This is Part One in a two-part series from the dynamic husband and wife team behind Cheapsheds.com.au. In Part One, the Panczels tell us how they used Terapeak to turn a bad shopping experience into a rapidly expanding global business. In Part Two, which will appear next week, they discuss the Cheap Sheds operation today and the ways in which they continue to rely on Terapeak for basic business needs.
My wife Maria and I emigrated from Hungary to Australia in 2003 carrying nothing but two backpacks and less than $200 between us.
Krisztian and Maria Panczel turned a Terapeak subscription and a bad experience with a garden shed into a rapidly expanding global operation.
Living with a language barrier and a lack of in-demand skills for the labor market in our new country, we thought repeatedly about starting an online business, but we weren't sure about the prospects for a “pure digital” business—one that would sell only downloadable goods or online services. What we were comfortable with and excited by was the prospect of a traditional retail business that happened to be online, one in which the classic rules apply: buy low, sell at a markup, provide goods that are in demand, and serve customers well. The tough question for us was how to start. Unfortunately, we had no idea what products we should sell. This problem is familiar to most enterpreneurs—the question of finding a viable niche. What could we offer to online shoppers? What opportunities existed? What goods were sought but not currently available? More importantly, how could we find answers to these questions?
As it turned out, Terapeak and a bad garden shed answered these questions for us.
Our Bad Shed
Still pondering our online retail goals, we bought a house, and—as fate would have it—a typical backyard garden shed. It was a big hassle to get, and when we finally bought a shed, it turned out to be a lemon. It was so bad, in fact, that we had to chuck it away. Though our shed experience had been poor one, it gave us an idea. We'd heard about Terapeak, so we decided to subscribe and do some preliminary market research. That was a huge moment for us because we discovered that we could use Terapeak to research all sorts of products, seeing what other sellers were selling and how particular products were doing. It was massive. eBay is a dominant marketplace in Australia, and being able to research products this way really gave us our beginning.
In 2008, based on our Terapeak research, we decided to give ecommerce a go—selling better quality garden sheds.
Making Cheap Sheds Work
The big complication was that sheds of any size—from the tiniest garden shed to the multi-ton triple garage sheds that we now carry—are not the easiest things to stock or ship. We didn't want to have to stock all of the sheds that we thought we’d need to sell. Starting with just one of our product ideas, we sought a manufacturer that could produce and deliver sheds for us directly, enabling us to sell without having to manage the warehousing and shipping difficulties that we’d otherwise have had to face. We found just such a manufacturer—and the rest is history. After starting small—one shed and one manufacturer—we continued to evolve, building relationships directly with other shed manufacturers and importers and using Terapeak to help us make good decisions and expand our product line.
Most eBay sellers that work in the drop shipping space know it to be highly competitive and fraught, in any product category—even in hot markets like the Australian one. So how did Cheap Sheds manage to succeed where others often struggle?
Using Terapeak to discover an underserved niche and research growth opportunities was our first key choice, but with Cheap Sheds we also went several steps further than the drop-shipping business model. Our relationships with manufacturers go beyond advertising and marking up ready-made products; we work closely with them in all phases of the business and communicate with them every day. We rely on manufacturers for the physical parts of transactions—from shipping and handling to returns and missing parts. We do the rest. This more-than-drop-shipping strategy has paid off, allowing us to satisfy our customers’ needs and to achieve a very good lifestyle for ourselves and our team members.
The Australian Market and Beyond
The Australian market has been a great local market, and it really gave us our start. The dot-com boom was emerging in Australia as we began, and Cheap Sheds found a ready base of customers able to propel us to global success. The buying power of customers Down Under has been very significant, even as a lot of big retailers are still working to get online. With our highly vertical business model and Terapeak-inspired niche, we moved quickly enough to exploit what has turned out to be a great opportunity. Today Cheap Sheds is located on the Gold Coast in Queensland, Austrialia and our yearly sales volume is measured in millions.
Our business has grown to such an extent that the Cheap Sheds name has become known around the world and we’re actively working on expanding into new markets. We’ve continued to rely on Terapeak for market intelligence and to identify and form relationships with new manufacturers around the world. Terapeak, our business, our manufacturers, and our customers have been good to us.
In the next part of the Panczels' story, Krisztian talks about how Cheap Sheds operates today—the quantity and diversity of their suppliers, the Cheap Sheds team, new directions they're considering, the concrete ways in which they continue to rely on Terapeak as a key part of their business, and where they hope to be in the future as the premier global provider of cheap, quality sheds.
To see how Terapeak can help you to start and grow your business, take advantage of Terapeak's free trial membership today.