BUILDING a strong infrastructure is key to ensuring firms can both grow and cope with pitfalls, one of the country's top entrepreneurs has told Croydon businesspeople.

And if anyone should know the importance of building underlying strength into a company it is Rachel Elnaugh, who made her name by establishing the hugely successful Red Letter Days company.

But her reputation reached another – although this time unhappy – peak when the company crashed with alarming speed in 2005 after 16 years.

It was brought out of administration by Peter Jones, who had appeared on the BBC's Dragons' Den programme with Ms Elnaugh.

Her involvement with the company, which offered tailor-made gift days out called 'experiences', ended when it went into administration.

But she has now rebuilt her career, she told members of Croydon Chamber of Commerce's Executive Club at a lunch in Selsdon Park Hotel last week, by turning her talents elsewhere.

She now mentors businesses and runs workshops to help business owners get the best out of marketing their companies.

Her aim, she says, is to inspire, motivate and empower business people to achieve "personal fulfillment and success".

She said the rise of Red Letter Days from her original idea had been rapid, so fast in fact that the back-up of the company turned out in the end not to be strong enough to support the rise.

Ms Elnaugh said its downfall had virtually been sealed when it was discovered that because of a lack of in-depth support services, £3 million of what were thought to be unclaimed experiences were written off the books, only to find that people were turning up much later than their gifts' expiry dates to claim their days.

Out of the goodness of their hearts, she said, staff allowed the experiences to go ahead, creating cash problems as companies running the events demanded payment.

Ms Elnaugh said: "Because we were so sales-driven, we didn't have a strong enough infrastructure behind us to support the kind of growth which had happened. We were also under-capitalised."

But with the right kind of infrastructure she made it plain there was plenty of opportunities for businesses to succeed.

"You have to have passion and produce something you want to share with people," she said.

"When you are able to give great service and products, that is when you really gain customers and build respect," she added.