Silvery Case Study

Silvery Case Study - bizval

Case study: Silvery’s founders see the strategic value of small decisions

Silvery is a wonderful example of how South African craftsmanship can be taken to the world. Based in Durban, Silvery specialises in hand-crafted jewellery with a personalised focus.

Although Silvery was officially started in 2013, Justin and Vanessa Blake bought the business in 2016 and have taken it to where it is today. After using bizval to obtain a valuation of Silvery, their mindset has shifted.

We like that.

A valuation that validates a journey

As the founders of bizval, we strongly believe that a valuation is a wonderful way to validate an entrepreneurial journey. We know how incredibly tough it is to build a business. It’s so important to step back and assess whether your energy is being used in the right places.

After spending six hard years developing Silvery’s manufacturing process and website, the owners found themselves focusing on cash flow management and the other monotonous tasks involved in day-to-day operations, instead of focusing on the long-term strategy of the business.

This is part of what makes entrepreneurship so tough. Usually, the founders are effectively doing five “jobs” each, by keeping an eye on sales, operations, finances, marketing and human resources! It’s very hard to find time to think strategically. This is the old analogy of flying the plane while still building it.

Perhaps Managing Director Justin Blake says it best when he describes being “stuck in a rut” while focusing on the daily tasks. The thought of valuing the business intrigued him, even though there are no plans to sell shares or raise capital.

Recognising that valuing a company is a specialist skill that requires years of experience to master, he turned to bizval.

So, what is the business worth?

Silvery is a private company, so we aren’t going to tell you. What we can tell you is that the founders were pleasantly surprised, which has certainly put a spring in their steps.

“Instead of undervaluing ourselves, we’ve been spurred into action to come up with innovative ways to accelerate growth. We are thinking less about the short-term impacts of decisions and more about the strategic priorities that create long-term value.”

The team isn’t just focusing on what the business is worth today, but what it could be worth. This is a fundamental shift in thinking that was catalysed by the bizval valuation result.

A five-year plan for “intense value creation”

When you are exposed to the key drivers of value, you start focusing your efforts on the right things. This is the benefit of answering the questions on the bizval tool, as you can clearly see where the focus areas are.

“We mapped out a five-year plan for intense growth and value creation, focusing on the value drivers of the business. This includes access to markets, optimisation of leads in the sales process, cost management and key elements of the business model. For example, just a 0.25% reduction in merchant fees adds R1 million to the value of the company!”

Through using the tool more than once to test different scenarios, the founders discovered that dropping courier costs by R15 per delivery would add over R2 million to Silvery’s value.

Of course, growing a business is about far more than finding cost efficiencies. Silvery has increased investment in areas like high-quality manufacturing and marketing, which will create value over the long-term.

The strategic value of small decisions

“It often takes a considerable amount of time for the effects of actions and decisions to become apparent, so they are not seen as being worth the effort. Consequently, businesses worry more about what can be done in the short-term. I’ve now seen the importance of long-term thinking to push the business towards the team’s expectations for it. The valuation has opened my eyes to the strategic value that small decisions can create.”

Having now engaged a thinking partner to keep them accountable to their goals and give feedback on ideas, the team at Silvery has done everything right to get the most out of the next five years.

Thanks to such renewed focus, revenue is up by 30% and Silvery is entering the UK market with its diversified and impressive product range.

We can’t wait to see this business reach its full potential and we know that regular use of the bizval model will help the team measure that journey.

Check Out Silvery Here