magazine march 2011

Accelerate Your Growth!

SME

BL

How to Start a Commuter

Transport BusinessHow Profitable and

Sustainable Is It?

Turning acraft intoa dreambusiness

Marketing Basics

for Small Businesses

7 Ways to Finance Your Business

10 Ways to Differentiate Your Customer Service & Make Your Clients Feel Actually Valued

How to Write Your Own Bankable Business Plan - A Step-by Step Guide Part 2

NS HT II IG S, RESOURCES AND OPPORTUNIT ES EFOR NTREPRENEURS

March 2011

BusinessLink

Regulars3. Publisher’s Brief5. Unleashing Your Greatness -Where is Your Dream?

Starting a Business6. How to Start a Commuter Transport Business How Profitable and sustainable is it?

Running a Business

14. The SME BusinessLink Interview: Christina Nziradzemhuka

How She Turned a Craft into a Dream Business

Finance

Sales & Marketing

Leadership & People Management

Inside SME BusinessLink This Month

FEBRUARY 2011

SME BusinessLinkMarch 2011Issue No.03

SME BusinessLink is produced by Admiral Business Systems (Pvt) Ltd

Admiral Business Systems is the leading provider of insights, resources and opportunities for SMEs and entrepreneursin Zimbabwe Our services to entrepreneurs include thismagazine, Entrepreneurial and Business Resource books,training services and the full range of business consultancy services.

Phillip Chichoni Director

Admiral Business Systems (Pvt) Ltd111 Seke Road, Hatfield Harare

Http://admiralbiz.wordpress.com©2011 All Rights Reserved

Contents

Phone 0777 774 007

Personal Development & Health

SME BusinessLink March 2011

Insights, resources and opportunities for entrepreneurs

8. How he did it: Cliffe Chiremba of Smart Glue and Chemicals

10. Your Ultimate Guide to Starting a Business in Zimbabwe: How to set up a Private Limited Company

11. How to Write a Bankable Business Plan: Layout and Developing a Powerful Executive Summary

13 . Office and Home Security Equipment

22. Good Record Keeping Which Records Must You Keep and For How Long?

19.Start ups on a Shoe String: How Three Entrepreneurs

Started Business with less than $150

32. How to Keep Going When You’re Out of Fuel

24. High Impact Low Cost Marketing Strategies Marketing Basics for the Small Business

31. How to Deliver Really Bad News

26. Timing Your Offers to Sell

29. Ten Ways to Differentiate Your Customers Service and Make Your Clients Actually Feel Valued

9. Ten Reasons Why You Should Start Your Own Business 2011

17 .Seven Ways to Finance Your Business

23 . Cost Cutting Won’t Get You There

Innovation35. Innovation Lessons From Small Businesses

Publisher’s Brief

Join our electronic mailing listIf you own a business or are an entrepreneur or potential entrepreneur who wants to build a high performance business, join our SME BusinessLink Newslettermailing list and keep up with other high-performance entrepreneurs. It’s for free. All you need to do is send an email with the subject line SUBSCRIBE to and you are [email protected]

Phillip Chichoni

The month of March celebrates International Women’s Day on the 8th. This year is the 100th anniversary of IWD.. SME Businesslink wishes to celebrate with Zimbabwean women, recognizing those women who have made extraordinary achievements in entrepreneurship and small business. I invite you, our readers, to identify those women who have made some contribution to entrepreneurship, either through starting their own businesses, helping others to get into business or playing whatever role you feel has made a difference. Follow the instructions on the next page. The outlook for small business is very encouraging indeed. The signing of the Bilateral Investment Protection and Promotion Agreement between the governments of Zimbabwe and Botswana marks a step forward in easing the liquidity crisis in the financial system. We hope a significant portion of the US$70 million to be loaned to local industry will go to SMEs, who have been battling to get funds for working capital as well as re-equiping their firms. Those who have been following my newsletters and website will recall that sometime last year, I forwarded an email from the Ministry of SMEs advising those interested in accessing the funds to forward their proposals directly to the Ministry. However, this time I understand that proposals should be forwarded to commercial banks, who shall be handling the applications and disbursements of the funds. We will keep you updated. The March issue of SME Businesslink magazine is once again packed with insights, resources and opportunities to help accelerate your growth. We feature stories about local entrepreneurs, which we hope will motivate you, whether you want to start or grow your business. Entrepreneurs are ordinary people, they are just not satisfied with ordinary things. We also look at the popular commutter transport business; is it worth investing in? Please help us improve by letting us know what you think about the magazine, and tell us issues that you want featured. This March issue is on CD again, but the April issue will be in print. Don’t miss it in the second week of April. Or, better still, subscribe now at our special promotional prices valid until 31 March and you will be guaranteed a copy. (See page 4 for details)

