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Stuart's boxing clever
(The Birmingham Post Via Thomson Dialog NewsEdge)In the grey drizzle, Stuart Miller cuts a cheery figure striding across the grass to greet me.
Dressed in a corduroy suit he is a contrast to the anonymous looking industrial estate that is home to Bybox's Coventry distribution hub.
With bounding enthusiasm, a firm hand-shake and upbeat chatter he isn't exactly the sort of man you would expect to dedicated his career to storage boxes.
"On the face of it you'd probably struggle to find a more dusty, boring industry than left luggage," Stuart chuckles.
"But the concept behind the distribution is far more interesting."
Bybox, founded by 39-year-old Stuart, has grown to become the UK's leading business-to-business overnight parts delivery service. In just five years it has notched up a pounds 17 million annual turnover, which is expected to rise to pounds 20 million by the end of 2006.
The Oxfordshire-based company owns 14,000 electronic and mechanical boxes squirreled away in petrol stations, industrial estates and supermarkets across the UK.
These boxes act as the collection points for the firm's overnight delivery service comprising nine UK distribution centres, including the 30,000 sq ft Coventry hub.
Dedicated to growing the company, Stuart has already moved into the parts storage business, with exclusive contracts with NTL, the RAC and Marconi and aims for a UK turnover of pounds 30 million. The first box has arrived in Germany and there are already 23 sites in France.
Born in Essex and raised in Kent, Stuart was an entrepreneur from the age of 17, selling homemade cufflinks to boutiques down the King's Road in London.
"I called them 'tough-links'," he says laughing: "They were just nuts and bolts enamelled in different colours.
"There wasn't much quality control, the enamel used to rub off on people's shirts!
"But I managed to sell quite a few. Eventually I switched to buying anodised nut and bolts in bulk from a local manufacturer."
The experience gave Stuart a valuable lesson in selling.
"Walking into a shop and asking someone if they wanted to buy a product isn't easy," he explains.
"You have sell an idea - get it from your head into somebody else's really fast. If you can't, it doesn't matter how good your idea is, you're pretty stuffed. "
Stuart certainly bears many salesman traits - an enthusiasm for his product, a talent for whisking the conversation down his own path and a chattiness that would lend itself well to sales patter.
What saves him from falling into the depths of a well-recognised stereotype is a frankness about some of the less positive moments of his business and life.
"There's no point lying when you've got something wrong," he shrugs.
"If you lie to people, you hide and don't give yourself the opportunity to solve the problem. It's better to admit what went wrong and get better, even if you do feel a bit of a Charlie."
Stuart's thirst for problem solving was realised during his first 'proper' job with Anderson Consulting.
After leaving school with just A Levels and getting a job with Unilever, Stuart realised his career could be stunted without a degree.
Despite much consternation from his father, who with little education had worked his way up from a tailor to an underwriter for Lloyd's of London, Stuart signed up for a business degree at Loughborough University. After gaining a First Class Honours, he then landed himself a place on Anderson's graduate trainee scheme.
"I knew I wanted to start my own business, but I knew I wanted to get to grips with new technology first," Stuart explained.
"If you don't learn about new technology, somebody is always going to be able to pull the wool over your eyes."
However, Stuart got more experience than he could have hoped for, ending up as a programmer.
"It was quite mischievous of Anderson. They would recruit all these people who thought they would be management consultant trainees and they were made to work as programmers.
"If you got the wrong end of the stick, you'd go to your first job and wonder why the chief executive wasn't asking you what he should do next year!
"I didn't understand anything at all, but I thought it was a blast!" Stuart's first job was a secondment to Finland to program for the Helsinki Money Market - set up in order for the Finnish government to raise money through bond sales. "I'm not sure how I kept my job, if I'm honest," Stuart admits.
"I didn't have a clue what I was doing. I had to code these things called a packer and an unpacker, which condensed data to send it out to the brokers.
"But I can't think how I did it at all. I'm sure I was utterly incompetent."
His second posting was to Bank One in Ohio, where he developed his problem solving.
"Most programmers don't get up before nine, but my boss happened to be the one pain in the neck that did.
"He didn't teach me anything technical, but he put the fear of God into me and showed me how to problem solve.
"He taught me that you should always analyse the problem first and work out what you need to learn to solve it.
"So many people run around blindly trying to only use the knowledge they already have to solve a problem, which wastes time."
Whilst in the US, Stuart also registered his first business - a saxophone export firm founded out of a long-standing love for the instrument.
The lead saxophonist for the World Music for Youth Orchestra when he was a teenager, Stuart had the opportunity to train as a professional musician but chose business instead.
"To be honest, I'm not sure I was good enough to go all the way with saxophone," Stuart admits. "I don't regret the choice, but saxophone is still my first passion.
"I'd love to open my own arts centre one day to help young musicians and promote jazz."
