Look, no hands

For Frog Bikes, global growth took off sooner than expected – obliging the firm to make a swift detour on its growth journey.

Jerry and Shelley Lawson expected their new company to accelerate gradually. But demand for the kids' bikes produced by Frog forced the business to step up a gear.

Frog had planned on the basis of trading domestically until the latter period of its three-year plan. International customers had other ideas.

"People overseas began buying our bikes directly," Jerry Lawson recalls. "What we thought was just a UK niche product suddenly became a global opportunity."

Now Frog bikes are sold in 35 countries. In each market, the business follows its original UK model, selling via independent bike stores.

Dealer model

"The best thing about working with independent bike dealers is that they have lots of customers locally," Lawson explains.

"We talk to a store, and they go out to their 20,000 or so customers, telling them about our products. When we went to the US we did exactly the same, with a team of people visiting stores."

Frog found this approach more effective than trade shows, which offered a marketing window but did not lead to direct sales.

To decide where to break into the world's biggest bike market, it analysed two key factors.

"We drew up a map of the cycling communities in the US, and a separate map of the tax advantages of setting up in different states. Then we married the two," Lawson says.

"We decided to set up in New Jersey, where tax benefits are good. We can ship bikes there from the UK more quickly than if we kept stock in the US."

In-house manufacture

In 2016 Frog set up its own factory in Wales – another element that wasn't part of the original plan.

With financial support from the Welsh government and tailored funding and guidance from HSBC, the firm took over a long-empty building in Pontypool, where it now employs 20 people.

Lawson extols the benefits: "Suddenly we have control of our supply chain.

"When you're using third party factories and you want to make a change to the product, you can't stop the line. Now we can go to the factory with an idea and we'll stop the line, look at it and come up with an improvement in a way everyone is happy with."

Frog makes a point of keeping other core competencies in-house too. "We looked at outsourcing customer service, but we found people didn't understand our brand – however well we trained them," Lawson says.

Unique proposition

Frog values its intellectual property, even though it hopes other manufacturers will adopt its methods and improve the overall quality of children's bikes.

"The whole reason we've gone for trademarks is that we're unique in our geometry, due to independent research carried out at Brunel University," says Lawson. But there are bottom-line benefits too: Frog gets a 10 per cent tax break for every bike sold that includes its patented components.

The Lawsons launched Frog because they were unable to find good quality, lightweight bicycles for their own two children. "The proportions of kids' bodies are different, yet most manufacturers had just taken adult bikes and shrunk them down without reducing the weight," Lawson says.

The instant enthusiasm of independent bike stores and customers to Frog's more child-friendly designs proved there was a gap in the market – and led to swifter-than-expected growth.

"We've had to learn to deviate from our original plan, but we're still moving in the same direction," Lawson concludes.

Business plans change but it is important to a robust plan in place from the outset, visit our guide to business planning.

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