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Posts for June 2011
The Apprentice: snap and snappier
June 29, 2011
Missed the ninth episode? Catch up here
The task
Zoe hates Melody. Melody hates Zoe. Actually, I suspect Melody hates everyone, but this week was all about the battle between two strong personalities. It was like Big Daddy vs Giant Haystacks all over again (Zoe is Giant Haystacks, naturally – hair all over the place). And, like those theatrical tussles, there was only going to be one winner: Melody, bloated by ambition, won’t allow anything to knock her down.
The task should have been fun – invent an original idea for a biscuit, make it, brand it and flog it to three of Britain’s biggest supermarkets. Sweet. Lord Sugar divvies up the seven survivors: serial winner Helen is on Venture, along with Jim and Natasha. Zoe and Melody find themselves side by side on Logic; the seeds are sown. Oh, Tom and ‘little’ Susan are in there somewhere, too.
Zoe instantly mows down Susan in her pitch for leadership, citing her experience in the food and drink industry. She delivers the first blow to Melody by packing her off to Wales with inventor Tom to make biscuits. “Don’t take this the wrong way,” Zoe drawls contemptuously, “but I’m probably happier working with Susie.”
They have only the fuzziest of ideas about their biscuit and none at all about their target market. But they do have a name (BixMix), a strapline (“Snap and share”) and an inventor on their team (Tom). It’s the inventor I’d worry about.
Logic, led by Helen (also from the food industry) and capably supported by Jim (ingratiating) and Natasha (anonymous) is harmonious by comparison. Helen is oppressively efficient and seems more like an android by the week. They go for “Special Stars” – a biscuity treat for kids when they get home from school. Mmm, special. The tagline is contradictory: “The after school treat for any time”. Errmmm.
The best bit
Tom making biscuits. In his element, the inventor showers his team with one crazy idea after another: first there’s the “Mermunchie” (“The emergency biscuit to be eaten in emergencies”), then the “biscuit-within-a-biscuit”. He tinkers and fiddles happily as Melody twitters girlishly about hearts and sharing.
But Melody, whose intellect is hardly her strong suit, suddenly lets slip a shard of wisdom: “I think big and then try to work out the details,” she smirks. “He works out the little, little details and then tries to fit them into the bigger picture.” She quickly kills her insight with the idea of biscuits as popcorn – “Popscuits”, obviously. That “big picture” thing – it’s tougher than it looks.
In the end, they compromise on a biscuit-within-a-biscuit that you can “snap and share” with your loved ones, family, friends, the bus driver, whatever. “Why didn’t you make it snap that way?” demands Sugar. If you have to ask a technical question about a biscuit, it’s not a good biscuit.
The worst bits
The sniping and general bitchiness between Zoe and Melody is actually the best bit. Only it’s the worst bit. But it’s the best bit. It’s riveting. They even argue in the middle of a supermarket as a team of buyers waits for them to start their pitch.
“Melody is a nightmare to work with,” spits Zoe. Melody is sniffily superior. “I’m not used to that sort of behaviour in a public place,” she exclaims. “Oh please!” cries Zoe, in chorus with several million Brits.
The winners and losers
Melody wins the battle, but is scarred – Sugar and his management team noting that, despite her “sense” (eh? She did a roleplay as a sales pitch), she seems to generate a lot of ill-feeling. Zoe’s gone; she may be assertive, but she can’t make a good decision for toffee. It’s a farrago – decent name, decent strapline, terrible product and no idea who to sell it to.
Helen wins. Again. That’s nine weeks in a row. How does she do it? The marketing strategy is confused and Jim makes an astonishing pitch to Asda in which he promises a movie tie-in with Harry Potter. Amazingly, Asda places an order for 800,000 units. “It’s a mega-product” stutters a stunned Sugar.
The ones to watch
Helen. And, yes ok, Melody. Despite her lack of irony, self-awareness, relationship-building skills, sound ideas, accountability and maturity, Sugar seems to like her. There's no accounting for taste.
Helen evades scrutiny once again. She’s smart, efficient, quick on her feet. But at some point, somebody is going to notice that she makes decisions too quickly in the name of efficiency and ends up backing undeveloped ideas.
Business lessons
Just the one, from Lord Sugar himself. “At the end of the day, marketing is all superficial if what’s in the box is rubbish. The most important thing is to make sure that what you’ve got in the box is good value for money.” I’d second that.
Quote of the week
The Welsh biscuit-maker: “You can do anything you want. Never say never in the biscuit industry.” I love this show.
Missed this episode? Watch it on BBC iPlayer.
Lord Sugar’s Profitometer
Sugar’s stock just keeps on rising. The man talks sense, you know.
Don’t obsess about your competitors
June 28, 2011
How much do you know about your competitors?
If you’re busy running your own business, probably not much. Do you know what? That’s how much your competitors know about you as well. Not very much.
The lesson to take away is that in most small businesses and in most industries, your competitors are oblivious to your marketing moves. They don’t see your small price changes. They are not going to react to them.
So the lesson is — don’t obsess about your competitors.
You are not in a life or death fight with your competitors. This is not a game where one of you has to lose and the other has to win.
The only scorecard is how much profit does your company make? How much money do you put in your pocket? And at the end of the day, month, quarter or year, nobody compares your score with your competitors. The only people who really care about your score (income) are you and the tax man.
How should you think about your competition? They are a data point. They are an important data point, but they are just a data point. The only thing that is important about your competition is what your customers and potential customers think about them. That’s it. (OK maybe this is an over simplification, but so what? If you’re a small business person, it’s true in your situation.)
So, talk to your customers. Have conversations with them and in the process work in the following questions: What other products (or services) did you consider? How did you decide on this one? What other sales channels did you consider? How did you decide on this one? This is what we want to know about our competition, what our customers think about them.
PS – price wars do exist, but they are pretty rare. Most companies are too into their own world to even know what you are doing, let alone react to it. Unless you do something “in their face” you will probably not prompt a price war.
Mark Stiving, Ph.D. is a pricing strategist, runs Pragmatic Pricing and is author of Impact Pricing (due out Autumn 2011).
