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Performance & Growth

First Take Care of Customers

Service and selling are closely linked. Understanding how customers relate to your business, talking to and listening to customers is where it all starts.

Steven Viviers

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The next step is treating customers as unique and special and making them partners in your business, where they can assist with service improvement and product development.

In our last article we discussed the art of ‘Upselling’ and introduced various tips and techniques successful entrepreneurs use to increase sales and stay ahead of the competition. This month we focus on developing a true customer focus.

It’s been ages since we’ve heard the plea “if you don’t take care of your customers, someone else will” or that the customer is “king”. One-time CEO of Scandinavian Airlines, Jan Carlzon, declared a long time ago that “the only thing that counts is a satisfied customer.” In an industry struggling with high fuel prices and overcapacity this idea soon faded into obscurity, along with many airlines.

Walt Disney, the legendary entrepreneur and co-founder of Walt Disney Productions, said right at the outset, “Do what you do SO well that (customers) will want to see it again and bring their friends.”

The satisfaction index

Recent research indicates only 1 in 4 customers go home satisfied. Clearly we are paying lip service. The whole point about sales is that you want your customers to come back, and when they do, to bring their family and friends. The early entrepreneurs were lucky. When a customer had a bad experience she told just 10 people.

Nowadays, with the internet, and especially social media, customers tell 10 000 of their ‘friends’ and the whole world gets to know in milliseconds. Ask companies like Woolworths, South African Airways and Hyundai whose fortunes have risen and fallen on customer’s perceptions.

Only two types of customers?

If you’re a small business owner you may think there are only two types of customers – those that shop with you and those that shop with the opposition. We believe its helpful seeing customers in categories. These could be ‘new’, ‘fickle’, ‘loyal’ or ‘advocates’, price-sensitive, convenience, traditional or finer foods or ‘blue blood’, ‘cosmopolitans’  and ‘young influentials’. There is no end to the segmentation. Adapting your sales strategy to suit each group is key though.

For new customers, shopping for a particular price point or a special occasion, a warm welcome is essential. They may not represent a big proportion of your current sales, but they offer the greatest long term potential – so don’t ignore them. For loyal customers and especially customers who sing your praises building a formal, long-term relationship is the ultimate goal.

Talking works

In our experience nothing works better than talking to your customers. Some would say not merely talking, but listening. Hearing their voice above everyone else’s in your business. If you have physical premises (restaurant, shop or garage) you should be walking on the floor / forecourt daily and talking to your customers.

One of the ways to interact with customers, preferred by the big retailers, is Customer Focus Groups. A Focus Group is a group of customers carefully selected to give you feedback. It’s important they’re customers who have a vested interest in your business and who won’t hold anything back.

Focus Groups are not difficult to organise, requiring just some simple planning, sending out of invitations, hosting of customers in a safe environment (on or off-site) and engaging in conversation. Let customers talk openly about their shopping experience or ask them specific questions about your products and services (sales channels, pricing, promotions and new developments, in fact any area of the business you want feedback on). Focus Groups shouldn’t be once off events but an opportunity to build life time relationships with customers.

Next time you are on the shop floor, instead of avoiding difficult customers, as many salespeople do, ask your staff to point them out and then introduce yourself and your product offering or “value-proposition”.

Engaging your customers

By definition a “value proposition” is a promise of value to be delivered to a customer or the belief by a customer of value to be experienced. “Value”, in this context, is based on the benefits a customer receives from good or services in return for payment. Value propositions may apply to the entire business, or part of it, and may include customer accounts, various products or services offered for sale.

Audi’s introduction of the Quattro drive system in 1980 led to it becoming synonymous with high-performance vehicles. In terms of customer value Audi’s Quattro system set it apart from other competitors. Although other car manufacturers (BMW, Mercedes and Jaguar) also had all-wheel drive systems they were not as widely encountered and marketed as Audi’s.

Why is a value-proposition essential? The answer is simple. Your value proposition creates a strong differential between you and your competition. It improves the quality and focus of your selling. You’re able to increase sales in specific customer segments. Customers typically want to know “What’s in this for me?” and “Why buy from you?”

If you spend just one day understanding what customers want and clarifying your value proposition you will have improved your business.

Another key concept to understand is a customer’s “moments-of-truth”. These are points at which a customer interacts with your business and has an experience, good or bad. They may be many. Let’s use the example of a garage. Nowadays garages operate as “convenience centres” i.e. they sell petrol, diesel and other automotive-related products as well as groceries and / or fast foods and with added-value services like dry-cleaning, ATMs and car washes.

