Mathers launched her eco-friendly retail business just a few short years ago. It has since attracted a loyal, tight-knit community of customers and several accolades around the world. Here, Mathers talks about the launch of her bricks-and-mortar store, becoming a B Corp and the importance of creating a flexible workplace. Inside Retail Weekly: How would you describe the past financial year at Flora & Fauna? Julie Mathers: We’ve had a strong financial year. This year, for us, has been our g
our growth year or our grounding year. Prior to that, we had grown at such a rate that we grew out of our systems and space. This has been a great year to really ground us and stabilise us for the future. So we’ve moved into a new space, we’ve changed a lot of our systems, we’ve put in new processes, we’ve got new team members – all while growing at the same time as well. We couldn’t keep doing what we were doing without putting those things in place.
The space we’re in now is 10 times the size we were in before, from a warehousing perspective. Our sales growth this year is 120 per cent over the previous year and the year before, it was 300 per cent on the year before that. It’s interesting because we’ve had 120 per cent growth without having all those systems in place, so the potential now is huge.
IRW: Do you still think of yourself a startup or a small business?
JM: I don’t consider us a startup. I do still consider us a small business, but growing.
IRW: Do you have ambitions to become a big business one day?
JM: It’s a really interesting one. I think there’s lots more growth for us – absolutely. Because we’re so purpose-driven, I never want to lose that and I never want to compromise our values. Our purpose is to help everyone make better choices and to do that, we need to be bigger. Are we going to have hundreds of stores? No, we’ll never do that. And the reality is there’s still a niche market that does shop with us. Eco, vegan and ethical are still considered expensive. Yes, we want to get bigger. It’d be amazing to have an ethical retailer become so huge.
IRW: Are you excited about the slow change in consumer mentality towards eco?
JM: Yes. The thing I’m always focused on is we have to appreciate everyone is at different points on a journey and on different paths, which I get excited about. For example, reusable coffee cups are the norm now. Not using plastic straws is the norm. When you go to a supermarket, of course, everyone has their own bags. It’s the norm now, after the furore last year.
And it’s not just consumers who are changing, but other businesses. There are cafes that don’t stock plastic straws anymore, and there are others that say customers have to bring their own cup in. We see pockets of action happening everywhere.
We’re inclusive, we’re accepting and helpful and I think that’s so, so important for us as a business.
IRW: What are you focusing on in the next financial year?
JM: We’ve just launched our bricks-and-mortar store in North Rocks [in the Hills District of Sydney], which is exciting. We’ll also change over to more systems as well, and once we’ve done that, we can ramp things up more. We’re looking at more brands, products. We’re going to focus on omnichannel and offer customers a better online experience. The great thing about our store is we already have an endless aisle. If we don’t have what you want in the store, you can do click-and-collect and we’ll get it for you straightaway from our warehouse next door. The store gives us more options.
We’ll be doing events in the store as well. We want to get really close to our customers and the physical space helps us do that.
IRW: How did the launch of the store go?
JM: The store opening was fantastic. We had well over 1000 customers visit us over the day and it was amazing to be able to talk to so many of them. We had a great community atmosphere with delicious vegan food, music, mini-makeovers and wine by Vineful. We also were sampling Tea Tonic tea and had a wonderful raffle, where we raised $1360 for Where Pigs Fly Farm Sanctuary. A truly amazing day.
Since the opening, we’ve remained busy and it is wonderful to be able to talk to our customers face-to-face.
IRW: Flora & Fauna has been a pureplay up until now. Why did you decide to open the store?
JM: I’ve always wanted to have one since I launched the business because I am a massive fan of bricks-and-mortar, having started my career in it. It was about getting the right space and it being the right time, I felt we had to establish ourselves first. We’ve got a great community now and within it, great brand recognition and to be quite frank, customers were asking us for a store. We wanted to give them a great place that they can touch and feel.
We have makeup that’s hard to buy online, like if you’re looking at a new foundation from a new brand. But now we’ve got somewhere that you can test and try it and someone can give you advice. It’s the same with our perfumes – it’s really hard online.
The store is a brand extension and gives us a great way to showcase ourselves physically, but it’s been built in a way that when you walk in, it’s not different to our website. You walk in and it feels like Flora & Fauna. For us, it’s not about driving huge sales or profit. If you start with a store and you tack on online, it’s very different. But because we started online and I view stores as a brand extension, I’m not stressed about them making their own money in their own right.
IRW: It’s quite an old-school way of thinking. I think people are more open to the fact that the customer’s journey isn’t linear.
JM: We’ve been pretty obsessed about channels. I’ve worked in omnichannel businesses where we’ve been obsessed about attributing dollar sales to stores and it just gets messy, because it divides you as a channel. I think in some ways, the whole P&L aspect needs to be pulled out of it. It really needs to be shaken up and looked at in a wholly different way. What does a modern retailer look like?
