Great idea, wrong spot
- Borjan and Lidija Ivanonic are the founders of Balkan Burger.
- What started as an experiment at a farmer’s market has grown into a full-time, highly profitable and successful business.
“We bought a 1967 short-body school bus that we converted into a mobile food truck. We took it to Arts on Main in Maboneng and parked it at the entrance of the market, but that didn’t work out for us. It was a great marketing tool – people would stop and chat and want to learn more, but they’d always say they’d come back after looking around and then forget about us.”
Borjan Ivanovic is very candid about the wins and losses of growing Balkan Burger. Effectively pioneers of mobile food trucks in Joburg with no one to guide them, they spent a lot of money buying and outfitting a very cool mobile food truck that was not yet needed.
A combination of being a purchase made too soon and positioning it in a bad spot for food sales, it was a costly trip-up that only started paying itself off once they joined other markets and started landing catering jobs.
Wanting to start a business? You should read these books first
Give people what they want, not what you want
- Andrew Leeuw and Herzon Louw are the founders of Sumting Fresh.
- Starting out as a food trailer in the streets of Midrand and making negative profits at first, they’ve since grown by 9 000% and have a staff contingent of 18.
“I’m a qualified chef and opening my own restaurant was just far too expensive to consider. I figured I could bring people restaurant-quality food from a food truck but learnt hard and fast that that’s not what people wanted. They wanted street food.”
Andrew Leeuw and Herzon Louw learnt a costly lesson in their early days as street food vendors. They were serving expensive food, expensively, because that’s what Leeuw thought people wanted. The minute they pivoted and focused on selling quality street food at value-for-money prices, sales rocketed. They went from 80 portions and – R480 a day, to 120, 240 and beyond.
“We really had to take a hard look at ourselves, develop our own identity and style, and then bring it to the people. Be flexible, take criticism constructively, and don’t wait for the customers to decide who you should be.”
Read more: 4 Ways Entrepreneurs Can Become Truly Great
Estimate how long you think something will take, then double it
- Yossi Hasson is the co-founder of Synaq.
- Established in 2004 the firm underwent major changes that allowed the business to scale much more efficiently.
- In 2011 Dimension Data bought a 50,1% share in the business, allowing them to scale at even greater speed.
“When we made the decision to convert from a product-based business to a service-based business, we lost R1,8 million, we owed SARS half a million rand, and grossly underestimated the complexity of the change and planning for it. What we thought would take six months actually took two years.”
It was an incredibly tough time for Yossi Hasson and his business partner David Jacobson, but they maintain it was the best move they ever made.
“We recovered through management pay cuts, we froze salaries, cancelled outsourced providers, managed expenses like crazy, managed to get clients to pay upfront for a small discount, and convinced shareholders to give a little bit more money.” The major lesson they learnt about change?
“Now we always get advice and manage expectations before we start, so we have a more realistic timeline of how long something will take.”
Read more: Yossi Hasson’s full story here
Look before you leap
- Chris Ndongeni is the co-founder of Twin Cities Cleaning Services.
“We should have done more research about the contract cleaning business and industry before we started. We’d landed our first contract with Man Truck and Bus, and on our first day we were shocked to find that there was absolutely no cleaning equipment or detergents and the previous contractor hadn’t left anything behind. We scrambled and made expensive purchases because of that.”
Business plans belong to the last century. Gone are the days of creating 40-page, detailed documents about your business, it’s target market, competitors, finances and so on.
Today it’s about the lean canvas: Starting with a hypothesis, testing it, and quickly iterating depending on the results of your test. Even though this method requires less research, research is still very necessary.
Ensure you know what permits, certificates, and approvals are required to operate in your industry, how competitors are operating, and then figure out what you can do differently.
Do what you know
- Ross Wilson is the founder of urbantonic, a Cape Town-based eventing agency.
In 2007, Ross Wilson made a business decision that would take him almost five years to recover from. Despite his background in eventing, he bought a joinery business.
“Urbantonic was a successful, growing business, but I’d been building it for almost a decade and I thought it was time to branch out. My ego was sky-high. I thought I could do anything, in any industry.”
This would turn out to be a very expensive assumption. 20 months after buying the joinery business, Wilson managed to close it down. It would take a further three and a half years to pay off the debts associated with the business.
“I kept thinking about that Top Gun quote, ‘Son, your ego’s writing cheques your body can’t cash. We built up urbantonic slowly. We offer incredible customer service because we’ve never over-extended ourselves, so our growth has been organic and self-funded. We’ve never spent what we don’t have. And most of all, we know this industry inside out. The joinery business was none of those things.”
