Here’s two important words for start ups:
Follow up.
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Category: supply chain
Product vs. Service
Which is better for your start up? I say service, qualified by the fact that I have just been involved in a product launch. The main advantage with a service is that every customer experience is new production run. You can change the delivery – instantly. Not so if we have just produced 10,000 widgets. We must sell first, then adapt and improve. Services have the following advantages:
- Lower start up costs
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Shorter supply chains
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Reduced cash traps
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Direct selling to consumer
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Ability to change marketing mix quickly
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Possible electronic duplication
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Ability to leverage your employee skills
This is not to say products don’t have advantages. They are just more difficult to launch. Of course, both products and services can be successful. But for our first start up foray, we should try to make it as easy as possible.
Single Minded Proposition – V 2.0
There’s nothing more powerful in marketing than this. It allows the other important things to happen. Like being remarkable, sexy, premium, eyeball worthy, first, functional or ‘the’.
There’s another reason it counts. It makes the un-fun part of a start up easier. The administration. It’s far easier to do all the non audience stuff when you only do, make or sell one thing. Accounting, banking, inventory management, production, tax, supply chain, warehousing, distribution, invoicing et al… all become less arduous.
Then we can focus on the stuff that really matters.
Cold Calling
Cold calling is difficult. What choice do we have when we are establishing a product in a new distribution channel? One in which we have few contacts. (note: my definition here is B2B & excludes interuption phone calls to private dwellings)
Try two phase calling. Turn up and ask for the manager or owner. You only want 5 minutes to talk about an idea with them. You simply tell them what you are doing and ask for some input. It goes something like this:
We are developing X and think it could be good for your industry or a business similar to yours, but we’re not sure. This is what we are thinking, what do you think…?
Two things often happen. Firstly they tell you what type of marketing you should be doing. Then, they may ask you to bring in your widget to show them next time. What it needs to be successful is a low status approach. Let them they own part of the idea. Collaborate with them. Don’t bring anything with you. No samples, no brochures, nothing. Just talk with them.
If they’re not interested move on. Don’t be annoying.
This can work because you remove their defenses. They don’t have to figure out a way to reject you. Then next time you come to actually sell something to them, it’s not a cold call, it’s warm.
Rainmaking
In the movie The pursuit of happiness, there’s a seen where the main character asks a successful Ferarri driving stock broker his secret. He replies with two things, “People and numbers”
What it doesn’t mention is the subtlety of this statement. It’s actually about numbers ‘of’ people. It’s the art of rainmaking.
The most important role in any start up is your ability to make rain. (read here sell). It can only be done by hitting the pavement and phone. Our technical and strategic brilliance will need to the back seat for a while. Especially in launch phase.
Success ratios aren’t nearly as important as the number of calls we make. The former improves when we focus on the latter.
Priority List
Some advice from the street. Love jobs can kill your start up.
Definition
Love Job : Engaging friends or colleagues to perform specific, crucial tasks which one would normally pay for.
Through our journey as entrepreneurs we’ve engaged the help of friends, colleagues, professionals. In this category fall tasks like legal advice, design, advertising. They’re always happy to help, but when it’s delivery time, they got caught up, their boss was on their back, their dog died…
They didn’t make time because they weren’t getting paid. We were low on their priority list. Love Jobs are part of entrepreneurship and bootstrapping. You should and will use them. But if something is vital and you can afford it, it might be best to pay for getting it done and meeting your timeline.
Dreams
You need believers in your value chain. When engaging potential suppliers, many won’t get it. Sure, they’ll book a meeting with you and discuss supplying their widget. But invariably, ‘Joe Salary’ will find a reason to shut you out. Maybe with a minimum order or a credit history you wont have. You’re not going to help him make his budget this year. He doesn’t care, he doesn’t have to.
Dreams are hard to sell. That’s because so many people have had theirs stolen.
You want a short cut?
It’s much easy to build a value chain with suppliers who were you, 20 years ago. Entrepreneurs that had a dream, and got it up. They will take you seriously. They live in family run firms and SME’s. If you dig deep in the supply chain, they’re out there.