I’m not stressed about attribution at all. I just want to know if our marketing is working overall. Of course, I look at individual numbers, but as a percentage of revenue, is it delivering what we expected? And if it isn’t, we dig in and have a closer look and make changes. But you can get really obsessed about individual pieces instead of looking at the whole pie, then you can end up making changes based on those pieces if they’re not working. If you look at the last click, they might not work, but if they’re part of a customer journey, then they are.
It’s taken a massive shift for retailers today to think differently to what they were doing five to 10 years ago.
IRW: What have you learned about your time in corporate that you’ve implemented in your business?
JM: My corporate time was phenomenal. I really value all the experience I’ve had. I was talking to a lawyer last night who’s a B Corp and she said it’s challenging in the online space, because there are a lot of people who don’t understand consumer law. So there are all these people starting businesses who don’t get policies, procedures – stuff that you need to have when running a business.
What’s brilliant is that when you’ve worked at Coles, Woolies and John Lewis like I have, you’re very much across that – you live and breathe it every day. You’re across legal, consumer law and what you can and can’t do. You’re also across the HR stuff and working with a team and leading them – all those things that are so important. I see things being done so badly in other businesses and I think that wealth of experience has really helped hone me into what I hope is an inspirational leader. We make sure we’ve got policies and procedures in place.
Like if a disaster happens – which hasn’t happened yet, touch wood – but how would we deal with it? We have a disaster recovery plan. We’ve had disasters happen at both at Coles and Woolies, where something happens and you need to approach it with a straight head and deal with it quickly. It could be all sorts of things, like a data breach.
I once priced a case of beer for $4. I remember where I was when that happened – I was at a concert, my phone was going off and it was my social media coordinator going, ‘Julie, Julie!’ at 11pm. That case of beer should have been $60 and we’d sold thousands. It had gone around to all the students! So we all had to get on the phones and fix it. It was one of the best experiences I had in terms of learning.
A disaster could be anything, like if the website goes down or if someone breaks into the store.
I’m massive on health and safety and suddenly, when you have a physical space and people can walk into it, there are different things to worry about. All the shelves have to be attached to the walls, children can’t be able to pull things off and furniture fall on them. It’s all brilliant experience from corporate life. Had I not had that, I’d probably not think about those things.
IRW: You guys became a B Corp a couple of years ago. Why did you decide to undergo that certification process?
JM: I started Flora & Fauna to be a better business. It had nothing to do with B Corp, it’s just what we wanted to do. We already had plastic-free packaging and we were already vegan and cruelty-free, so when I came across B Corp, it seemed like the right fit for us.
B Corp is very new to Australia. It’s well-known in the US, but I’d say Australia is the second-biggest market for it.
It’s a long certification process and as you’re going through the questionnaire, you become so much more informed when they’re asking you things like, ‘Have you got your mission statement written down?’ and ‘Have you got an environmental policy?’ It’s a really rigorous process and it gave us a huge to-do list, which was phenomenal. We knew were doing good, but it brings more rigour and structure and after having gone through it, the B Corp certification means so much more to us now. It just really helped drive our strategy. We had started doing things with charity, but then I realised we had to do way more things in the community. It also covers your team a lot in terms of bonus structures and asks you about the kind of paid leave you offer.
It’s very thorough and it made me think about what we could do better and where our gaps were so we can start to fill those gaps.
What’s great about B Corp is you don’t have to be perfect. The score goes from zero to 200. Eighty is the B Corp benchmark and it’s actually quite hard to get, but equally not impossible. You don’t have to be perfect to get 80 but you have to be on a journey.
B Corp is not just having a tick in the box, it’s also about being part of a community and the community in Australia is growing, so you can work with each other. There was a guy I met last week who does marketing for purpose-driven companies and he’s worked for places like Patagonia. They’re also just good people and when you’re in a business like ours, you want to work with good people with shared values.
If you want to become a B Corp, don’t think about the certification as much, think about the fact that you’re becoming part of a community driving change and helping each other.
You also have to recertify. We haven’t had to yet, but it’s constantly on my mind that next time, I want a much better score, so there are all these things we have to do to make sure that happens. It’s quite cool.
And even if you’re a business that might not necessarily want to get the B Corp, do the free assessment, so you can see where you’re at. It’s a great way to figure out what your strategy should be.
IRW: What kind of changes are you making to your team?
JM: We are working with something external for HR to really put in lots of procedures and policies. We want to offer more flexible leave. What bugs me is you get four weeks’ holiday and that’s it. It’s really annoying. I never take leave, but when I used to be employed, I would have liked to have had the option to take a couple of weeks more.
It’s about more flexibility for my team so that they’re really happy in the workplace. It’s also about output, not input. I rarely sit at my desk, so I’m not someone that says, ‘You gotta be in by nine and leave at five’. It would be completely hypocritical, because it’s not how I work at all. For us, it’s about shaking that up.