Pre-heat your oven to 180°c (or 160°c for a fan assisted oven or Gas Mark 4) and grease a couple of baking trays with some excess butter/margarine.
Cream together the sugar and butter/margarine until light and fluffy. Add the vanilla & egg, and beat together until combined.
Stir in the flour and mix until combined into a dough.
Divide the dough into 16 pieces (about a teaspoon sized). With wet hands, roll each piece into a ball before rolling in the coconut.
Place each coconut ball onto your pre-greased trays, leaving a bit of space between and gently press each down a little with your fingers. Top each biscuit with a small piece of cherry.
Bake in your pre-heated oven for 10-15 minutes, until golden.
Leave on the trays until cool enough to touch before transferring to a wire wrack to cool completely.
Notes
If you aren't a fan of coconut, use oats or crushed cornflakes for rolling your biscuits in instead.