A very stimulating part of my work is supporting and mentoring entrepreneurs with their startup businesses.
After reading through the business plan and interviewing the entrepreneur, one of the fundamentals that I make sure they have is a deep understanding who their target market is, and how they are going to access that market.
When I work with small businesses who are not web or app based, I find it interesting how much reliance is placed on advertising and marketing through direct marketing and media channels, and how little emphasis there is on personal selling.
My partner and I started a distribution business in the hospitality industry, wholesaling everything that was used in a restaurant except food, drinks and furniture. In other words, all the equipment and small items used in a kitchen, a bar and a dining area.
Having started this business without any research at all (this may sound familiar to some entrepreneurs), we found the Johannesburg and Pretoria market very challenging and price competitive and decided on taking a field trip to eMalahleni (Witbank) to see if the market would be more profitable in a smaller environment.
“Entrepreneurs often forget how important they are in
putting a face on the business”
We arrived in eMalahleni early in the morning and went door to door cold calling every single establishment we could find that served some sort of food or beverage. We covered the restaurants, the bars, the corner cafes, the clubs, and the mines, even the supermarkets.
We called on new potential clients solidly for 12 straight hours and the results were interesting. Although we had not closed sales on each and every call, we had made enough to return, profitably, in two days with deliveries.
And that was the breakthrough. Calling on everyone again, two days later, showed we were serious and capable and that our service level, happened to be better than the local competition. We were inundated with orders and requests for quotations.
Putting a face to the business
We were able to open a profitable branch in eMalahleni after three months, with gross profit margins that were almost double what we achieved in Johannesburg and we didn’t spend a cent on advertising, flyers, banners, a big opening bash or any other form of marketing. We just worked hard. Really hard!
The point is that entrepreneurs often forget how important they are in putting a face on the business. A product is just a product, but an entrepreneur is the passion, trust and loyalty in a business.
When the owner of a business calls on you, you are important to him. He has taken time out of his day to see you or phone you. You know that there is no one higher up in the business and the results from those calls speak for themselves.
One of the most powerful statements in business is, “it’s not what you know, it’s who you know”. This statement applies equally to the big deals and the opportunities that can present themselves through a network as it does to creating a relationship with your clients or customers, even if it is just for the sale of six beer glasses. Who knows what will come of that relationship?
About the author: Stephen Read is the founder and CEO of FIELD an incubator programme working in rural and under-resourced areas including Katlehong, Vosloorus and Thokoza. Stephen is also a life-long entrepreneur and now a teacher.