Read more: Ross Wilson’s full story here
Hire for cultural fit, not skills
- Irfan Pardesi and Hina Kassam are the founders of ACM Gold, a R350 million + gold and foreign exchange trading company.
Of course skills are important, but many entrepreneurs have learnt to their detriment that a person with the right skills who is a complete cultural mis-match with the company will bring everybody down, and even put your business at risk.
Irfan Pardesi and Hina Kassam, founders of ACM Gold, learnt this the hard way. As their start-up grew, they started building up a team. The problem came when they made the decision to bring in an experienced management team. They focused on the credibility that they thought big names would bring to the business, instead of whether those same names suited the company’s culture.
“The whole culture of our company started shifting – it was no longer what we had worked so hard to build. It took us months to rectify, and cost us a lot as well. Today we know, always hire for cultural fit. Attitude is everything. Skills can be taught, experience gained, but you’ll never change a person’s values and personality.”
Read more: The Midas Touch: Hina Kassam & Irfan Pardesi
Know your numbers
- Kerryne Krause-Neufeldt is the founder of I-Slices Manufacturing, the producers of eyeslices.
When Kerryne Krause-Neufeldt launched her business, she was so focused on customers and making sales, that she neglected the inner-workings of her own company.
“I particularly wasn’t good with numbers,” she says. This was Krause-Neufeldt’s biggest lesson.
“It’s easy to abscond the numbers to the ‘finance guys’, especially if you don’t have a background in finance. I didn’t even know we weren’t paying PAYE, and ignorance is no excuse. You need a basic understanding of numbers at the very least.”
Once she realised the shambles her start-up’s finances were in, Krause-Neufeldt realised the buck needed to stop with her.
“I did accounting for dummies, followed by financial management workshops. It was time consuming, but worth it. It was the only way for me to truly be in control of my own business. Now I can spot problems in the figures at a glance.”
Read more: Kerryne Krause-Neufeldt’s full story here
Everything will always take twice as long as you think it will
- Vusi Thembekwayo is the founder of Motiv8.
- He is a Dragon on South Africa’s Dragon’s Den, and the youngest JSE director in SA.
Vusi Thembekwayo is not the first entrepreneur who learnt this lesson, nor will he be the last.
“By the time I launched my motivational speaking and strategic consulting business I had top tier experience at a local FMCG giant. I knew business. I had seed money from ring-fencing and selling the division I’d built up and ran.”
Thembekwayo certainly wasn’t green behind the ears, and yet his start-up journey ended up being very different to how he imagined it to be.
“I used that money to get set up in fancy offices with a PA. I thought that was what you needed. And then it took eight months to get my first client.”
Eight months of zero income, and expensive overheads. Thembekwayo was sleeping in his car, fending off the bank who wanted to repossess it because he wasn’t meeting the payments.
Today that business has a turnover of R140 million, but Thembekwayo will never forget his first real start-up lesson: However long you think it’s going to take to get going, triple it. And you still won’t be there.
Read more: 10 Tips From The Dragons Of Dragons’ Den SA
Not everything is an opportunity, some are a waste of time
- Mongezi Mtati is Founder and MD of WordStart, a word of mouth marketing firm that connects brands with influencers.
“Your time is yours to pour into the business, not to use on non-paying efforts that present themselves as opportunities,” said a mentor who was discouraging Mongezi Mtati from taking on more work for exposure. “The advice fell by the wayside,” admits Mtati. “Unfortunately, he was right.”
Mtati knows the situation well: When you’re starting out, people offer you the opportunity of ‘exposure’ in lieu of billable work and hours. Start-ups that are desperate to build up their portfolios often agree.
“The reality is that most of that exposure does not amount to billable work. It ends up being a waste of time that could have been used to either make money or spent in the business waiting for the phone to ring or drumming up sales. It could even have meant going to SARS for an hour or two, which saves you pain and punishment later in the year.
“The rule is simple: Don’t work for free,” he says. You’re there to make money, so do it.
Never treat the business’s cash like your own
- Lebo Gunguluza is the founder of the GEM Group and a Dragon on South Africa’s Dragon’s Den.
Like many young entrepreneurs, Lebo Gunguluza treated the money his start-up made as his own. After a few weeks, he realised that he needed to start saving the cash he was making in a bank account if he wanted to hire some help. It wasn’t a lesson that translated into good cash flow principles. The more the young entrepreneur made, the more he spent.
