Fraser Smeaton, co-founder and ceo of Morphsuits, talks about being more hedgehog, the importance of face-to-face and diversification.
When did you set up Morphsuits and why?
We set the company up in 2009 as a side hustle (before that was even a thing) because we had worn spandex suits on several stag dos and we had always been amazed by how many people asked us where to buy them. Given there was obviously demand we thought we would make it easy for people by selling them ourselves.
What is your greatest achievement at the company?
Turning the company around from 2015 onwards after the Morphsuits craze came to an end. At that point the business had a lot of issues. Falling demand, reducing margins and a demotivated team. We managed to get through that by focusing on what we had always been good at. Creating and marketing innovative new products and then distributing them efficiently around the world. We started by adding inflatable costumes and since then have steadily expanded our range across all costume categories. This combined with our expertise in selling direct to consumer, has resulted in years of profitable growth and a clear route for that to continue.
Favourite part of your job?
The variety of challenges and opportunities that we get to work on. From improving sourcing, to working out advertising strategies, to raising finance. All this in an industry where the underlying product is fun.
Who is the unsung hero of the company?
It has to be our operations and finance teams. Efficiently forecasting, manufacturing and moving stock to where it needs to be when it needs to be there is key to our success. It is incredibly complicated across 1000s of SKUs, multiple markets and customers, yet our teams not only make it work, they make it better each year.
What is the biggest change within the party industry that you have seen since you have worked in it?
The consolidation of the routes to market due to the growth of the grocers and speciality chain retailers (in the US) and Amazon taking the market from the independent websites.
What’s the best piece of advice you’ve ever been given?
For me it is the hedgehog principle that originally comes from the business book “Good to great”. A hedgehog does one thing really well – it rolls into a spiky ball so that nobody can eat it and therefore it can thrive.
The business parallel from the hedgehog is that companies often think they have to be doing multiple things to be able to grow. The reality is that you will likely do multiple things averagely and would be much more successful if you were truly excellent at one thing. This has been core to our turnaround since 2015.
Biggest lesson you’ve taken away from the last year?
That there is no substitute for meeting people in person. With the rise of zoom and Teams, it is easy to stop making the effort to travel but we have realised that it is a very poor substitute. We have enjoyed being able to meet our customers in the last year and are looking forward to visiting our manufacturing partners in the next month.
If you could change one thing about the party industry, what would it be and why?
There isn’t much I would change. Although there are obviously issues, I think we are lucky to be operating in a growing, international market with a product range that is both fun and has constant potential for reinvention.
If you didn’t work in the party industry, what industry would you work in and why?
I started in marketing and it is still a large part of what I do now. If I wasn’t in the party industry I am sure I would still be in marketing, just in another category. I love the thought that goes into getting marketing right and the power it has to transform businesses when done well.