From a customer’s perspective the “moment-of-truth” is the minute she decides to fill up her car (on the way to work or on returning home again), spotting tell-tale signage or perhaps an inviting looking forecourt, safe, secure parking as well as short queues at the pumps. Buying fuel is a ‘grudge’ purchase. Customers typically ask themselves: Will my experience be easy and quick? Is there someone helping with traffic control? Is the entrance to the shop accessible or is it blocked by a delivery van? Is the shop clean?

Are the aisles easy to shop and my favourite food product on display? (We’ll deal more thoroughly with layout and / or space issues in a future article). When I want to pay, will I have to queue? Is there a manager on duty if something goes wrong?

Let’s not forget we’re now in a convenience outlet, customers need to find a suitable place to park, fill up their car, choose tonight’s meal and then leave in under 12 minutes. We can learn a lot from TESCO, the UK’s market leader, with respect to convenience. Their standard for queues is not “3 minutes” or “5”, or one cashier for every three customers, as is typical in South Africa, but “one person behind another is a queue” then management take action.

They call up extra cashiers, put on packers, walk the queue talking to customers. Nowadays, service stations operate 24/7 and need to run efficiently even at 03h00 in the morning. But it’s not operational efficiency they want. It’s customer efficiency. Cutting back staff to the extent that customers requiring assistance can no longer find them on the shop floor is ludicrous.

Bettering experiences

If one understands a customer’s moments-of-truth and what they really need one can improve their experience of your business.

Hiring the right people in the first place is one of the keys to success. We believe hiring salespeople with the right values or “attitude” is vital. Values, unfortunately, are best taught by parents. As an entrepreneur your role is to hire people who already have a “can do” attitude.

You need to “hire the smile” as it were and then train these raw recruits in product knowledge and specific job-related processes and procedures. Keep recruitment interviews practical. Ask difficult questions and then role-play actual encounters with customers on the sales floor.

Product training should take the form of indoctrination – touching, tasting and experimenting with product as customers would. Your salespeople won’t be able to sell your products or services if they don’t know anything about them.

Good old-fashioned shopkeeping

Sales gurus the world over believe that the longer you’ve been in business the less you know about your customer. If you apply just one technique from this article, amongst the many, make it the one preferred by an old-fashioned shopkeeper we know. Write down everything the customer tells you in a small notebook and keep this in your top pocket. Refer to it constantly, implementing just one thing each day and encourage your staff to do likewise.

Steven B. Viviers is a partner of Customer1st, a change management consultancy operating in Cape Town, Johannesburg and Durban. He has worked in retail most of his life with British Petroleum, Chesebrough-Ponds Co., Edgars Stores and Woolworths Ltd. He has consulted to various governmental and business organisations in South Africa, Namibia & Zimbabwe on the subject of Service Improvement. You can contact him at customer1st@iafrica.com.

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Performance & Growth

Taking Care Of Business

Do you want to grow your business in 2019? Bear these tips in mind.

Christiaan Steyn

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SMEs are the lifeblood of the South African economy, accounting for approximately 29% of employment in the country and forming a critical pillar of the government’s 2030 National Development Plan. With funding scarce and the economy volatile, small businesses remain increasingly vulnerable to economic pressures, with many failing to last beyond the five-year mark.

Thanks to the abundance of new and affordable technology, bringing with it the potential for new industries and market gaps, there has never been a better time to conduct business without crippling costs. It is not all doom and gloom in the small business sector, despite findings in the 2018 SME Landscape Report that suggest that a meagre 6% of all start-ups have received government funding.

Do not be afraid to delegate

Many entrepreneurs are so passionate about their own undertakings that they are unable to simply let things go. Rather than empowering and enabling others to take responsibility, many Type A business leaders instead opt to do it all themselves – usually with disastrous consequences.

Learning to delegate is key to alleviating bottlenecking and freeing up capacity in your business, so make sure to utilise all your available resources if you want your enterprise to expand.

Related: 10 Questions With Tshireletso ‘Ty’ Hlangwane, Winner Of The Workspace/MiWay Business Insurance Entrepreneur Competition

Go digital

While billboards and TV ads are expensive, marketing a business can now be done quite cheaply, thanks to the abundance of relatively affordable digital channels. So while you might not be able to have your brand staring out at you from the pages of a glossy magazine just yet, digital channels like Facebook and Google now allow you to achieve the same audience reach for a fraction of the cost.

Be discoverable

Offering the best service in town is one thing, but it is worth nothing if nobody knows about it. So make sure to pay close attention to your website and its search engine optimisation (SEO). By using the correct keywords and even putting a small investment into Google Adwords, you will ensure that people who are looking for what you offer are able to find you easily.

