Client wins: How Nomad Eyewear grew a powerful Shopify business from their spare bedroom
Nomad Eyewear is a Shopify success story. And an inspirational one at that.
In 2022, Tom and Idana were shipping 50 orders for sunglasses out of their spare bedroom every day. Juggling family life and a burgeoning business meant working until 2am was the norm.
Today, Nomad Eyewear is shipping 150-200 orders per day of sustainably made sunglasses to happy customers, quickly and easily from a fulfilment centre.
In the space of a few years, this family-run ecommerce business has quadrupled their sales, and Tom and Idana have managed to largely step away from the grind of daily operations. They have a bigger space, and a few employees. Their numbers are only getting better. Now, they’re working towards their big life goal: a move to Australia.
How did they do it? Let’s dig in.
Every entrepreneurial person will resonate with these words
“Wouldn’t it be cool if…”.
If you’re an innovator, you know the origins of this story. The dream product or service you want for yourself doesn’t exist. So what do you do? You find a way to solve the problem. You bridge the gap. You bring it into existence.
It’s that opportunistic and creative mindset that led to the establishment of Nomad Eyewear.
Whilst on a family holiday in Cape verde, Tom’s Oakley sunglasses got caught in a tussle with their (then) 3 year old and lost the fight. On the same trip, the couple witnessed a crazy amount of plastic pollution washing up on the once pristine beaches. A few beers later, an idea was formed.
“Wouldn’t it be cool if we took plastic from the ocean and turned it into sunglasses?”
And they did.
Nearly 2 years later, and after many late nights researching, Tom and Idana found a supplier who aligned with their vision. They cancelled their upcoming wedding and took the savings to manufacture their first sunglasses.
After their first year of business, Tom and Idana were asking “is this actually working?”
It’s hard to gauge how well your business is performing without:
Having laid out exactly how you want it to perform
Knowing how to pull the right numbers
Understanding how those numbers are impacting your goals and targets
Like most fledgling business owners, Tom and Idana were learning on the job. And, like many, they were starting to feel imposter syndrome creeping in.
“We were thinking - who are we to own a company selling sunglasses? We aren’t even near the beach! We were two kids with a business, having no idea when and how we needed to spend money. We had an accountant but they just did the end-of-year accounts. We never knew if we were taking out too much or not enough.”
They were making sales: good!
They were meeting all their accounting requirements: good!
Regardless, there was still a question mark over their progress.
They knew the business had good legs, but they weren’t sure where it was going. Had it been a good year? How should they measure “good”? Should they look at sales? Profits? Is the business doing well if you’re working until 2am every night?
They knew they needed these questions answered if they wanted to scale.
Tom and Idana went looking for business guidance. But their instinct wasn’t to reach out to an accountant.
When you need advice to scale your business, who do you ask?
Tom and Idana looked at business advisors, investors, and operations directors. Having worked with accountants in the past, they determined the level of support they needed was out of scope for what an accountant could provide. They wanted someone to come into the business with experience, understand it inside-out and move them forward.
At Scotch, we’re a partner, not a provider. We’re the ‘person on the inside’ for our clients - the bridge between the finance world and the business world. We know our clients are looking for hybrid help:
Practical help with the accounting
Jargon-free financial insights and business advice
Motivation to reach goals, plus a kick of accountability along the way
Someone to talk to and run ideas by
Knowing Patrick through their kids' school, Tom and Idana could talk freely about the challenges they’d been facing in scaling the business, and the frustrations keeping them stuck. Shortly after, Scotch came on board.
In the first few months, we provided Tom and Idana with the insights they’d been missing from Shopify.
The first quarter was all about increasing Tom and Idana’s confidence in the business, by looking at how they’d been performing so far.
A big part of that was helping them understand their numbers from Shopify.
Shopify is a rich source of data. If you want to scale a business on Shopify, it’s in your best interests to to work with a team who have a specialist knowledge of the platform, and how it connects with your bookkeeping software (such as Xero).
