Katy Parkes is the founder of the functional and fashionable London-based fashion brand, Dereks Backpacks.
Katy started Dereks Backpacks after moving back to her family home in summer 2013, to plan her future. She made a list of all of the things that she could do, and all the things that she loved doing in order to find her dream job.
Katy decided on making backpacks and ordered 20 metres of theatre backdrop canvas, then started a successful crowd-funding campaign on Kickstarter, and is now a full-time fashion business owner.
Katy always wanted to be a fashion designer and went to what she calls an ‘arty school’ and took subjects directed towards art and design, so she had a creative skill set to support her.
We met up with Katy for some cake at Federation Coffee in Brixton Market to pick her creative brains on what it takes to run a Kickstarter campaign and keep a fashion business running.
How long have you been a full-time fashion business owner?
Backpacks have been my job for a year now. Bookselling had been my main income since moving to London in 2010; in May last year I decided that I’d still do the odd shift in bookshops but I wanted Dereks Backpacks to become my priority.
I enjoyed bookselling and have a huge passion for it, but I always wanted to have a go at running my own business. Luckily, I came up with making backpacks in the first week and then spent seven weeks getting my head around the balance and dimensions of bags.
What was the process when you started?
I bought canvas from a theater backdrop supplier somewhere in Soho, that I found from a Google search. I ordered about 20 meters of plain 12oz canvas, then I screen printed on it, dyed it, and messed around with colour.
When it comes to sewing the bags, I have a very lateral brain. So if someone said: “Can you make a bag like this?” I can immediately picture it in a three-dimensional shape.
How did you know how to screen print?
I have never studied fashion, but I went to a school – Bryanston School in Dorset – that had a good art department where I spent a lot of free time.
How did you start the business?
I was making lots of backpacks and decided to do a Kickstarter campaign. It was the litmus test. If I could put the idea to the public and they gave me the money, then, I needed to buy canvas from a proper supplier and go for it.
I saved up £2,500 from my wages at my job at the bookshop, and then I raised £3,000 from my Kickstarter campaign. Putting that money together made it happen. I didn’t have that much money and I don’t now, but I’m still doing it. To start your business, you don’t need much money.
It is doable; you just have to want it enough. You have to sacrifice a pint at the pub and a dinner out. Stuff does go wrong, but I have found there’s so much value in just having a go.
How did you summon the courage to do crowdfunding?
I was very ready for it to not work and I knew I could happily go back to the bookselling. I wasn’t asking for very much money, just a small amount to experiment a bit further. I presented it as a risk-free idea to see what people thought; therefore I didn’t put a lot of pressure on myself.
When I did my campaign, I assumed that it would be my uncle, or my aunt or second cousin donating, but most people that funded me were serial ‘Kickstarters’ that had been involved in more than 50 projects previously and thought Dereks Backpacks was a cool idea. I was really surprised by that, and I received 90% of my funding in the first two days.
I have been thinking about doing another one, because I think it is amazing publicity – you can share your story with interested and philanthropic people, and I want to expand the business. But I’m more nervous to do it again, because although the idea is more fully formed now; this is now my daily income and livelihood, and so much more of my personality is now involved.
What did you offer people who donated to your Kickstarter campaign?
People who donated £5 got a thank you note; a £20 donation got you a laptop case; if someone donated £50 they received a tote bag, and the bigger donations received backpacks. If I did it again, I’d still do laptop cases because they are so easy to make and people will quite happily donate money to get a laptop case.
Did making the extra items for those who donated not set you back, time-wise?
Well, you only get the money that you’ve raised at the end of the funding period, and because I did it in the run-up to Christmas, it was a horrible December! I didn’t have the money to buy the canvas for the bags, so in the end, I borrowed the money, knowing that I could pay it back immediately, because I had 40 people who wanted their bags before Christmas.
What would you do differently with your next crowd-funding campaign?
If I did it now, I would say I need this amount for marketing and this for a sewing machine. When I first did it, I just wanted to make the first 40 bags and asked for enough money for materials. I didn’t put in any budget for anything else. I want to have a marketing budget now, but not to pay for advertising placements. I just want to share my story with people and perhaps collaborate to generate more publicity.
Related reading: The Benefits of Crowdfunding Fashion Start-Ups
Where do you sell your backpacks?
Orders can be placed through the Dereks Backpacks website, and your backpack will then be handmade to order. You can also buy backpacks that are in stock and ready to go, directly from my website. I also stock backpacks in some London shops, such as Hatch in Homerton, and Kennedy City Bikes.
Is there a cost to stock your products in other stores?
Yes, for example with Hatch I paid them a commission and a monthly fee. Then we talked about it and worked out that that doesn’t actually work that well. People don’t decide to buy a £150 bag spontaneously, and in three months I’d racked up fees for my bag just being there. Now we have scrapped the fixed fee and increased the commission, so it’s risk-free for me, which is great for any small business owner.
How do you price for profit?
My bags are handmade but the margin is so small. I currently work with three different businesses, and with all of them it’s quite unconventional how I get paid. This is because the usu
al retail market markup is 250 percent and there’s no way that I could do that and be able to sell the backpacks at a reasonable price.
So with one of the stockists, we have a 200 percent markup, and another takes a commission when it sells, and that works a lot better for me. The tricky thing with wholesale is that I make less money but more bags. But if I stick to trying to get people to buy into my online presence and the brand, I could make quite a good profit but not a huge profit, because I’ve always wanted to make the prices realistic.
