Having Bank of Ireland as its banking partner helped entrepreneurs Nicola Lyons and Elaine Cross to start and scale their premium sheep milk skincare brand Bánór.
The pair, childhood friends, grew up near Cashel in Tipperary.
After school Nicola became a pharmacist while Elaine, from a farming background, specialised in international food marketing, with a focus on dairy.
Their complementary skill set, a perfect blend of ‘farm and pharma’, inspired them to launch Bánór, a range of soft and soothing sheep milk-based body washes and creams.
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The idea for the business came from a chance conversation with Elaine’s brothers, who run a sheep dairy.
Sitting around the kitchen table they told the pair about all the beneficial properties of sheep milk, which is higher in fats, minerals and vitamins than cow or goat milk, and was traditionally used both for health and skincare remedies.
“Then Elaine’s father came in and told us how shearing sheep gave him soft hands, because of the lanolin,” says Nicola.
It was a lightbulb moment for the pair, who spent the next two years assessing both the science behind the claims and the market opportunity in front of them.
Heartened by what they found, and working with an expert third-party manufacturer, they developed their formulations, which independent testing found had antioxidant, anti-ageing, collagen-boosting and skin barrier-protecting properties.
They launched Bánór, which means white gold in Irish, in 2022, bringing Europe’s first sheep milk skincare brand to market.
Today the brand is stocked all over Ireland, including in Avoca, Kilkenny Design, Shaws, Blarney Woollen Mills and Dublin Airport.
It has a growing direct to consumer business online too. “People often get our products as a gift and go on to become loyal customers themselves,” explains Nicola.
Starting strong
One of the first steps the pair took when starting the business was to open a Business Current Account with Bank of Ireland, a support that helped them build with confidence. With Bank of Ireland, start-ups incur no maintenance transaction fees for the first two years.
“Both our families are with Bank of Ireland, including for the farm,” says Nicola.
They opened a Business Current Account, agreed an overdraft facility and, in their second year, secured a business loan, all critical milestones in the start-up’s development.
“When you are starting out you have to buy a lot of supplies up front. Then, when you start retailing your product, there’s a gap between when you provide it and when you get paid. Good cashflow is really important, and Bank of Ireland has been an essential support for us in bridging those gaps,” says Elaine.
Like many startups, the pair secured grant assistance from their Local Enterprise Office in their first year. “But it’s often in the second year that you most need that additional banking support, as grant funding and the personal money you put into the business gets used up. Bank of Ireland has been an amazing support,” she adds.
Having good credit facilities helped in other ways too. “The business loan allowed us to buy in bulk from our suppliers, and the higher the order quantities you place, the lower the price you pay,” she explains.
Suppliers tend not to extend credit to start-ups.
“When you’re starting out, you don’t have a relationship with the factories you are dealing with, or the trust. They don’t know who you are because you haven’t been in business for years. It typically means you must pay up front for goods, as well as having to pay more for those smaller order quantities,” adds Nicola.
“So you’re paying more to order less and can’t yet benefit from economies of scale. It’s why good cash flow is so important.”
Having the Bank of Ireland overdraft in the background provided a layer of comfort. “It allows you to dip in at certain times if you need to. As a small business there are always unexpected costs, or opportunities that we mightn’t have budgeted for. It’s both a buffer and a safety net,” says Nicola.
Supporting growth
Currently Bánór’s biggest overheads are the cost of sheep milk and the cost of third-party manufacturing. “Our products are manufactured in Ireland which is something we’re very proud of,” says Nicola.
But establishing any high-end brand requires additional expenses right along the supply chain, each of which adds to the cost of production, so strong financial management is key.
“For example, all of our ingredients and all of our packaging is premium, featuring beautiful illustrations and photography, of imagery based around the Rock of Cashel,” says Nicola.
And, while the pair initially packed orders themselves, as sales grew they had to take on a third-party fulfilment company. All of this eats into margins but ensures greater efficiency for the growing business and faster deliveries for its growing customer base.
Marketing and new product development are ongoing expenses. The business has grown its range from five products in the beginning to 10 now, plus seven gift sets. “It means we’ve something for everyone and our products are unisex,” explains Elaine.
Their timing couldn’t be better, as research shows milk-based skincare is growing worldwide.
Bánór already sells overseas, but for now the pair is keen to focus on domestic sales, growing their profile here.
“We do have some stockists in the US and UK but for us it’s about making sure Ireland is a solid base first. That will allow us to grow and build our cash flow for a year or two, so that we have the investment required to really develop those export markets,” says Nicola.
It’s why every Euro they make is reinvested in the business and why having such a good relationship with Bank of Ireland is helping at every stage, with dedicated business teams to support them as they grow.
“It has been so great to be able to pick up the phone to Bank of Ireland to see what supports are there, what kind of products and services are best for us, and to get that advice,” says Nicola.
“Financial management isn’t in either of our backgrounds, so we need that support and we definitely get it. Whenever we call, we are put straight through to the experts we need to talk to,” she adds.
Elaine agrees: “And the bottom line is that, if we didn’t get that bank loan early on, at a time when we really didn’t have very many proof points behind us, we wouldn’t be in business. It was a huge leg up for us.”
