It’s easy to be successful when times are good. But if the first few years of the 21st century have taught us anything, it’s that the good times don’t last — and it’s critical to know how to deal with the bad as well as the good. Lean, mean and efficient companies that were willing (and able) to adapt when the recession hit survived the downturn.
Some even prospered. After all, one man’s recession is another man’s windfall, provided he knows how to capitalise on an opportunity. But, while many business owners admit that the last few years forced them to improve their business systems and foster a customer-centric approach, no-one was sorry to see the back of the recession. Or rather what they thought was the back of the recession.
If you breathed a sigh of relief, it’s possible you relaxed too early. Economists around the world are predicting a double dip, and while it’s unclear at this stage what the impact will be on the South African business landscape, it’s always better to be prepared, particularly because preparing for a downturn is actually no different from following good business principles.
We spoke to ten local experts about what it takes to launch, run and grow a sustainable business that will prosper in good times and bad. Here’s what they had to say about what you should be focusing on in 2012.
Businesses are living, breathing entities made up of hundreds, if not thousands, of moving parts. We have focused on four core areas that together make up a company: The company’s leadership, in other words the business owner or management structure; the employees of the company; its operational structure; and the marketplace, the buyers of the company’s products or services.
These four areas overlap at any number of touch points, but without focusing on all four, a business cannot grow.
Leadership: For the love of the game
Creating and sustaining a successful business is tough. It takes perseverance, dedication, resourcefulness and passion, not to mention a product or service that the market wants and is willing to pay for. As the leader of your business, much rests on your shoulders. Here are some ideas to apply to your role in your business.
1. Be passionate
Don’t be fooled. Entrepreneurship is a hard and lonely road. If you aren’t passionate about what you are doing, you won’t succeed. Just look at Steve Jobs, who famously said: “I was worth over $1 million when I was 23, and over $10 million when I was 24, and over $100 million when I was 25, and it wasn’t that important because I never did it for the money.”
Yes, money is important, but if you’re an entrepreneur for the money, chances are you won’t reach where you want to go. Passion is vital. Ask yourself why you are doing what you’re doing, and if the passion isn’t there, either find it by changing what you’re doing, or accept that entrepreneurship might not be for you.
2. Be a leader
Don’t get bogged down by the little details. According to Bertie du Plessis, you should spend no more than 50% of your time on the operational aspects of your business, and at least 50% on strategy, which is basically just thinking about ways to improve your business. “You have employees to take care of the operational aspects of your business,” he says. “It’s your job to work on where your business is going, and how you’re going to get there.”
3. Don’t panic
Panic leads to emotional decisions that you could end up regretting. “Knee-jerk reactions can make business owners cut costs in areas they should be growing, not minimising,” says Denvor Phokaners. “As an entrepreneur you are more likely than not heavily invested in your business, not only in assets, but emotionally as well. You need to approach your business with a clear head though, particularly when times are tough.”
Nathalie Schooling has a slightly different take. She says you should ‘panic slowly’. “It’s okay to be concerned about a situation,” she says. “Just make sure that concern does not degenerate into flat-out panic that leads to poor decisions.
Take note of your concerns and carefully develop plans to address them. You’ll be amazed how many apparent worries can actually be transformed into new and exciting opportunities if you take the time to address them slowly and with a level head.”
[box style=”grey map rounded shadow”]
Want to keep growing your business? These are the numbers you need to know about.
Strategy vs operations
Confused about the difference between strategy and operations? Here’s how Bertie Du Plessis explains it.
There are three indispensable features of efficiency and optimisation that you need to execute if you want to remain in business:
- You need to deliver quality
- You need to remain close to your customers
- You need to benchmark to assure that you don’t fall behind your competitors.
Hard core strategy takes the opposite tack. Hard core strategy asks “What if?” questions:
- What if my quality is too good? What if there is a low quality competitor waiting to wipe me out?
- What if I am too close to my customers and
have become blind to what newcomers to the market want?
- What if my benchmarking lets me improve, but in the process I destroy my differentiation in
Hard core strategy questions the assumptions of everyday business efficiency.
4. You can never know too much
Many entrepreneurs start a business based on a particular technical skill. They have been in an industry for many years and have decided to ‘go it alone’. While understanding your industry, market and customer base is incredibly important, business acumen and technical skill are two very different things.
“An entrepreneur who cannot recognise where their skills gaps are cannot fill those gaps, and ultimately the business will suffer because of it,” says Shawn Theunissen. This can be done in one of two ways. Savvy entrepreneurs can hire people whose skills lie in areas they lack, or they can upskill themselves and seek coaching and mentorship. “This is easier said than done,” admits Theunissen. “It’s difficult to evaluate yourself. We’ve worked with entrepreneurs who are open and willing to learn, and others who refused to believe they didn’t already know it all. What we have experienced though is that it’s the teachable entrepreneurs who are willing to learn and ask for help whose businesses are really experiencing growth.”
5. Flexibility and adaptability are key
Without the ability to adapt and be flexible to what the market wants and needs, a competitor could literally sweep you off your feet. “Understand how the business landscape looks around you,” says Du Plessis. “If you can’t adapt, you’re stagnant, and that will eventually lead to a slow death.
Customers expect you to offer them value, and that requires giving them what they need, not only what you currently have to offer.” Adaptability is first and foremost a mindset. You must be willing to be flexible in your offering.