Celebrating Women Entrepreneurial Achievers During International Women’s Month



Join SME Businesslink in celebrating International Women's Day and women's month of March by recognizing omen who have made extraordinary achievements in entrepreneurship and small business. It’s very simple:

Your nomination must include your name and email address, your nominated achievers plus brief descriptions of their achievements (why you are nominating them) in 20 words or less per nominee.Three entries stand a chance to win the following prizes:

· Goods Vouchers from our sponsors (Beauty products, office products, etc)

· A 6 months subscription to SME Businesslink Magazine

· A copy of the book High Impact Low Cost Marketing Strategies for SMEs

· A copy of either the book Business Planning Simplified or 101 Tips For Your Business in 2011.Nominations may be made in either of the following ways:

1. By email to [email protected].

2. By posting on the Facebook page http://www.facebook.com/pages/SME-Businesslink

Example

My name is XXX XXX email address [email protected]

Nominee 1 xxx xxx of location xxxxx. Her achievement:xxxxx xxx xxx xxx xxx

Nominee 2 etc

w

SME BUSINESSLINK WOMEN ACHIEVERSIN ENTREPRENEURSHIP COMPETITION

Guest Comment

Milton Kamwendo The Motivation Company

Unleashing Greatness!


On 28 August 1963, Martin Luther King in his famous speech bequeathed to us this line: “I have a dream today.” True, everyone can have a wish but few people have real burning, inspiring dreams that they have turned into magnificent obsessions. Once you embrace a powerful dream you are unstoppable. You can be delayed but you cannot be denied.Unearth your DreamsFor most people, their dreams are now buried under the debris of frustration, excuses, disappointments, delays, denial, retrenchments and a lot more. Dreams can only die if you let them. Letting dreams die is a choice, so is letting dreams live. Refuse to flash your dreams down the drain of despair. Choose to dig, refresh and pursue your dreams. Your dreams are your life and they are your prized assets. Dreams will keep you alive and they are the most powerful motivator that I know. Pursue your dreams until they are begging for mercy.Talk your DreamsDreams can easily die if you do not verbalise them. Words are powerful and words are things. Talk about your dream and talk to your dream. Amplify your dreams with your mouth. When you share your dream with people of like-mind you strengthen the dream. When you share your dream you never know who is listening and who is willing to support it. There is more support that is available in the world than you can use. Its just that people do not know what your dream is. People cannot support what they do not know. God will never move to help you realize your dream when He does not know about your dream. Talk to Him about the dream.Crystallize and Refine Your DreamsDreams are like gems or diamonds. When you dig them from the ground they usually look rough and unattractive. Their value increases when they are cut, and polished. When you conceive your dreams they are usually in rough form. You need to crystallise them through writing them down. You polish them through learning, information and getting other ideas to add to your dream. Parading unpolished dreams will simply make you a clown. The market for unprocessed dreams is very small. This is why so many people get frustrated when people reject their ideas and trash their dreams. Refine them. Use people’s rebuffs as shaping tools.Picturise Your DreamsBring your dreams to earth by picturising your dreams. Get someone to draw a sketch or plan for your dream house. Instead of keeping that book in the harness of the world of dreams write an outline of the book and start writing 100 words a day. Look for a model that resembles your dream and place it on your desk. Go get the brochure for your dream. Do something that makes your dream look concrete.Act on Your DreamNothing will change until action happens. When you do not act on your dream, it soon turns into a nightmare. Martin Luther King Jr. did not say he had a nightmare, but a dream. He took action and even the act of delivering his speeches was part of acting on his dream. Take action daily. Do not wait, do not procrastinate. There is a whole generation waiting for your dream to be realized. The worst terrorists are people who are too timid to act on their dreams, too lazy to act, and I know that that is not you!

Where is Your Dream?

Starting a Business


How to Start a Commuter Transport BusinessHow profitable and sustainable is the business?