If I can achieve 40 percent of my monthly income from the wholesale stuff, which is more regular and generates publicity, and 60 percent from direct sales, I can actually make a living in London.
Speaking of living in London, where is your workspace?
I work from home, so my studio is the sitting room. The most important thing about being a start-up is working out where you can save money. When you do that the pressure comes off, that’s why I work from my living room. I rented a space in Deptford for about six months but decided I could do with saving those hundreds of pounds every month.
But it’s not healthy being in the house all day; living and working. It’s easy to get to the end of a very long day and realise you’ve not been outside once, and you’ve worked late because there’s stuff to do. It can be psychologically challenging. So, friends will come over and work here, because I can’t move around with my sewing machine that easily.
How long does it take from start to finish to make a Dereks backpack?
It takes five hours from nothing to everything to make a single rucksack. The way I cost it up is: labour (£10 an hour) + cost of materials + profit = price of backpack.
So when I do wholesale I’m only ever getting paid for my labour and the cost of materials. The amount I pay myself for labour is above minimum wage but it’s not a lot of money.
I make everything myself, I buy in the canvas from Halley Stevensons in Dundee, the leather from Batchelor & Sons in Culford Mews, and I buy the hardware and webbing from a foundry in the Midlands.
What do you wish people understood about handmade fashion products?
People need to see how it is handmade to appreciate the work that goes into products like mine, and to understand the value of the finished product.
I’m also keen for people to understand that handmade or handcrafted products are not the same as luxury goods. They can go together, but I have noticed that sometimes people assume they are the same thing. There can be very different stories behind two bags retailing at the same price.
Dereks Backpacks is not a luxury brand. It is a small workshop making bags by hand, that are built to last and to not be disposable. My bags are made to be functional and necessary and to look good and not be a fast trend.
Where did the name Dereks Backpacks come from?
I decided on the name Dereks because I wanted the name to be British and anti-fashion. I named it after the coolest person I know, Derek. He is a great friend.
Unfortunately, he lives with Parkinson’s Disease, so ten percent of all of my profits go to Parkinson’s UK. Sadly, this wonderful man’s condition is so advanced that I don’t think he even knows that I’m making bags.
What are you working on at the moment?
Right now I’m working on a backpack that can carry a French Bulldog, and a backpack for a florist that will allow them to carry ten bouquets of flowers: six bouquets on the inside and four bouquets on the outside. That is a challenge because it’s turning out to be a very big bag.
Through my work as a freelance seamstress, I got commissioned to make a wedding dress in April, and that was a nice change. It was at an exhibition at the South Bank Centre called Adopting Britain which was part of a bigger festival called Changing Britain. The festival was a wonderful and thought-provoking celebration of multicultural Britain, without media bias and sensationalist reporting.
Do you put the backpacks through some kind of quality control testing?
Yes, I go for a walk with heavy stuff in backpacks to test how much they can hold. I own three backpacks and use them regularly. I have a great relationship with many customers who are very happy to send feedback and give ideas on how to improve their bags.
Do you offer some kind of warranty or guarantee for the backpacks?
Yes, as long as I’m doing this [Dereks], I’ll fix it. You can’t give a lifetime guarantee to a cotton product, but I can repair the backpacks easily.
Do you do your own PR and marketing or do you use an external agent?
I find it hard to market my own brand because you have to put forward a precise brand identity. The thing that attracts me to this job is that there’s this very basic exchange: someone wants a backpack and I make a backpack. I didn’t choose this job because I wanted to get into social media or PR but it is essential to growing a business, so I am learning and trying to do better.
What steps are you taking to improve your marketing skills?
I prefer to use newsletters and one of them is called Five Good Things, it includes one thing about Dereks Backpacks and four other ‘cool’ things. It’s not too pushy and allows me to share things that I find interesting with people.
I also sign up to a lot of newsletters from similar businesses for inspiration and guidance. The biggest challenge with selling online is building up trust to convert interest into a sale. Everything from the logo to the copy to the photos has got to get across the idea that I am a trustworthy person who is doing a good thing. That is the plan. Instagram is also a great platform for doing this.
I have a BA in History and find it useful when I do my marketing, because when you study History, you always ask why. So with my marketing, I ask myself: ‘Why am I posting this?’, ‘Who am I posting it for?’, and so forth.
How have you attempted to establish your brand through PR and marketing?
My logo used to be something else, which didn’t have Dereks on it, and my colleague from the bookshop raised the subject one day. She said: “If I saw it on the Tube I’d think it was a cool backpack, but I wouldn’t have a clue who made it, or where to get it.”
So, I decided to change it to my current logo, and now if you search for Dereks on Google, I’m number one in the results.
What plans do you have to grow Dereks Backpacks in the future?
I want to grow direct sales, so my aim for the next year is to sell 250 bags direct from my site.
I really want to employ two people as well; it would have to be on a freelance basis though. I’m going to use an app called Nudj to recruit people, because for a couple of years it’ll be on an infrequent basis, and I’d never want to offer someone a zero hour contract.
How supportive have your family been?
I live in south London with my older brother who works in publishing and he puts up with not having a living room because it is now my workspace. I have a close and supportive family – two brothers and a sister. We recently went on a family holiday and everyone brought along a Dereks backpack!
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