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Start-up Advice

Position your Business

Do you have a hamburger? Or how to Position your business (Part I).

Bertie du Plessis

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McDonalds

Business success requires focus.  You need to know what your focus is, but above all your potential customers need to know what your focus is. They need to have that very clear picture in the mind about you in order to choose between you and the opposition.

This is where many businesses, especially many start-ups get it wrong. Very wrong. They want to be all things to all people. You can’t!

You need to focus!

Think of the famous company with the large yellow arches.  You think hamburger!  You don’t think salad or coffee or chicken burger or chips or soft drinks. You think hamburger.

Imagine an early Friday evening. Mum says: “I am not going to stand in front of the stove tonight. We’re having takeaways.  What do you guys want?  MacDonalds, pizza or KFC?  This is the primary positioning for each of the fast food companies.  Note that MacDonalds and KFC own their respective positions in the market. There is no single company that represent pizza in the same way – perhaps in theUSthe mother would have said: “MacDonalds, Pizza Hut or KFC?”

In any case, dad and the kids have a clear idea about what they are going to choose between at the highest level: Hamburger, pizza or chunks of fried chicken.

Focus, clear focus has helped mum and the family to make a choice. A burger is not better than a chunk of fried chicken or a pizza. It is also not worse. It’s just different. It offers a clear and distinct choice and in the case of the burger that clear and distinct choice is associated with MacDonalds. Because they offer the hamburger option so clearly and consistently they own that choice. Good for them!

Our little model family could just as well have chosen pizza or KFC on the given Friday evening.  No matter, they had a clear and distinct choice before them. But note there is a difference here, because pizza isn’t owned by a brand name, which pizza brand they choose to support, will most probably be decided on by convenience.  In contrast hamburger is MacDonalds and chicken is KFC.

Using focus

Having a clear focused brand helps the consumer. It’s easy to choose. But how does it help the franchise?  After all, if it is easy to choose, it is by definition also easy to choose your opposition’s product, rather than yours?  True, but people make choices where and when the options are clear and distinct.

If you are vague with a foggy, smudged offering the choosing and deciding public – that is the buying public – ignores you. You need to be clear and distinct to even make it to market square!  If the consumer or client doesn’t have a clear picture of what you stand for and what you offer, you won’t come into consideration for a transaction.  You absolutely need your hamburger to get the buying public’s attention!

What you want is that your business or service is exclusively associated with the specific offering. You want to be like MacDonalds or KFC.  Think hamburger? MacDonalds, of course!  Think chicken? KFC of course! I have known a few business owners who wanted to take a short cut here, upstarts who chose as their business slogan things like “think beds, think us,” but hey, you must earn MacDonalds’ identification between hamburger and brand name.  It’s not simply there for the taking.  But that is another story.

Identifying brand with product

If you manage to get the specific product or service identified with your brand name, you get the customer to choose your specific franchise whenever they choose the product. That is the position prized above all!

Note that pizza vendors are in a worse position because they need the consumer to move to a second level of choice and decision making. First the customers must decide that they don’t want hamburgers or fried chicken on that specific Friday evening and then, secondly, after having decided on pizza, they must decide on which pizza franchise.

So, go all out to get your hamburger, your symbolic flagship product or offering that is associated exclusively – or as close to that as possible – with your brand.

This is only possible if you differentiate between your products and service offerings. They must be ranked! This is what focusing means. Something is in the centre of attention and others are not.

Please note: Your hamburger need not be your most profitable product.  It is the specific offering that makes it easiest to swing the customer’s mind in your direction. It is the bait that gets the customer to your other offerings that may be more profitable or that provide a more sustainable income.  But you must have a hamburger. And you must get your hamburger right!

So, let’s return to our fictitious family who chose MacDonalds that Friday evening. As all mothers (or fathers) who innocently and well-meaningly offered to buy takeaways well know, this is where the fun starts!

Suddenly Missy Teenager says, “I am on a diet, I only want a slimmer’s salad, otherwise I won’t fit into my matric farewell dress.”  Little Boet opines: “I wan’t a large chips and a coke too.”  Dad wants coffee with his Big Double Quarter Pounder with cheese and chips. And mum in the end decides on a chicken wrap.

