Online seller CED’s net gains

Foyzur Ullah grew up in the back streets of West Yorkshire rather than in the shadow of Canary Wharf, but ever since he was a teenager he knew he was destined to have a career in business.

“I was buying the Financial Times when I was 15-years-old.” he recalls. “What’s a kid in inner city Bradford doing buying the Financial Times!”

As it turned out, his days spent devouring the latest business and economic news weren’t for nothing. After taking a course in retail management at the University of Surrey, Ullah got his career break in the mass retail market, gaining experience with companies such as Comet, B&Q and Lidl.

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However, he always had a desire to run his own business and after a short spell in a sales role at Electrolux Laundry Systems, he decided to set up a firm supplying laundry equipment to care homes. He wasn’t to know it at the time, but it was to be the start of a path that led him to the catering equipment market.

“It wasn’t many weeks into the business when one of the customers said, ‘I’m okay for laundry equipment, but I am just doing my kitchen up. Can you help?’” remembers Ullah. “So I got suited and booted, got a tape measure and a folder, and said, ‘I’m going to take a list down and then I’ll send you something from the office.’ At that point the company name on my business card still said Laundromatic!”

Not knowing where to go to source commercial kitchen equipment, Ullah searched online and phoned around a few suppliers. One of them recommended Pentland Wholesale and that was when he spotted the opportunity to launch the business he would call Commercial Equipment Direct (CED).

“It took me a whole day to find Pentland but when I got their catalogue and looked through it I realised it was what I had been looking for all the time [online]. I realised there was a need for something like that and right from the start I was very specific about how the website had to look.”

That was more than seven years ago and while there were plenty of online providers at that time, Ullah felt that the market was hugely fragmented and few had progressed beyond publishing scroll-down lists of what they had in stock.

Within four months of starting Laundromatic, Ullah had shut the business in order to focus on developing an online catering equipment business. “I realised I had to stop doing everything, and I actually spent two or three months putting the website together without trading because I knew I had to get my marketing right,” he says.

He remains fiercely proud of the first website he created and says it formed the platform for the sophisticated online infrastructure that it oversees today.

“99% of websites are off the shelf, e-commerce software and that is it, whereas from day one we have had a dedicated raw coded PHP database-driven website, so it is completely bespoke. Every single line, every single picture, every single positioning that you see has been decided by us.”

Building on the initial relationship it had developed with Pentland, Ullah initially concentrated on supplying refrigeration equipment and a range of Lincat lines, while Classeq became one of the first manufacturers that it established a direct partnership with. It wasn’t long before the company was supplying kit to restaurants, cafes and food outlets as well as care homes.

Not everything went to plan, however. “In the second year of business I suffered a £24,000 fraud,” reveals Ullah. “It was one company. They’d done the whole lot — got all the paperwork, registered with Companies House and had a fantastic credit rating. We received a big order and I wasn’t sure about it, but I did the credit rating, which came out good, phoned the finance company and they said they were good for credit. Fortunately the company did eventually get caught and taken to court.”

Although CED started off with a website and does upwards of 70% of its revenues online, the company also began publishing its own trade catalogue three years ago. Ullah describes it as an extension of the website rather than a separate sales channel.

“We knew that the catalogue wouldn’t make the money, but it cemented the business and provides kudos,” says Ullah. “It is the fact that I can put the catalogue under anybody’s nose in any industry and say, ‘this is what the business is.’ There is a value to that.”

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In the last two years, CED has done business with around 10,000 customers, expanded its portfolio to 5,000 product lines and grown the team to eight people. Four more sales staff are due to join the business this month.

CED also now offers equipment under two own-label brands that it commissions: Innox-Max and Glacial. One of the newest additions to those ranges is a 10-grid combi oven, which it is selling for less than £3,000.

Ullah insists that the own-brand range allows the company to make stronger margins, but he is adamant that there is no compromise on quality. “We are very careful that the products we source have reliability,” he says. “Value is important, but reliability has to be the pivotal part of the product selection, purely because we can’t afford for our customers to be left in the lurch.”

After spending a considerable amount of time getting the infrastructure of the business right, including moving to a new office and warehouse in Horley, Ullah admits he is relieved to be concentrating on growing the operation at last.

“For the last two years we have been focusing on the infrastructure of the business — infrastructure, infrastructure, infrastructure. I am so tired of saying it and I am so tired of doing it. And I am financially looking at the money aspect of it and seeing how much it has cost me — it is infuriating! But I can see the result of it.”

Indeed, CED is on track to enjoy a record year if it hits its fourth quarter targets, according to Ullah. “We will do anything between £5m and £6m this year, and next year that will be doubled,” he declares. “If I compare myself to the established businesses out there, we have got the infrastructure and we have got the knowledge. We are not a wholesaler — which we could be — and we are not just another dealer, which we could be. It is a whole new concept of commercial equipment direct. It is about volumised buying and scaling up things. Ever since I started this business I was looking at whether we can scale it — it has got to be scalable. Even our customer service has got to be scalable.”

That is one of the reasons why CED has never got involved in scheme work. Ullah admits that at some stage in the future he is likely to have a “little department in the corner” that takes care of projects when needed, but up until now he has seen no need for it.

“We do get involved in the installs, but there is a financial reason why I don’t do the project or scheme work. I would never have grown to this size and I would never have been able to scale the business if I’d have got involved in that.”

The growth of internet-based companies such as CED continues to split opinion in the catering equipment market, but that won’t concern Ullah. The boy from Bradford has made a success out of an industry he barely even knew existed seven years ago, but the business aspirations he had as a teenager and the appetite for sales he developed during his time in the retail sector continue to burn brightly.

“For me, the business is the most important asset and speaking to customers is still my passion. Money is one thing but it is not really the most important aspect and people don’t understand that. That’s why I drive a £2,500 car!” he says.

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Three steps to web success

If your business model is based primarily on internet sales, you’ve got to have a website that is rich
in content and simple for customers to use.

That was certainly Foyzur Ullah’s aim when he started Commercial Equipment Direct (CED), which today sells kit from brands such as Foster, Gram, Lincat, Rational, Winterhalter and many others.

When he set up the business seven years ago, he admits it was a challenge to put together a site that provides everything a catalogue does but in a digital format.

“I must have phoned about a dozen web developers and asked for it to be three clicks and you are there,” he explains. “Another priority was to have a snapshot of the products, rather than scrolling down. Every single one of them turned around and said ‘no’.”

In the end, Ullah did much of the development work himself, spending three months building the website from scratch and focusing on making sure that customers would be able to move around the site easily. That first website went on to form the basis of the much more powerful online platform that CED operates today.

So having seen the proposition evolve over the last few years, what does Ullah regard as the key attributes that combine to make a great trade website?

“Navigation, content, and the actual lay-out of the website,” he says. “Those are the three most important ingredients.”

Channel profile

Name: Commercial Equipment Direct (CED)
Address: Unit 2, Axiom Business Park, Balcombe Road, Horley, Surrey, RH6 7HF
Tel: 01293 775073
Email: enquiries@cedtrade.co.uk
Website: www.cedtrade.co.uk
Founded: 2005
Focus: Catering equipment; refrigeration; dishwashing; laundry systems; light equipment

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