iclimb.co.nz – an online business success story
Finding international manufacturers willing to supply an online, outdoor equipment shop with no sales record is no simple feat – particularly in an industry that is normally shop-based. Yet www.iclimb.co.nz managed to get two of the best outdoor equipment manufacturers in the world to take them on as their New Zealand distributor, and five years on, the online wholesale business continues to grow annually. Founder and company director Glenn Pennycook tells us more about setting up and growing his online outdoor gear business.
On this page:
- Approaching the big manufacturers
- Sourcing funding and spreading the word
- Joining forces with a similar business
- Top tips
- Business drill-down
Approaching the big manufacturers
While working for a retailer selling camping, tramping, and climbing equipment from 2000 to 2001, Glenn Pennycook began to wonder about importing outdoor gear and selling it direct from the distributor via an online shop. He felt there had to be a more affordable way to get outdoor equipment to customers – without compromising on design and quality.
It wasn’t until 2005, when he was aged 30, that Glenn began to seriously pursue the idea. With a background in tramping and mountaineering and an in-depth knowledge of the science and design of outdoor gear, the main barriers Glenn faced were finding manufacturers willing to take on an online distributor just starting up, and funding his first stock purchase. He began by contacting several climbing equipment manufacturers, whose products he trusted.
“It was difficult. Most manufacturers don’t want their gear sold online – they want it to be seen in shops,” says Glenn.
The first manufacturer to come on board was Simond, a French company based in France’s adventure capital of Chamonix, who have been making and perfecting climbing gear since 1860.
“They hadn’t been able to find a New Zealand distributor for the last few years so were enthusiastic when I approached them. At the very beginning of our relationship, Simond invited me to France to meet their lead designer and visit the factory. While there, I also went climbing with their designer and European sales rep, which allowed us to bond over a shared passion.”
Once Glenn had one manufacturer on board, it became easier to get another. He approached Mont Bell, a Japanese company specialising in outdoor clothing and equipment.
“Mont Bell is a massive company but it isn’t well known outside Japan and the US, despite making outdoor clothing and gear unequalled by any other manufacturer. I found out about them because my brother lived in Japan and he sent me some of their clothing.”
“I realised I had to make myself stand out when approaching Mont Bell so instead of emailing them, I got my brother to translate a letter I had written into Japanese. I then went to Japan to meet them and sat across the desk from six overseas sales reps, essentially asking a half-billion-dollar company if I could buy a handful of their tents, packs and jackets. I guess they liked me!”
Sourcing funding and spreading the word
The next challenge was getting funding for his first stock purchase. Glenn approached his bank for an overdraft but they said no, so he got a small loan from his family, drawing up a contract with them and agreeing on an interest rate.
“Having limited funds at the beginning was actually a blessing in disguise. Had I spent $100,000 on stock right away, I might have ended up with a lot of gear that customers weren’t actually interested in,” says Glenn.
Glenn then built the website for iclimb.co.nz, and in early 2006, the company was officially launched. With few overheads and no retail store mark-up, iclimb.co.nz was able to offer outdoor gear to New Zealand customers at wholesale prices.
Attracting customers to the online shop was the next challenge. Glenn initially focused on the mountaineering community and invested a lot of time in going to climbing club meetings and giving presentations.
“At first it can be demoralising how much effort is required to spread the word to just a few people, but you have to give word-of-mouth time to work.”
Even before Glenn started iclimb.co.nz, he’d been involved with promoting mountaineering in New Zealand. He and a friend had set up New Zealand’s only dedicated mountaineering website in 2004, www.mountainz.co.nz, and since 2006, Glenn has run free climbing instruction courses every winter, in both the North and South Islands.
“Both the Mountainz website and my instruction courses have been invaluable tools for promoting iclimb.co.nz,” says Glenn.
Since 2009, Glenn has expanded his business focus to the tramping market, which is much larger than the mountaineering market and best reached via paid advertising. Now that iclimb.co.nz is established and growing, “Paying for advertising is much more feasible than it was in the early days,” explains Glenn.
Joining forces with a similar business
Another change in 2009 was iclimb.co.nz forming an alliance with Grant Guise, a dedicated back-country skier and ski-racer who was importing Dynafit brand skis and ski accessories from Europe. Although Grant had his own online store, it was agreed he would start selling his products through iclimb.co.nz. This meant Glenn and Grant pooled their customers, who have similar interests. It also meant they could start sharing the customer service role.
“Operating as a one-man band for an extended period of time becomes unfeasible because the demands from customers tend to be five-plus days a week, every week of the year,” says Glenn.
Because Glenn’s and Grant’s areas of expertise differ, this aspect of customer service had to be managed.
“A challenge in growing a specialty business is that much of the front-line work in which you interact with the customer is eventually delegated to someone else, and it is possible for the company to lose its expertise,” says Glenn. “Grant and I manage this by (1) having an information-heavy website that answers pretty much all customers’ questions before they even contact us, and (2) getting Grant to forward emails with technical queries about things like climbing gear and different types of rain jackets to me. In the latter case, I CC my reply to Grant for his information. In addition, we have saved sample replies to typical customer questions.”
iclimb.co.nz is now in a position where it has been able to get finance from a bank and can order in larger quantities. However, some of the methods Glenn used to operate while starting out have been retained, such as maintaining low overheads by selling only online, and offering new products in limited number, to gauge their appeal to customers.
“Running my own business has been a great educational experience. Having started out so small and then built the company up, I have great confidence that we will continue to grow and reach different markets.”
Top tips
- “If you’re small, you need to approach manufacturers who do not already have existing distributors in New Zealand. Realise that most manufacturers will be receiving countless requests from start-up importers and they are perhaps unlikely to reply to a request unless you stand out somehow.”
- “Don’t diversify your range too quickly. It’s tempting to do so but it causes headaches. If you spend your available cash on new items instead of established items, you can run out of stock. Running out of stock is a bad experience for the customer and it creates extra work in dealing with back orders and creates stress. In addition, if you have more stock of fewer items, you have the option of going after bigger customers who want to buy products in bulk. And when you’re purchasing stock from only one or a few suppliers, your shipping costs are less.”
- “When in business, it is natural to think of everyone else as the competition. But when you are small, it is perhaps a better idea to join forces with those in a similar position, because then you have a greater product/service range and can attract more customers. You also gain from each other's limited advertising budgets.”
Business Drill-down
Business type: Online retailer
Main products: High-quality climbing, tramping, camping and ski gear
Number of staff: 2 part-time
Years in operation: 5–6 years
Main markets: Climbers, skiers, trampers and other outdoor users in New Zealand
Bio: www.iclimb.co.nz is an online, New Zealand-based climbing, tramping, and ski gear shop that sells all its products at wholesale prices as there is no retail shop mark-up and customers are buying direct from the distributor. Glenn Pennycook and Grant Guise, who run the company, have between them a background in tramping, mountaineering, backcountry skiing, ski racing, and adventure racing. Glenn and Grant only sell their favourite and trusted brands, stocking outdoor products from Europe and Japan. iclimb.co.nz is the first outdoor gear business in New Zealand to sell only online and with no retail shop mark-up, giving them a strong competitive advantage.
Website: iclimb.co.nz