Choosing right

So, what happened to the burger?  Well, more often than not being focused in business still means that you need a menu of secondary items: the compliments that go with the burger:  fries and Coke; the secondary menu items: the slimmer’s salad, coffee, the chicken wraps.

Positioning  your brand is about getting the hamburger. About getting the right hamburger and then managing the burger in the context of your extended menu.

But first, you must get your hamburger! Have you got one? Or do you show clients an undifferentiated menu with no hierarchy?  Do you have a hamburger or a list?

Bertie du Plessis founded his successful consultancy firm, MindPilot, 17 years ago. He names several of South Africa’s blue chip corporations among his client list and has taught as a lecturer and guest lecturer in six different disciplines at tertiary institutions. His fin24.com blog is the most read business blog on the 24.com domain. Visit Bertie Du Plessis's website for more information.

Start-up Advice

Put On Your Wellies: It’s Time To Wade Into Risk

Entrepreneurs aren’t all leaping into the unknown like lemmings off a cliff, but they do need to consider it…

Chris Ogden

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risk-management-rain-boots

You’ve had a great idea. You’ve looked into its development. You’ve recognised that it has potential beyond just what Auntie Mabel and Mike From The Grocer think. And you’ve clearly nailed a pain point that can make money. Now it is time to take the risk of running with it.

Every big idea comes with risk. You can’t step out into the world of entrepreneurial thinking and business development without it. Your idea may fail. It will also be time consuming, demanding, hungry for money, and hard work. It is unrealistic to expect that your project will leap out into the world and be an unmitigated success.

It is also unrealistic to assume that it isn’t worth taking this risk.

There are steps that you can follow to ensure that your risk is managed so you aren’t blindly leaping off that cliff…

Step 01: Do your research

No, canvassing your neighbours, friends and family is not doing research. You need to know that your idea will appeal to a broad market and that it will have significant legs. This may sound like daft advice, but you would be surprised how many people think an idea will take off just because Susan in Accounting said so.

Step 02: Understand the costs

Projects are hungry for money and investment. Realistically work out your budgets and how much it will cost to take your project off the ground and then stick to it.

A calculated risk is a far better bet than one that shoots from the hip and hopes for the best. You can also use this as an opportunity to draw a clear line under where you will stop investing and end the project. If it keeps eating money and isn’t getting anywhere with results you need to be able to walk away.

Step 03: Know when to walk away

As mentioned before, this can be defined by a line you’ve drawn in the proverbial sand (and budget) but no matter where you draw this line, you have to stick to it. Often, when time, money and energy have been poured into a project it can be incredibly hard to walk away.

You think ‘but I have put so much into this, just one more’ and then it gets to a point where the ‘just one more’ has taken you so far down the line that walking away feels impossible. Leave. Learn the lessons. Apply them to your next project.

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Start-up Advice

Mind The Gap

The entrepreneur’s guide to finding the gaps and building the right solutions.

Chris Ogden

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entrepreneurship-gap

Innovation may very well be the key to business success but finding the gap into which your innovative thinking can fit is often a lot harder than people realise. Some may be struck by inspiration in the shower, others by that moment of blinding insight in a meeting, however, for most people finding that big idea isn’t that simple. They want to be an entrepreneur and start their own high-growth business, but they need some ideas on how to find that big idea.

Here are five…

1. Network

It sounds trite but networking is actually an excellent way of picking up on patterns and trends in conversation and business problems. The trick is to note them down and pay attention. Soon, you will find patterns emerging and ideas forming.

2. Look for pain

Just as networking can reveal trends in the market, so can spending time reading. The latter will also help you find common business pain points. These are the touchpoints that frustrate people, annoy business owners, affect productivity, or impact employee engagement.

Be the Panado that fixes these pains.

3. Luck

luck

This is probably the most annoying of the ideas, but it is unfortunately (or fortunately) very true. Luck does play a role in helping you capture that big idea. However, luck isn’t just standing around and random people offering you opportunities. Luck is found at networking events, it is found in research and it is found in conversations with other entrepreneurs.

