4-Small-Businesses.com

Jonathan Elvidge Turns A £20,000 Loan into Millions!

Name: Jonathan Elvidge.
Nationality: British.
Age: 27 when opened The Gadget Shop in Hull, 1991.

'Foolish' small business idea: A shop full of unusual gadgets. From inflatable aliens, to lava lamps and night-vision goggles.

Start-up Capital: Jonathan Elvidge had made a lot of money by moving house in the late eighties. Re-mortgaging the new property gave him some capital but he needed a further £20,000. The bank loaned him the full £20,000 on the Government Scheme for Small Firms - the Government secured 70 per cent of the loan.

How small business idea was Launched: Rented a unit in a new shopping centre in Hull.

Sales: Started with one shop in Hull. Formed partnership with Andrew Hobbs, who bought half the company. By, the end of the first year, they had 3 shops. To date, 31 outlets. Their best selling product is the lava lamp. They purchased them before their renewed popularity.

Earnings: Business empire is now worth over £50million.

When Jonathan Elvidge had a falling out with his employer at the telephone company in Hull, he decided to try his hand at running his own business. His passion for gadgets, combined with his fondness for the TV show *The Fall and Rise of Reginald Perrin*, gave him the inspiration for his entrepreneurial idea. The Grot shop in the series, along with his frustration at not being able to find the types of gifts he wanted, sparked the idea for a shop selling unusual, affordable gadgets. He conducted research into products and how to secure a unit, then approached banks for a £20,000 loan to supplement his own funds and open his first shop.

The day he opened his first shop, there was just himself, a friend and baby-sitter to serve customers. Because Jonathan Elvidge had not realised all the other retailers in the shopping centre had negotiated the rent on their units, he had accepted the £30,000 a year rental charge without question. It left him only breaking even, despite working a 60 hour week. He wanted to open more shops, but was unable to raise the capital.

Andrew Hobbs, who was in charge of letting the shopping centre units, suggested a partnership. Jonathan agreed and before the end of the first year, they had opened two more shops. Jonathan spends most of his time travelling to trade fairs, especially in the Far East, to select products. Jonathan Elvidge went from working for a telephone company to owning a business partnership worth over £50million from his idea.