We walked Tom and Idana through:
The insights they can get from Shopify itself - who their customers are, when they’re buying, how much, how often.
Extracting key data from Shopify for Xero - splitting out their sales numbers so they could see different geographies, discounts, refunds, and charges.
When you make a sale in Shopify, the net payout that lands in your bank account is often treated as sales when you do your bookkeeping. But there’s a whole load of information you can get from that one number, that you might be missing out on.
You can keep track of where shopify fees are, see your level of discounting, see how many people are refunding your products. You lose all that info when you just take the net number into account.
Stock accounting was also a big issue for the couple. They couldn’t understand their profit margins, because they didn’t understand their stock.
Their worst sales month had no stock purchases, so their profits looked great.
Whereas their best sales month was offset by a huge new stock order for future sales, and didn’t look so good.
When the business made a purchase of stock, at the point they paid for it they would post the payment direct to costs. Sound familiar?
We work with a number of growing ecommerce retailers like Nomad, and accounting for stock incorrectly is a common problem.
For Shopify businesses we recommend using an integrated app called A2X, which allows you to enter all of your individual stock line unit costs, and automatically calculates the costs of each sale that needs to be transferred from your stock account. We helped the Nomad team set up A2X and integrate it with Xero, and they were up and running in no time.
They now have financial performance reports that show true margin and profitability trends month on month, which means they can make decisions about their business with confidence. You can read about this solution in more depth here: How do I account for stock purchases?
It’s this specialist e-commerce guidance that Tom and Idana needed.
The more accurate and in-depth information you have in your financials, the more equipped you are to analyse how well you’re really doing.
Once we’d unlocked past performance, we could start planning for the future.
Once we knew what had got Tom and Idana’s business here, we used a strategic planning session to look at where they wanted to go.
Strategic planning is one of our favourite explorations to do with clients. We strongly believe planning for the future is fundamental to help turn your dream into your reality.
We create bespoke strategic plans, built around your business and personal goals. Your plan provides you with a roadmap to your goals that is both motivational and practical. It defines:
What your business and life goals are
What income you need to be earning to achieve them
What sales you need to make to be earning the required income
“The strategy session was worth its weight in gold. We dug into our long term goals (not financial but lifestyle goals) and then worked backwards to create a plan to reach them”.
“Scotch Accounting have changed our business and we see them as more than accountants, they’re an extension of our company”
We’re really proud to support Tom and Idana on their journey.
By handling their bookkeeping and accounting, we’ve got our finger on the pulse of the Nomad Eyewear business. As their finance partner, we’re in the best position to keep the couple on track with their goals.
Regular performance reviews allow us to provide updated insights on their progress, to assess what’s going well and what needs some work.
Most recently we helped the Nomad team sign a contract with a fulfilment centre. This is a huge step for the team in scaling their operations, and frees up a lot of their personal time. They brought us along for the viewing, to help provide the right information to seal the deal.
Talking about their partnership with Scotch, Tom says:
“You may find Scotch is more expensive than your typical ‘speak once a year’ accountant. Scotch is WORTH THE INVESTMENT. Having a decent accountant and business advisor from the outset has been a game changer. It is worth every single penny we pay. I feel like we have an in-house financial director at our beck and call. Patrick likes to be on the ball. He instantly gets things moving. I feel like he is part of our business”.
Profit margins. Stock accounting. Translating financial data. Nobody teaches you this stuff when your creative ideas start to sell. Yet, this is the stuff you need to know to build a successful, fulfilling business. And that’s what we want for all our clients.
If you feel like you should know this stuff but the uncertainty is holding you back, you are not alone.
We’ve seen it, and we’ve turned it around. We’re here to be your guide.
Feel confident in your business’s finances and future
We want to be your dream of what an accountant could be. You deserve the time to focus on the things you love and that move your business forward. We’re here to listen, advise and help you get excited about what’s around the corner. Think we could be what your business needs? Click the button below to book a free chat and let’s see if we’d be a perfect partnership.