When Brenda went to the United Kingdom in 1996, she had a vision to help set her parents in business. up After working for three years, she had saved enough money to buy a used 18 seater mini-bus, which she shipped to her parents to start their dream business. The business did so well that the family was able to increase their fleet to seven vehicles within five years. The commutter transport business is a cash-cow because thousands of people travel to and from work every day of the week. There are also students going to school and housewives going shopping. There is no shortage of ready and willing customers in this industry. No wonder there has been massive growth since the days of ZUPCO and Peugeot 404s. Accurate records of the number of commutter omnibuses on the roads are not available. However, the SME BusinessLink team went out on the ground to find out how this business is performing in the US dollar era. This was in response to the many emails we have been receiving from Zimbabweans working in Europe and America who were enquiring if it is still possible to profitably operate a commutter omnibus business. We managed to get “average” data from a cross section of omnibus operators we interviewed in Harare. We must admit though, that the figures we got varied significantly among the differrent operators. One reason is that operating costs and fuel consumption varied due to the different ages, conditions and makes of the vehicles used. You might therefore want to obtain more accurate running costs of the particular vehicle you wish to use in your transport business.Operating costs and income Here are the typical operating figures, showing a comparison of two typical vehicles:

Toyota Hiace Mitsubishi Carvan High Roof Flat RoofPrice range of 5-10 year-old vehicle $7,000-$8,000 $3,500-$4,000Passenger capacity 18 15Fuel consumption City-Chitungwiza 2,5 litres per trip City-Mabvuku 2,5 litres per tripAverage trips per day 12 14Average fuel usage per day 25 litres 25 litresAverage fuel expense per day $33 $33Amount cashed per day (net revenue) $100 $80Average monthly revenue (net of fuel) $2,400 $1,800Driver's wages 15% 12%Conductor's wages 7% 5%Repairs and maintenance per month $120-$200 $100-$180 Incidental expenses $100-$120 $100-$120Average net income per month $1,600 $1,200

Starting a Business


Starting upThe following are the procedures and related costs of starting up in the commuter transport business, before you can start operating:

a) Purchase the vehicle; prices vary from $3,000 to $8,000 for a used vehicle on the local market.b) Change of ownership of the vehicle: this is done at Southerton Police Station, CID Anti-Vehicle

Theft Section. The process takes 2 to 3 days and costs $100.c) Registration plates. These are not necessary if it's a second hand commuter transport vehicle

(that is, one which is already in the business). However, for a new vehicle, the cost for plates is $300. The process is done at ZRP Inspectorate along Robson Manyika Avenue, Harare. It normally takes 2 days.

d) Licence. This is issued at ZRP Licensing along Robson Manyika Avenue, Harare. The cost is $75 per 6 months and is usually issued in one day.

e) Insurance. This can be purchased at any insurance company and costs $60 per three months. It is issued immediately.

In total, an amount of $10,000 should be enough to start you up in the commuter transport business. With earnings of $1,200 to $1,600 per month ($14,400- $19,200) per year, other things being equal, the return on investment is good. However, other expenses, such as management salaries, major repairs etc, may affect the net return.You also need to take into account the wear and tear of the vehicle, which is in continuous use, and the fact that it's already a second-hand vehicle and its lifespan is short. Repair costs will increase significantly as the vehicle ages.

SME BusinessLink Team

Starting a Commuter Transport Business...continued

Starting a BusinessHow He Did It: Cliffe Chiremba of Smart Glue & Chemicals


SME BusinessLink team

After working for thirteen years for a leading adhesives and chemicals company in Zimbabwe, Cliffe felt he had gained enough knowledge, skills and experience to start his own business.In March 2007, he formally started his company, Smart Glue and Chemicals (Pvt) Ltd. Being well versed in the critical areas of Factory and Production Management, Quality Control and Research and Development, he knew what needed to be done to set up a production firm. He was able to implement the highest quality systems from the start and, through concentrating on the firm's core business, has made significant strides to penetrate the highly competitive market.He is a man with a vision: to be a dominant player in the manufacture and supply of adhesives, detergents and chemical products in Zimbabwe. His mission is to exceed customer expectations through the provision of exceptional service and quality performing products.Although facing massive competition from established and bigger players, Smart Glue and Chemicals has managed to build up a base of repeat customers due to the reliability of its products.ProductsSmart Glue and Chemicals produces the following range of products:Adhesives:

?Flexible PVA?Paper glue?DIY glue?Wood glue?Contact glue?Parquet glue?Core winding glue?Labelling glue?Envelope glue

Detergents?Hand cleaner gel?Hand soap?General purpose cleaner?Toilet cleaner?Sanitizer?Engine cleaner?Car wash?Mortuary cleaner

Smart Glue and Chemicals, has among its values, the commitment to cultivating symbiotic and mutually beneficial relationships with business partners, customers and all stakeholders.

