIBILITY IS
A COST, BUT IT’S
ALSO A PART OF
BUSINESS — AND A
VERY GOOD PART
OF BUSINESS TOO
E
llie Redmond knows her
business wouldn’t survive
without the support of
her local community. As
such, she believes it is her
responsibility to support
the local community right back.
Redmond, 36, is the owner of
Movie Junction in Carrigtwohill,
Co Cork, Ireland’s only permanent
drive-in movie theatre. Open seven
nights a week, it has two giant
screens, you tune your radio for the
sound, and pizza is delivered to your
car door. The business was set up in
2010, broke even in its second year
and made a profit in its third year.
Her plan is to make it a franchise.
“The only way in which this crazy
drive-in movie concept could have
worked was if the community came
out and supported us — and it has,”
said Redmond. “Now I see it as my
duty to give something back.”
On average, the company, which
employs 10 people, supports at least
one good cause a week, through
providing movie tickets as prizes,
allowing people to use the venue
for fundraisers or by sponsoring
charitable events.
“I grew up in France and saw my
father serve the community as a
politician,” she said. “If I had stayed
in France I would probably have
gone into politics myself. Instead, I
look at my business as my way of
serving the community. Yes, business is about being profitable and
about employing people, but there is
a social responsibility too.”
Susan Hayes Culleton, 28, set up
her financial training company,
HayesCulleton,in2010andemploys
five people. As part of her corporate
social responsibility (CSR) activities, she runs eight-week economics courses for transition-year
students. “On the one hand, I feel
very fortunate to have been able to
build a business like mine, so CSR is
a way of giving something back,”
she said. “On the other hand, I also
view CSR in quite a strategic way.
For example, it was through putting
together the course for transitionyear students that I met the two
teachers with whom I went on to
write a Leaving Certificate economics text book.”
Though an economist and
accountant, she does not believe
that CSR should be about money.
“CSR doesn’t have to deliver a
return on investment,” she said.
“The only issue I have with CSR is
that word ‘corporate’ — you don’t
have to be a big corporate to believe
in social responsibility. I did it when
Redmond runs Ireland’s only
full-time drive-in cinema
I was unemployed and I will continue to do it as I grow.”
There can be measurable benefits. James Colbert runs Colbert &
Co, an estate agency, with his
brother. Set up in Midleton, Co
Cork, by their father in 1981, it
employs four people. Apart from a
weekly local beach clean-up and
donating to a local charity, the
business has recently become a
totally paperless enterprise.
“Estate agents are enormous
generators of paper,” said Colbert,
32. “We do all our work online
now, including ebrochures and
digital signatures.
“In Midleton, there are 11 estate
agents fighting for, on average, 140
properties annually. We sat down a
while back and asked ourselves,
what makes us different? And the
answer was nothing. So we decided
to act on our motto, which is ‘Feel
good about doing business’ — and
now we are 92% paperless.”
The move has also saved money.
“Our printer cartridges cost €500
each — we’re saving that much
each month on those alone,” added
Colbert.
Company cars have changed
from four-wheel-drives to Smart
cars, but it’s not all about saving
money. “You have to believe in CSR
to do it because there can be costs
involved,” he said. “We had to invest
in cloud-based systems and shared
drives in order to become completely paperless. But now that we
have, we are much more efficient.
We’re at a point now where other
estate agents are coming in to ask us
how we’ve done it.”
CSR is about running your business in a way that is “responsible
and sustainable”, according to
Sinead Mitchell of Business in the
Community, a CSR network that
this week hosts Building Trust, Reputation and Culture, a conference in
Dublin Castle. “A lot of people think
it’s only about working with the
community or giving to charity, but
it’s how you run your business from
day to day,” Mitchell said. “It’s
about the relationships you have
with employees, customers and
suppliers, too, and evidence is
emerging showing a correlation
between a business’s CSR and its
financial performance.”
Research indicates that “millennials”, typically those born between
1980 and 2000, want to work with
companies they perceive to be
ethical and sustainable, said
Mitchell. Many elements of CSR are
easier for small firms to achieve than
large ones, including employee
engagement. Small firms are at
the forefront of providing employment in rural areas or providing
flexible working arrangements for
employees, added Mitchell.
These activities are typically done
on an ad hoc basis, but there may be
good reason to formalise the
approach to CSR. “Increasingly,
large companies are asking suppliers what they are doing about
matters such as environmental
management,” said Mitchell. “They
don’twantthesuppliertobeariskto
their own reputation.”
First move into drinks trade was a sobering experience
but now alcohol distributor is the toast of New York
HOW I MADE IT
Illann Power
Founder,
Dublin Distillers
ILLANN POWER has packed more
entrepreneurial experience into his 22
years than many business owners
thrice his age. As the child of an entrepreneurial dynamo, he started young.
Power, who is from Carlow, is the
son of Michelle Power, the founder of
Boozeberries, a liqueur range created
long before the current boom in craftbased drinks.
Prior to that, she grew herbs and
sold them to local restaurateurs,
before words such as “locavore” had
been coined.
Illann started his entrepreneurial
journey when he left school at just
15. “I had been asked to write
an essay on the sex life of a cornflake
and, when I objected, was told by
the teacher that I could talk the talk
but I couldn’t walk the walk,” he said.
“So I walked.”
His mother was devastated — “it
broke her heart, she cried for months”
— but she could hardly have been too
surprised. “When my mum used to
ask me what I wanted to be when I
grew up, my only ever answer was,
‘The boss,’” he said.
He starting out selling wheatgrass
juices at farmers’ markets at €5 a shot.
“It was the Celtic tiger, 2007, and in
those days you could take money off
anybody for anything,” he said.
JUSTIN FARRELLY
He already knew how to sell.
