Leadership & Strategy
The highs and lows of thriving as a business in a pandemic
Before coronavirus pandemic, 95 per cent of sales for high-strength vitamin supplement business Tonic Health were via physical retailers. Since then, the business has shifted its focus to online and seen a dramatic increased in demand. Founder Sunna van Kampen looks back on the period and tells us what he’s learnt from running a thriving firm.
What has changed for the business since the coronavirus outbreak started – both positive and negative – in relation to sales?
“The good news first of all is that we have the media and consumers for the first time thinking about their immune health. This had led to a knock-on effect in sales and helped grow our business by 1000 per cent in March.
“The downside is that, despite the consumer need and market appetite, a lot of the retailers have put on hold range reviews and new product launches for the remainder of the year. This will likely delay our plans and growth into 2021 as retailers are focused on availability of current lines and limiting store change hours as much as possible.
“Increased demand has put a real strain on all vitamin availability across the industry. This has led to retailers like Wholefoods decide to list us ahead of plan and it bought ten times the volume we had anticipated. This jump in demand has been consistent across retailers.
“Key to securing new demand for us has been credibility and trust. We were round before the pandemic, focusing on the immunity message and talking to retailers, so there is an inherent trust there already. We work hard to back this up with everything we do from providing hundreds of scientific references on our website, to becoming the UK’s first immunity brand to be Mumsnet rated.”
What changes have you had to make (production, staff numbers, distribution, customer service, etc)?
“It’s been a challenging but fun journey to keep up with increased demand. There was definitely a pain point where we were answering customer emails at 11pm at night to keep up but we resolved this through the recruitment of a new customer service manager. Then we had an out-of-stock situation for three weeks where we were managing demand to try and keep everyone happy whilst not losing sales. To help alleviate these issues we’ve had to pay thousands in air freight to get goods into the UK quicker. The cost of raw ingredients has definitely gone up and production capacity has gone down due to social distancing measures in the factories. We have accelerated our recruitment drive as well to keep growing the team and business capacity.”
Has the last three months made you think differently about how the business strategy might change in the future?
“Consumer behaviour has definitely shifted to a focus on prevention and regular immune support. This will definitely change some of our product pipeline and how we talk to consumers. We have always been about high-dose immunity vitamins in times of need but before most people waited until they felt the first sign of a cold and then did something about it.”
What have you learned about yourself and the business having had to deal with a significant increase in demand?
“Ultimately, as in any young business, we are in a test and learn stage. We are trying to gain as much understanding as possible through research, consumer testing and a good chat with friends and family. For us it’s about being nimble enough to react quickly, understand where investments aren’t working and then react and adapt quickly.
“The journey as a business owner is never easy and when the business gets put under this much pressure so quickly it fundamentally falls on your shoulders and you find yourself working seven days a week, all hours of the day only stopping to literally eat and sleep.
“I’ve learnt I’m a proactive doer. I am very quick to take extra things on and make sure it’s delivered, then I take a step back and think how can I build a process around managing this work more efficiently and effectively for the long term.”