Special PromotionTwo new SME BusinessLink Club subscribers stand a chance to win vouchers for products of their choice from Smart Glue and Chemicals valued at US$50 each. See page 28 for how to subscribe, or visit the SME BusinessLink Gold Club page at

.http://admiralbiz.wordpress.com

Cliffe Chiremba and some of the Smart Glue Products

Starting a Business


There must be some reason why over 600 people downloaded The Entrepreneur's Guide to Starting a Business

in Zimbabwe from my blog in January. Well, there are plenty of good reasons why you should want to run your

own business. Here are just ten of them:1. You control your own destiny. Many people are not satisfied with working for someone else. They want to

be in control, making their own decisions and setting their own future. You can only do this when you are running your own business.

2. You don't have to beg for a job. With the high level of unemployment in this country, and with the gloomy prospects for new jobs creation, starting a business is the most viable option to get an income.

3. You can find you own work / life balance. Running your own business gives you the benefit of flexibility. You set your own working hours, where ever you want; you can even work from home in the middle of the night and do other things during the day.

4. You choose the people you want to work with. Employees rarely get the chance to choose their co-workers, if you don't like your colleagues you better ship out. When you own the business, you make the decisions on who to hire or fire. This allows you to surround yourself with positive people who can give you the confidence you need to keep on moving forward.

5. You can get rich. Entrepreneurs take the risk and reap the rewards in business. As an employee, you are only entitled to an agreed salary. As the owner, the more money the business makes, the more you also get. And as you become good in the game of spotting good business opportunities, nothing will stop you from becoming a millionaire or more.

6. You can do the things you love. The best business to start is one where you do the things you love. That way, you make money while having fun. There are many entrepreneurs who have turned hobbies or crafts into successful businesses. For example, Dennis Anderson fell in love with soap making while in a chemistry class. He then started making organic soaps at home in 2007, a business which has now grown into a profitable empire.

7. Your life becomes more exciting. Most people get bored from performing the same chores day in and day out, which is standard at most jobs. As an entrepreneur, you face different challenges and opportunities every day, which will force you to be creative and learn new things.

8. You enjoy self-fulfilment. Doing something that you love, being your own boss and being in comtrol of your income is fulfilling. You get satisfaction from creating something of value, the feeling of achievement that humans long for. There is nothing like being successful through your own leadership, skills, sweat and tears. It's the highest of Maslow's hierarchy of needs.

9. You make a contribution. Many entrepreneurs are able, and love to, give back to the community. Employees don't often get that opportunity, but when you run your own business you can choose which charities to give and what beneficial products and services to produce.

10.You can reduce the unemployment. As a business owner, you can contribute to reducing unemployment by creating jobs for people in the community you operate from.

I hope one or more of these reasons convinces you to get up and start working on your plan for starting a business. Here is one tip from one of the leading and award winning woman entrepreneurs in Zimbabwe: “Starting a business does not require capital, scientific knowledge or connections. Let me elaborate: Capital - through printed money, equipment, tractors etc. through farm mechanization. Do we have food security? You do not need to be a chef to own a hotel. It takes 99% ATTITUDE – red hot burning passion, to achieve; enthusiasm to produce quality products or knowledge; the ability to be able to sell yourself and your products to the market, not the connections. The connections are not going to work if you are selling the wrong product or service, Yeah, initially it might help, but the staying power is in whether your product is serving the customer's needs.”-Divine Ndhlukula Founder and MD of Securico.

Feedback . Phillip Chichoni

[email protected]

Ten reasons why you should run your own business in 2011

Starting a Business


Your Ultimate Guide for Starting a Business in ZimbabwePart 2: How to Set up a Private Company

Last month's instalment described the various types of entities that one can choose when setting up a business. These are : a) sole proprietorship, b) partnership, c) co-operative, d) private company, e) private business corporation, and f) public limited company.This article looks at the process of setting up a private limited liability company, which is the most popular vehicle for business.The private company is popular because it has the following benefits to business owners:

a) It is recognized as a legal person in law, and thus has its own life separate from the owners. The company can continue in existence even after the owner dies.

b) It has limited liability, thus the owner cannot be sued for the company's debts, unless he made some personal guarantees to creditors.

c) Shares can be easily sold and transferred.