Mobile first

With over 50% of all web traffic in South Africa coming from mobile devices, businesses simply can’t afford not to take a mobile-first approach to business. If you are offering an online service, make sure it is optimised for a mobile experience and ensure that any communication touch-points – be they blogs, social media posts or online check-out pages – are designed with mobile in mind.

Be agile

One of the key advantages SMEs have over their larger counterparts is their ability to be flexible. Without outdated systems and reams of red tape to wade through, small businesses are far better able to adapt to market conditions and revise their offerings based on consumer needs. So make sure to listen to your customers and be willing to accept that some of your great ideas simply are not feasible.

Your willingness to accept failures and move on, will ultimately be what gives you the edge over your competitors.

Plan your finances

Cashflow is king when it comes to entrepreneurship and many a micro enterprise has come undone thanks to their inability to manage it. As such, financial planning is a critical tool for any business, especially for those operating without significant investment capital. Understanding potential pitfalls and keeping tabs on your profit margins will help to ensure you keep your pricing realistic and enable you to avoid finding yourself in the red.

Related: The Entrepreneurial Case For A Co-Working Space

Network

Operating in isolation can only get you so far, so it is important that you put yourself out there and make proactive attempts to connect with other like-minded businesses. By joining a business network or attending industry events, you will be able to arm yourself with useful contacts, handy insights and perhaps a few new clients in the process.

Remember that owning a business is like raising a child – it requires constant supervision, nurturing and care if it is to succeed to its utmost potential. So make sure to look after your business and one day it will end up looking after you.

MiWay is a licensed Short-term Insurer and Financial Services Provider (FSP. 33970).

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Performance & Growth

How Taking Risks – And Failing – Can Lead To Business Success

Don’t let fear of failure stop you from taking the risks you need to, to carry your business forward. But as your business grows, you’ll have to re-evaluate what risks you can take.

Grant Field

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Innovate, innovate, innovate. The war cry is so often repeated that it has become something of a bore. Yet, true innovation remains a rarity – and to our huge detriment. As South Africans, we seem to carry a deep shame associated with failure. Yet, facing the very real possibility of failure is the only arena in which a culture of innovation can take root.

The biggest business failure of my life was an investment into a software company that wrote a piece of software that was set to revolutionise the mobile landscape. It was going to be huge. It was going to take the world by storm. But unfortunately, we backed the wrong horse.

We developed the software for the Symbian platform because Nokia was way ahead of the pack. Nobody else even came close. But, given the fact that there’s a good chance you currently have an iPhone or Android device in your pocket right now, you know how that story ended. Nokia seemed untouchable, then almost collapsed. We lost a lot of money.

Get back up

But, we learnt valuable lessons from that. Of course, there’s the general lesson that everyone should take away from failure – to get up and try again. As General George Custer said, “It’s not how many times you get knocked down that count, it’s how many times you get back up.”

The other lesson was more specific to our business. In developing the software, we learnt a lot about different technology platforms and those lessons were invaluable as we took the next steps in Fedgroup. The same people who built that software helped in the initial stages of developing Azurite, which today is the backbone of our company’s entire operation.

Because we’d been involved so heavily in developing for mobility and the future, our minds were opened to what technology could do. It gave us the mindset to get where we are today.

Related: 2 Types of Failure and How Your Business Can Weather Them

Investing in education

It sounds like a terrible cliché, but there’s value in failure. Take the lessons you learn in failure – the genuine lessons – because even if you lose money, consider it school fees, and cheap at the price. Arguably, our failure was the “fees payable” that bought us our competitive edge.

In the United States, they are less afraid of failure. They wear their failures like a badge of honour. Elon Musk, for example, misses his targets, but he’s always pushing the boundaries. Recent (questionable) antics aside, Musk’s risk-taking drives innovation.

If people in an organisation are terrified of failure, they don’t try new things, they don’t innovate, they don’t move forward and they certainly don’t disrupt. Even though now, as the CEO of a large financial services company, I can’t afford to bet the whole business on a risky proposition, I still encourage risk-taking and a spirit of adventure – within reason.

Reckless vs reason

This is not to say that we can – or should – be reckless. There should be accountability, and the reasons for making the mistake should make sense. And, you shouldn’t make the same mistake twice. But if you take risks within those parameters, you’ve got a better chance of making a real difference in your organisation.

