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ReWare Did One Crucial Thing That Most Entrepreneurs Are Too Afraid To Do

If you want your product to sell, make sure it aligns with your target audience’s wants and needs.

Nadine Todd

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Vital Stats

  • Players: Nothando Moleketi and Felix Martin-Aguilar
  • Company: ReWare
  • Launched: 2014
  • Visit: reware.co.za

One year into their start-up journey, ReWare founders Felix Martin-Aguilar and Nothando Moleketi sat down and did something that every single business, new and established, should do, and yet so few manage to do well (if at all).

They dug deep, assessed the business, and changed their business model.

Related: 6 Of The Most Profitable Small Businesses In South Africa

Here’s how they’ve successfully grown their start-up.

1. They closed a division

When Martin-Aguilar launched his start-up in 2014, it was as the South African partner of Spanish company Zwipit, a buyer and seller of new and pre-owned mobile phones.

Although the idea sounded good to Martin-Aguilar and Moleketi, who both had telco backgrounds, local uptake was not what they expected.

“South Africa has a hand-me-down culture and a big informal market,” says Moleketi.

“Unlike Europe, there just isn’t a big enough seller’s market here. We gave the informal market a proper price point to work from, but attracting sellers was extremely difficult.”

The lesson: Even if you’ve done your research and you’re incredibly passionate about your start-up, sometimes the business just doesn’t have the traction you expected. Take the time to review your strategy. Understand that focusing on one thing will always detract you from another, and evaluate where your best opportunity to win lies. If it’s not where you originally expected it to be, it’s time to pivot.

2. They adjusted their model to meet consumer needs

On the other hand, consumers were definitely in the market to buy pre-owned devices. “We were advertising to buy phones, but the market kept asking us how they could buy pre-owned phones from us,” says Martin-Aguilar.

Zwipit was still operating and bringing in revenue, which gave Martin-Aguilar and Moleketi the time to create their own brand, ReWare, which reconditions and sells pre-owned phones.

Zwipit and ReWare ran simultaneously for a year, until the partners could wrap up Zwipit and focus their energy on ReWare.

The lesson: Launching Zwipit first hadn’t been a complete disaster. “Buy and sell go hand in hand,” says Moleketi. “We understood the market better because we entered as buyers. We were able to critically evaluate price points and what consumers wanted. The experience made us realise that we needed a brand and product that speaks to the South African consumer.”

reware-products

3. They focused on educating the consumer

If Zwipit’s problem had been finding phones and purchasing them at price points that matched local perceptions, ReWare’s challenge was one of trust.

“Certified pre-owned (CPO) was a new concept in South Africa,” says Martin-Aguilar. “We needed to formalise it, which meant educating the market.”

The business partners realised they needed to leverage off bigger brand names. “We partnered with a retailer on a white label basis. ReWare supplied the phones, but our branding was nowhere to be seen. This can be risky if you want to build your brand. However, as a start-up it was more important that the market started understanding and appreciating CPO. Educate the market first, and then supply the product.”

The lesson: Evaluate the pros and cons of every decision. The payoff of educating the market was worth making a white label deal. You can hold on to your product, idea and name, but then what? What’s the point if no one understands what you do? You can’t get market share until you’ve actually created a market.

Related: Uzenzele Holdings Unpacks The How And Where Of Business Funding

4. They found the right partners

Ecommerce in South Africa is growing, but Martin-Aguilar and Moleketi knew that placement in physical stores was essential for the growth of their brand, and so they started looking for alignment. “Understand the objectives of any potential partners you approach,” says Martin-Aguilar.

“You need to make sure that your offering aligns with their needs, otherwise you’re just wasting everyone’s time.”

In ReWare’s case, Martin-Aguilar first started talking to the Edcon Group from a buyback perspective. He was interested in whether the retail giant would offer to buy back client phones when they upgraded.