Steps for setting up a private companyStep1. Name ReservationThe first step is to choose a name for your company and reserve it with the Registrar of Companies. It is advisable to choose a few names in case your preferred one is already taken. An application for the approval of a name should be made on Form CR21, in duplicate, which should be sent to the Registrar of Companies, in whose office all records of existing names are kept. It takes about seven days for a submitted form to be ready for collection. The name reservation fee covers the cost of the search until a suitable name has been approved. The reservation is valid for 30 days and can be extended for another 30 days for an additional fee.

Step 2.File Memorandum and ArticlesThe memorandum and articles of association must be lodged with the Registrar on application for registration of a new company. The Companies Act (Chapter 24:03) provides for model articles of incorporation. You need to pay the prescribed fee when filing these papers. In addition to the foregoing, Form CR6, notifying the situation of the registered office of the company, must also be lodged on application for the registration of the company .

Step 3. Appointment of Directors and SecretariesWithin a month from the date of incorporation, the Registrar of Companies must be notified of the appointments of the company's directors and secretaries. This is done by filing the particulars of the directors and secretaries and any changes therein or of directors and principal officers (Form CR 14).

Step 4. Allotment of SharesForm CR2 must be lodged with the Registrar within one month of the allotment of any shares. Shares subscribed for in the memorandum are NOT allotted for the purpose of this requirement and should NOT be shown in Form CR2 , except in paragraph 2(a) thereof under the heading “shares previously issued”. The transfer of shares is of no concern to the Companies Registration Office and no return or notification thereof is required by the Registrar.

Sometimes, instead of going through the above steps, it is faster and easier to simply buy a “Shelf Company” from agents and make the necessary changes. The usual changes are on the registered office and directors and secretaries.Next month, we will discuss Annual Returns and procedures for change in capital.

Business Plan Outline and Executive Summary

Starting a BusinessWriting a Bankable Business Plan-Part 2


Section

Title

I.

Executive Summary

Overview

Products/Services Offered

Mission, Goals & Objectives

Funding Requirements/Proposal

II.

Introduction to the Company and its Management

Introduction and Background

Legal Structure

Management

III.

Products & Services

Introduction

Product Description

Price and Pricing Strategy

Production Costs and Gross Margins

IV.

Market & Industry Analysis

Market Overview

Target Market Description

Market Growth Trends

Competitive Business Strategy

V.

Marketing Plan

Marketing Plan Objectives

Marketing Strategies

Marketing Mix Strategy

VI.

Sales and Distribution

Selling Strategy

Distribution Strategy

VII.

Production Strategy and Structures

Human Resources Plan

Production Structures

Production Strategy

VIII

Financial Analysis

Introduction

Assumptions

Risks and Contingencies

Financial Projections

Develop a Powerful Executive Summary An introduction is essential to the business plan, just like it is to any good story or book. The executive summary introduces the story of your proposed business to the reader. You providing basic information about your business, what you offer, the intention of the business plan and the financial requirements, if any. The executive summary is the most important part of the business plan. Investors going through lots of business plans will only read this. The summary in itself will not secure an investor; however, it can lose them. The quality of the summary must therefore be outstanding and you should pay particular attention to it. Obtain critical feedback from others on your drafts to make it very compelling. The summary can also be used as a stand-alone document when introducing the project to others so it must be able to capture interest and entice the reader to take the next step and request more information - and hopefully secure a meeting.The executive summary abridges the key points of the business plan. It should define the decision to be made and the reasons for approval. The specific content will be highly dependent on the core purpose and target audience. Overview: The executive summary should begin by explaining the reason for the business plan. It could be start-up, reorganization, downsizing or expansion. Provide a brief description of your company, including name, location, web site (if you have one), contact information, company ownership and products and services offered. Continued>>>>>

"Without the vision of a goal, a man cannot manage his own life, much less the lives of others." – Genghis Khan

This outline is only a suggested format to guide you in understanding the sequence of content. Developing an outline brings focus to your vision.

Starting a Business


How to write a bankable business plan-Part 2

Phillip Chichoni- author of Business Planning SimplifiedPlease email feedback to [email protected]

....continued. To get a sense of the difference the purpose and target audience can make, here are three different sets of key points for an executive summary - one for a loan request, one for a start-up seeking venture finance, and one for an internal plan. Items unique to a particular kind of plan are in italics:1) A loan request executive summary might contain the following information.