Find out more about business threats like competitors in our dedicated section on SWOT analysis.
The Apprentice: the French connection
June 23, 2011
Missed the eighth episode? Catch up here.
The task
It’s the overseas trip. The call comes in telling them to pack an overnight bag and meet at St Pancras International station. The candidates are excited at the prospect of going to Paris. Meanwhile, the viewers are looking forward to an episode full of dodgy accents and cultural misunderstandings. They won’t be disappointed.
The teams have to sell two British products to retailers in Paris. They are shown ten items, several of which are “transformers” — in other words they are innovative because they do this and they do that. So, there’s a child’s beanbag sofa that turns into a bed, a pop-up postcard that turns into a box of cress, a child’s booster car seat that becomes a rucksack and a bone china teapot that thinks it’s a light.
Ta-da! Is this what passes for innovation nowadays?
Each team has to select two products and take them to Paris where they will pitch to retailing giant, La Redoute and also set up their own appointments with other retailers.
This is how it all shakes down:
On Venture, Helen, Jim, Zoe and leader Susie select the booster seat and a universal gripper device for mobile phones.
On Logic, Melody, Leon, Natasha and leader Tom select the pop-up postcard and the teapot light.
The best bits
This week is all about strong women — Melody and Helen. Both stand out but for very different reasons.
Melody is incredibly aggressive. She know that individuals are going to be judged on their sales performances and once she has set up eight appointments for her team, she refuses to let anyone else do the pitches — and tells team leader Tom that he can make his own appointments. Eventually, she grudgingly gives Tom one of her appointments — probably because she hasn’t got time to do them all herself.
But while she’s strong, she’s also very wrong. Firstly, it’s her that persuades Tom not to take the booster seat — the product that goes on to win a massive order. And she fails to do her homework on La Redoute — despite being asked to do just that — which leaves the team floundering at the pitch.
Helen, meanwhile, does do her homework and she is a complete tour de force at the La Redoute pitch — articulate, persuasive, charming.
The worst bits
All these weeks, I’ve been wondering if Little Susie had hidden depths. This week the answer comes across loud and clear. Here are just a few of her witless remarks:
“Are the French very fond of their children?”
“Do a lot of people drive in France?”
“I honestly know nothing about the French and their culture.”
You don’t say. As Karren Brady says, “That really is beyond stupid.”
The winners and losers
The winning team is Venture. Led by Susie, she is totally eclipsed by Helen who outshines everyone with her assured pitch to La Redoute — bringing in an order for a staggering €214,000.
The losing team is Logic. Tom’s in charge, supposedly, but he is totally bulldozed by Melody who has clearly chosen this week to make a play for the limelight.
Despite Melody’s mistakes, her approach impresses Lord Sugar. You can tell he’s got a soft spot for her when he says: “She is ruthless. She’ll walk over and tread over anybody. She’ll eat them up and spit them out for breakfast. That’s what I like about her really.”
So Lord Sugar has to choose between Tom and Leon — both of whom, it is agreed, need to man up. Tom has failed to assert himself and Leon has excused himself from the task completely — on the grounds that he doesn’t speak French.
After an impassioned speech from Tom about his real-life business success, Leon gets the finger, so to speak.
The ones to watch
Helen is surely the front-runner now. Melody will undoubtedly continue to take no prisoners. The question is, will Tom toughen up? One thing’s for sure, Little Susie’s days are definitely numbered.
Business lesson
- Do your research before any pitch — know the company, their products, the market they’re in and also work out your own numbers beforehand. If you don’t, you not only look stupid, but you are actually insulting the people that have given up their valuable time to meet you.
Quote of the week
Leon: “I can’t be selling cress all day so I’m going to sell the teapot.”
(Do you think you might have chosen the wrong products Leon?)
Missed this episode? Watch it on BBC iPlayer.
Profitometer
This week Lord Sugar made orders of £240,404
20 important lessons you can learn from the real experts...
June 22, 2011
There’s no doubt that the best way to learn about business is from the real experts – people who actually run their own successful small firms. Here is a selection of insightful quotes cut from just some of the businesses featured in our case studies…
1 “Carrying out pre-launch market research is essential. Look for firm evidence of demand for what your new business is offering. Crucially, find out whether people will pay your asking prices” Henry Virgin of Green Boar Organic Tea
2 “Get a non-disclosure agreement signed before you reveal your invention to a potential manufacturing partner. Don’t register your design until your patent is close to being granted” Cara Sayer of SnoozeShade
3 “Retail buyers are notoriously difficult to reach. I had to email, call and send them samples relentlessly. You must keep going until people just can’t ignore you any longer” Matt Horan of Rollasole
4 “Being in full-time employment while setting up or running your business is very challenging. For more than two years, I sacrificed my evenings and weekends to developing my business” Janan Leo of CocoRose
5 “When it comes to borrowing money, I’d advise caution. I’ve made a conscious decision to put profits back into my business, enabling me to grow it organically, without having to seek a loan or investment elsewhere” Claire Willis of SnugBaby
6 “Don’t overstretch yourself – an easy mistake when trying to get a business off the ground. Make lists. I know it sounds stupid but I find I get so much more done if I’ve made a list" April Browne of Crystal Jewels
7 “Don’t let age put you off starting your own business. It’s never too late. You probably have a lot of knowledge, experience and skills you can bring to a new venture” Suzy Kilgour of Walking Workouts
8 “Nurture strong relationships with good suppliers and pay your bills on time. With new suppliers, it’s a case of working slowly to build up relationships and trust with them” Jane Robson of The Fine Cotton Company
9 “If your personal financial liability is small, becoming a sole trader is easier and cheaper than setting up a limited company. Put money away as you go along, then you won’t have to panic when you get your tax bill” Andy Oakley of AO Pro Finish Plastering
10 “When trying to think of a name for your new business, come up with a few choices and ask as many people as you can which they prefer. Find out why they like and don’t the names you’ve shortlisted” Jennie Avramovic of Clevercow
11 “When using Twitter for business, be careful about what you say in your Tweets and what information you link to. Don’t lie, bash the competition or say anything that will reflect badly upon your brand – but that doesn’t mean be boring” Sean Price of iBox-Security
