by Charles Orton-Jones - Thursday, 30th August 2007

Who’d have thought styling irons would be such big business? I started Good Hair Day almost by accident six years ago and now our irons are famous in the UK. We’ve cracked Australia and the US. Sales this year will be £80m, with profi ts of £14m. But I never started off wanting to conquer the world of hairdressing. I just got lucky.

It all started in 2001 when I bumped into an old friend of mine who runs a hairdressing salon. He’d been sent a ceramic styling iron by a colleague in the US, who advised him to take a look at it.

The iron shapes hair though heat. You can curl, straighten or mould hair with it. He used the iron on his clients and was hugely impressed – he found that with this iron, hair kept its shape for far longer. Clearly there was an opportunity to import the irons into the UK.

He had no funding, so I invested. At the time I was running an environmental consultancy, OHS, which employed 70 people. I went into business with him for almost philanthropic reasons. I had no idea we’d be onto such a winner.

We bought 1,000 irons from the Korean manufacturer as a taster. In addition to the £30,000 we put into the business, we borrowed £50,000 from the bank. Initially their credit committee insisted we were crazy, saying, “There’s no money in styling irons.”

And at fi rst it looked as if the bank was right. Our plan was to sell the irons direct to top line hair salons like Nicky Clark and Charles Worthington. But salons aren’t keen on selling home styling devices. We drove round the country, visiting hairdressers, trying to persuade them to stock our irons. If they weren’t keen we just left a box with them to see if they could shift any. The fi rst year was slow. I remember celebrating because we’d received an order for five irons!

In year two things just took off. Word of mouth had built up the product’s reputation so much that instead of us trying to sell to salons, they were ringing us up. One salon owner asked a client how she’d got her hair to look so good, and when she told him she’d used a GHD iron, he rang us up and asked to be a distributor, product unseen. We soon had a six-month order backlog.

The factory in Seoul had to ramp up production. Our relationship with the manufacturers, Kica, grew and grew. They were like us: tiny. They employed six girls to make the irons. They had to keep expanding to meet our orders and now they’ve got six factories. Last year, we were the fastest-growing fi rm in the UK, and Kica was the fastest growing fi rm in Korea.

I go out to visit four times a year. We have exclusive distribution rights, and our relationship is so close I was asked to theboss’s daughter’s 21st birthday party at their house. They’ve granted us an exclusive worldwide distribution deal, a measure of their faith in us.

By 2004 sales hit £46m, but I got worried. We were too dependent on one product. To diversify I hired a chemist and told her to invent a complementary product range. She came up with a suite of haircare products, such as hair spray and moisturiser, which work brilliantly with the iron. A fi rm in West Yorkshire, Ore-An, makes them for us. The range, called GHD Thermodynamics, now accounts for ten per cent of sales.

Luck played its part in our export story too. A guy with a salon in London was moving back to Australia, and asked to be our distributor. We set up a subsidiary, gave him a slice of equity, and he’s worked wonders. He manages distribution deals, and two years on sales should be around £10m. We’ve used the same process to expand into Spain and Germany. We offer between ten and 25 per cent of a region’s equity to someone who wants to run a subsidiary in that territory. It’s a simple formula. Right now we have enquiries from 50 countries.

In the UK, we’ve changed the hairdressing industry. Salons used to make fi ve per cent of turnover through product sales. Now they make up to 25 per cent. We don’t sell through supermarkets for two reasons. The fi rst is price. Supermarkets are powerful negotiators, and would squeeze our margins. The other is our sales pitch. Hairdressers don’t hard sell.

They act as beauty consultants, and when they recommend a GHD styling iron it is akin to a doctor writing a prescription. This sales method means we aren’t competing with other styling iron brands and means we have the loyalty of both the salons and our customers.

The plan is to take GHD as far as it will go. Though I’m still chairman of my fi rst fi rm, OHS, I’m trying to encourage the management to do an MBO. Good Hair Day is a brand with truly global potential. We haven’t even started trying to sell into Brazil, Canada or Russia yet!

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