6. Avoid ego-based decisions
“This is not the time to spend on things that make you feel good about yourself,” says Allon Raiz. “Yes, luxuries do make us feel better when times are tough, but spending on frills is never a sound business decision. If it’s not going to boost sales, don’t spend the money.
That goes for everything from signage or the gloss on your business cards to the car you drive and the entertainment of clients.” Raiz is a firm believer that clients don’t expect to be wined and dined — they just want you to do the job well and give them value for their money.
[box style=”grey map rounded shadow”]
Take your strategy workshops to the next level. Here’s what you need to know.
Employees: Staffing solutions
You cannot run a successful and growing business by yourself. Period. “An entrepreneur’s partner and the first two or three members of the company will ultimately determine that business’s success,” says Justin Spratt. “On the whole, entrepreneurs have an over-inflated sense of self.
That’s okay — it’s what makes them entrepreneurs, and it’s a character trait they need when battling against the odds to get their companies off the ground amidst all the challenges that start-ups face. But it’s the most self-aware entrepreneurs who are able to recognise their gaps and hire great employees to help them that are truly successful.”
7. Hire for the right stage
Evaluate what stage your business is in and who you need to take it forward. “The stage of your business determines the skills it needs,” says Spratt. “Look carefully at what you are missing and then start sourcing the right person to fill that role.”
8. Engage with your staff
Even when times are good, it’s valuable to motivate your employees and build a loyal staff complement. It might sound clichéd to say that your staff is your greatest asset, but the cliché exists for a reason. Good employees can make a valuable impact on the success of your business.
“Whether times are tough or going really well, as a leader you need to support your staff,” says Shawn Theunissen. “In good times this means engendering loyalty so that your best employees aren’t lured away by better packages. In tough times you want your employees to stick it out with you, and that takes loyalty as well. You might need to even cut hours or salaries. If you are open and honest with your employees, and they feel you truly have their best interests at heart, they will not only accept these measures, they will support you. They will understand that when the situation gets better they will be rewarded for their loyalty. Great teams can achieve great things, but it’s important that your employees feel like they are part of a team, and that has to come from you.”
9. Inspire your troops
“You need to inspire your troops to fight for you,” says Pavlo Phitidis. “Create an environment that allows (and rewards) people for putting in extra effort. They must get meaning out of their work, and that starts with you. It’s important to keep your employees abreast of everything that’s happening — in the business, the economy and even globally. Don’t let nasty shocks creep in, rather be open and transparent. You’ll be surprised at how much people can handle when they are entrusted with the truth.”
The Business: Your asset of value
Earlier we discussed the fact that entrepreneurs need to be leaders, and leaders should spend 50% of their time on strategy. While this is true — and vital to the growth of an organisation — it should not detract from the importance of operational issues. If a business isn’t operationally efficient, it cannot be an asset of value, and according to Pavlo Phitidis the purpose of an entrepreneur is to build an asset of value. This requires strategic planning as well as strong operational systems.
10. Be organised
Be realistic about what your business can achieve and the amount of customers you can manage, and put systems in place to do just that. If there is a system for everything, you will always know exactly where your business is, and you will be able to realistically scale the business when the time comes to grow.
“Every business can only handle so many customers,” says Phitidis. “If you stretch yourself too thin you will not be delivering a good service. Rather be realistic about what you can achieve and deliver a good service. This will ensure you maintain clients, which in turn will allow you to grow when the time is right. If you are organised, you will also know exactly what is needed to facilitate that growth.”
Shawn Theunissen also recommends having a development map. “It’s important from a business continuity perspective to evaluate where you are and where you are going on a continuous basis. If you are constantly updating your development map, you will not only be extremely familiar with your business’s operations, but you’ll be aware of any threats or opportunities in your space.”
11. Cash is king
The importance of strong financial management and cash flow cannot be overstated. If you don’t know what is happening with your books, and you don’t have money in the bank, chances are your business isn’t performing as well as it should.
“Whatever the size of your business, don’t be intimidated by your accounts,” says Justin Spratt. “As a start-up, your main concern should be cash first. Know exactly what is coming into your account and what is going out. As your business grows and things become more complicated you can flesh out a financial model that works for you, but the core will always remain the same: what is the state of your business’s cash flow?”
12. Drive down costs
You can bring down costs in a number of ways, but the first place to start is by asking the question: Is this adding value to my customers? “The simple truth is that anything that isn’t adding value for your customers is eventually costing your business money,” explains Nathalie Schooling.
However, you need to be careful that you are only cutting costs where you can. “Beware of reactionary tactics that cut back on your means of production,” says Allon Raiz. “When the recession turns you will find yourself in a vulnerable position without the resources in place to take advantage of the upswing. Instead, you need to be more aggressive in your sales, marketing and drive to acquire new profitable business.”
13. Invest in your productive costs
Evaluate your business model and determine where your unproductive costs lie. If something is unproductive, eliminate it, then take those savings and invest them into productive costs. “The net effect of the cost savings should be zero, but change the balance of your spending in your business,” says Raiz. “Do not use the cost savings to pay off debt.
Rather invest in making more sales and then the income you make from that will keep your staff and repay outstanding debt.”
14. Focus on return on investment
The two areas that are threatened during a recession are price and volume. “If the one drops, you need to increase the other,” explains Graham Geldenhuis. “In other words, you can protect volume by offering good pricing. If both are under pressure, you need to reduce your costs. Just make sure that based on which area comes under pressure, put your energy into the factor that can mitigate the risk.”