We have recently launched an app that is fairly disruptive, and as far as we can tell, the first of its kind in the world. Before we launched, we put our personal money behind the idea to test it. We had done our homework, but it was still a risk. If it hadn’t worked, we would have lost our personal money, but because we took that risk and proved it worked, we were able to launch it safely to the public one year later.

Related: 8 Reasons Why Failure And Focus Are Essential To Business Success

Parameters, limitations, and the ethics of risk

When you’re an entrepreneur, when you’re just starting out, you can bet the farm. You can take risks on new ventures and potentially build something out of nothing.

Once you’re an established organisation with staff and clients – and in our case, clients who have invested their pension with us – the scope of risk takes on a new set of parameters. When you are dealing with a client’s security, it is simply not acceptable to expose them to additional avoidable risk.

However, because risk taking is where the magic of innovation happens, encouraging a framework where creativity, experimentation, and risk is possible within your organisation, is critical. One of the ways to encourage this is to examine your attitude towards failure. Build an environment where failure is not taboo, but presents a strong learning opportunity, and ring fence those areas within the organisation which absolutely cannot be jeopardised. This is risk in a helmet – you might get a roasty, but you could win the race.

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Performance & Growth

Proven Strategies To Grow Your Start-up On A Scale Following These Guidelines

The following strategies can help you make the start-up scalable and grow it to accommodate a larger demand.

Joseph Harisson

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Scalability and flexibility are important properties of any business. Let’s say you’ve managed to build a successful start-up. It’s profitable and promising, but you want it to become better. The scalability of a business involves its ability to adapt for bigger workloads without losing revenue.

Even if your business is currently small and doesn’t generate huge profits, scalability can help it turn into a large enterprise. The wrong approach to developing a start-up can deprive it of an opportunity to become better.

The following strategies can help you make the start-up scalable and grow it to accommodate a larger demand.

Scaling Vs Growth

Many companies make a mistake of thinking that scaling and growing a company is the same thing. In fact, growth involves increasing revenue or the size of the company (the number of employees, offices, clients).

Constant growth requires numerous resources and may not always lead to a proportional revenue increase. In many cases, the growing number of services or products needed to boost revenue involves high costs related to the growing number of employees and equipment.

On the other hand, scaling allows you to increase the revenue without the costs involved in growth. You can handle the extra load and boost your profits while keeping the costs to a minimum.

At some point, a successful start-up needs to make a choice between growing at a constant rate and switching to the scaling business model.

Even though a single clear method for scaling your business doesn’t exist, there are some guidelines you can follow.

Related: If You Want Scale, Fail Fast And Learn Quickly

1. Get Ready To Be Patient

Scaling is not a quick process so you have to be patient. The overnight success story is not about you. In fact, scaling too fast usually results in unfortunate failure.

Allow yourself to spend the time to understand who your ideal customers are and how you can solve their problems in a better manner. Make sure you understand how to be confident about the new volume of your work.

Do research to find out how you can find the right resources to achieve scaling rather than growth.

2. Choose The Right Software

The lack of time and team members is a common problem for a startup looking for scaling methods. That’s why they need to try and automate as many processes as possible. This can be done with the assistance of the right software.

  • Trello – to simplify in-office and remote teamwork
  • MailChimp – to improve marketing campaigns
  • Brand24 – to get insights about your business
  • Survicate – to collect customers’ feedback
  • Voiptime – to increase connectivity.

Enterprise SEO specialists at Miromind also recommend paying special attention to different programmes to help you with your marketing efforts. Many digital marketing tools available today are free.

3. Take Advantage of Outsourcing

Since you are hoping to limit the expenses while growing the revenue, you have to find ways to spend the revenue in the right manner. The biggest mistake made by business owners who think they are choosing scaling is hiring a big team. By doing so, they turn scaling into growing.

Your best bet to avoid hiring a large team and paying large salaries while achieving your plans is to outsource. Using your resources wisely involves finding freelancers and remote employees who are willing to work for a lower pay on a one-time (or several) contract bases.

For example, you don’t need a lawyer or a computer specialist sitting in the office all day long. Why should you pay them a monthly salary?

Related: What It Will Really Take For South Africa’s Businesses To Scale And Create Jobs

4. Don’t Do It Alone

Even though certain team minimisation is necessary to improve your scaling efforts, don’t try to handle everything on your own. It’s important to have at least one person you can rely on to manage the business-related problems.

Conclusion

Scaling your start-up is possible as soon as you understand what scaling is in detail. You need to be careful not to start growing your business instead of scaling it in the process. Once you have all the fundamentals figured, resources managed, and the right people in place, you are ready to start.

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