It took Richard Shonn, managing director of 151 Products, three years to find a warehouse big enough for his requirements.
He started looking in 2006, just before the recession hit, when property prices were rocketing on a daily basis.
The business, which is a large-scale distributor and manufacturer of household, DIY, gardening, pet care and automotive products, was expanding rapidly and more space was needed to store products to fulfil orders.
However, because property prices were so high, every time Shonn made an offer he was outbid.
He says it was a difficult process finding the right building because of the size required and the budget he had.
Undeterred, he continued with his search and in 2009, at the height of the recession, Shonn stumbled across a 200,000 sq ft warehouse in St Helens, Merseyside.
The asking price was £6 million, but because of the credit crunch Shonn was able to buy the warehouse for just under £3 million.
He tells us he managed to get the price down because of “luck, favourable market conditions and clever negotiation skills”.
“The market had turned, people needed to sell because they needed the money. And of course we had a lot of luck,” Shonn recalls.
The managing director says it was the best deal he has ever done, because “it enabled the business to grow”.
“Had we not have had that building it would have constrained what we could do.”
And the deal also saved the company a lot of money in rental costs, Shonn adds.
“We had rented for a number of years and wanted to buy. And with interest rates the way they are now, it has turned out to be considerably cheaper than renting.”
The company, which has a 15 per cent growth rate year-on-year, has more than “1,500 items within its many ranges and brands”.
Shonn tells us that 151 Products was originally started within the family cash and carry, Shonn Brothers, which was established 50 years ago in Greater Manchester.
“We separated the business and 151 was pushed into developing as its own brand."
Shonn describes the firm as an “always in stock business”.
It carries large volumes of stock and the products that are in demand for customers are available there and then. Customers do not have to wait for stock or pre-order.
151 Products are supplied to numerous retailers including Asda, Home Bargains and Poundland. All of these stores, particularly budget shops such as Poundland, have experienced rapid growth during the downturn as consumers tighten their purse strings.
This has led to an increase in business for 151 Products, as the demand for its reasonably priced goods has gone up considerably.
“The bigger we get, the larger we grow, the more stock we need to carry,” Shonn says.
“We always have products that the customers need, so they don’t have to wait or pre-order. We can deliver to small retailers or big supermarkets.
“We use economies of scale and buy in bulk, which helps us to keep costs down.”
He tells us that the warehouse is currently running at about 75 per cent capacity and that they have planning permission to expand it.
“There is enough room to expand to almost double the size of what we have now.”
What’s next for 151?
Shonn says he is focused on growing the business.
“We are on the acquisition trail, so we are looking at a variety of different companies with synergies to our own business.”
He said having the warehouse and being able to expand it when they need it will be key when they acquire other firms.
His advice to budding entrepreneurs is to “take a chance because you never know what will happen”.
By Kirsty Hewitt