Ultimately, you want to find and secure predictability. This might mean finding a market that makes less in the good months, but has more predictable cycles. “You need to determine what the risks are that are out of your control, and eliminate them,” says Geldenhuis.
15. Evaluate your risk
Different times present different risks. You need to continuously evaluate where your risks lie. If you can’t recognise them, you can’t mitigate them. Careful evaluation also allows you to deal with them. For example, one of the biggest challenges entrepreneurs face during tough times is whether or not to offer extended credit terms to customers who are struggling to pay.
“Do you let Jack go because he can’t pay you, or do you shoulder some risk to establish a lasting relationship when he is back on his feet?” asks Phitidis. The answer to this question lies in the state of your own business, whether you can afford to let Jack pay later, and how much risk you can tolerate. “Assisting Jack now could lead to a long-lasting relationship in the future,” says Phitidis, “But it’s important to draw up firm contracts if you choose to do so.
“You will essentially be moving from a cash relationship into a debt relationship. You need to agree on the terms of this new relationship, formalise it and then actively manage it. If the agreement is infringed upon, terminate credit and return to the previous system. There is a difference between assisting your clients and working together and being taken advantage of. You have a business to run. Always remember that.”
16. Rethink your business model
Wherever you can, rethink your business model — even at the expense of thinner margins. “You need to be flexible and able to react quickly,” says Phitidis. “Don’t be the slave of your suppliers because you rely on them to deliver a service or product yourself. You are still their customer as well. If they are slack, find new suppliers.
Negotiate with them for good terms, and most importantly, keep your options open. You need to be able to react quickly to service your own clients. If your suppliers can’t assist you in this, they are not adding value.”
You also need to make the decision that nothing is sacred in your business. “Be absolutely ruthless in killing off your most precious service or product if the need arises,” says Bertie du Plessis. “If you could totally disrupt your industry, what would you do? Even more important, what would disrupt your industry?”
17. Staple yourself to your process
Evaluate every step of your supply chain and challenge your processes. “You need to be constantly evaluating your touch points,” says Vanessa Bluen. “What are the experiences of your stakeholders? How do your employees interact with your business? What do your customers think about you? All these perceptions go back to how your business is run. Are you getting the right message across? Are you efficient? As long as you are evaluating your processes, you are able to adjust them where necessary.”
[box style=”grey map rounded shadow”]
Think Business Systems Aren’t Necessary? Think Again
Manage costs judiciously
Here are a few areas where you can address costs (and possibly bring them down):
- Outsource where you can
“Paying invoices instead of salaries means you are only paying for skills and services as and when you need them,” says Denvor Phokaners. “Getting the basics right is key, but you also need those basics to be flexible enough to be adapted when times are tough,” advises Schooling. “The business that masters the art of outsourcing is better positioned to adapt to a changing economic climate than the one that upstaffs when times are good and ends up with massive overheads and staff responsibilities to cover when things go south.”
If you do choose to go the outsourcing route however, it is very important to find partners and suppliers who share your values, passion and service commitment.
- Negotiate with your suppliers
“The key element here is that ‘he who is proactive will win the race’,” says Phitidis. “Start planning for the future now. If you think the economy might dip, talk to your suppliers before it does. Fight for good credit terms and negotiate aggressively for discounts on cash payments. It’s in everyone’s best interests to continue to do business together. By speaking to your suppliers openly and early on, you can both plan ahead. For example, they might be more than willing to give you good terms as long as you continue giving them business. Storms are weathered together.”
He warns, however, that businesses should have good financial discipline before they consider asking for extended credit terms. “This should not be a means to spend more.”
- Partner with your clients
Your clients are more than likely to be dealing with the same issues as you: they are also exposed to risk and they need to cut costs. You can actually help each other. One way of doing this is through retainers if you are a service-based business, or extended contracts if you supply products.
“The cost of selling is expensive and often unpredictable,” says Graham Geldenhuis. “Think of the old adage ‘a bird in the hand is better than two in the bush’. Retainers aren’t always sexy, and they usually aren’t the big money-spinning contracts, but they do provide stability, and they aren’t costing you money. Chasing sales can be expensive, both in time and resources, and then the deal is still not certain. Tell your clients you will reduce your costs and therefore your profits if they agree to a retainer or extended contract. Long-term it might actually save you money, and it definitely gives you stability.”
The Market: Matching your market
So, you have a business, employees and a well run structure. But none of this means anything if you don’t have a market: someone to buy your product. Without customers there is no business. And here is the tricky part, because you not only need something to sell — whether that’s a product or a service — you need to sell something that people want to buy, you need to be communicating your message with them, and you need to keep them coming back for more. One sale does not guarantee a repeat sale.
18. Have the ability to identify an opportunity
Some markets already exist, others are just waiting to be created, but a true entrepreneur will be able to identify a gap waiting to be filled. “The ability to recognise and assess an opportunity is very different from creating a product or offering a service and assuming because you have it, they will buy from you,” says Shawn Theunissen.
“You need to understand your target market. What is the burning need in that market, and how will you fill it?” In order to answer those questions, it’s vital you understand your market.
“You essentially need to become a diagnostician,” explains Vanessa Bluen. “Traditionally, we go into a market with the product or service that we have to offer, and we ask just enough questions of potential clients to be able to match our offering to their needs or business.
Sometimes it’s a pretty tenuous connection. Imagine if you approached this from another angle and you investigated the market’s needs and problems, the motivations behind those problems and developed ways that you could solve those problems. Instead of selling your product or service, you will have identified a real need, and undertaken to solve it.”