12 “If we hadn’t taken steps to differentiate ourselves, we’d be ‘just another sandwich shop’, which makes marketing even harder. Being different – if you get it right – has appeal” Griff Holland of Friska
13 “When publicising your business, focus your time and money where it’s most likely to have the greatest impact. Use knowledge of your target customers to decide which marketing methods to use” Claudia Kapp of Deadly is the Female
14 “Before they’ll buy from you, a supermarket must feel confident that your business is run properly and has the necessary infrastructure and support. If it were just me making bread from my kitchen table, no supermarket would ever have been interested in my products” Lucinda Bruce-Gardyne of Genius
15 “Provide your customers with a friendly and professional service. Listen to them and aim to continually meet their needs” Ross Campbell of the Exercise Club
16 “We’ve never had any problems with health and safety, because we talked to the relevant organisations before we started the business. We listened to their advice and continue to ensure we fully live up to our legal responsibilities” Natalie Richmond of The Kitchen
17 “You must be tough but fair when negotiating with suppliers. Often you must ask for a better price. Usually, they’ll ask you to buy more, but successful negotiation isn’t just about gaining ground – sometimes you have to concede it” Adam Ewart of Karacha.com
18 “Start your business with as little money as possible. Only buy things you need. If you can’t borrow, buy second-hand or trade-off with other businesses. Be cheeky, too. If you don’t ask, you won’t get” Kerry Hale of FUSE Bristol
19 “Look at your supplier chain. Does it have too many links? Ask manufacturers if they will sell direct to you rather than via a distributor. We doubled our margins on some products by doing this” Will Starrit and Andrew Taylor of Urban Rider
20 “Take your time when looking for staff. Having good people in all areas of is a must. They are the face of your business” Oliver Trezise of The Yurt restaurant
- You can read more Start Up Donut case studies here.
The seven stages of finance
June 20, 2011
The key factor in delivering good mentoring is to understand your own strengths and weaknesses. In my case, after ten years’ in-depth study of the challenges of starting and growing small businesses, my own particular blind spot is finance.
It is not that I do not understand the essentials of double-entry bookkeeping, taxation or cost analysis. It is more the case that when talk moves to these subjects, my eyes glaze over and my mind wanders off to topics of more personal interest, such as sales and team building. If people have challenges in the finance area, I always refer them to someone else, a genuine subject matter expert.
The only finance advice I do provide is to avoid debt wherever possible. While there are many people who are expert at taking on debt and leveraging their businesses, this is a dangerous game for the unwary or over-confident, who can over-extend themselves with disastrous effect.
This might not even be their fault, but a by-product of the recession, an external event caused by some very unpleasant people, many of whom seem to have exited with large personal fortunes.
The best financial advice I give would-be entrepreneurs is to start by running a cash-positive, service business. Even someone with negligible financial skills can determine that the business has had a good week if there is more money in their bank account at the end of it than at the beginning.
So long as you continue this for fifty-two weeks in a year, you have mastered the first of the seven stages of finance. You may never progress past this stage, but remain a successful, self-employed sole trader with a good quality of life.
There will be long hours and occasional crises to knock your confidence, but if you are passionate about customer satisfaction and able to build a small team, you will be able to weather the storms. You might even learn how to use a spreadsheet, which is the simple, second stage of finance.
The third stage is to realise that rather than spending your valuable time collating receipts and issuing invoices, it is more cost-effective to hire a bookkeeper. This almost inevitably leads to stage four, which is to hire an accountant to file the paperwork that the government requires.
Both bookkeepers and accountants are by necessity reactive, dealing with history. As the company grows, it will be necessary to do forward planning, a role typically undertaken by a finance director. Many companies become stuck at this point, as they want to grow but cannot afford a full-time finance director.
Fortunately there are now companies who provide virtual finance directors, who can undertake this role for a day a month if that is all you require. This is stage five, and the same company can also help you to stage six, which is when you finally hire a full-time finance director.
Stage seven of finance is only necessary if you are planning a public listing, trade sale, management buy-out or other significant transaction. This is probably a task beyond your local accountant, so my advice is engage one of the top accounting firms to negotiate on your behalf.
The best firms will also provide personal tax advice to ensure you do not give a disproportionate amount to the government to help pay off the national debt.
My overall advice is always to get the best financial advice you can afford from increasingly expert people as you grow your business. If you do, then you will be able to concentrate on those parts of the business that really excite you.
Originally published in The Financial Times. Copyright ©Mike Southon 2011. All Rights Reserved. Not to be reproduced without permission in writing. Mike Southon is the co-author of The Beermat Entrepreneur and a business speaker.
- You can find articles, tools, videos and more on the subject of finance for small businesses in our Finance section
The Apprentice: "You are marginally worse than Glenn"
June 15, 2011
Missed the seventh episode? Catch up here
The task
This week, the teams have two days to create a “freemium” (that’s “free premium” to the likes of you and me) magazine and sell advertising space to three of the UK’s biggest media buyers. They each have 35 pages to sell with a potential value of £100,000. The biggest seller wins. Simple, right?. Not with these clowns.
Team Venture is led this week by Jim, who is getting more creepy by the task. “I can take their hearts, I can take their minds,” he calmly assures us on his appointment. “I’m good at getting people to do what I want them to do.” Ewww.
Natasha takes the reins at Team Logic, where she displays an impressive capacity to ignore sound advice in her singleminded pursuit of a bad idea, and tread all over people in the process. It’s a lads’ mag, she immediately decides. The team winces and expresses a preference for a business magazine for young professional men. So they come up with Covered, a spectacularly shameless business mag for unreconstructed lads (and Natasha). “Work hard, play hard” is the strapline. Sample finance feature: “Blow your load”. Ewww. “I’m thinking dirty secretary,” boasts Natasha smugly. EWWWWW.
