Interview: Will King - King of Shaves takes rough with smooth

Published on Saturday 18 April 2009 14:08

Redundancy gave one entrepreneur the chance to hand-fill 10,000 bottles of shaving oil. The effort paid off, writes William Lyons

WILL King can be forgiven if he feels the odd sense of dj vu. Rising unemployment, widespread negative equity and a tired government overseeing the collapse of an economy shattered by recession were just some of the obstacles the former advertising salesman had to face when he made the decision to go into the manufacturing business.

It was late 1992 when King, recently made redundant, sat in his kitchen and manually filled 10,000 small bottles of his own brand of shaving oil. Two weeks later, with a badly blistered hand, he sat down with the Yellow Pages and drew up a list of retailers he hoped he could persuade to stock it. The first year was not a success. Sales hit a peak of 300 while losses stood at 30,000. To make matters worse the flat he was running the business out of halved in value as the housing market continued its freefall. It was a period he now describes as "living in the valley of death".

Convinced that his shaving oil was better than his competitors', King persevered. Sixteen years on his King of Shaves brand is listed in every major retailer in the UK. Retail sales are expected to top 100m by the end of 2012. This week the company will announce a 4m inward investment as King embarks on an export drive into Brazil, Japan and the United States, where he will take on his largest competitor, Gillette, in its own backyard. Never let it be said that recessions are not a good time for start-ups.

"It does feel a little like Groundhog Day," he chuckles, fiddling with the now-mounted plastic pump he used to fill the original bottles of King of Shaves. "The last recession was bad. Unemployment was nearly three million, the internet wasn't really around, most people had either worked in manufacturing or had mined for coal and there just wasn't the business opportunities we have now.

"But saying that, great businesses will prosper and a recession is a great time for start-ups. In a boom, cash is king as everyone is making money, but in a period of gloom, creativity is king. Look at the fashion industry. Ted Baker, Fat Face and White Stuff were all created in the last recession."

Dressed in jeans, open neck shirt and loafers with a movie star tan and a perfect coiffure, King exudes the informal image of the lads' mags such as Loaded and FHM, which raised interest in male grooming products and helped his business flourish. Sitting in his Buckinghamshire head office he talks about "shaving people's lives", the thrill of receiving e-mails from satisfied customers and he describes himself as the "chief shaving officer".

"I set this business up because I thought it would be recession-proof, " he says. "People still have to shave, shower and style their hair. But I didn't know anything about it so I didn't have any preconceptions of what the hurdles were likely to be. I guess if I had appeared on Dragons' Den they would have said well, you are going up against Gillette – that's worth $50bn – and your next competitor is Wilkinson Sword, which has been around a couple of hundred years, so what's the chance of success?"

King puts it down to his original eureka moment when, tired of suffering a rash from wet shaving, he experimented with a girlfriend's bath oil and found it seemed to help. After searching through Yellow Pages and directory inquiries, he found himself in Henley-on-Thames one afternoon where he wandered into an aromatherapy shop which stocked exactly the right oil.

He ended up paying the retailer 250 to tell him who his supplier was. "We launched something different," he says. "In the early 1990s people shaved with a can of foam. A small pot of oil was visibly very different. It worked. But you have to 'zag' and have a point of difference."

After tracking down the phone number of Mohamed Al Fayed's personal assistant, King secured a 12-bottle order from Harrods. It wasn't much but King says it was enough to say to Boots "I'm in Harrods."

Knowing he couldn't match the marketing spend of his competitors, in 1995 he bought the domain name shave.com for $35, a process almost unknown then. The move coincided with a fashion for goatees and sculptured beards, and through a blog King of Shaves built up a cult following. The turning point came in 1995 when he persuaded his old colleague Hiten 'Herbie' Dayal to become a business partner. Together they raised 100,000 through the Government's Loan Guarantee Scheme for what was then King's parent company Knowledge Merchandising Inc (KMI), which owned the King of Shaves brand.

The business lost money until 1997, when it made a profit of 125,000 on sales of 1.25m. A year later they secured a worldwide fragrance licensing deal with Ted Baker.

It was around this time that King met Scottish PR consultant Brian MacLaurin, who added King to a client roster that included lastminute.com, Chrysalis Group and Disney. The Scottish influence does not stop there. One of King's major shareholders is based north of the border while discussions have been held with Tom Hunter's investment vehicle West Coast Capital.

Recent figures show that KMI doubled operating profit year-on-year to 1m on sales that were only marginally higher, at about 14m, than in 2006. This week the two divisions of KMI will become separate companies. The King of Shaves Company will be headed by King while Dayal will take control of KMI, which retains its portfolio of brands including Ted Baker Fragrance, Toiletries & Cosmetics, Fish & Angelfish Styling, Beautifully Delicious & Good Works.

In the UK, King of Shaves has about 13% of what King describes as the "software" market of oils, gels and foam, compared with Gillette's 55%. The business is expected to turn over 35m this year. But King believes he can grow that significantly.

Central to this is the Azor, a lightweight Y-shaped razor launched last year, with a bendy block of blades across its forked end. It is in this market that King sees the real growth. Azor has already surpassed 2m worth of sales, a feat it took King of Shaves shaving oil five years to achieve.

"The software market, by that I mean shaving preparation with oils and gels, is worth around 59m in the UK," says King. "But the razor blades market is worth around 550m. Gillette has 85% market share of that by value. Wilkinson Sword has a 10% market share and that is pretty much it."

This month sees King of Shaves launch its first national advertising campaign, a 5m initiative to promote Azor. King reckons that consumers believe a cheap razor means expensive blades, so he has priced the razor at 4.99 with the blades costing the same.

"The razor and blades market is enormously difficult to break into because of the barriers that are constructed to prevent anyone getting in. When we were looking at Azor we came up against 20,000 patents, but there are only two competitors and it can be extremely profitable."

Despite his obsession with shaving, King's first love is sailing, more specifically yacht design. Growing up in Lowestoft, Suffolk, the eldest of three boys, by the age of 15 he was Britain's youngest sailing instructor. At school he wanted to be a yacht designer, but poor A-level results shattered that dream. So he took a degree in mechanical engineering at Portsmouth Polytechnic. It is this love of design that prompted him to spend more than five years designing the Azor.

There are plans for a female version to be launched later this year and several improved razor blades.

"Awareness is our biggest competitor now," he says. "This is a British company, making a British-designed and British-manufactured razor sold in Britain and growing nicely. If the business isn't worth 100m in three years I will be disappointed."