Innocent Drinks boss: You're bonkers to blame economy for holding you back

Richard Reed, co-founder of Innocent Drinks, on dealing with supermarkets, making 10% of his team redundant and why true entrepreneurs are never put off by a weak economy.

by Elizabeth Anderson
Last Updated: 09 Oct 2013

Innocent was born out of friendship. The two other co-founders and I are best mates from university. We always thought it would be great to start a business together and one weekend we came up with the idea of selling smoothies. By Monday we'd all quit our jobs.

My dad worked for the local bus company but I've always been entrepreneurial. At four, I was selling jam jars of rose petals and water to the neighbours for 2p. At 13, I was buying surf stickers for 2p from a local newsagent and selling them on for 15p at school. I've never made a profit margin like that since.

My worst moment was in 2008 when I watched the market sliding away and we didn't act quickly enough. After eight years of growth, we weren't expecting sales to fall. We lost millions of pounds in that traumatic year and had to make 10% of the team redundant.

I haven't found supermarkets aggressive to deal with. You've got to understand how they work. They try to buy products from suppliers like us as cheaply as possible. In the mid-2000s, Innocent did a two-for-one deal and ended up losing a few pence for every bottle we sold.

I've never really wondered why I started a business with two other men. It worked great for us, but our first big hire was a lady who is still with us now. We're not macho guys anyway.

Coca-Cola had been approaching us since our second year in business. For years we said no, but in 2008 the business had stalled. Eighteen other investors heard our pitch. Some were brutal, but Coke understood the brand and asked the least. Innocent has blossomed since.

The other business that I think is very cool is Zumba. It was created by one guy who now sells the rights for other people to teach it. I went to a Zumba fitness concert once. There were 3,999 women and me.

If you think the economy is the biggest thing affecting your business, you're bonkers. Success depends on whether you've got the right brand, are selling what consumers want and at the right price.

Find this article useful?

Get more great articles like this in your inbox every lunchtime