Over at Team Venture, they actually have a good idea: a bright, modern magazine for the over-60s who really don’t feel like they’re over 60. It’s a growing market. Unfortunately, they scupper themselves with the title (Hip Replacement – you’re kidding, right?), a cover design that looks like something that should be pinned to the wall of a doctor’s surgery and a feature explaining how to use a mobile phone. So everything, really. The team loves it, of course.
The pitches are a mixed bag. Everyone recoils from ‘Blow your load’. But Natasha presses on with misplaced enthusiasm. “I feel like I’m back in the 90s,” sneers one buyer. “Men are growing up. You’ve probably alienated 85 per cent of our client base.”
Most buyers, however, light up at the winning idea of a free modern mag for the over-60s. But they are crestfallen when they see the cover. “It looks like Viz have done a magazine for the over 60s. You’ve got someone in a cardigan!”
Incredibly, Team Logic win, despite losing two of the pitches. One of the buyers wants £60,000 of advertising space in their bewildering publication. Natasha is off the hook – for now. So it’s off to the boardroom with Jim and co. for the ritual recriminations, followed by humiliation at the hands of the Bearded One. He’s sounding more careworn by the week. I wonder if he ever regrets getting himself into this?
The best bits
Team Venture’s focus group at a bowling club. Susan is baffled by the whole idea of anyone being over 25, let alone over 60. Surrounded by savvy, funny 60-year-olds whose mental acuity puts the young ‘uns to shame, she asks, without irony: “What about something to do with aiding your memory? Crosswords, little puzzles to get your brain going.” Oh dear.
The worst bits
Team Venture’s pitch to Carat. Offered a deal by one of the most powerful media buyers in the land, Jim refuses to budge from his starting price – it’s the rate card or nothing. The buyer is unimpressed and Jim’s team silently will him to shift. They could have made a big sale; they walk away with nothing. Jim later blames the magazine title for the lack of a sale. Eh?
The winners and losers
Bossy Natasha comes out on top, despite her tired idea, her sordid obsession with dirty secretaries (eww) and her boorish refusal to listen to her target market. She got lucky, possibly because big-spending Carat just wanted to screw Jim for being arrogant.
The big loser? Well, it was Glenn who got fired. “I was wondering if you were one of those people that thought Only Fools and Horses was a business documentary,” snapped Sugar, later adding the cutting put-down: “I’ve never yet come across an engineer that could turn his hand to business.” Glenn figured Lord Sugar “just doesn’t want to work with an engineer”. No, mate, he just doesn’t want to work with you.
The one to watch
Sound, sensible Helen. She’s the only one who has yet to humiliate herself and has the happy knack of both avoiding trouble and being on the winning team more often than not. Could be a sleeper, but she doesn’t really grab you, does she?
Quote of the week
Jim, to Susie: “You are marginally worse than Glenn.” Even Lord Sugar snorted at that.
Business lessons
- When you’re pitching a launch product to one of the most powerful buyers in your market and they open the way for a deal, negotiate. Don’t be a Jim.
- Don’t be a Jim.
- If your target market tells you your idea is rubbish, you should probably listen; after all, you are trying to persuade them to part with their cash.
Lord Sugar’s Profitometer
There’s a whopping £105,350 for the value-for-money-electronics supremo this week. He’ll be able to buy an island soon. Or a decent stereo.
Missed this episode? Watch it on BBC iPlayer.
The top five "must read" books which will help you grow a business
June 15, 2011
There are hundreds of business books available and many of them say the same things but I have yet to come across one which doesn’t have at least one gem of wisdom in it somewhere. However, reading them all is not really possible! After a quick poll of my Twitter followers I have compiled a short list of five “must read” books and we welcome any more suggestions below.
Freakonomics / Superfreakonomics by Stephen J. Dubner/ Stephen D. Levitt
These two books are my personal favourites and use different and interesting scenarios to look at “The Hidden Side of Everything”. I found these books very useful from a business growth angle in the way they offer a different perspective on why people are motivated or driven to do certain things. The reason why customers buy something is an extremely powerful piece of information in business. Two very easy reads and very thought-provoking.
Rules For Renegades: How to make more money, rock your career, and revel in your individuality by Christine Comaford-Lynch
This is in essence the career story of a very successful woman who didn’t always follow the conventional rules of business. It’s another interesting read and contains a lot of very easy to implement ideas and approaches if you are looking to grow your business.
The E-Myth Revisited by Michael E Gerber
This is the book that almost 75 per cent of the responses I got through Twitter recommended. Personally I found it hard work — there is a lot of stuff to take in, although there is no doubt that it makes complete sense and is an absolute must for any list such as this. The book is based on the logic that the traits that make entrepreneurs into entrepreneurs are traits that don’t make good business people and it offers systems and ideas that will help them with that transition.
Rework by Jason Fried and David Heinemeier-Hansson
This is the only book on this list that I haven’t read yet but it is on its way from Amazon as I type. It was recommended by Michelle Rodger of Tartan Cat and she knows what she is talking about. After reading many online reviews of the book I couldn’t leave it off this list. In a similar fashion to Rules For Renegades, Rework challenges conventional business rules and will make you uncomfortable with some everyday practises. To grow a business effectively in the current climate it is necessary to look outside our comfort zones. I am looking forward to the sound of this book coming through my letterbox soon.
Crush It by Gary Vaynerchuk
This is a book that came highly recommended but took me a long time to get round to as I felt it wasn’t aimed at either my client base or me. I was very wrong. It does seem to be angled at people who are unhappy in their jobs and encourages them to take their passion and turn it into a business but the principles, ideas and rationale behind them are very relevant and powerful for any small business aspiring for growth.
A massive thank you goes to all who contributed ideas for this list through Twitter including Tim Barlow of Attacat, Kevin Ashcroft of OCD, Dan Frydman of Inigo Media, Michelle Rodger of Tartan Cat and the guys at Kennedy and Co.
And finally a special mention has to go to Dr Richard Norris, his new book “Hoof it!” is certainly worth a read.
Craig McKenna is a managing partner at The Growth Academy.
