Launching a business on the eve of the largest economic downturn in living memory would usually be a sure fire guarantee of failure.
While there are exceptions to the rule – Microsoft being a case in point – trying to get a business off the ground while everyone else is battening down the hatches means the odds are stacked against even getting through the first 12 months.
So it is all the more impressive that despite launching his company less than a year before the collapse of Lehman Brothers, Nikhil Nathwani now finds himself at the helm of arguably one of the UK’s fastest growing companies.
While September 15 2008 will go down in corporate history as the day one of the greatest names on Wall Street filed for bankruptcy, a far more significant date for Nikhil and his incredible success story is July 1 2007.
This isn’t the day he launched his company – that would come a short time later. This was the day that a ban on smoking in all enclosed work places came into effect in England, the catalyst for a business that next year is set to be turning over around £1 million a week.
At the time the ban came into effect, Nikhil was working for the family business and running a bar with Shisha pipes in Leeds. He was tasked with finding ways to accommodate their smoking customers.
As smoking bans began to be rolled out across the world, the development of acceptable alternatives was gathering pace and Nikhil travelled to China to examine the fledgling technology of electronic cigarettes.
With his eyes open to the opportunity in front of him, Nikhil saw the potential for a massive future for e-cigs and Nicolites was born.
In the six years of its existence, the turnover of Nicolites has been nothing short of staggering. In 2011 the company turned over £600,000 and then last year this rose to £6 million. In 2013 sales topped £23 million and are forecast to rise further – and it is easy to understand why.
Smoking may have been in decline for decades as the impact on health of the 4,000 different chemicals contained in burning tobacco has become increasingly apparent but it is still a multi-billion-pound industry.
However, as the costs have risen and public opinion has turned, more and more smokers are trying to turn their back on tobacco and electronic cigarettes – which look and feel like real cigarettes but are battery powered and contain a nicotine solution which is inhaled as a vapour – are helping smokers switch from tobacco.
It has not always been an easy journey for Nicolites – spearheading a new technology under the noses of some of the world’s most powerful corporations and in the teeth of a global economic meltdown is not for the faint-hearted.
Helping guide Nikhil through this early period for the company was his father Harish, a successful businessman in his own right, and even more importantly his uncle Nilesh Nathwani and his business partner Parag Khiroya, the owners of a pharmaceutical company.
With their expertise in the sector, Nilesh and Parag helped Nicolites accrue the necessary accreditations and licenses to become one of the first suppliers of e-cigs to the UK market with both of them going on to join forces with Nikhil and take a stake in the business.
Further work in this regard is likely in the coming months and years as the European Union introduces a Tobacco Products Directive which will bring new regulations for e-cigarettes, a move welcomed by Nicolites which it hopes will help to underline the health benefits of e-cigarettes compared to tobacco.
A number of companies have entered the e-cigarette market in the last five years but none has enjoyed the success of Nicolites. A recent survey by Epos Data Facilities Management (EDFM) – experts in the UK Fast Moving Consumer Goods (FMCG) retail sector – found that six of the company’s products – which include menthol and cherry flavoured cigarettes and an electronic cigar – were in the top ten selling e-cigarette products in June 2013.
Nicolites are also stocked by more retailers then any of their competitors. You’ll find them at Tesco, Asda, Sainsbury’s, Superdrug, Co-op, and WH Smith as well as more than 10,000 independent pharmacies and convenience stores.
It is hard to comprehend how far Nicolites has come in such a short period of time and it is a market that is set to continue to grow.
It may have been a business launched in the eye of a global economic meltdown but the numbers would suggest that this is an industry as recession-proof as its tobacco-based counterpart, which has traditionally seen record sales in times of economic depression and investors taking shelter in their stock during stormy times.
Nicolites has proved itself to be the exception to the rule and with green shoots of recovery beginning to appear, and the Chancellor declaring that the economy is no longer in intensive care, the sky really is the limit for a Birmingham business very much in the ascendancy. For more information please visit www.nicolites.co.uk.