· Company information: name of company, years in business, legal structure, minority and majority owners

· Brief description of project · Amount and length of loan · Objective reasons why the bank should be confident that the loan will be paid back. This

likely will include o Financial track record o The future revenue stream o Any contracts in place that might guarantee that the revenue stream is more than

just a forecast.2) For a new venture, the executive summary might contain the following information:

· Company information: name of company, proposed legal structure, current legal structure, and minority and majority investors.

· Amount of investment requested

· Expected terminal value ·Description of market opportunity

· Objective reasons why the market opportunity can be exploited by this particular team 3) For an internal project plan, the executive summary might look like this:· Company information: not applicable. Description of project

· Project mandate: who requested the proposal, who is being assigned to carry it out · Strategic, tactical and financial justifications · Summary of resources needed: staff, funds, facilities

In some cases information will overlap. For example, some of the reasons why a loan is likely to be repaid might equally as well be used as justification for the kind of extraordinary return expected by venture capitalists. Products and Services Offered: You briefly discuss the nature of the products and services offered by your company. You should describe the unique features that make your products stand out above the competition. Do not be too detailed, the details are provided in the main body of the business plan. Mission, Goals and Objectives: The mission statement should express what you offer and what will be the benefit to the customer in two sentences. The goals are generalized statements regarding the direction the company wishes to take regarding products, services, customer service and the like. For example, "we will attract customers for the extraordinary new features our product offers plus exemplary support and follow-up after the sale". Objectives are quantified statements addressing monetary intentions related to profitability, market share, target markets, cash flow, sales volume and other measurable items regarding markets, operations and finances. They should include timelines for fulfillment. For example, the company will reach profitability by a specific date with average annual sales reaching $230,000 by the 16th month of operations. Funding Requirements/Proposal: You complete the executive summary with a summary definition, Sources & Uses of Funds, of the capital investment required to fulfill the goals and objectives of the business plan. If outside investment is sought, stipulate the terms and conditions under which the investment capital is sought (commercial loans and/or venture capital).

Running a Business


Safes & Equipment is a Zimbabwean owned company which makes and supplies high risk security products. Its vision is to be the first choice security solutions provider to small, medium and large organizations and individuals in Zimbabwe, known for satisfying customers' needs timeously, effectively and consistently. The company specializes in the supply of high risk security products, with a special emphasis on bank safes, vault doors, strong room doors and general steel fabrication. It manufactures the products, imports related components and carries out maintenance service and repairs.The owner, Mr. Charles Manyeku, has over 20 years experience in the safes and security equipment business, most of which was gained while working at Chubbs Union. His team is equally skilled and experienced, and are ready to

give customers total satisfaction and value for money.

PRODUCTS AND SERVICES PROVIDED The product range includes the following:

?Pioneer Safes: for security of record against fire

?Explosive Resistant Safes: Resists the modern

crack man scientific approach. Highly

recommended for large cash holdings.

?Treasury Office Safes: protects against brute

force, fire and burglary attacks

?Strong Room doors: Made in two categories:

a) Fire resisting strong room doors, and

b)Burglar resisting strong room doorsSafes and Equipment also has a service and repair centre that provides service and repairs to all types of safes, Safe removals and Key cutting

Special PromotionSafes and Equipment is

offering a 15% discount on cash boxes to readers of SME BusinessLink Magazine. All you need to do is to mention SME BusinessLink when you ask for a quotation or place your order, and you will be entitled to the discount, between March 15th and April 15th, or while stocks last.

Office and Home Security EquipmentSafes & Equipment (Pvt) Ltd provides world class solutions

SAFES & EQUIPMENT

Factory No. 10 Isafil Industrial Complex667 Seke Road, HatfieldP.O. Box CY 1659, Causeway, HarareTel: 04 - 589218 / 576653, Fax: 04 - 576637Cell: 0772 403 827 / 0712 400 534 / 0733 377 915e-mail: [email protected]

(PRIVATE) LIMITEDManufacturers of high risk security products & Filing Cabinets,

Catering Equipment & Electric motor rewinding, repairs & maintenance of all garage & workshop equipment as well as plant