You can follow Craig (@Craig_McKenna) and Start Up Donut (@StartUpDonut) on Twitter.
- Read Matt Bird of Stinky Ink's blog post "Three start-up books you should read"
Happy Birthday: reflections on starting an agency in a recession, one year on
June 13, 2011
We’ve just had our first birthday – a very big moment for us all!
While waiting for our bottles of champagne to arrive at our birthday celebration, I thought about the past year and what I could have done better or differently.
I have been asked many times how I made the leap into setting up my own sponsorship agency, so I thought I’d jot down some of my tips as a birthday gift to all those thinking about starting up any service-based.
Tip one: Understand your agency’s value proposition
Without a full understanding of what your business does, it’s going to be next to impossible to explain, let alone convince others to buy into your service. Clearly identifying what it is you do, who you’d like to work with, and knowing what you can’t/won’t do is incredibly important. Do your research and find out what else is out there and what your competitive edge is. And then, as someone I regularly go to for business advice says, “Make sure you can explain all this in an elevator between the ground floor and arriving on the first floor or else forget it.”
Tip two: Use a cash flow
The number one failing of a business is not having enough cash flow. Not only understanding how to put one together, but also using it to identify how to develop and grow your business moving forward.
With an educational background in finance, I thought I understood this fairly well, but a textbook understanding of cash flow and how it actually relates to your business turn out to be very different. I’d highly recommend speaking to someone who has done it before and get them to help you tailor your cash flow to reflect your business objectives.
Tip three: Shout about what makes you unique
If you are considering starting out on your own, I am assuming you already know what will make you different from your competitors. If you don’t know, then it might be worth reconsidering whether or not you should be going it alone.
When you do know what you do better than the next guy, make sure to tell everyone you know. This can be through your website, word of mouth, articles, profiles, credentials, your company blog and actively using social media such as Twitter. Your unique selling point won’t ensure you’ll land every client that comes along, but it will help you get your foot in the door.
Tip four: Outsource
Working until the wee hours of every night for the past year has not been my idea of fun, but I did anticipate it and assumed it was part of starting your own business. However it did takes its toll, especially on tasks that I wasn’t particularly good at – such as invoicing and filing. I finally made the decision to outsource some of our non-core activities and it has made a world of difference – allowing me to work on what I do best – being creative and building relationships between brands.
Tip five: Love what you do
It is not always easy working in sponsorship and there can be a lot of rejection – both from prospective clients as well as prospective sponsors. If you don’t love what you do, then you won’t make it past the long hours and what seems like an extraordinary amount of copywriting that I never knew existed (website, blog, articles, emails…) to find yourself sitting in the VIP room at the Hammersmith Apollo realising that you helped build this.
Jackie Fast is an expert contributor to Marketing Donut and managing director of Slingshot, a specialist sponsorship agency.
You can read more about opportunities for sponsorship on Marketing Donut.
Be brave enough to invest in your business
June 10, 2011
Inspired by a post called Be Happy it’s Not Easy I read on Sarah Petty’s Joy marketing blog site, I wanted to share my thoughts with you about free marketing.
There is no shortage of experts who will tell you not to waste money on a website or smart brand identity – having you believe instead that social media will catapult your business to financial success alone. And there is probably no denying that somewhere out there, someone will have made their first million (probably selling info products) in spite of their “horror show” of a website. But they’re the exception, not the rule.
A powerful brand identity and website will attract the right sorts of client prepared to spend what you need to charge. It will differentiate you from your competitors and it will help you stay memorable. You can’t get that sort of design for free. To be honest, it doesn’t even come “cheap”. But the great news is, investing in marketing your business means your competitors can’t copy as easily as free marketing.
I’m not knocking free marketing. Social media is the lifeblood of my marketing activity – but only in conjunction with a range of activities. And it only works because I take myself seriously.
The problem of not being able to invest in your marketing because you’re not making any money is an age-old catch 22. I firmly believe that you need to invest in your business and get all of this right at the outset and the results will pay dividends. It’s all about being brave.
Ask yourself this: If I don’t believe enough in my business to invest in my brand identity and website, why should my clients?
Fiona Humberstone, Flourish design & marketing
The Apprentice: where there’s muck there’s brass
June 09, 2011
Missed the sixth episode? Catch up here.
The task
It’s time for the candidates to put on their steel-capped boots, slip into a day-glo vest, roll up their sleeves and get their hands dirty. The task is to become rubbish collectors for a couple of days. The teams can charge to take away unwanted stuff but they have to pay to dispose of it too. So margins are tight. The best chance of profit is in selling on the valuable stuff — in particular metals such as copper and steel.
The teams are rearranged again. Here’s how it looks this week:
On Logic and in the red jumpsuits: Project manager Helen, Jim, Melody, Tom and Natasha.
On Venture in blue: Project manager Zoe, Glenn, Leon, Edna and little Susie.
This task has got Del Boy written all over it. The question is — who will be the plonkers?
The best bits
There may be money to be made from rubbish – but it’s a much tougher game than any of them anticipate, and not just physically. Quoting for two rubbish removal jobs gets team Venture all tied up in knots. The thing is, this stuff isn’t junk. A room full of office furniture can obviously be sold on. And some 100-year-old parquet flooring from an old building in the city of London could bring in a bob or two.
Zoe insists on being paid to take it away. Susie wonders if instead they should be paying for the stuff. Zoe sticks to her guns and Susie is left scratching her head, wondering if she has got the “completely wrong end of the stick”. Laurel and Hardy spring to mind.
Meanwhile team Logic offers to take both lots away for nothing. Not surprisingly, they get the contract.
At the end of day one, having lost both contracts, Zoe has a Damascene conversion. She got it wrong. Here come the tears. Meanwhile, little Susie says somewhat dreamily, “So I’m not stupid then”. Mmm.
The worst bits
What are team Venture up to? Well Jim and Tom are driving around the London suburbs and Jim is tannoying terrified people in their own homes in his Northern Irish twang. “Number 73, house number 73, with the skip outside.” Honestly, would you come out?
