Although running your own business can be a more risky affair than distributing someone else’s product, it does offer you far greater control over what, how and where you can sell something.
Just ask former racing driver turned entrepreneur, Toby Scheckter, son of local racing legend Jody Schekter, who learnt this lesson after his short (but disastrous) foray into selling magnetic therapy armbands to sports players.
A few years ago the armbands were popular for reportedly being able to improve blood flow by balancing the positive and negative ions that the body absorbs from surrounding electrical equipment and sunlight.
Everyone had them, and Scheckter, who was finished with managed racing teams and wanted to start something of his own, began selling the armband to basketball and football players in the US. Then the Japanese manufacturer asked him if he was interested in representing the brand in his home-country South Africa.
He soon had fast bowler Dale Steyn and the South African cricket team signed up and was generating R1 million in sales a month in the southern African region. Not bad for his first foray into business. And then the wheels fell off.
It all came to a grinding halt in 2010 when a competing brand admitted during legal action in Australia that there was no credible scientific evidence the band helped improve an athlete’s strength, balance and flexibility. Local sales immediately plummeted.
It was the last straw for Scheckter, who had already realised that his hands were tied with the manufacturer when it came to suggesting new ideas or making moves into any other markets despite connections he might have built up. Being hobbled is never an entrepreneur’s strong suit.
“I wanted to take it to India. I was supplying the IPL teams when they were down here and I had the head guy (of IPL) on board, but the manufacturer wouldn’t let me pursue it. They had someone else in that region. I was frustrated because I knew what I could do.
“I realised that I never wanted to be tied down like that again… I thought, ‘I want to start something from start to finish and have complete control of the process and what I can do with it’.”
Today he owns Scheckter’s Organic Energy, an organic energy drink he launched in 2010, which notches up R80 million a year in sales in South Africa, the US and the UK.
- Player: Toby Scheckter
- Company: Scheckter’s Organic Energy
- X-Factor: Spotting a gap in the market and creating a product to fill it.