19. Don’t be everything to everybody
According to Ivan Maroke, it’s as important knowing who you are not targeting as it is knowing who you are targeting. “Rather know exactly who you are, what you are offering and who you are offering it to, even if that means a smaller market, than trying to appeal to everyone,” he says.
“If you try to be too much, you will lose your value proposition, and you might end up with no clients.” Understanding who you are requires you to know your brand truth. You need to have something worth selling, you need to believe in what you are selling, and you need a clear picture of what your brand stands for.
20. Speak to your customers
Never be afraid of speaking openly with your customers. “If you want to add real value for your customers, you need to understand what they perceive as value, and that can only be learnt through speaking to them and asking them what they want and need,” says Pavlo Phitidis. You can ask them what they specifically expect from you, but you should also ask them more general questions. “You need to understand the critical factors affecting your clients and their industries,” says Bluen.
“Stop selling your plan and start finding out what is valuable for them. Ask questions like: what are you using the product or service for? What is important to you? What is the industry doing? You can then start developing solutions for your clients. Some of these solutions might not even involve your product or service, but you are making yourself valuable to them — and that will eventually lead to a strong relationship with sales as well. When you leave, your client should think, ‘This was the best hour I have spent today’ because they received so much value from you.”
21. Differentiate yourself
“It’s easy to differentiate when you have a unique offering, but what about if you’re in a highly competitive market?” asks Theunissen. “Identify what elements are important to the client and focus on them. If you have a service-based business, chances are your differentiator will be service, and therefore your staff. Find something that makes you different, and focus on that.”
“It cannot be overstated how important it is to focus on what makes your business special,” says Allon Raiz. “You need to spend a disproportionate amount of time on building up your value proposition. Leverage the distinctive value that you have to offer and invest in it, market it, sell it and grow it.”
22. Look after your existing customers
“We’ve all heard the statistics about it costing much more to find new customers than to keep the ones you have,” says Nathalie Schooling. “Unfortunately, few businesses seem to take this to heart, and they become so focused on winning new business that their existing, loyal customers are often ignored, and sometimes completely neglected.
To me, that’s a formula for disaster. But it’s easy to reverse. By investing the time, effort and resources in showing your existing customers that you value them, you strengthen and build the foundation on which your business success has been built so far.”
This doesn’t mean you should forsake new clients though. “You need to focus on growth, even during tough times,” says Allon Raiz. “This might feel like you are running on the spot, but often that also means you are not moving backwards. When the economy picks up, you will have a head start.” It is also dangerous to forget to look for new clients while looking after the old. If you lose a few key contracts you could end up in serious trouble.
23. Customer service comes first
Whatever happens, look after your customers first and foremost. “It’s important to remember that your customers are experiencing the same economic conditions as you,” says Schooling. “If you are under financial pressure, chances are that they are too. However, that doesn’t mean they are just going to run off and find a cheaper competitor. Most businesses are looking for value when times are hard, so focus on giving them what they are after.”
24. Sales vs marketing
Understand the difference between sales and marketing. “Marketing gets leads through the door. Turning those leads into actual customers is where sales come in,” explains Phitidis. “Customers will always have some form of perception about your company and what you do. At the very least you need to do what’s expected of you. Ideally, you need to do a lot more.
“To really deliver — and close those deals — you need to understand the difference between sales and marketing. Measure the disconnect between leads and the successful conversation of leads to customers. If you have enough leads but are not making enough sales, the problem is in the selling, not the marketing. If you aren’t getting enough leads, you need to focus more on your marketing. How are you getting yourself out there?”
25. Focus on niche areas
“If you don’t find your niche, you will never market yourself successfully,” says Phitidis. “Finding your niche isn’t only about providing a unique product or service, but packaging it in a unique way.”
Geldenhuis recommends looking at areas that bigger players find difficult to operate within, particularly when customers start looking for added value. “Either find a space where there isn’t a lot of competition, or look for areas where your particular offering will excel.”
For Du Plessis, it’s all about narrowing your focus rather than adding more. “A ‘me too’ mentality is certain death. Different is always better, and often that means focusing your energy and attention, not extending it.”
15 Of South Africa’s Business Leaders’ Best Advice For Your Business
15 of SA’s entrepreneurs have already made the mistakes. If you heed their advice, you’ll avoid repeating the same blunders.
Do you want to hit that R100 million mark in turnover? Do you want to make a name for yourself as one of those that made it? If you want to streamline your path to success read these insights from some of SA’s leading businesspeople, you’ll be richer (and wiser).
These 15 South African business leaders have already circumvented start, and growth hurdles and built-up their R100 million business. It’s always a good idea to listen to the advice of established, successful entrepreneurs, especially when you’re just starting out, or are experiencing growing pains, or even if you can’t figure out why your business isn’t growing.
Learn the secrets, top-tips and best advice for your business from 15 of South Africa’s biggest business leaders. You know their advice is going to apply to your context, market and customer base, because they’re operating in the same local market that you are.
Here is the best advice for your business from 15 of South Africa’s business leaders:
Best Advice 15: Go all in
- Player: Nadir Khamissa and Shaazim Khamissa
- Brand: Hello Group (includes Hello Mobile, Hello Distribution and Hello Paisa)
- Established: 2005
- Visit: hellogroup.co.za
Hello Mobile achieved 718% growth from 2010 to 2015, while Hello Paisa achieved 1100% growth from March to October 2015. These next-level growth entrepreneurs disrupted international calling, telecom distribution, money transfer and low-cost banking across Africa and Asia.