As ever, the candidates are shown up by the experienced wheeler dealers they have to negotiate with. Our innocent would-be apprentices are like lambs to the slaughter when faced with canny operators like the builder that dumps loads more rubbish on the pile when they’re not looking — and after they’ve agreed a price to remove it. He doesn’t even deny it on national television. In fact he admits it. He tells Tom, “I’ve had a result then”. Ouch.
The winners and losers
And so to the boardroom. It’s a tight finish. Helen's Logic makes £712, beating Zoe's Venture (£706) by a whisker.
So team Venture shuffle down to the Loser’s Café for a debrief. Leon, Glenn, Susie and Edna hang their heads and mumble, all hoping Zoe won’t pick them. This is not the time for recriminations.
Back at the boardroom, Leon and Glenn are free to go and immediately Edna and Susie are like guard dogs that have been let off the leash. And Zoe is their prey. But she handles it pretty well — she admits her mistakes and points out that at least she was prepared to step up and manage the team when no-one else wanted to do it.
This week, it’s clear that whatever they do during the task, the fate of the candidates is definitely decided in the boardroom. Zoe plays it straight. Susie whines and looks lost. And Edna tries to take the credit for all the good stuff that went on during the task. But it’s all talk. How can she impress Lord Sugar? She resorts to mentioning her MBA. Later she says she has three degrees.
The Three Degrees. Didn’t they sing, “When will I see you again?”
Edna, you’re fired.
The ones to watch
By this stage, you’d expect the front-runners to be emerging. But it’s still anyone’s game. Sadly, I think this reflects on the poor calibre of this year’s bunch of candidates. There’s no Stella that’s for sure. But if pushed I’d say Tom, Melody and Helen were the ones to watch. And maybe Zoe.
Business lesson
- Actions speak louder than words — don’t try to impress Lord Sugar, or any other successful entrepreneur for that matter — with academic qualifications alone.
Quote of the week
Edna: “I train chief executives how to be better at their job.”
Nick Hewer to Lord Sugar: “Do you need training?”
Lord Sugar with a sigh: “No, I don’t think so.”
Missed this episode? Watch it on BBC iPlayer.
Profitometer
This week Lord Sugar made £1,418.00
How to combat the stress of starting a new business
June 08, 2011
Life can be stressful at the best of times, whether it’s caused by work, family or just day-to-day activities. Indeed, recent research suggests one-in-ten British workers are stressed from the time they awake to the time they go back to bed.
It’s a wonder at all that anyone would want to start their own business in such a stressful world. But what steps can you take to minimise the inevitable stress once that first period of enthusiasm has been drained and the first challenges arrive at your doorstop?
1 Manage your paperwork
One of the most depressing realisations is that invoices and bookkeeping won’t sort themselves. While not the most glamorous of tasks, it’s amazing how much stress you can relieve simply by keeping on top of the paperwork.
There are not many more soul-destroying moments than finishing a hard and challenging day, only to cast your eyes over a mountain of paperwork you know needs to be done. Make sure to include admin in your schedule; never let it mount up and you will soon cut out one of the major causes of stress in a start-up.
2 Find a sympathetic ear
People don’t realise how lonely the start-up world can be. With no one to celebrate the significant business achievements with – or discuss problems – you can quickly feel isolated. This can be compounded by family craving more attention (which is in no way a bad thing). It’s unavoidable that the first few years of a new business will dominate your time and energies, so it is crucial to minimise the adverse effects on relationships at home.
Having a business mentor, or a friend as a sounding board (someone who perhaps runs his/her own firm), gives you support and a third party’s perspective, and helps to maintain your sanity.
3 Manage your cashflow
Start-ups are not just lonely from a personal stand point, but lonely on the financial side, too. Once cash runs short it really is amazing just how quickly a bank manager’s interest can change.
Teach yourself how to forecast and plan your business’s cashflow. Not only will this skill get honed with experience, adding another tool to your skill set, but it is also a brilliant way to limit stress. This ability to maximise return on investments and budget for future activities has a knock-on effect in so many business areas that I really cannot oversell its importance.
4 Remove technology stress
Technology is a big cause of stress. It’s great till it goes wrong. A Stinkyink.com survey in May 2011, of 3,000 workers, suggests that slow internet, computers crashing and the printer running out of ink or paper sees people feeling harassed for an average of 56 minutes each day.
Many entrepreneurs aren’t interested in how technology works and are unlikely to have an in-house IT person. The options are to find a user forum via Google where you can pose your dilemma and seek DIY help, or hire a computer specialist, again located via a search. Do ask for references and check whether the person/workshop charges by the hour or by the job as sorting IT problems can be very time-intensive. And back up everything externally and create a “restore point” before handing over your kit.
Nothing in life worth having is easy, and you’ll ultimately need to work harder than you ever have before to make it succeed. Following my suggestions above will help you limit the damage this stress can cause and make that future seem a little bit brighter.
Have you found any specific ways to limit your stress? Something that could be of benefit to others? Comment below and let us all try to make the start-up environment just that little bit more comfortable.
Essential advice for new businesses
June 07, 2011
My business partner Chris Hyland and I are mates from university and we setup 4Ps Marketing three years ago. Now we employ 25+ people and service 40+ full-time clients. All good headline facts, but for Chris and I, it’s always about learning and improving our business.
We talk about the business seven days a week and probably drive all our friends and family crazy but we love it. I thought I’d bash out 10 really important lessons we’ve learnt.
1 Listen to experienced people
I don’t mean this to sound ageist or hairiest, BUT a major reason behind the success of our agency has been the free advice we’ve had from our friends. Successful people who have been in business for a while have probably encountered most of the issues you’ll face and they can help. Sometimes it takes 30 seconds listening to them on the phone and you are over the hurdle. Job done.
2 Listen to your team
They are the eyes and ears of your business. If you employ intelligent people, you should listen to them. Some of the best ideas we have implemented came from our employees.
3 Make your own decisions
Chris and I take a lot of advice. The people advising you no matter how long they have been in business will not be in possession of all the facts. Listen and then make your own decision.
