It is the business dream – growing a startup and then selling to an industry giant for millions. But for Sheree Sullivan from Udder Delights, the journey has been paved with blood, sweat and tears.
And that journey began at birth. Sheree watched her entrepreneurial parents build small businesses and work incredibly hard.
“I grew up in a family that always had businesses on the side, I look back now and realise that it set me up to have a go and not to be afraid of failure,” Sheree told Bushy Martin on the Get Invested podcast.
But it was a decision to start a goat dairy farm that would ultimately change everything for the family.
Sheree’s parents doggedly worked on the Adelaide Hills farm in the early hours of the morning and on weekends, while still juggling full-time jobs in the city.
The goat’s milk market was inconsistent, many litres were going to waste, so Sheree’s Dad made a decision.
“He just came home and had a chat with Mum, and they just decided they were going to value add,” Sheree said.
“They needed shelf life, they needed control. ‘Why don’t we build a cheese factory? We’re so gourmet, we love goat cheese.’ There’s no financial backup plan, you have no money left, keep going.”
Meanwhile, Sheree seemed destined for a career in music, completing a jazz piano degree at University.
But at the same time, she threw herself into sales for the family business, now called ‘Udder Delights’.
And if that wasn’t enough, Sheree was given an eight hour crash course in cheese making, to cover the holiday leave of the company’s Cheesemaker.
That would be the catalyst for the next big jump. The Cheesemaker would soon quit, and the business was again at the cross roads.
“I remember sitting around the dinner table that night and I said to my parents, ‘Look, how about I become the Cheesemaker, and I’m going to teach myself how to make cheese trial and error’,” Sheree said.
“’I’ll read books, I’ve got this guy I can call in Melbourne, and just put me on a really small hourly rate’. I reckon I was probably on $15 or $18 an hour. ‘Then the rest of the time I’m going to get out there, I’m going to set up this business and I’m going to get the sales, I’m going to get profit, I’ll brand it, and that can be commission based on sales. I’m going to give you a five-year commitment, and at the end of five years, I’ll re-commit again or I will look elsewhere for a job.”
The hard work continued but the business grew. Sheree married Saul, also an entrepreneur with a huge vision, and the couple sold their house and car to start a separate but aligned business, the Udder Delights Cheese Cellar.
The couple would become the ultimate team. The business initially churned out 2000 litres of milk to cheese each week, now it is 100,000 litres.
“We’ve navigated 20 years of huge growth,” Sheree said. “Every year we’ve done between, say 25-45% growth, year on year on year. I think our average is about 35%, and we just finished our financial year, which is a calendar year sitting at about 30% again.”
Sheree said there are key fundamentals behind their success as a business couple.
“We have a rule, and I don’t remember when we set the rule, but it was very early, and it was if we don’t both agree then we don’t do it,” she said.
“I’m a very big believer in you cannot be an entrepreneur with a family business if both of you are not fully comfortable with the risk taken, or the time sacrifice required.
I just wouldn’t like being in business by myself and I know that if Saul hadn’t come on, Udder Delights wouldn’t be the business it is today. I just really like being in business with someone and my husband’s actually the same.”
While the highs and lows of every day business are enough for most people, the Sullivans faced breaking point.
Within a short period Sheree’s Mum passed away, the company faced an enormous insurance battle and her Dad lost his house to termite damage.
“My husband and I almost (had) nervous breakdowns, and my Dad is saying, ‘Can you buy me out (of the business)?’” Sheree said.
“And it’s like “No. I can’t risk anymore, we are too highly geared in this, I can’t risk anymore.
“I know in life there are seasons of pain and trauma and challenge, and that was just the season at the time.
“So that (was) when Dad said, ‘I want out, I need an exit.’ By then my husband’s now saying, ‘I need to get out. I don’t actually physically know if I’m going to survive this if I don’t somehow get rid of some of this stress’.”
At that point, selling Udder Delights was on the agenda and it wasn’t as easy as it may sound.
Sheree had to come to terms with the decision. And then when a buyer emerged, Japanese giant Snow Brand, the stress kicked off yet again.
“I liken selling a business to dating, to getting engaged, to getting married, to consummation, and every single step there’s a month at least in between,” Sheree said.
“I remember we weren’t even married, and the bill by then was probably $200,000. Then we got married and the bill was probably $300,000, and by the time I call consummation, actually money changing hands, the whole transaction cost us close to half a million dollars, and that was just out of our cashflow.”
Ultimately it paid off. The Sullivans sold 90% of the company to Snow Brand for $14 million, and remain involved in the business albeit with much more balance and a lifetime of lessons under their belts.
“I think my favourite quote is, ‘Don’t envy what someone has because you don’t know the price that they’ve paid’,” Sheree said.
“I hate people saying, ‘Oh, you’re so lucky,’ or ‘I’m just really jealous’, and it’s like you actually don’t know the cost that’s been involved.”
Listen to the full interview here.
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