On the one hand, he was a bootstrapper, and he made his first million at the age of 27 without funding, tenders or loans. This just meant that he at least didn’t owe anyone money when he went bankrupt a year later.
“I spent my first million in one year,” he says. “Instead of using the money I was making as seed capital, I bought a GTI and partied like there was no tomorrow. It didn’t take long before I was flat broke.”
He learnt from that lesson, built himself up, and never squandered cash again, and to this day he warns other young entrepreneurs: Never treat the business’s cash like your own.
Read more: Lebo Gunguluza’s full story here
The Importance Of Being Organised For Your Start-up
If you are not convinced that it is an important aspect of owning a start-up, read on for reasons why being organised is important for your start-up.
So, you have decided to create a start-up. This is great news, especially if you have solid plans in place and have attainable business goals. However, if you are somewhat of a tidsoptimist or are disorganised, then your start-up could be something of a nightmare to begin with.
Being organised does not have to be difficult or take up too much time. But if you are not convinced that it is an important aspect of owning a start-up, read on for reasons why being organised is important for your start-up.
Schedules are crucial
Established business people understand how a schedule can significantly contribute to business success. You do not have to be at an executive level in order to follow an executive schedule, and setting one up for your start-up can work wonders for how your business grows.
You should take time on the weekends to plan out your week, writing down all obligations, meetings and tasks that you have to finish. Seeing your week written down in front of you will help you to stay on task and will make it easier for you to complete them on time.
Having a schedule is important, as you are the leader of your start-up and you need to stay organised and set an example for any staff you have.
It saves you time
Being organised saves you from rushing around, searching through paperwork to find that one invoice or bank statement. You can use business processing solutions to help you to capture and collect forms, as well as outsourced document collection to save you from having to chase clients for forms and documents.
You should invest in having a well-structured filing system, both in the office and digitally. Use neatly organised folders with clear and relevant names on them for all of your documents, bills and emails. By doing this, you can free up hours of the day to work on important tasks, such as drumming up more business through a new and exciting marketing strategy. You will also be setting an example for your team by having an organised office and computer.
Procrastination can be toxic
When tasks get put off due to disorganisation or procrastination, everyone fails. Not only will you feel bad for not completing a task on time but your clients and possible business partners will see you as unreliable, which is hugely damaging to any start-up. Many instances of procrastination can be linked to not being an organised business.
This is one of the major reasons why organisation in a start-up is essential. You will spend less time procrastinating and more time achieving goals and completing client tasks. Spend time every day organising your digital folders and your physical folders before you start working. This will ensure that there are no distractions throughout the day and you can complete all the important tasks on time and within budget.
Organisation keeps your employees on track
You cannot expect your employees to stick to their schedules and stay organised if the person at the top doesn’t do the same. As the leader of your start-up, you need to set an example for your staff, which means that you have to be the most organised person in the company. While it is important to ensure your employees follow suit, try not to be too overbearing about how they choose to organise their days.
By keeping your company organised, you will be better able to keep your employees on track, making it easier for them to finish tasks on time. This is because they will not be spending time searching for important documents that have been filed in the wrong folder (or not even filed at all) but rather focusing on completing tasks and building your profit as a company.
You can improve customer service
By using organisation techniques, such as document processing solutions and an outsourced document collection service, you will be able to improve customer service. Problems with organisation can lead to a drop in customer service, which is highly detrimental to any start-up. Customer satisfaction is key to any return business, which is why you need to be organised.
If you have a poor billing system or are constantly losing invoices and important documents, soon your clients will move on to greener pastures (and more organised businesses). If you implement a strategy to become more organised, you will find your customer service improving. This will lead not only to return clients but to new business, as word-of-mouth travels about your professionalism and efficiency.
Keep ahead of the curve
As a start-up, you likely have a lot of competition in your industry. This means that you need to stay organised in order to keep ahead of the curve. By being more organised, you will be able to meet client briefs on time and keep to your schedule. Organisation is important for your start-up because it saves you time, stops you from procrastinating and keeps your employees on track. With improved customer service due to your efficiency, you will soon find your business growing in leaps and bounds.
Want To Jump-Start Your Ecommerce Business? Try A Pop-up Shop
The first thing you need to know: A pop-up isn’t about stocking shelves and hoping people browse. It’s about attaining a ‘wow!’ status.