4. Luck needs courage

You may have found the big idea through your network, a pain point or pure blind luck, but if you don’t have the courage to take it and run with it, you will lose it to someone else.

Being bold in business is highly underrated because most people assume that everyone is bold and prepared to take big leaps into the unknown. However, not all brilliant entrepreneurs were ready to throw their family funds to the wind and leap into an idea – they were courageous enough to figure out a way of harnessing their ideas realistically.

5. Pay attention

This is probably one of the most vital ways of finding a gap in the market. Often, people are so busy that they don’t really pay attention to that niggling issue that always bothers them on a commute, or in a mall, or at a meeting. This niggling issue could very well be the next big business opportunity. Pay attention to it and find out if that issue can be solved with your innovative thinking.

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Start-up Advice

5 Things To Know About Your “Toddler” Business

As you navigate this new toddler phase of your business, here are five things to bear in mind.

Catherine Black

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small-business-start-up

Ah, toddlers. Those irresistible bundles of joy bring a huge amount of energy, curiosity and fun to any family – but there’s also frustration and worry that comes with their unpredictability, as they grow and start to become more independent. If you own a business and it’s successfully past its “infancy” of the first year or so, it’s likely it will also go through a toddler stage of its lifecycle.

Pete Hammond, founder of luxury safari company SafariScapes, agrees with this. “Our business is now three and a half years old, and we’ve found that we’re not yet big enough to justify employing a large team of people to handle the day-to-day admin tasks, yet we still need to grow the business as well,” he says. “As a result, our main challenge is finding the time to step back and see the bigger picture. Kind of like when you are raising a busy toddler and you spend most of your time running after them!”

As you navigate this new toddler phase of your business, here are five things to bear in mind:

1. This too shall pass

Everything in life is temporary – and that goes for both the good and the bad. It’s as helpful to remember this when you’re facing the might of a toddler temper tantrum, as it is when you’re facing throws of uncertainty in your business. If your new(ish) venture is going through a rough patch in its first few years, it can be easy to think about giving up – but don’t. As long as you have an overall big idea that you believe can add value to your customers, keep pushing through the rough parts until you come out the other side.

2. Appreciate what this phase brings

The toddler years mean that the initial newborn joy is officially behind you. But these small humans also bring their own kinds of joy, as you watch them learn new skills, say funny things, and give affection back to you. While your two-year-old business may not hold the same exhilaration for you as it did during those first few months, there are now different things to appreciate about it: Maybe you’re expanding your product range, or employing new people who can take the workload off you.

3. Establish boundaries

Toddlers thrive on boundary and routine – and your toddler business will too. As it grows into a new phase, try and establish limits in terms of the type of clients you want to work with and the type of work you’ll do. It’s also a good idea to make a decision about the hours you’ll work and when you’ll switch off, which will help you establish a good work-life balance.

4. Take a break

Every parent with a toddler needs a break every now and then, even if that means a walk around the block (on your own!), a dinner out with friends, or even a few days away. The same is true for a demanding small business: every so often, remember to take time out to rest properly, where you switch off your laptop and completely unplug. You’ll return much more inspired and resilient to deal with the everyday uncertainty that it brings.

5. Give it space to make mistakes

While the unpredictability of a young business can be stressful and tiring, it’s also a time for trying new things without the risk of huge consequences if they don’t quite work. After all, it’s much simpler to change your USP if you’re a small business employing a few people, rather than a big company where 50 people are relying on you for their salary, or where you’ve received a huge amount of investment capital. While you may fail in some of the things you try with your business (in fact, this is almost guaranteed), see it as a toddler that’s resilient enough to pick itself up, dust its knees and keep moving forward.

During this phase of business growth it’s also essential to have the right type of medical aid cover. There are medical schemes such as Fedhealth which has a number of medical aid options and value-added benefits to ensure that your health and wellness is taken care of too. After all, the healthier you and your staff are, the more productive your business will be – during the toddler (business) stage and beyond.

While this phase can be frustrating, it’s a sign that your business is growing and adapting, rather than remaining in its infancy, and that can only be a good thing! So embrace the difficulties, learn from them, and watch as your business strides forward confidently into the next exciting phase.

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