The discussion revealed that Edcon consumers are looking for smartphones — particularly iPhones — which the group didn’t stock. CPO stock was also at a price point that Edcon couldn’t offer with its brand new Apple iPhone or Samsung Galaxy smartphone ranges, and so the business model was compelling for them.

“There’s a lot of synergy between us and their consumers,” says Moleketi. ReWare is currently in 21 Edgars stores, one Edgars Connect store, ten Jet and Jet Mart stores as well as CNA Online and Jet Cellular Online to test the uptake of the offering.

The lesson: Take the time to listen to what your clients (and potential clients) actually need. “We saw this so much when I was in the telecoms space,” says Martin-Aguilar. “Business owners are so busy pitching their product to you, that they don’t listen to what you need. Take the time to listen to your client and adjust your offering accordingly. That’s how you build a business with a compelling offering.” 

5. They looked for additional revenue streams

Once you’re operational and know what your core business and area of expertise are, other revenue stream opportunities start presenting themselves.

“We have two core ranges, ‘as is’ and ‘good as new’. This means we need to be able to fix and refurb phones, and so we import parts,” says Moleketi. “So now we’re importers of LCD screens. Who else needs screens? We’re importing parts anyway — where can we add value?

“While in discussions with Vodacom, the question was asked of us: Do you have parts? This has added a great additional revenue stream for us.”

It also led to an even bigger opportunity. “The parts business is tricky. The chain of custody is long. We test something, it works, the device travels to Vodacom, the tech guy opens it and says, no, it doesn’t work. Now we have a problem. We have a good relationship with our client that we need to maintain, but there are QC errors and they can’t be tracked,” says Martin-Aguilar.

Related:

To deal with the problem, ReWare has developed an app that allows everyone in the chain of custody of a device to photograph it with a unique serial number. This means QC is tracked from start to finish.

“Here’s the secret to great solutions,” he adds. “If you have a need, chances are someone else does too. And this was no exception. Operators like the concept because they have a huge need for it. Think about this: Customers drop off their phones for repair. They’re sent from a store to a central tech centre, then back again — all via courier. Multiple hands handle each device, and by the time the customer gets it back and says there’s a new scratch or problem, no-one can track when — or if — it happened. If everything is tracked and documented its straightforward. There’s no finger pointing and everyone is accountable.”

The lesson: Multiple revenue streams work if you’re finding the gaps in areas where you’re an expert. Everything should be related. Ask yourself: As a business, where do you add value and how can you do more and offer more with what you have?

Do this

Be convinced about your idea, but don’t try so hard to educate your customers that you don’t listen to what they have to say.

Nadine Todd is the Managing Editor of Entrepreneur Magazine, the How-To guide for growing businesses. Find her on Google+.

Upstarts

Watch List: 11 Teen Entrepreneurs Who Have Launched Successful Businesses

These teens are proving that you don’t need a driver’s licence – or the ability to vote – to create and execute a successful start-up.

Diana Albertyn

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In South Africa youth entrepreneurship is encouraged as the best way to build the economy. Teens are no longer relying on tertiary education to jumpstart their careers, as many high school students become budding entrepreneurs. From make-up to confectionary and tech-centred ventures, youth entrepreneurship is taking the business world by storm.

“It’s easier than ever to become an entrepreneur, and technology has a lot to do with it. You’re a tech-savvy millennial, and Internet and mobile technologies make it easier to connect and identify with people, based on shared values and ideals,” says Michael Freestone, founder of the MJF Group. “All entrepreneurs wonder if their companies will succeed, but you don’t really know until you try. So, do it while you’re young and have little or nothing to lose.”

And that’s exactly what teenagers across the country are doing. While being a teenager is stressful enough, without worrying about marketing and your bottom line – these young entrepreneurs thrive on success, which must be their secret sauce to their winning business ideas.

