New firms can find an upside to downturn

Andrew Stone

4th January 2009

A recession might seem like the worst time to start a business but for those with a strong idea � and the right business plan � it can work to their advantage.

Robert Matthams pressed ahead with the launch of his online freight service, called Shiply, in the summer despite warnings from friends about launching at a time when the economy was going into recession.

"People did ask me whether I thought this was the right time to do this but I think it was a great time to start," said Matthams.

"The timing has almost worked to our advantage. It's a business that helps hauliers cope with slower business and record diesel prices and which helps to deliver goods for up to 75% less than traditional services. It's also good for the environment because it cuts down on overall miles travelled."

Anyone looking for a good business to launch in a downturn should consider ones that save customers money, said Matthams. "It's a great time for businesses that can do that. Look at Aldi.

"I got the idea for Shiply when I took delivery of a snooker table when I was a student in Manchester. The driver said he was going back to London with an empty truck, which amazed me. I started doing some research and found that 25% of lorries on the road travelled empty. I thought I could help hauliers earn extra money by helping them fill their vehicles."

His hunch has so far proved a good one. Shiply has signed up 5,000 customers and 3,000 hauliers so far and has arranged the delivery of everything from small parcels right up to a super-yacht, said Matthams. "We are ahead of the business plan. We did not expect it to take off this quickly and we are going to expand into regular contract work this month."

Starting a business need not be expensive, either. Matthams estimated he initially invested £5,000-£10,000 to get the business going, although he continues to invest in the website and to improve the technology it uses.

It can also be cheaper to start up in a recession, he said. "It pays to look for the advantages a recession can give you � being able to negotiate cheaper things like advertising, for example. You can get some very good deals."

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