“When Mum was starting Boozeberries, I used to go to all the trade
and consumer shows with her,
selling drink even though I was
underage,” he said. “I was watching,
learning and doing all the time, right
up to the point where she was
exporting to countries around the
world. She really gave it socks right
until she sold the business in 2009.
“She had given it her all but she was
burnt out from the effort.”
Illann is just revving up. His first
serious business venture was
importing bicycles from China and
selling them online, which he did with
a friend. While the friend moved to the
UK and kept the business going, it
wasn’t for Power. “It was all about
dealing with VAT and Revenue and it
was pretty boring.”
In 2011 he and his mother jointly
set up Banshee Spirits, a new drinks
company.
“We wanted to create a completely
different and unique Irish spirit that
could not be replicated, and we succeeded in doing that in a relatively
short period of time,” he said.
Banshee Legend, an Irish liqueur,
won numerous awards. Yet the
demand for liqueurs was gradually
dying out, so the product evolved into
Banshee, a flavoured Irish whiskey or
“spirit drink” — the current buzz
word for a drink that is an adaptation
of a distilled spirit.
With the help of a small start-up
loan from an enterprise agency and a
bank loan, the pair purchased a stockpile of Irish whiskey to form the basis
of their drinks range and began
looking for serious investment to help
them grow.
Unfortunately, the drinks market
was about to undergo a tectonic shift.
In December 2011 Cooley Distillery
was sold to US bourbon giant Beam for
€73m. “I had an investment offer of
€4.5m ripped out of my hands three
Power upset his entrepreneur mum when he decided to leave school at just 15
days before the contract was due to be
signed, following the sale of Cooley,”
said Power. “All of a sudden, everybody wanted Irish whiskey and,
unfortunately for us, our investors
saw the future as being whiskey too,
with no room for anything else.”
Though still only a teenager, he
found himself facing some adult challenges. “I was left with €350,000 of
bank debt hanging over me,” he said.
“Having struggled to get the loans in
the first place, the lenders had no
interest in negotiation and moved to
wind up the business and attempt to
bankrupt me at 19 years of age.”
After just nine months in business,
Banshee went into liquidation. Power,
who bought the Banshee name from
the liquidator, still personally owned
the stockpile of Irish whiskey.
When it came to setting up his next
business, Dublin Distillers & Co, he
took a different tack. “My biggest
mistake with Banshee was borrowing
money from a bank to start a business
when seed capital from investors is the
way to go,” he said. “With a bank you
have to make repayments regardless,
whereas a loan from investors can be
turned into equity. Our cash flow
cycle was nine months, yet the letters
from the banks looking for repayment
started coming in straightaway.”
With his mother having retired
from active involvement in the business, Illann began studying the
American market. “People drink
shots of whiskey in bars there like you
wouldn’t believe. They drink it in a
way we don’t in Ireland.”
He developed a range of whiskeybased spirit drinks, outsourcing
production and selling into the US.
Initially using the services of a
distribution company, he quickly
realised he could save himself margin
by setting up his own American
importation company and handling
distribution there himself.
The first year was hard. “I had no
interest in putting in place a remotely
managed sales team. I had to be
there in control of the project
because everything was on the line.
I put everything I had into building
the business.”
With help from Enterprise Ireland
and Bord Bia in the form of office space
on Park Avenue, New York, he began
selling, quickly moving into larger
premises he found nearby. The early
days were a blur of activity.
“Daysstartedat5amandfinishedat
midnight,” he said. “It was an hour’s
commute back to my house and the
same back in so it seemed sensible to
sleep in the office. Everyone thought I
was mad and said the business would
never work, yet here we are, four
years on, with five full-time staff and
10 sales agents across eight states
generating $5m (€4m) in revenues.”
He spends Tuesday to Friday each
week in New York, and weekends
handling the business here. He is keen
to expand further, having already
begunsellingintoChina,withthehelp
of a sales force in Hong Kong.
Further down the line he plans to
raise $30m to fund the building of a
distillery in Dublin.
“It’s been a difficult road but we’re
starting to see the rewards,” he said.
SANDRA O’CONNELL
There is also a view that CSR is the
domain of big companies with big
budgets, yet small businesses can
make a really big difference at
a grassroots level, said Mark
O’Mahoney of Chambers Ireland.
“Big companies can have national
campaigns, but small companies
can really embed themselves in
their local community,” he added.
CSR is very much a consumerdriven trend. “Consumers want to
see what kind of company you are,”
said O’Mahoney. “Transparency
has increased exponentially and,
thanks to Twitter and Facebook, a
problem can get enormous traction
in a matter of minutes. It’s no good
waiting to respond in a quarterly
report. You have to be able to
demonstrate your CSR credentials.”
Kevin and Joyce Dempsey set up
KDD, a trade supplier of blinds and
curtains, in 1985. At its peak, in
2007, the company employed 40
people. The recession, however, led
to sales tumbling by 50%. Pay cuts
and job losses followed.
Throughout the difficult years,
the company kept investing in
upskilling and training the
remaining staff, even paying for
personal development courses
unrelatedtotheirwork.“Ifsomeone
wants to do a course in flower
arranging and it will make them
happy, we will pay for it,” said
Kevin. “In return, we look for small
improvements every year.”
The company donates a percentage of sales to Action Breast
Cancer, provides time off for birthdays and rewards good attendance
levels with days off.
“We don’t see CSR as a cost , but as
an investment,” he said. “It is part of
business and it is also very good for
business.” Dempsey believes the
company benefits from low
absentee levels and low staff turnover. It builds CSR into its overheads
every year.
“CSR should be instinctive, you
should want to help other people”
he added. “We genuinely believe
that because we work hard, and
smart, and do well from our business on a personal level, that we
have a responsibility to look after
our people. That is wired into how
we think and behave.
“It’s also fun.”