  1. Rabia Ghoor
  2. Cory Nieves
  3. Nathan Woodrow
  4. Isabella Rose Taylor
  5. Mikaila Ulmer
  6. Moziah Bridges
  7. Tony McPherson
  8. Anthony Veck and Malvin Musanhi
  9. Reabetswe Nkonyane, Phumla Mvila, and Thandokazi Mtshakazana
  10. Omphile Sekwele and Didintle Nkambule
  11. Fisokuhle Lushaba and Wendy Nkosi
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Upstarts

10 Young Entrepreneurs Under 30 Share Their Start-Up Secrets

The future of entrepreneurship has never looked so bright…these young entrepreneurs share their wisdom around building a successful business.

Nicole Crampton

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Natural Talent Can Become Your Success

Thabo-Khumalo

Thabo Khumalo

Thabo Khumalo – ToVch

“I learnt to design and sew while assisting my mother who was a seamstress, and that is when I realised that I had a talent to create,” Thabo Khumalo explains. “But I never knew I was an entrepreneur.” Thabo Khumalo started his company ToVch in 2010 and has since appeared in South African Fashion Week, Soweto Fashion Week and Mpumalanga Fashion Week.

Khumalo has a small but engaged audience, who he communicates directly with. “The brand has a dedicated audience, and the social media presence also allows me to continuously scan the fashion environment to keep up with external forces.”

The Lesson

One of the most challenging aspects of launching his businesses was marketing the brand with limited funds. He used social media and word-of-mouth to market. “On social media, people share your brand with others simply because they want to,” says Khumalo. “It’s a powerful platform, and it does not cost anything.” Khumalo built up his company using support from a strong online network, which became his marketing strategy.

Read more on How Fashion Start-Up ToVch Built A Brand Presence With Only A Little Budget.

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Upstarts

For Founder Of National Tekkie Tax Day Having A Higher (Business) Purpose Keeps Her Driving Forward

The NGO space isn’t easy. It’s a constant uphill battle to connect scarce resources with the vulnerable. Annelise de Jager has persevered in this space because she’s tapped into her personal purpose and values.

Nadine Todd

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Vital Stats

  • Player: Annelise de Jager
  • Initiative: National Tekkie Tax Day
  • Launched: 2013
  • Visit: www.tekkietax.co.za

Use your purpose to drive you forward

Connect your purpose with what you do, and you’ll find untapped reserves of perseverance and the discipline needed to achieve your goals.

Purpose before profit is not a new concept in business. In fact, it underlines the motivations behind some of the most successful entrepreneurs. It’s also not reserved for social enterprises alone.

However, it is in the social entrepreneurship and charitable spaces that living one’s purpose first found a foothold, mostly because without a strong purpose, the work would just be too hard, and many would give up.

Annelise de Jager, founder of National Tekkie Tax Day, unpacks how she’s used living her purpose to drive her forward, even when she’s faced almost insurmountable challenges and disappointments.

Make ‘living a life that matters’ intrinsic to everything you do.

“I was lucky in that I didn’t ever need to sit down and say, ‘I want my life to matter, so I need to do x, y, z’,” says Annelise. “It was intrinsic for me. However, in the past five years I’ve become acutely aware of it, and I’ve seen how important the ability to look beyond oneself is when you’re facing disappointment and challenges.

“It helps you look beyond the now, find a solution and keep pushing on, because there is a bigger goal at stake. The biggest revelation for me has been that anyone can figure this out and use it as a tool to achieve their dreams and purpose — you just need to trigger your intrinsic motivators.

Related: ReWare Did One Crucial Thing That Most Entrepreneurs Are Too Afraid To Do

“Figure out what’s really important to you, and then align this with what you’re doing, in both your business and personal journeys. Robin Bank’s Mind Power and Shaping your Destiny courses are a great place to start.”

Don’t be afraid to ask what’s next

Critical to Annelise’s journey has been the realisation that when goals are met, we need to ask ourselves: What’s next? “Too many people achieve their goals and then feel adrift. You should meet your goals. Your ultimate vision should change. That’s growth, and it’s critical if you want to keep moving forward.

“Our experiences inform our knowledge base and world views, and so as you live and run your business, that view should be changing, bringing with it new challenges and perceptions. Don’t be scared of it; embrace it.”

