Moving with the times
Monday, 19 September 2016
by Glenn Baker
You know what it’s like when you buy that new piece of furniture, BBQ or appliance, or any bulky item that won’t fit in your car. It’s often the weekend, you’re standing in a retail store with the salesperson, wondering how you can get your exciting new purchase home straight away.
Well, if it’s in Auckland and you’re in the right store – a quick call to Smart Express means the problem’s solved. You can have it home today.
Smart Express is the moving and delivery business started by Susan Spelman, husband Tony, and Devan and Jeanine Devaroyan in 2005 (although it really only got going properly in 2006 they tell me). They, along with GM Nick Sawers, have decades of combined experience in New Zealand’s freight and courier industry. Nick and Devan were both regional sales managers for CourierPost. Devan had also previously reported to Tony at Roadstar Transport, and Susan spent 20 years working for DHL.
They felt it was time to put their experience and expertise to create something of their own and stamp their customer-centric attitude to their own brand. Smart Express was launched after recognising a gap in the transport market that the mainstream providers weren’t focusing on. With the directors’ vast amount of knowledge, and a shared passion to succeed, it was inevitable that Smart Express would disrupt the market – although it would take more time than anticipated to gain traction, due to starting from scratch and a lack of external funding.
It also required a complete change of business model five years down the track, plus a strong focus on technology, to add the word ‘consistency’ to their profitability. Initially the business was 100 percent based on commercial customers, but the founders could see the potential demand from private customers to speed up business growth.
“We were fortunate that Trade Me was becoming very popular and smartphones were gaining in popularity [for sourcing products and services],” recalls Nick. “I said to Devan, we really need to create a lot more inbound calls. The commercial sales process is slow, because it takes time to build relationships and trust. Bringing on private customers was a way to grow our business more rapidly and to strengthen cashflow.”
Smart Express capitalised on new mobile-friendly, cloud based dispatching technologies to provide online job booking and visibility to the customer.
“We invested in Google Ads, a strong SEO-built website, and based our entire business focus around customers’ needs,” says Nick.
As the customer base was extended to the private market – catering for the likes of people shifting house, flat or apartment – trucks were added to the van fleet.
Today, revenue is split 50:50 between the trucks and vans, and 50:50 between commercial and private work.
“Our real niche is still in the vans though,” says Nick. “And in same day service.
“If you walk into a store – for example Big Save, Target, Freedom or PK Furniture – and you want a lounge-suite delivered today, we’ll deliver it today, or at a time that suits you.”
“It gives the store salesperson another powerful tool in their sales toolkit,” says Susan, adding that they place high importance on communicating with customers because “consumers do not have faith in delivery companies; there’re such bad reputations out there”.
Not surprisingly, Saturdays are now the busiest day for Smart Express, and Sundays are not far behind. The business closely mirrors consumer shopping trends.
Switching to the owner-driver model in 2011 allowed the company to better manage overheads and cashflow and gave the owner-drivers responsibility for vehicle maintenance in return for larger share of sales revenue. The new model attracted a higher calibre of driver, hungry for success and passionate about service. Although it wasn’t an easy transition (there was a loss of revenue on margin), it freed the directors to focus on sales and marketing, and the past five years have seen revenue grow significantly.
Taking on Chris Reid from the Business Engine as mentor 12 months ago also resulted in greater momentum, as Chris challenged the directors over various aspects of the business. Progressing from a small business to a medium size one has also required a change in mentality, explains Nick. “We realised we needed to bring in some disciplines from a management perspective, around such things as financial reporting and budgeting, to manage the business and plan for future growth.”
The three agree that the key to upsizing from small to medium business is having a long-term vision built around what the customer wants.
“Our very first van carried our motto ‘when service really counts’ and this remains our ethos today; in fact service is in our DNA and reflects our philosophy of placing the customer at the centre of our company culture,” says Susan, quoting directly from their entry for the 2016 Westpac Auckland Business Awards, where they’re a Marketing category finalist.
Weekly team meetings with staff are also important when upsizing, she says, “so the directors can understand what the challenges are and getting staff intimately involved”.
Number one ranking
Today Smart Express has grown to nine full-time support staff, including the directors, plus a team of 30 drivers and assistants.
Marketing is centred on website Google SEO, Adwords, Remarketing, Facebook, Trade Me and a monthly newsletter. The directors are proud of the fact that their “unique claim to fame’ is being ranked number one on Trade Me, under both ‘Services’ and ‘Moving and Delivery’.
“There are around 7,500 businesses listed under services and we’re number one in terms of positive feedback,” says Devan. ‘Polite’, ‘punctual’, and ‘excellent service’ are the most common words quoted in feedback.
There are lots of anecdotal stories about how drivers and assistants go the extra mile when unpacking, assembling and placing items in the home too. A ‘Just Labour’ service is also proving popular with retailers for jobs such as refreshing a showroom after-hours along with other value-add services.
Networking has been another key to their success, in particular Susan has found the knowledge gained by attending the Deloitte Private Club to be invaluable.
Looking forward, the goal is to be Auckland’s number one moving and delivery company; to double the size of the business over the next four to five years.
But ultimately, the aim is for Smart Express to be the automatic choice for getting that precious purchase home – no matter what day or time it is.
Magazine Issue: NZBusiness October 2016
Page Number: 12