It wasn’t an easy journey for these two brothers, R6 million in seed capital turned into R30 000 after some early, expensive mistakes. But they persevered, and today Hello Group is changing lives at the base of the income pyramid.
Best Advice For You
What do you do when your first business idea is a failure and you’ve lost all your money? According to Nadir and Shaazim Khamissa, go back to the drawing board.
“We needed to make sure we created value, differentiated ourselves and knew why people would buy our product,” explains Shaazim. “This meant challenging all of our own ideas and making sure that only the best survived. It’s a process we still follow today and is part of our DNA.”
This won’t be easy, you’ll need to be able to critically evaluate your own ideas, admit when they’re flawed, listen to other people’s opinions and move on quickly when something isn’t quite right.
Best Advice 14: You can still launch without being fully funded
- Player: Natasha Sideris
- Brand: tashas
- Established: 2005
- Visit: tashascafe.com
Natasha Sideris overcame the challenges associated with starting a restaurant to create a brand that is utterly unique. Like other successful franchises, tashas grew from a small sole operation into a large organisation.
With 19 locations, including 2 in Dubai and 1 in Abu Dhabi, tashas has started its journey to become a global franchise. But it hasn’t been an easy journey, trying to get a hold of funding was a serious obstacle for Sideris.
Best Advice For You
“Money helps, but you can get very far with hard work, tenacity and ingenuity. Don’t let money put you off. Too many entrepreneurs feel that they can’t pursue their dreams because they don’t have money. That’s just not true. If you’re willing to work extremely hard, you can make it happen,” explains Sideris.
“A lack of money can often be a good thing, since it forces one to think creatively,” she continues.
Best Advice 13: The power of marketing
- Player: Grant Rushmere
- Brand: Bos Brands
- Established: 2009
- Visit: bosicetea.com
Grant Rushmere engineered Bos Ice Tea for stratospheric growth, which required a ballsy optimism and willingness to go big or go home. “From the beginning we jumped in with both feet. We approached retailers and secured contracts that we knew we wouldn’t be able to sustain down the line if we didn’t get funders on board, but it was a calculated risk that we were willing to take,” says Rushmere.
Best Advice For You
In their first year, Rushmere and Bowsher, his partner, spent as much on marketing as their turnover. “We knew we were tapping into a health trend, but this didn’t mean we should scream health from the front of our packaging, and in our marketing messages. If you do that, you lose all sense of fun. You want your consumers to feel a little naughty; like they’re having fun,” explains Rushmere.
This might sound counter-intuitive to you, but from a brand’s perspective, an emotional hook is much easier to defend than a functional hook.
“By tapping into emotions, what the brand stands for and how it makes you feel, you give the brand a voice; you’re not just selling features and benefits. If you take a functional approach to marketing, you’re basing everything on the fact that you contain less sugar than other soft drinks. What happens when someone comes along with even less sugar? You’re suddenly dead in the water,” advises Rushmere.
Best Advice 12: Like who you’re hiring
- Players: Tom Goldgamer and Danny Aaron
- Company: 3 Way Marketing and Benater Production Group
- Established: 2008 and 2012
- Visit: 3waymarketing.co.za
Danny Aaron and Tom Goldgamer launched their business in 2008 with no grand strategy, five-year plan or a physical product. They started with an idea, a few business philosophies and a willingness to take on a lot of risk.
“We operate in an industry that changes frequently, so strategising too far ahead is difficult and often counter-productive,” says Goldgamer. “But we knew we needed strong foundations if we wanted longevity and growth, and so we focused our energy on developing business philosophies that we could implement across our various companies.”
They now have a turnover of over R200 million, with staggering year–on-year growth.
Best Advice For You
Conventional business practice says hire for skill. Goldgamer and Aaron have done the opposite. A large portion of their early hires were friends or friends of friends. Everyone had strong referrals and they only hired people they liked.
“We hired people who we thought could help us grow the business, not necessarily because they possessed the right skills, those could be learnt, but because they had the right attitude,” says Aaron. Today, those early hires are managers, instilling company values in their own teams, hiring based on values and continuously focusing on upskilling.
Best Advice 11: Make fewer mistakes than your competition
- Player: Stephan Ekbergh
- Company: Travelstart
- Established: 1999 (Sweden), 2006 (South Africa)
- Visit: travelstart.co.za
Stephan Ekbergh recently sold 49% of his business for R648 million, but at one stage he had to lay off 34 of the company’s 40 employees. Ekbergh founded Travelstart in Sweden in January 1999. In 2002, after a few very bumpy years, the tide turned, and Travelstart started to become exceptionally profitable. In 2004, he decided to move to Cape Town and launch Travelstart here.
Best Advice For You
You’re going to make mistakes, but so is your competition. If you’re on the ball, you can benefit from every mistake they make. “The difference between failure and success often lies in making fewer mistakes than your competition. You need to ride in the slipstream of your competitors and wait for them to mess up. Over the years, we’ve made some good decisions at Travelstart, but at least some of our success is attributable directly to the mistakes of our competition,” says Ekbergh.