4 JFDI
There is a time for talking and there is a time doing. Make a decision and get on with it. As long as you are not risking the future of the business you will learn from it – win, lose or draw.
5 Know which customers to avoid
This sounds controversial, but from time to time the chemistry between customer and supplier just doesn’t work. We’ve done this only twice in our business life and it has been for the best for both parties. We would probably flag a client for this if they were:
a) Not profitable Even if a client is giving you nice monthly revenue, it can quickly become unprofitable for many reasons. If it isn’t profitable and you can’t find a resolution you need to act.
b) Abusive On the rare occasion you may get an abusive customer who is aggressive to your team. From our perspective, life is too short to be in this type of relationship.
6 Get your pricing right
Wining business is easy if you discount. Don’t compete on price or your new client will value you for only one thing. Price.
7 No matter how tempting – don’t continually give away freebies
On a few occasions we have given out new services for free as added value. In reality, as soon as we have given a service away for free the client hasn’t valued it and it has prevented that area from becoming important to the client. We do give away the odd introductory audit, but we do it less and less these days.
8 Don’t try to do it all yourself
This is the most obvious of all points, but if you don’t delegate, you won’t grow. A major part of our success can be attributed to our core senior management team. Without them running our day-to-day activity, we wouldn’t have time to develop the business.
9 Realise the importance of your customers and staff
Your business is nothing without either. Love them, hold them and cherish them.
10 Get a life
Enjoy your weekends. Have a few beers on a Friday night and then switch off. Although I sometimes find this hard, not focusing on the business at weekends enables me to come back fully refreshed on Monday.
Matthew Phelan of 4PsMarketing
A version of this post originally appeared on the 4Ps Marketing blog
A great place to work
June 03, 2011
Company bosses often set a key corporate objective to ensure that they gain a good listing in the league tables of those organisations judged to be the best places to work.
Those who organise the lists helpfully define the criteria for success, so aspiring companies can implement the best practices of the best companies and then persuade their people to affirm that they are indeed happy and are treated well.
As an entrepreneur, I often meet highly motivated people working in small teams. In larger organisations, particularly the public sector, the picture is not nearly so rosy. Even those who have escaped the current round of cuts can later feel guilty and de-motivated despite working in a relatively stable environment.
The best example I know of a company that knows how to recruit, motivate and reward their staff is not a high-powered corporate entity, but a social enterprise: The FRC Group.
Based in the north west, they have a number of operations, including Bulky Bob’s, a van-based collection and delivery service. They will pick up your old sofa, washing machine or other awkward item, re-cycle or repair them, and then resell to low-income families or anyone looking for a bargain.
They are a regular business, providing a valuable service for a tidy profit. What makes them a social enterprise, is that as well as the focus on recycling, most of the people who work there are long-term unemployed, ex-offenders, or otherwise challenged.
You know you are visiting somewhere special as soon as you walk through the door to see a personal welcome displayed at reception. This may seem obvious, but you would be surprised how few companies bother with this simple courtesy.
Shaun Doran, chief executive of The FRC Group explained to me that this not only makes visitors feel welcome, but also it spikes the curiosity of the staff, who are encouraged to engage with visitors as much as possible.
Rather than a standard name badge, the visitor chooses their own name badge, based on the core values of The FRC Group: bravery, creativity, passion and professionalism, another good conversation-opener.
The company’s interview process is well thought-out and focuses on the design of the job itself, its delivery criteria and metrics for measuring success. These are then reviewed by an external organisation, The Reward Group, to determine the appropriate financial rewards for good performance.
Each potential new employee then goes through a “values day” to see where they would best fit in. They are then given the opportunity to convince the interviewers that they are ready and willing to give the job their very best shot.
The induction process is very thorough and their subsequent employment is based on recognition and reward. Their photograph is displayed in a public area with ten interesting facts about the new joiner, and their step-by-step progress constantly monitored and again displayed publicly, with regular praise for a good job done.
But the best confidence-builder is their staff knowing that they have a specific “buddy”, who on their own first day was equally scared and confused, so is always available to put a hand around their shoulder and show them the ropes.
This is just a tiny glimpse into of the well-considered and highly effective methods the FRC Group use to make their company a great place to work. They would be delighted to welcome you to their place to explain how to recruit well and increase the self-esteem of your people.
If you do, you might even make it into the Financial Times’ own list of Best Places to Work one day.
Originally published in The Financial Times. Copyright ©Mike Southon 2011. All Rights Reserved. Not to be reproduced without permission in writing. Mike Southon is the co-author of The Beermat Entrepreneur and a business speaker.
The Apprentice: Alan's dilemma resolved
June 01, 2011
Missed the fifth episode? Catch up here.
The task
Is it really week five already? How has Vince lasted this long? Thank heavens he has, though, because this week – finally – we get the full diluted Monsieur Disneur in all his unremarkable blandness. Yup. He's a team leader. I've waited five weeks for this.
His opposite number is Glenn – sorry, GLENN, AWRIGHT? – who seems determined to prove himself more assertive, more creative and more obnoxious than anyone else on the show. He wins on all three counts.
Their task? Create, brand and pitch a pet food. Vince is magnificently awful throughout. Quite possibly he's more Vince than he's ever been in his life. This is his big moment to show the world he's got what it takes.
“We're creating a product that appeals to everybody!” he proclaims with revelatory zeal. “I want every cat, every dog, every animal you want. IT'S BRILLIANT!” Ok, he wasn't quite as fervent as that, but he was somewhere between limp and mildly assertive and for a second there – just for a second – naaah, just kidding. Then the vet speaks. “You can't feed the same food to every kind of dog,” he explains wearily. “It just doesn't work.”
The view of industry experts isn't enough to put Vince off, though. For the first time in his life he's on a mission. Kind of. Glenn, on the other hand, really is on a mission. “NO GUTS, NO GLORY!” Yes, he actually said that. Glenn is the polar opposite of Vince. It's almost like it's deliberate. Hmmm, I wonder...
