Structural changes in your business can help position it for greater growth
ME businesses account for 42 percent of the workforce and contribute around 40 percent to Dubai’s economy, according to the 2016 Global SME Survey released by global insurer Zurich and Dubai SME. Micro firms (between one and nine employees) account for 72 percent of the overall business count in Dubai, followed by small and medium sized businesses, accounting for 18 percent and 5 percent espectively. While these are big numbers, it is still the case that on average 36 percent of businesses fail within the first three years.
Reasons for failure are varied and specific to industry, location and above all the individuals involved, but the most common causes in this part of the world are:
1. High competition/sales margins (33 percent)
2. Lack of sales revenue (20 percent)
3. Legal and fiscal problems (16 percent)
4. Customer/ employee health and safety (14 percent)
5. Reputation damage (13 percent)
I personally have launched businesses in ten different countries around the world over the past 25 years. With each new venture I learnt something new and invaluable, but the one thing that remains throughout is the need for a smart sales strategy.
Every business needs to generate revenue, otherwise it isn’t a business. Your strategy will depend on the nature of your start-up, but whatever that may be, ensure it is S.M.A.R.T:
In May 2012, having been successful in the international wealth management industry myself, I realised the biggest problem the industry had was in its sales strategy - the approach was wrong. The strategy used was to gather data on prospects and then cold call and book an appointment in order to then make the sale. The problem was many advisers were not fully qualified and cold calling is an archaic system that quite frankly irritates people.
In February 2013 I launched Finsbury Associates to take the sales process and turn it on its head, literally. I wanted to bring clients to us, not chase them around town.
The strategy was to create educational workshops where we would teach people what financial planning meant and how it could benefit them.
We created a plan and over the course of nine months did our research and tested to see if the model would be suitable for this market. We clearly defined the outcome we wanted and worked backwards.
Now, it is not enough to have a great product or service, so we had to develop a unique value proposition. Without one you will get lost among the competition. You need to define what sets your business apart, what makes your business unique. If you fail to differentiate, you will fail to build a brand.
In year one, we grew from just two or three of us to 50 staff. Hiring is one of the key elements for a start-up to consider. Our first job was to hire a really strong management team, so I found a marketer, a head of operations, and someone in finance. It was essential that everyone involved was a strong leader and bought into the concept of doing something different. If you get the management team right, it will pay massive dividends later on.
Having that first smart sales strategy is crucial, but you also need to be open to evolving and changing your strategy to suit market changes, be it a change in regulation, global economy or available technologies. We changed tact at Finsbury because we discovered the value in using social media as a sales platform that we hadn’t seen before, so investment was redirected there. It was a key learning for us to create as big an audience as we possibly could. In any start-up, you need to become the go-to person, the expert voice. Attain and share as much knowledge as possible in your particular subject.
Other key learnings from my time with start-ups have been:
1. Ensure you have a robust business plan in advance, but be prepared to be flexible.
2. Work out your budget and stick to it – you don’t want to run out of cash before you’ve even got started.
3. Don’t be afraid to try something different if you really believe it’s going to work.
4. Be passionate about what you are doing - if you truly believe in it and you work hard at it, you have a much better chance of making it happen.
5. Focus, do not get distracted – manage your time wisely.
Implementing a smart sales strategy keeps you focused and breeds success, it makes the whole sales process easier too. If you don’t hit your numbers, analyse it and determine what needs to be changed and change it. Then add the missed amount to the coming month’s goal.
Once you make these adjustments the momentum builds with each step and if you keep working at it, you will make it happen.
Spencer Lodge is the managing director at Make It Happen.