& earth moving machinery

The SME BusinessLink Interview


Good day. Thank you for taking the time to be on the SME Business Link Interview. Please tell our readers briefly about yourself.I have always been someone who enjoyed craft work and decor. I am someone who continually seeks to grow and easily gets tired of routine work. When and how did you get into business?As early as 2000 whilst I was with my first employer, work became too routine for me. Instead of waiting for things to change at work, I started making bed sheets during my spare time using a sewing machine that my husband had bought for me. I would pack and sell these. I then had a break from 2001 -2003 as I was now pursuing my Bachelor's degree in Environmental Health Science with Pretoria Technikon. On completion, I was still with my first employer but still things did not change much as I was looking for a work environment that allowed me to grow in pursuit of my passion.In 2007 I worked with Innov8, where I was involved in Project Management, Social Responsibility projects, Facilitation work as well as monitoring the hygienic, safety and general environmental Standards of the retail outlets. The latter drawing from my previous work experience. At Innov8, I learnt and grew very fast as I was working with a very innovative entrepreneur. My presentation skills, negotiation skills, an eye and an acumen to spot opportunity and grab it before it's too late, grew. I believe these skills are critical to every entrepreneur. As part of my personal goals, I registered Zochar (Pvt) Ltd in 2007 as a shelf company. I left Innov8 in August 2008 to pursue my passion on a full time basis. This is the company that is now trading as Dreamz and the rest is history.What was your greatest motivation to start Dreamz? What really prompted me was the realisation that many of my colleagues, relatives and friends would go to every extent to ensure that their kitchens, lounges and dining rooms would look their best because that's where visitors would see. The bedroom would be attended to last because no visitor would go there uninvited. It seemed like it was all about keeping up appearances.As if it were not enough, many a time I would meet up with people running around looking for pyjamas when, say, a relative suddenly had to be hospitalised; again, keeping up appearances. Many a time you would hear ladies arranging kitchen tea parties, kitchen top ups but never bedroom top-ups and this continued to fan my desire to inspire the world to rediscover the invaluable gift of a good night's sleep. The broader vision was to provide a one stop shop for all sleep requirements. At the end of a hectic day we all deserve a good night's sleep. Most of us spend about a quarter

Christina Nziradzemhukafounder of



of our lives sleeping. The time we spend sleeping deserves to be time well spent in an environment that gives an elegant experience. Have a hotel experience from your own home!

Your industry has a lot of players, how did you manage to make a break through?

It was all about responding to a need. I defined a product and a brand that I wanted to stand for. It also took believing in myself as well as my product and also aspiring to learn and grow everyday. The Japanese call it Kaizen…… Never ending continuous improvement.What also gave Dreamz an advantage was that it was established at a time when most people were concentrating on importing and selling foodstuffs, cheap clothing and cheap polycotton bed linen. The area of bed linen and sleep wear seemed to be greatly neglected. Dreamz came as an answer to discerning people, parents and guardians who were looking for quality linen and pyjamas for their children in boarding school. If we didn't have a product in stock that a client required, we would make it for them. That flexibility and also the ability to house all sleep accessories under one roof was an answer to a great need that existed.

How are your company and products different from those of other players, both established firms and smaller ones, like home-based or cottage industries, and why should customers choose your products?From my previous experience, the concept of HCCAP was instrumental (Hazard Analysis Critical Control Point). At Dreamz this meant we take care on the fabrics we use, the workmanship, the packaging, the premises from which the product is sold and how its displayed….. right until we hand it over to the client. Apart from innovation, Dreamz products are a fusion of beauty and purpose. In a bid to meet the customer at their point of need, our products include:?Men's Gown and short set- seeing that most men don't like pyjamas , this allows them to

jump into bed in a short and then pull over a dressing gown when they have to move around in the home.

?Mattress protectors -these come in two types waterproof and non-waterproof. The waterproof ones come in handy for parents with children who bed wet and also for those that may be nursing incontinent patients.

?Pillow Protectors- For those that drool or sweat a lot whilst asleep, these protect the pillows from getting wet and moldy as pillows are difficult to dry once they absorb some moisture.

?Dreamz now has In-house Brands and Labels in sleepwear for different ages. This is for all products manufactured at Dreamz Factory.

?-Wow- For children under 12years of age-Guess-For the teenagers-Imagine-For the ladies-Thunder-For the men-Dreamz- For all Linen, Curtains & Soft Furnishings

?Sleep over Kits- a kit that a child can carry when going to sleep away from home and this consists of pyjamas, socks, toothbrush and panties.

?Accessories to create the right ambience for sleep- Drawer freshners,scented candles, some with animal print (giraffe,zebra,guinea fowl etc)for the tourists.

?Bridal and Bedroom Top Up Registries-Brides to be can come to Dreamz and chose bedroom presents that they want their guests to buy for them. The same applies to those with bedrooms that they want to spruce up .This then culminates in a function where the purchased gifts will be presented. At these functions the Dreamz Team gives presentations on



related topics about the bedroom and also gives a present to the host as part of giving back to the community.

