revenue Archives - Page 2 of 3

Industrial Tourism

Posted on August 1, 2009 by Steve Sammartino

Industrial Tourism is big business. It’s a little know fact the Boeing factory in Seattle has over 180,000 visitors a year. At $15 a ticket that is approx $2.7 million in high margin revenue.

Local Australia firm fosters brewing has a popular brewery tour at their Melbourne plant (you get a free beer at the end of it) as does Media conglomerate NBC in the Rockerfella Centre in New York. None of this is free, and they are all fully booked pretty much every day. The thing that is almost as powerful as the cash such Industrial Tourism generates, is the relationship it builds with the brand.

It is pretty cool to be taken into the ‘secret back room’, even though we can all be pretty sure that Boeing or any large conglomerate are not about to give away any secrets on said tours. But this is where startups and SME’s can do it even better. We can let our early adopters into our Factory, Alpha testing, Retail back room, Warehouse, New Product Development session. We can let them expose our secret goodness to the market for us. Especially if we do something awesome like make great software, use recycled materials or anything creative.

So the question for startups is this: How can we let our early adopters and brand evangalists into our secret world to spread our world?

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The strategy is fine

Posted on April 20, 2009 by Steve Sammartino

Today I had a discussion with a fellow entrepreneur who was wondering whether to reduce his pricing on a new business. His point was related to the fact that his very new business hadn’t achieved a great deal of sales volume just yet.

Then I asked him if he had implemented any of the sales generating activities we had discussed last week – to which the answer was no. My response was straight and simple:

If you haven’t been out knocking on doors selling your product to the potential target market, then how is it possible to know if the marketing mix is wrong?

It was at that time he knew he had some boot strapping work to do and get out there and sell.

picture-3

The point for entrepreneurs is that it is easy to get tempted to constantly revisit the strategy. To go back to the plans when things are not automatically falling into place. Instead of doing the really hard stuff – we look for a simple revision of ideas, the plan and all that shiny stuff. The thing we often avoid is the hard effort of selling and facing rejection. But until we go out into the market and try to generate revenue, it’s impossible to have real market feedback of what needs revised.

So before we re-design our plans and process, we have to test the current one in market. We do this by trying to sell what we already have at every possible distribution point. Until we have done that, strategy revision is just an excuse for not putting in the effort required.

Set up costs

Posted on April 19, 2009 by Steve Sammartino

When starting out in business the first thing we often do is set up the relevant legal structures:

Partnership agreement
Logo design
Business name registration
Operating company
Holding company
Non disclosure agreement
Holding company trust
Member terms & conditions of product / web usage
Specific bank account
Small business book keeping software
insert other legalese business recommendation here

Startup blog advice is this: Don’t waste your time or money. Get revenue first, register later.

With the only possible exception being a .com registration – which if you’re in the on line world may be an actual requirement to simply operate. No doubt this is contrary to all you’ve read in business guides. Sure, keep accurate cash flow books, run things professionally and stick to project deadlines. The reason for the recommendation is pretty simple. Most startups never get to revenue. If you’re like me you have a hard drive full of business ideas, half written business plans, and a spare room full of product prototypes. Until we have revenue (which doesn’t mean a couple of orders, it means thousands of dollars) we have nothing to protect. It also adds a strong reporting and administration burden which startups could well do without.

sand-castle

So why waste time and money building a fence around nothing? Build the castle first, or at least get the foundations in place. If we follow the lawyers advice, they may be the only people who ever make money from the venture.

New York Series: Bloomingdales – You’re Welcome, really.

Posted on February 16, 2009 by Steve Sammartino

The historically significant department store Bloomingdales do some pretty cool stuff. This includes the ‘Visitor discount’ they provide:

bloomingdales-visitor-centre-1

bloomingdales-visitor-centre-2

Yep, if you’re from another country you automatically receive an 11% discount on everything you buy. Now, this isn’t one of those trick promotions, impossible to get, with 100 other conditions. You simply go to the visitor center pictured above and show them your passport, or overseas license and that is it. And the discount is real, even if an item is on promotion or already discounted, you get the 11% on top of that. I was fortunate enough to get an incredible winter jacket which was already half price (end of winter discount, even though it was actually snowing outside) with an additional 11%. I was pretty happy. They also have a gift incentive if you spend over $200, and yep, I got my gift…

It get’s better, they also have personal shopping assistants, Multi-lingual assistants to take your around store and free hotel delivery for purchases greater that $250. You can read more about it here.

Sure, discounting isn’t always the path to profitability, but when you are taking one time customers, making them feel special, with ‘money to spend’, under your wing, it’s pretty clear that they are ‘inventing revenue’.

What does your startup do to ‘invent revenue’?

Revenue

Posted on December 19, 2008 by Steve Sammartino

One of our jobs in business is this:

“Make it as easy as possible for people to give us their money”

It’s already hard enough to convince people to buy our product or service, so why some businesses minimize payment options is beyond me.

cash-only

photo by Mike Monteiro

Cash only, just doesn’t cut it these days. Regardless if we are on line, business to business or in retail, minimizing the payment options has this simple repercussion: It minimizes revenue.

Live example is a café in Melbourne called ‘Journal’. I had a company breakfast there and they wouldn’t accept my credit card. They even had the audacity to say ‘Who doesn’t carry cash on them?’ Answer: plenty of people. That’s fine. I’m never going there again and they missed out on around $100 this week.

Startups ought make it easy to collect revenue.

Steve – founder rentoid.com

Best advice ‘ever’ for entrepreneurs

Posted on November 27, 2008 by Steve Sammartino

I often get asked the following question: “If you had to give one piece of advice for entrepreneurs what would it be?”

Here’s my answer:

Revenue must exceed expenditure.

The more it exceeds it by, the better.

I like doing cool stuff as much as the next guy, and no I wouldn’t sell tobacco to kids in Africa to make money. But it becomes really hard to do cool stuff if your business doesn’t survive.

Tough times

Posted on November 13, 2008 by Steve Sammartino

In tough times, operating in a non revenue generating business gets difficult. All your business may even dry up.

It doesn’t mean these activites aren’t important, it’s more a reflection of human behaviour. Unless the link of the activity to the transaction is clear – it will get pulled. This is true for consulting, marketing budgets or even your job. So the question we then must ask is this – how close are we to where money changes hands? Are we close to the transaction or in the backroom somewhere?

The further say we are from the money – the greater redundency exposure we have, in business and employment. Closeness to money is why many real estate agents who are often intellectual dodo’s still make big dollars. I’m sure you can think other examples too.

If you want to be an indispensable business partner in tough times, make sure you are close to the money.

Steve – founder rentoid.com