Realising that the US had little regard for 1950s-made Conn saxophones, Stuart began collecting them from flea markets and shipping them back the to UK.
"I could buy them for about pounds 100 and sell them back in the UK for about pounds 1200. It was lunacy!" he says.
However, Stuart was unable to give up all of his finds and started a saxophone collection that he still owns today.
"I've got eight at the moment," he admits.
After four years at Anderson and aged 26, Stuart finally hit on the business idea he had been searching for and, along with a colleague Steve Huxter, returned to the UK to found Octopus.
Designed as a telephone-based concierge service, Stuart hoped that technology could help them find a way to speed up the process of helping people with tasks.
As it turned out, the process was easy' it was the pricing that proved was the headache.
"How do you charge for such a service?" Stuart says. "By the hour? By the request? It was gruelling.
"We built the business up over three years and paid ourselves and absolute pittance.
"When I left Anderson I was on pounds 40,000 a year. For the first two years at Octopus my salary went down to pounds 12,000."
Octopus eventually lasted for six years.
After a joint venture with First Direct bank, Stuart decided to sell his share.
"I had been convincing myself the business wasn't niche when it clearly was."
So with the internet taking off, Stuart and Steve got together again to research the best area of the new technology to exploit.
"We realised e-commerce would affect distribution.
"I remember thinking that delivery hardly works now with orders arriving when people are at work - how is it going to work with the rise of internet shopping?"
After much thought Stuart decided the answer would be box shaped.
"If you can establish a network of electronic boxes, you can have a box allocated to you when you need it and we could send a text message with the opening code when your order was ready to be collected."
In January 2000 the pair bought a French company that specialised in electronic left luggage lockers and launched Bybox in January 2000.
Deciding the United States, and in particular Silicon Valley, would be the best place to launch the Bybox system the pair established their first office in California.
Then disaster struck. In 2002 the NASDAQ crashed and Bybox fell apart.
At that point Steve decided his days as an entrepreneur were over and pulled out of the business.
"I think Steve decided his risk profile didn't match start-ups," said Stuart, who can now see the funny side. "Although I'm sure he just had enough of working with me.
"We had spent $150,000 filing patents in the US and Steve spent two months in a tiny office just writing out the applications.
"In the end, we didn't get any of them approved, not one!" Stuart came back to the UK with, as he describes, with his tail between his legs.
"I was very humbled, but still convinced I was onto a good thing.
"I think an absolute inner belief that you're right keeps you going. It's not arrogance. It is as clear as day to me that in my lifetime there will be networks of boxes for the consumer market."
Returning to the UK, Stuart began reinventing the business from a small Logibank office in Oxfordshire. He realised that business-to business parts delivery was a sector that could be tapped.
"I bumped into someone from Hays, who explained the company had built a business with 10,000 mechanical boxes all over the country delivering parts to engineers."
In January 2003, Bybox signed a contract with Hays to supply 135 banks of electronic boxes to compliment their mechanical ones.
"Over ten weeks we manufactured them like mad! We tripled shifted the factory and, as it was in France, you can imagine how well that went down. But it was a big breakthrough so we had to just get on with it."
Then two weeks after By box delivered, Hays announced it was breaking up the group.
"I was terrified," Stuart says. "I'd just spent more money than I've ever done making these boxes and I didn't know what was going on.
"But Hays was very honourable. We put in a bid to buy the box side of the business, which was accepted."
However, with Hays retaining its distribution network, By box was left with four months to establish its own.
"Unfortunately I wasted about a month thinking I could outsource it, but it wasn't a reliable enough method," Stuart said.
So the company spent pounds 4 million setting up nine depots across the UK and began attracting clients such as BSkyB, British Gas, Glaxo, Unisys, Konica Minolta, Astra Zeneca and Comet.
The company has now spent around pounds 2 million on boxes and has newer versions lined up for this year. It has recently started storage and delivery of parts for NTL.
"It means engineers can place next-day delivery orders up to 11 o'clock at night," Stuart explains.
"But it was pretty hairy setting it up. I suppose we could have just bought some racking and manually updated the stock spreadsheets, but that's daft.
"We wanted to develop our own automated picking trolleys from day one.
"To be honest, it was the first time I thought I might have bitten off more than I could chew."
However, Stuart is also well aware that he would not like to work in a company that doesn't enjoy a challenge.
"I think it helps that all the directors of Bybox have got a maverick streak. They're willing to prove the doubters wrong.
"They are very polite, but it really is a two-fingers to your attitude. If we say we will to deliver something, even though it might get tough, we always do it."
You have sell an idea - get it from your head into somebody else's really fast. If you can't, it doesn't matter how good your idea is, you're pretty stuffed
I think it helps that all the directors of Bybox have got a maverick streak. They are very polite, but it really is a two-fingers to your attitude
joanna_geary@mrn.co.uk
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