Best Advice 10: Your customer is the boss
- Player: Peter du Toit
- Company: Soccer Laduma
- Established: 1997
- Visit: soccerladuma.co.za
With no experience in publishing, Peter Du Toit built up the biggest single-copy-sale weekly publication in South Africa. Soccer Laduma has a turnover of R90 million, 3.4 million readers and some of the most loyal customers in the country.
Best Advice For You
Du Toit’s first rule is that he’s not the boss. The readers and online users are always the boss. “No one works for me. They work for the reader. It’s an important mind-set, because it means that everything we do is with the reader in mind,” says Du Toit. “What do they need from us? What do they care about? Are we delivering on those needs?”
Even though the reader is the boss, Du Toit has implemented a system to ensure everyone works towards keeping that boss happy, he labelled them his six golden rules: Planning, planning, planning, preparation, preparation, and preparation. You can use these six golden rules to ensure your team works towards keeping your consumer happy.
Best Advice 9: Stick to your guns
- Player: John Nicolakakis
- Company: Roman’s Pizza
- Established: 1995
- Visit: romanspizza.co.za
John Nicolakakis took over the reins of Roman’s Pizza from his father. He had only one goal: To create the biggest pizza brand in SA. With R1 billion in system-wide sales, the company’s aggressive expansion plans have never wavered.
Best Advice For You
Nicolakakis developed a specific business plan for Romans Pizza; have high-quality product with a low price. To do this he decided not to offer delivery services throughout the whole brand.
“I don’t believe the South African market suits a delivery model. Urban areas are congested with traffic, and suburban living means that a delivery radius needs to be quite large. It’s expensive to offer; even if it’s marketed as ‘free,’ that service has to be built into the product’s price point. It’s also difficult to deliver a hot product that’s as good when it reaches its destination as it was when it left the store, and there will always be incorrect orders.”
Even though he’s lost business to customers who want delivery, he’s stuck to his guns and refuses to budge on his price just to capture the delivery market. Once you’ve decided on something, whether it’s for financial reasons or based on what you offer your customers, you should be resolute in your decisions, after all, you made them for a reason.
Best Advice 8: Build positive relationships
- Players: Tshego Sefolo (founder and CEO) and Londeka Shezi
- Company: Agile Capital
- Launched: 2016
- Visit: agilecapital.co.za
Hard work, determination, drive and discipline are the habits of the world’s most successful entrepreneurs and you need to study them. Tshego Sefolo and his business partner Londeka Shezi recently raised over R500 million in capital to launch their private equity firm, Agile Capital.
Building market trust and credibility to make his dream a reality has been 14 years in the making for Sefolo, and worth every second.
Best Advice For You
“My role was to identify opportunities for the business, but on a personal level I saw it as the start of my own foundations and networks. Investing is all about building and leveraging networks. Sustainable relationships allow you to identify and then tap into opportunities. Integrity is incredibly important in all business dealings, but it’s integral to the private equity space,” says Sefolo.
Through his positions over the years he came into contact with the business that would eventually found Agile Capital. Because he built up trust and integrity he was able to realise his dream.
“It takes time to build up trust and integrity in the market place, so I knew that this was a long-term commitment. That was okay, I wasn’t in any rush. The right foundations have been fundamental to launching Agile Capital.”
Related: Tshego Sefolo On Living The Dream
Best Advice 7: Don’t be afraid to fail
- Player: Brian Altriche
- Company: RocoMamas
- Launched: 2014
- Visit: RocoMamas.com
Altriche has taken RocoMamas from three stores to 49 in 18 months, and is spearheading South Africa’s renewed love affair with the burger. Even though he has achieved success, his past is riddled with failures. His first franchise left him in debt, he lost almost his entire life’s savings on the stock market, he got squeezed out of one business and sued by Red Bull in another, and the list goes on.
Best Advice For You
“Failure is part of the equation of success. I call them my fabulous failures. You can’t achieve greatness without failures and risk,” says Altriche.
Failures are teaching moments that can help you learn to navigate future business opportunities.Yes, they hurt, but if you didn’t experience them it wouldn’t change your thinking and help you to make a break-through, or at the very least progress.
“I opened a Longhorn Steakhouse in Pretoria. It was a lead balloon,” he says. “My gut told me the location wasn’t right, but I didn’t listen. On paper it looked great, a good suburban, high-LSM area. Once I opened, it quickly became apparent that there were no office parks in the area, which meant no lunch trade, and the residents were primarily retirees whose kids had left the house. This was not the right demographic for my steakhouse.”
He immediately approached Fats Lazarides, who had five Ocean Baskets. Altriche became his first franchisee. “I opened in Southgate. The lessons I had learnt were valuable with the second business. Thanks to Ocean Basket I paid off my debt, had a nice living wage, and walked away with R240 000 in profit when I sold it in 1998.”
Best Advice 6: Aim for the stars
- Player: Manny Rivera
- Company: Planet Fitness
- Launched: 1995
- Visit: planetfitness.co.za; www.justgym.co.za
When Manny Rivera launched Planet Fitness 20 years ago, he was fresh from New York, having married a South African girl. He was in his early 20’s, had no credit record, no assets and no money. And he had one goal: To take on the Health and Racquet Club to become the biggest health and fitness brand in the country, and he achieved it.
Now, he’s in a position to open a club every month for the next five years, despite the recession.
Best Advice For You
Michelangelo says: “The greatest danger for most of us is not that our aim is too high and we miss it, but that it’s too low and we reach it.”
Don’t settle for a business idea or opportunity because you think you might not be able to achieve it. Aim for the moon, and if you don’t land it, they say “at least you’ll land among the stars.”
