Small is Beautiful: A dog who found a home on the QVC channel

You get the feeling Sarah Spencer is not a great believer in the saying "Let sleeping dogs lie" – but her business literally depends on just that.

You get the feeling Sarah Spencer is not a great believer in the saying "Let sleeping dogs lie" – but her business literally depends on just that.

Mrs Spencer is the forthright founder and managing director of Snoozzzeee Dog, a Cheshire-based business that is carving out a niche providing designer pet bedding.

But it hasn't always been plain sailing. In 1997 when Snoozzzeee Dog was launched, the business run by Mrs Spencer's husband had just folded and the family was struggling to pay the mortgage.

Mrs Spencer had the idea for the new venture after failing to find a bed for the family's puppy, Snoozy.

"I went into several stores to buy a dog bed but there was nothing appealing," she recalls. "[Pet care] was an antiquated business and nobody tried to do anything different."

Mrs Spencer's husband had previously been in the fabric trade and the couple arranged for some samples to be made up, Mrs Spencer having sold her jewellery to pay the initial production costs. Just a month later they took a small stall at the pet trade show Petindex.

The venture was a success – but after receiving £15,000 worth of orders, the fledgling company was left with the problem of how it was going to deliver the goods.

"[The amount of orders] was a shock to us all," says Mrs Spencer. "We decided we would actually have to source the fabric – we basically asked people and drove around."

Despite its bulging order book, Snoozzzeee Dog also had trouble getting backing from high-street banks. Mrs Spencer was forced to use a friend's life insurance policy to guarantee a £10,000 overdraft.

By now, the company had already outgrown the kitchen table and needed space to expand but it was unable to lease or rent without cash forecasts. Instead, the family's garage was converted into offices. The remaining cash was sunk into packaging and brochures for a mailshot.

The gamble paid off. The brochures attracted the attention of a buyer at the home shopping channel QVC.

"That was our big break," says Mrs Spencer. "We went on and sold out continually show after show... we had the public ringing us asking where they could get hold of our product."

By the end of 1998 the company had again outgrown its makeshift premises and rented spare office space from a friend who ran a textile business. Even with Snoozzzeee Dog notching up sales of over £50,000 a month, securing capital remained a problem. But the same family friend who had helped with office space later sold his own business and sank £75,000 into the company.

"It's been hard juggling it all," Mrs Spencer admits. "I think I've aged 10 years. I've been away a lot and it's been tough on the children – and the dog."

Today Snoozzzeee Dog employs over 30 people and has commercial agreements in place in 14 countries across Europe. The company finally got the financial stability it needed in May, after it agreed funding with the merchant bank Singer & Friedlander in return for a 4 per cent stake.

Snoozzzeee Dog also makes cat beds and is now taking its brand into new areas, selling toys and other products for children.

European expansion is continuing apace; the company recently won a £120,000 initial order from Petco of Switzerland and is about to seal an agreement to supply one of Germany's largest pet product wholesalers. With the turnover now around £3m, a flotation is planned in the next two years.

Meanwhile, Snoozy the family pet who provided the inspiration for Snoozzzeee Dog pet beds, is due to have a litter in September. Thanks to her enterprising owners, her offspring should have a comfortable start in life.

Small is Beautiful features fast-growing companies with a turnover of up to £100m.