Facebook talked a good game about its 3-D virtual-reality headset, Oculus Go, during the platform’s annual development conference, F8. Still, the social media behemoth knew that words alone couldn’t make anyone but early adopters fork over the dough.
Consequently, Mark Zuckerberg’s team made a bold, radical departure by opening an Oculus pop-up shop to showcase the company’s newest technology.
Interestingly, the Oculus pop-up was arranged, Foot Locker store-style, to give browsers the opportunity to try the device rather than instantly buy it. Sure, eMarketer predicts ecommerce will exceed the $4 trillion mark by 2020; but, as a Retail Dive survey showed, nearly two-thirds of consumers remain leery of this consumer channel. They want to physically experience merch before handing over their hard-earned cash.
Hence, Facebook gambled, not on its core platform but on the expectation that die-hard, wannabe Facebook and VR fanatics would share their experiences on social platforms, bringing awareness, hype and, eventually, sales, to an emerging product.
Not surprisingly, that was, and is, one smart bet.
We’ve come a long way, baby, but smell-o-vision still isn’t available
What makes a temporary pop-up store such a powerful differentiator? In a nutshell, it’s tactile products. Forget that people are buying stuff online; they still appreciate a solid in-person demo. Plus, a well-managed pop-up is an intriguing prospect: No basic retailer can match the energy, intensity or uniqueness of a fleeting pop-up that’s literally here today, gone tomorrow.
Besides, pop-ups make odd or brow-furrowing products easier to understand. For example: A beeswax alternative to Saran Wrap? It’s tough to envision that product’s inherent value unless you see it in action and get answers to your questions, face to face from an expert.
Ultimately, pop-up stores raise brand awareness and generate loyalty. At the same time, they aren’t the place to make sales – they’re marketing events engaging brand loyalists who love the company’s message and want to interact. Sure, new influencers are bound to stumble upon pop-ups, too, but the truest emotional connections come from people already knowledgeable about the product line.
For example, a Harry’s pop-up shop’s purpose wouldn’t be to introduce guys to its razors. How many would care? Even more important, why would they switch? The pop-up, instead, would be to magnify Harry’s branding by creating an experience for people curious about why they should use its products.
An ideal Harry’s pop-up would offer haircuts, shaves, hipster drinks and other memorable experiences. After getting the best shaves of their lives, super-fans would head online and do some organic referral work to spread the brand’s message.
In response, people who trust those influencers would head out to the pop-up sooner rather than later, worried they’d miss the fleeting chance to see the fuss. Their actions would be all-too-human, according to Shopify: Individuals routinely flock to scarce, novel opportunities. The reason: FOMO is a powerful force.
Eager to get started on your own pop-up adventure? One that gets tongues wagging and fingers swiping? Before you pitch a pop-up tent on the corner green next week, pull in the reins. Pop-up shops require some serious forethought and planning.
1. Choose a location that caters to your audience
When our company put up The Nest pop-up to showcase many of our clients’ brands, we picked a place where our target personas hung out: Abbot Kinney Boulevard, in Venice, Calif. It’s known nationally as one of the country’s most expensive retail streets, putting us in front of the sophisticated, high-end community our brands serve.
After picking the locale, we used the pop-up to highlight a series of rotating brands. At the same time, we kept the atmosphere fun by serving healthy vegan popsicles, playing great music and consistently engaging with visitors. The idea was to create a complete experience from beginning to end, catering solely to the people we wanted to impress.
Your pop-up should be similarly based on your ideal visitors’ profile, whether that might mean a twentysomething socialite or a hip baby boomer. When you know your audience, you can arrange a locale that fits. From that point, you should create landing pages and send emails to your hottest buyers. Take advantage of organic shares and ad-targeting, along with Facebook event-creation and retargeting. Your goal? Pack your launch party (and every day thereafter) with eager faces.
2. Ditch anything that doesn’t elicit a “wow!”
Say it with me: “experiential.” That’s the pop-up mantra. Your only job is to provide a huge, memorable experience. Forget about stocking shelves and hoping people browse – this isn’t How to Run a Lame Mall Kiosk 101.
For instance, when Target set up CityTarget, its Chicago Millennium Park pop-up, the store wasn’t like a typical suburban big box store: Instead, it offered commuters special CityTarget coffee and a few tchotchkes. One morning, CityTarget even set up a spin class. Another day, kids created CityTarget-logo-ed kites from scratch. Its final event? A launch for the full-store version of CityTarget for VIGs, or “very important guests.”