“Take on the big player. Believe in yourself. Know you’ll build a big business that’s profitable. If you have the passion and you’re able to reverse engineer your success with a step-by-step growth plan, you’ll reach your dream,” says Rivera.
Best Advice 5: Actively seek growth
- Player: Nicholas Bell
- Company: Decision Inc
- Launched: 2008
- Visit: decisioninc.co.za
Successful businesses are formed through a series of challenges and solutions. Nicholas Bell doesn’t deal with challenges as they arise though. He sets goals, and determines what is currently stopping him from achieving those goals. Then he puts a strategy in place to eradicate any and all obstacles.
Nicholas Bell founded Decision Inc and within 2 years he had achieved R1.6 million in revenue. Eight years later, Bell hit R100 million, and now his sights are on a R1 billion business that will show a 10x return.
Best Advice For You
“I don’t ever want a challenge to slow me down,” he says. “You can let a setback derail you, or you can use it as an opportunity to learn and carry the business forward. I believe it’s important to dissect everything — even opinions and advice I don’t initially agree with. Mentors have taught me that it’s important to be adaptable and that nothing in business is hard or fast. We’re constantly faced with new sources of data needed to grow our business, and I’ve learnt that the only real question is whether you’re willing to use that data to drive the business forward.”
Best Advice 4: Don’t divide your focus
- Player: Marnus Broodryk
- Company: Beancounter
- Launched: 2008
- Visit: decisioninc.co.za
Marnus Broodryk was a self-made millionaire by the time he was 24. He founded Beancounter, but that wasn’t his only successful business, “I also got involved in a frameless glass company, a construction company, and bought a vegan restaurant,” he adds.
“It was a good experience, and I was particularly proud of some of the individuals I’d helped during those years. I lent one construction worker R20 000 to start his own business, for example. Today he employs 200 people and has the biggest road maintenance contract on the N3.”
Best Advice For You
“I knew that I wanted to build something big, and I was never going to do it like this, with my focus spread across so many different businesses. I sat down and asked myself, ‘where’s my biggest opportunity?’ The answer was clear. The Beancounter. We’d made progress, had the right foundations, could drive it — and the market was ready,” says Broodryk.
“In 2008, when I launched the business, cloud technology didn’t exist yet, but we had a vision. By 2014, real-time information was now possible because of the cloud, and it was affordable and accessible for SMEs,” he explains.
Best Advice 3: Anything is possible if you get started
- Player: Rodney Norman
- Company: Chrome Supplements and Accessories
- Launched: 2009
- Visit: www.chromesa.co.za
When Rodney Norman was 21, his first business ended up R1 million in debt. He owed too much to suppliers to continue trading. Ten years later, Chrome SA has a turnover of R100 million, he still works with all his previous suppliers, a testimony to how well he handled the situation.
Best Advice For You
“At 21 I had this enormous debt. It was a defining moment for me. I could call it quits, or get stuck in and make it happen. I managed to pay it back in two years. That’s all it took. I just had to start. So how could I do it? The answer: Slowly,” says Norman.
His first step to fixing the problem was to speak to all of his suppliers. He explained the situation, and that he would be fixing it and paying off the company’s debt, he just needed time.
“I made small deposits consistently, and that was enough. As long as it was being paid, and the needle was moving, everyone who I owed money to was happy. That’s the secret: Consistency. Don’t avoid the tough calls; take them and face the music.”
Because of Norman’s actions a few years later when he started Chrome SA, all of his previous suppliers were happy to work with him again. He earned their trust, and trust can make or break a business.
Best Advice 2: The wheel keeps turning
- Player: Sisa Ngebulana
- Company: Rebosis Property Fund
- Listed: 2011
- Visit: www.chromesa.co.za
When Sisa Ngebulana left Mthatha to pursue his dream he had high aspirations for himself. He didn’t know what path his career would take, but he did know he wanted to achieve greatness. When he listed Rebosis Property Fund in 2011, it was the first black-managed and substantially held property fund to be listed on the JSE.
He is also founder and CEO of the Billion Group, a commercial and retail property developer that will spend in excess of R35 billion over the next ten years on its current projects. The journey wasn’t an easy one, but he says an entrepreneur needs to take the hard knocks, learn the lessons they bring you and forge ahead with a positive attitude. That is the entrepreneurial way. That’s the real secret to success.
Best Advice For You
Just when you’re at the top you find yourself R30 million in debt and need to regroup and start again. Ngebulana says that success is cyclical, you can be abundant one minute, and have nothing the next, but if you keep moving forward, you can build that abundance again. You just need to get started and then build on each small success.
“The coal mining business was a financial blow, but it was also a blessing in disguise. It forced me out of employment, if it hadn’t, I might still be employed today, and I would never have achieved what I have through the Billion Group and Rebosis. ”
Best Advice 1: Run a tight ship
- Player: Andrew Brand
- Company: 99c
- Established: 2008
- Visit: www.99c.co.za
Andrew Brand learnt to build an advertising agency that cares more about customer supplier awards than glittering design awards. It’s a foundation of a 300-employee strong business with a turnover in excess of R175 million that was only launched because Checkers was willing to give a two-man agency a chance to improve itself. And it’s how a business that launched just as the recession hit, not only survived, but thrived.