Glenn overrides every suggestion of his team, regardless of common sense, sound reasoning or evidence. So 'Catsize' it is – geddit? It's a pun, a play on words. It's a double-entendre. You know, like 'cat's eyes'. He spends most of the programme explaining this to people while they roll their eyes. He's assertive and decisive, though, so that's all right.
So there's branding, there's a TV advert, there's a pitch before ad execs and industry bigwigs. Then there's the boardroom. Lord Sugar presents his dilemma – Venture have created a focused product that could go on the shelves tomorrow, but their advert is dull. Logic have absolute no focus at all, but their advert is quite funny. Come on Sugar, it's no dilemma at all, is it? Glenn wins.
Tom and Vince are on the losing team for the fifth successive week. There's a riveting exchange between Sugar and Jim, who seems to think it's a good idea to argue the toss with the bearded one in his own boardroom. “I've got your card marked, son,” growls Sugar, sharply. Fantastic. Sugar has noticed that Jim has amazing powers of mind control over others. “I don't know why,” he sniffs.
Vince is somewhat easier for Jim to influence, though, and predictably he takes two women into the boardroom, one of whom was the sole team member to perform well. Did I mention that Vince has poor judgement? Incredibly, it's Ellie who is fired, for being generally nondescript. Vince survives! Or does he...?
“I've got the feeling that you're too in awe of other people and that you're playing a risky game,” Sugar tells Vince, almost wearily. “So I think a message needs to go back. You're fired, too.”
NO! NOT VINCE! NO! YOU CAN'T DO THIS! I am bereft. About time, though. He really is rubbish.
Best bit
The dog casting. First, Vince tries to charm the dogs. Vince, these are not 18-year-old girls waiting at bus stops. “What a beautiful dog. Labrador right?” he purrs, urbanely. Pause, while corrected. “Oh, a golden retriever.”
Then he tries to charm the owners. “So what's he been in?” he urbanely enquires of a particularly bored sounding Jack Russell owner. “A few adverts, Midsomer Murders, the usual sort of thing.” Sniff.
Next, he tries to be professional and dynamic.
Vince: “Can we have the dog on all fours?”
Owner: “Standing up, you mean?”
Vince (desperately trying to recover): “Yeah, yeah, standing up.”
Comedy gold.
Worst bit
Almost everything involving Glenn. When he wasn't boasting about how CREATIVE he was, he was browbeating colleagues for not showing him enough RESPECT. He was also PATRONISING, ARROGANT and EGOTISTICAL. He probably thinks those are good things.
Winners and losers
Are you kidding me? You think anybody came out of this well? Ok, Tom displayed his customary common-sense, accompanied by his customary lack of charisma. Natasha, surprisingly, did well. I guess Glenn was the biggest winner, though.
No doubt about the biggest loser. Sugar has Jim in his sights: “I don't know what you're made of, mate. Is it brains or is it b*llocks?” Jim - he's marked your card, son.
Business lessons
- You can't feed the same food to every kind of dog. As Karren Brady said: “You might as well have called it 'Any old dog'."
- Know your facts when giving a presentation. Leon was dreadful: “Omega 3 is good for err.. it's good for the brain. It's good for cat's brains. Ahem. I don't really know why. Cough. Sorry about that. Hem.”
- When in doubt think, “What would Vince do?” Then do something else entirely.
Quote of the week
“I felt we were just in our infancy in terms of what I had to show Lord Sugar.” Vince, we'll miss you.
Missed this episode? Watch it on BBC iPlayer.
Lord Sugar's profitometer
You think you can profit from firing Vince? Oh, you've blown it now, Sugar, you've really blown it now.
Start your own web-based businesses
June 01, 2011
Looking back on all the ventures I've started or been involved in for the past 10 years, they all have one thing in common – they have all been internet businesses, mostly selling web-based software as a service.
It's not that I'm naturally a technical person. In fact, when it comes to DIY I'm the sort of person who will hammer a screw into the wall to save going to the hardware shop to get some nails. I couldn't write a single line of PHP code. I hardly know any Linux commands and yet most of the servers running my current email marketing business, Message Horizon, are based on Linux. I have no interest in learning these tools either. There's no need to. The most important thing for an entrepreneur starting a web-based business is to understand and research what the technology is capable of doing, and even more importantly – what its limitations are.
There are plenty of techies out there who really know their stuff. Let them build the technology. Make sure you team up with the best technical people you can afford. A word of warning, however – pick ones you think you can work with. The ability to get on with your technical people is key, as I’ve found they can be slightly arrogant when dealing with those of us who are less technical than them. If you spot one of these, avoid them at all costs – otherwise they will quickly drive you to despair.
So, why would a non-technical person be so heavily involved in web software businesses? The main reason is they make great businesses. They have all the key ingredients that make business fun and rewarding.
- They are only limited by your imagination. You can make software do almost anything with a computer. Whether it's automating your social media updates, sending email newsletters, taking online payments or powering data searches, your software does what you want it to do.
- A software as a service can produce recurring revenues, similar to subscription payments. This is the holy grail of any business. If you can build a decent base of clients paying you on a recurring basis then you're well on your way to having a stable, profitable business.
- They are scalable. You can start very small with a prototype and add layers of complexity and more processing power as you grow.
- They can make very low-cost start-up businesses. You don't need stock, premises, or even full-time staff. You can run them from home.
- They can be automated. Your website can do most of the selling for you. Some web businesses require very little customer pre-sales negotiation, if any. Payment and fulfilment can be handled automatically.
- Your market is international.
- You can add complementary services and build a portfolio of linked businesses.
The best way to start a web software business is with a basic version, which you develop according to user feedback. Over time the product will evolve into something customers actually want, rather than your own interpretation of what they need.
In terms of the idea, the key to web software is to automate a repetitive manual task or to simplify a very complicated one. Find a “problem” and make your software provide the solution. Take inspiration from your own everyday tasks, whether it be in the management of your website or any other task. Sooner or later you'll come across a requirement that isn't well served by existing tools. You may be already on the way to starting your own web software business.
Jonathan Rodger is managing director of email marketing service Message Horizon.
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