To attain “wow” status, map out every second of the pop-up flow (from the amplified, hyped launch party to the fireworks-inducing last moment). Keep the momentum going with live day events: Workshops, speakers and guest appearances keep the days hopping. Oh, and don’t forget to have a dedicated iPad to capture visitors’ emails and send instant welcome drips.
3. Follow up after the pop-up becomes a memory
Pop-ups are temporary, but impressions are lasting if you re-engage your guests. The Nest lasted three months, and it wasn’t a profitable up-front endeavour. However, we set out to monetise it later by treating it as a marketing exercise to broaden our clients’ brand scopes and widths. By following up, we ultimately made money down the line.
Of course, some pop-ups buck this trend. Toms Shoes is a great example: It started as a fleeting project and ended up becoming a permanent hangout spot in Abbot Kinney. People hang out, work, drink coffee and occasionally buy Toms merch. Still, don’t rely on an immediate profit. The Marc Jacobs pop-up dedicated to its Daisy fragrance sure didn’t. To the contrary, it allowed people to use “social currency” in the form of #MJDaisyChain on Instagram and Twitter.
The way to make money is by taking the valuable connections you make and turning them into evangelists. Reach out via email and thank those who shared social photos. Then, send out coupons to anyone who missed your pop-up.
You don’t have to be Facebook or Target to get significant foot traffic and loyalist love from a pop-up store. All you need is the right location, a solid planning team and a strong after-event marketing plan. Now get out there and make some brag-worthy experiences for your target audience.
Read next: 3 Types Of Ecommerce Business Models
This article was originally posted here on Entrepreneur.com.
5 Actionable Tips For Novice Entrepreneurs To Skyrocket Their Business
Just follow these tips and your business will certainly go a long way.
Trying to curate a listicle of suggestions that can be given to any newcomer in the entrepreneurial world is really a task. Even if there are already more than five or ten pointers in the list, they don’t seem to be enough. Myriad of changes can occur in a businessman’s journey from a startup to an entrepreneur. Still, here are some effective tips for you to get a strong foundation on which you can build a flourishing organization.
Just mix and match these ideas with your own thoughts. Finally, you will be able to overcome the obstacles that will come in your path of becoming a successful businessman.
1. Build a culture of learning around you
The businessmen who’ve already established themselves, understand that there will be loopholes in their knowledge and expertise. They never cultivate the feeling of self-content. Rather, they make sure to alleviate with a perfect commitment towards learning.
So, if you want to earn the same reputation and degree of stability in business, you must follow in their footsteps. One of the best approaches to do that could be investing in professional development training for the entire company. Try to make the most out of the resources around you like industry publications, professional network and so on.
2. Co-operate with reliable partners
New business owners should never hesitate to choose who they want to work with or hire. If you are one amongst them, aim for a variation in your stakeholders and clients across different levels.
Wait! You are not supposed to look for a racial and gender diversity. Rather, it is all about a miscellany of experiences and backgrounds. You must work with reliable people.
3. Be constantly focused
You might be eager to grab every opportunity that you come across. Well, that’s not something you should be doing as a new entry in the business world. Be careful and always make sure that you are not losing track. If you end up juggling hundreds of ventures during the initial period, it will spread you thin. Finally, you will lose your efficacy and productiveness. Make a rule to deal with one thing perfectly rather than trying to manage twenty things poorly.
Wait! It doesn’t mean that you shouldn’t take up new projects. Of course, you must. All you need to take care of is the number of new works in your hand shouldn’t exceed your capability to accomplish them perfectly.
Related: 21 Steps To Start-Up Success
4. Work with a budget-friendly approach
Remember, you’ve started with a new thought amid millions of other ideas which are going strong for years. It is important for you to act strategically and smartly, especially when it comes to financing. You must create a business proposal which includes all the startup costs and expenses. However, make sure that you are not taking the first step with redundant expenses.
You must be clear with the idea of when it is the right time to throw the towel. Too much cash outflow can even cause bankruptcy. Before you open the doors to a new business, generating financial goals is a great idea. If you follow this tip, you will certainly be benefited.
5. Welcome failure with open hands
Of course, you’ve not gone into the business while expecting to fail, yet failure is a fact of life and every single one of us must bear it. There is no way to combat this reality.
In such a scenario, you must do what the biggest business tycoons have already done for years. Take every failure as a desired learning opportunity. It is pivotal to understand that setbacks bring a positive energy to fight back with a new enthusiasm. If everything goes on perfectly, you will not get a chance to learn something new and have new experiences. So, failure is important, make sure you to embrace it.
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