Overworked owner thinks outside the box

IF Troy Hughes could sum up the development of his approach to the business he started in 2002 it might be along the lines of: ‘work smarter, not harder’.

Like many small business owners, Mr Hughes immersed himself in his business – The Box Man, a Welshpool-based custom-made box and cardboard solutions company – regularly working more than 60 hours a week.

Having identified a market for low volume, specialist boxes in Western Australia, Mr Hughes’s business quickly gained traction and began to grow.

Eager to establish The Box Man in the local market, in the early days Mr Hughes would accept whatever work he could find, with unprofitable, “awkward” or complex jobs adding to an already hectic workload.

Due to the small quantity and specialist nature of The Box Man’s products, Mr Hughes was forced to be more selective in the type of jobs the business would take on.

But the ongoing challenge for Mr Hughes became finding time to manage the rapid rate of growth across all areas of the business.

In 2004-05 the company turned over $240,000, increasing to $520,000 by 2006-07.

That growth continued through to the following financial year when The Box Man’s turnover was almost $800,000.

As The Box Man struggled to keep up with demand, Mr Hughes realised placing himself in the multiple roles of business administrator, salesman and box designer was actually working against the company’s best interests.

This put the business at risk of failure should Mr Hughes become seriously injured or ill. Added to this were high stress levels and an ever-increasing workload.

With box design and tracking of jobs suffering as a result of the time pressures he was under, Mr Hughes created a sales and production manager’s position to alleviate the strain on resources.

After a brief recruitment drive, Mr Hughes poached former warehouse manager Chris Alton, who was at the time working for an existing client of The Box Man.

Soon after, Mr Alton became a director and the men are now equal partners in the business.

“When looking for a partner in your business, look for what is different in each other and how this best works for the business,” Mr Hughes told WA Business News.

“When you find a new partner, write up a director’s agreement that deals with all issues you can think of.

“We have a clause that says any expenditure over $500 and under $1,000 that is not agreed upon by both of us is decided by the toss of a coin.”

Mr Alton said before coming on board as a director, he was concerned at the lack of formal structures and procedures at the company.

“As a result, we immediately began formalising procedures and commenced multi-skilling our staff to take the burden off Troy and reduce our risk in the event of his ill-health or injury,” Mr Alton said.

These included introducing simpler methods to lodge and document orders and a formalised invoicing system.

The Box Man now employs nine staff who are multi-skilled so that work can be delegated should any member be on leave for an extended period of time.

“In January 2009, we took on a new full-time production worker and concentrated on improving the production, design, sales and administration processes,” Mr Hughes said.

After implementing these changes, Mr Alton and Mr Hughes now only work about 45 hours a week, the business expects to recruit another employee in the next three to six months, and turnover is expected to continue with steady, controlled growth.

Mr Hughes said without the systems and procedures the company would not have been able to stabilise its growth.

“As a business designed to meet the needs of the smaller clients, we understand that what we do is more of a solution to a problem than merely a box,” he said. “We understand that we are unique and we are exploring the opportunity for expansion of The Box Man brand throughout Australia.”

This includes looking at franchising opportunities for the business.

Last financial year, the business reached the $1 million turnover mark from about 500 clients.