Best Advice For You
One of biggest factors separating corporates from smaller entrepreneurial businesses is cash flow. But, while corporates have healthy cash flow to work with, the ability of a start-up to run lean is invaluable as the business grows. This is because you’ve built into the business’ DNA to be careful with expenditure.
“We needed to hire a team, purchase equipment and find premises. We also couldn’t afford to run with fewer people than we needed, and so our first round of hiring was over 30 people. We haven’t stopped growing since, and I believe in investing in people. That said, there are many ways you can run a lean organisation without skimping where it matters. Don’t be a bloated, top heavy business. Rather invest in the core of your business. What will enable you to offer your clients the best service possible? That’s where you should be investing,” advises Brand.
How To Make Better Business Decisions That Drive Productivity And Profits
Here are a few ways to enhance your decision-making skills.
Running a business requires some fairly particular skills. You are expected to be a project manager, financial guru, administrative champion, staff motivator and then some.
Your personality and determination will be constantly challenged and you’ll be exhausted. But you may never be too tired or too overwhelmed to grab opportunities and steer your company in the right direction.
Making the best decisions for your business is possibly, standalone, one of the most difficult things to tackle. You’re expected to make decisions that will drive productivity and profits, but which will keep your operation stable. Sometimes opportunity knocks at the worst times and you have to wave it on by as it passes. However, this type of situation can be mitigated if you have strong decision-making skills.
Nurturing your ability to make informed and smart decisions is something you should begin focusing on right at the start. Before you’ve opened your business’ doors, you should have honed in on this skill.
The best way to foster strong decision-making skills is by reading, researching and empowering yourself with a broad spectrum of business knowledge.
Follow entrepreneurs who you respect or who have failed and returned a more powerful force in their industry. Considering many of the great, well-known entrepreneurs out there have suffered incredible failures, there are a variety of personalities to choose from.
Make sure you pay attention to how they remain ready, and at the helm at all times, to make decisions that will benefit their business.
Here are a few ways to enhance your decision-making skills.
Learn how to make quick decisions
Really sit and think about all the variables you must consider before making any business decision. Unpack the areas in which you have ample knowledge and expertise and those in which you don’t. The areas where you lack knowledge is where you should focus your attention.
Gain some topline knowledge about everything that affects your business. From which internet service provider is considered the best to what courses you might send your staff on to upskill them. And making decisions about your staff in any capacity is often considered a quick decision. The staff member in question often wants an answer, and soon.
You need to learn to trust your gut so that these types of quick-fire answer situations are handled seamlessly and timeously.
Consider attending short courses on various aspects of the business that are out of your realm of expertise. For instance, participating in a human resources and legal course will assist you with your hiring and firing procedures.
Mindfulness is such a trend at the moment that it’s bordering becoming a marketing buzzword. But the concept makes sense and has helped many people in their personal lives.
Practicing mindful eating will assist with a healthier lifestyle, being mindful in your relationships will bring about more peaceful interactions and so on. Being mindful in your business is important too.
Mindfulness applied to a real time business environment means the business owner makes decisions based on what actually makes sense for the business in that moment.
Many business owners have a tunnel vision approach to their goals and focus far too much on not upsetting the marketplace, making up numbers and ensuring they look like a burgeoning enterprise.
When in fact, they’re making decisions based on external (possibly unimportant) factors and therefore not thinking first.
Transformation, innovation and the possibility of being disruptive are all restricted.
Enrol the help of those you trust
Just because you are the business owner doesn’t mean you’re the only one capable of making a good decision. If you’ve employed staff then you will know you’ve had to learn to trust that they too have your business’ best interests at heart.
When faced with a big decision, bring the top level staff together and put the concern to them. Ask them to assist you with breaking down the options and even create business plan templates for each option and potential outcome. Have your finance person factor in all expected profits, losses and risks.
Have your marketing person consider campaigns they’d like to see roll out for each option you have and enlist the help of your project manager to estimate deadlines and responsibilities. In this way you’re able to take a more pragmatic approach to making a big decision.
How To Say ‘No’ At Work (Infographic)
Don’t let this two-letter word scare you.
Whether you’re trying to impress your boss or you fear you’ll let someone down, saying “no” at work can be hard. But it shouldn’t be.
Too often, people burn themselves out by agreeing to take on more tasks than they can handle. However, overloading yourself with work can reduce the quality of what you produce. If you’re too busy, you may also miss deadlines. In those cases, the person you’re working for likely would have preferred that you had just said “no” from the start.
Don’t feel bad or guilty about saying this two-letter word. If you want to build a great career, you’ve got to get used to it. There are plenty of perfectly good reasons to say no to someone – it’s just a matter of how you say it.
Related: How To Say No Nicely
Check out Business Backer’s infographic below to learn how.
This article was originally posted here on Entrepreneur.com.
Lessons Learnt2 weeks ago
The Daily Schedules Of 10 Famous Business Billionaires
Self Development1 week ago
10 Secrets To Finding A Job You Love
Performance & Growth6 days ago
How Matt Brown Quadrupled His Business By Becoming A Niche Player
Entrepreneur Today5 days ago
Entrepreneurs Organisation Crowns the Winner of the Global Student Entrepreneur Awards
Branding1 week ago
How A Strong Brand Protects Your Business
Marketing Tactics1 week ago
An ‘Outside-the-Box’ Approach to the e-Commerce Unboxing Experience
Entrepreneur Today1 day ago
5 Businesses You Should Start in 2019
Business Landscape1 week ago
4 Tips To Create A Great Conference / Workshop / Event In 2019