This is part of uOpen’s 'Industry Insights' interview series - a valuable collection of informative and intelligent insights into how some of the UK's best-known and most-loved subscription box businesses came to be and got to where they are - all shared by the very people who made it happen...

Covering customer acquisition to fulfilment, this blog series offers a behind the scenes look at how the many moving parts of these complex, yet successful operations come together each month to satisfy the ever-growing demand of subscription box customers in the UK.

How did the idea for your subscription box come about?

I discovered whisky accidentally when I attended a tasting event with my now brother-in-law for his birthday. I went in fairly unsure about it, but having an expert guide us through a comparison of six great whiskies completely changed my opinion, and I left with my first bottle. The Dram Team aims to box up that whisky tasting experience and help people discover and explore whisky in the same way.

What attracted you to the subscription box model?

The subscription style is great as it allows you to build a great relationship with your customers, as well as offering more secure income for the business.

How did you validate your idea and test the market?

I did a lot of chatting, spoke to people in the whisky industry and so on. The biggest test was our self-kickstarter launch, which ensured we started the business with a reasonable set of paying customers.

How did you acquire your first customers?

Through our self-kickstarter launch event. We did a lot of social media and blogger outreach, and owe a debt of gratitude to a tonne of very supportive friends and family too!

Did you raise any seed or investor funding to help you grow?

Our only sources of funding were our own savings, and the pre-order revenue from our beloved launch customers. We may yet seek funding to help us scale up our production operation, which is still a little too handmade to be practical at this point!

How long have you been running now and what are your most successful achievements and milestones so far?

We've been sending out whisky since August 2016, so heading towards 2 years. I think our biggest achievement remains getting the product to market, given the number of challenges we faced in doing so (between obtaining whisky brand permissions, the Scotch whisky regulations and alcohol licensing, it wasn't easy!). Milestone-wise, we broke even on our costs in our second accounting year, which means we're in a good position to grow over the coming months and years.

With the rise of new boxes launching all the time, what do you see as your USP that sets you apart from your competitors?

Firstly, behind the scenes we're 100% above board, which is hard to achieve - since we only ever work with permission from whisky brands, this was essential, and it's something not all similar businesses take the time and effort to achieve. This is fundamental to our success to date and future growth - as we curate other people's products, we need them on side.

Secondly, we put personal thought and care into everything, and I personally still have a hand in every part of the business, from customer service to packing and shipping. I want every customer to have a great experience, even when we muck up!

Finally, we put aside a decent chunk of budget for whisky. Our stuff is great stuff. And our brand partnerships mean we get great value on the liquid. I believe we're the best value out there for the quality and quantity of drams our customers get to try.

How does your business continue to find new and exciting products to keep your customers engaged and excited every month?

Our curation approach is fairly simple - I think of an interesting theme, and then I pick 6 great whiskies that I would personally love to try. Beyond this, the whisky industry makes it easy - new and fantastic whiskies are released every month, and there are literally thousands available to choose from!

Have there been any particularly pivotal moments so far that have required you to make changes to how you operate?

Too many to go into in detail! I think the biggest ones are still to come - upgrading our bottling and labelling production line, and the outsourcing of our packing and fulfilment. I'm 100% dedicated to ensuring we still offer a personal touch and unsurpassed customer service, so it won't be easy to pass over the reins.

How large is your team? What type of roles do they have?

We are three founders, myself as the original founder and CEO of everything that needs doing, then Greg, our resident whisky expert and well-known whisky blogger and industry consultant, and finally James, an old and dear friend who actually has a full time real job. Greg helps with brand contact and introductions as well as curations, and James is a bit of a techy who contributed hugely during our website set up. Beyond that, my brother Tim does our graphic design and is our primary packing assistant!

Across all operational areas of your business, what do you manage in-house and what do you outsource to external suppliers to support you with - and why is this?

We do almost everything in-house currently. Setting up our own bottling facility in Scotland has given us a key competitive advantage, as this is a big barrier to entry, and most existing bottlers won't touch orders less than 10,000 miniatures (which is nuts!).

Our most important partner is probably DPD, who are our courier. Their technology is unmatched and offers us and our customers excellent service. I think for a subscription box company, choosing the right delivery partner is critical. You have no control once it leaves, and it's the single biggest cause of customer unhappiness in my experience.

Currently, we're evaluating outsourcing of packing (because it's becoming too big for us to handle ourselves) and fulfilment (because I want to free up time to concentrate on other aspects).

What types of challenges do you face with fulfilment, delivery and customer service?

The biggest challenge with fulfilment is the order processing for recurring subscriptions vs. gift subscriptions (some recur automatically, others have to be manually monitored monthly) and the personalisation of orders before dispatch. It's not overly complex, but it takes care and attention to get it right.

For delivery, the challenge is getting great service at reasonable value. Spirit strength alcohol generally can't be sent via Royal Mail, and couriers are expensive. Absorbing that cost within a subscription product without affecting the value for the customer can be tricky, but getting good service is worth it for the better customer experience.

We actually find customer service easy: ultimately, I believe any revenue lost refunding or replacing product is a good investment if it leaves the customer happy. They mainly get in touch with issues, so if you can fix that and leave them surprised at your response, you converted a fan for life, and that is priceless for a business that exists on repeat business and grows via word of mouth (either in person or via social etc). Treat customers like you want to be treated yourself and you can't go wrong.

How do you see the subscription box industry is evolving and what do you believe are going to be your biggest challenges over the next 12 months?

It's mad what you can get via subscription already, and I only see that increasing over time. I also think a lot of businesses will struggle, as I think there is a lot of pressure on a subscription product to be good value, but the cost base is challenging and tends to only increase as you grow and need to pay more people to do things for you (I think a lot of businesses start out very home-made, which is cheap, but not sustainable).

That'll be our biggest challenge: outsourcing to make our business sustainable as it grows, without compromising on quality/experience (very important to us) or sacrificing too much margin (worth some sacrifice for quality, but also important to make SOME money!).

What do you enjoy most about running your subscription box business?

Ultimately, being self-employed and the freedom it gives me, but I think the best thing about the actual business itself is when you get positive feedback from customers. Nothing makes me smile more than an excited whisky fan opening up their box and being delighted by it - I only wish I could be there each time!

What excites you about uOpen, and how do you see the marketplace featuring in your business' future?

I've heard awesome things about the concept and how it'll be marketed, which I think is really promising. I also think being dedicated to subscription businesses offers a product to both vendors and consumers that doesn't really exist in the UK yet, and fills a valuable niche. Many other reselling platforms don't cater well to subscription businesses, so it's exciting to be part of something that does. For us, we hope it'll become a core sales channel and contribute to our growth.