Thoughts for growing your business

Business Advisor Business Update

Many of the small and medium sized businesses we advise do not have a sales or marketing director; this is simply one of the many tasks the entrepreneur keeps to himself. This is not unreasonable as the business will often be founded to exploit the entrepreneur’s market knowledge or contacts.

If, however, the businessman was to take a step back and coolly consider his business and its marketplace, he may need to look at some of the following issues:-

  • What is being sold? Are there any unique selling points about your product or service which provides a market benefit (compared to your competition’s offering)?
  • How is it being sold – what routes to market are used?
  • Does it have a brand or potential for branding, which could enhance your sales value?

In the early stages, some businessmen reasonably adopt an approach to sell as much as possible without considering a strategy to maximise value to the business. But, if your product / service offering is merely the same as your neighbour, why would customers beat a course to your door? Your product or service will need to meet some, if not all, of the following points:-

  • Resolve a problem for the customer and be “fit for purpose”. If technology is involved this might involve providing evidence of accreditation etc.
  • At a competitive price. Note it is not necessary to be the cheapest especially if you are selling added value, such as a support service.
  • From a convenient source (might be a store or online) and enabling payment in a convenient manner
  • Has additional benefits competing products lack – for example extended warranty or no quibble returns policy etc

It is important to consider your routes to market – how you will sell to customers. In this day and age, this typically means having both a physical type presence (eg selling to shop, wholesalers etc) and also an online presence. Alternatively, it might be sensible to have a travelling salesforce or perhaps sell through partner organisations. In the early days of online sales, it was common to find high street retailers under pressure from online stores who did not have the overheads; as a consequence, the early high street adopters found they were competing with themselves when lower prices typically were found on their website than in their stores. This is less a problem now but the general lesson of ensuring that the online presence does not detract from the physical store still applies and the danger of having sales channels competing for your customer can be bad news. Each route to market will have its own characteristics and thus any business plan needs to address the benefits and costs of each channel, if you are to benefit from a multi-channel approach. Secondly, the channels need to work together in harmony and, as noted above, not against each other. You may need to consider different channels for some of your products – eg those where you want to focus on added value services might be different from simple click and collect ones.
All businesses have a brand – even if they have not chosen to protect or register it in any way. Generally, if you are building value in your business, it will aid your ultimate exit if the brand has a discernible value, and is protected in some way. The question of what makes a brand and how it adds value is a complex one. At its simplest level, a brand will have some of the following key points:-

  • It will in some way indicate what the business stands for (this might take some time to achieve). If very successful, the brand could become a word in general usage such as “hoover.”
  • The good brand will have authority – which can be built on by making comment and contribution to industry discussions. Ultimately, you want to be seen as an expert in the given field.
  • The brand will be deployable on your product’s packaging etc and used in any advertising.
  • If you are providing a service, can you work out a way to productise that service? If so, this will form part of the brand value. Simple examples include level of support – Gold / Silver and Bronze type service lists.
  • Ideally, the brand will be protected – possibly by using it in the name of the Company, registering the name as a Trademark or obtaining as many relevant domain names featuring the name that you can sensibly afford.
  • Have a recognisable Logo – again to be registered.

 

It is often thought that the logo is the Brand; this is a misreading of how the system works. A logo can only work once a brand has been defined and can become recognised for something. Once this occurs, then its protection and recognition is a big aid in building value in the brand and the company owning that brand.

Understanding all these points and how they work in your company is a task which ideally needs to be debated with someone to ensure that the underlying assumptions are tested. This is often the role of the Business Advisor or Consultant or even a non-executive director – all services provided by Gibson Hewitt.

For more information on our consultancy services please call Robert Hewitt on 01932 336149 or visit our website www.gibsonhewitt.co.uk.
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