Annelise went to Potchefstroom University to study social work where she joined the university’s musical revue group, the Alabama Student Company. “Alabama was given the opportunity to tour Taiwan, but I was about to graduate. Travel is high on my personal values list, so I started a second degree in communications to stay in university — and — in Alabama.”

New experiences can be the source of great ideas and strength

Studying communications opened Annelise to a new discipline that she loved. “Marketing and communications are so filled with energy — an energy social work didn’t possess. I loved both, and I wanted to find a way to meld them together. This would ultimately shape my business, The Marketing Team, after I’d been a social worker for a few years. Don’t be afraid to adjust your plans based on new experiences; they can be the source of our greatest ideas and strengths.”

Related: Reel Gardening Warns That Innovation Is Never Easy

No experience is ever wasted

“We spend too much time trying to plan exactly what we should be doing, where and when, instead of following our hearts and instincts,” says Annelise. “No experience is ever wasted. Once I discovered my love for communications, I questioned whether I’d wasted four years studying social work. I hadn’t.

“Both disciplines became the bedrock of how I would assist the charitable space in South Africa. Experiences open our eyes, our hearts, and our understanding. They give us empathy and patience. They allow us to view things from other perspectives. If you want to really make a difference in other peoples’ lives, these traits are invaluable.”

Be open to finding answers in unexpected places

“By 2004 I felt rudderless,” says Annelise. “I’d been running my own business, handling communications and marketing for NGOs, developing campaigns and even assisting NGOs to run more as businesses than under-funded organisations, but it didn’t feel like I was doing enough.

“Part of the problem was that you can only give people the tools to work with, you can’t make them use them. Another problem was under-funding. Corporates spend billions each year on CSI projects but they don’t like to fund salaries and basic operational expenses.

“It’s frustrating because volunteers can’t do what needs to be done — most households need two breadwinners, which limits the availability of volunteers to assist.

“I was looking for a way to add more value. Should I start my own NGO? Where could I make the biggest impact? I’d been offered an excellent coaching position, which would allow me to walk away from the problems this sector deals with daily. It was tempting, but it wasn’t what I wanted.

“At that time I attended the Global Day of Prayer in Argentina on behalf of a client. It was at that conference that I had an almost supernatural experience. I left knowing exactly what my purpose was.

“How these realisations come to you is less important than the fact that you’re open to them. Deep down I knew what I wanted and needed — I just needed the courage and fortitude to follow my path. My experience in Argentina gave that to me because I allowed it to.”

Always find the strength to persevere.

Nothing worth doing is ever easy. In the NGO space, this is particularly true. “I developed the idea for National Tekkie Tax Day because NGOs constantly asked me to help them develop funding campaigns. I developed this fundraising model when I launched Casual Day and ran the project successfully for 18 years.

“But I also believe the NGO space can benefit from a more unified mindset to overcome donor confusion and fatigue. This is my new focus, but it’s difficult to get organisations to shift their mindsets. National Tekkie Tax Day is a step in this direction.

“It encompasses 12 national NGOs and 1 000 regional organisations across five categories — but there’s one product and one national marketing drive. Donors can choose a category to support.

Related: How Fintech Zoona Is Solving Customers’ Real Problems

“I’ve needed to persevere to help NGOs see the benefits in working collaboratively, and corporates to see the benefits of supporting the operational costs of NGOs.

“I don’t have a high profile job at a top company. People don’t call you back in my world. And yet you need to keep pushing forward against incredible headwinds.

“I wake up each morning and repeat the mantra that my success helps everybody; my failure helps nobody. There won’t always be easy wins, but with the right purpose you can persevere. You can make a difference.”

Support National Tekkie Tax Day on 26 May 2017

12 national charities | 1 000 local charities | 5 sectors to support

Animals, Bring Hope, Children, Disability, Education

Available at Toys R Us, Clicks and Babies R Us or online at www.tekkietax.co.za

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