What do you think of entrepreneurship in Zimbabwe?I see entrepreneurship in Zimbabwe growing and also contributing greatly to employment creation as well as growth of our economy.

What is the most important investment that an entrepreneur can make towards his or her success in business?Giving the business time, staying focused/staying power. Investing in training and seeking growth in every area.

What message can you give to other women entrepreneurs, especially in the male dominated business world?Women can start and manage successful businesses. It's all about the state of your mind. “If you think you can, you are right and if you think you can't, you are right too!” Every time the world screams, “No way! No Way!” you ought to think that there is a way! There is a precious jewel inside every woman just waiting to be brought forth so that it can shine.Lastly, think bigger, dream bigger, believe bigger, stand longer, persevere longer and sow more and depend on a dependable God.

What is your vision in business and where do you see your company in 2021?To provide sleep solutions that are a fusion of beauty and purpose as well as to create environments that allows one to dream day and night. In 2021 we see our company to be a leading manufacturer , retailer and exporter of sleep wear,

bedlinen, curtaining/soft furnishings, deco and bedroom furniture.

What advice can you give to SMEs and potential entrepreneurswho wish to succeed in business like you have done?Success is a journey and not a destination. Demand more from yourself.

Finance


Seven Ways to Finance Your BusinessFinancing a business is always a challenge. Here we've compiled 10 techniques, from the tried-and-true to the experimental. By SME BusinessLink StaffFinding financing in any economic climate can be challenging, whether you're looking for start-up funds, capital to expand or money to hold on through the tough times. But given our current state of affairs, securing funds is as tough as ever. To help you find the money you need, We've compiled a guide on 6 financing techniques and what you should know when pursuing them.

1.Get a Bank LoanZimbabwean banks are suffering from a shortage of funds to lend to businesses, especially beyond the short-term. However, some SMEs are managing to get funding from banks. This year, at least three banks are offering loans beyond 6-12 months, with one reportedly going up to twenty-four months. In practice, even those banks offering 3 month loans are allowing borrowers to roll-over loans, as long as interest payments are kept up to date and the business remains viable. There are three important requirements for you to obtain a bank loan:?You need adequate security, preferably in the form of immovable assets valued at least twice or thrice the amount of the loan you seek.?Your business must be already operating and generating reasonable cash flows to satisfy a banker about its ability to repay the loan.?Prepare a professional business plan with realistic cash flow projections. Businesses that prove to be cash generators are more likely to get finance from a bank.Banks should generally be approached if you already have a relationship with them, and are seeking short to medium-term funds for an existing business. It will help if you already hold an account with the bank you are approaching, and have been making significant transactions regularly in the preceding months. The amount has to be significant, usually $10,000 or more, otherwise the transaction will not be worthwhile to the institution.

2. Get a Small Enterprises Development Corporation (SEDCO) loanThis government funded organisation is an important funder of small businesses. The requirements are nearly the same as those of banks, but since the Corporation focuses on SMEs, you are more likely to obtain funding for amounts ranging from $2,000 to US$4,000.

3. Attract an Angel InvestorWhen pitching an angel investor, all the old rules still apply: be succinct, avoid jargon, have an exit strategy. But the economic turmoil of the last few years has made a complicated game even trickier. Here are some tips to win over angel interest:

· Add experience: Seeing some grey hair on your management team will help ease investors' fears about your company's ability to deal with a tough economy. Even an unpaid, but highly experienced adviser could add to your credibility.

· Don't be a fad-follower: Did you start your company because you are truly passionate about your idea or because you want to cash in on the latest trend? Angels can spot the difference and won't give much attention to those whose companies are essentially get-rich-quick schemes.

Finance


Seven Ways to Finance Your Business....continued

?Know your stuff: You'll need market assessments, competitive analysis and solid marketing and sales plans if you expect to get anywhere with an angel. Even young companies need to demonstrate an expert knowledge of the market they are about to enter as well as the discipline to follow through with their game plan.

· Keep in touch: An angel may not be interested in your business right away, especially if you don't have a track record as a successful entrepreneur. To combat that, you should formulate a way to keep them in the loop on big developments, like a major sale.

4. Raise money from family and friendsHitting up family and friends is the most common way to finance a start-up. But when you turn loved ones into creditors, you're risking their financial future and jeopardizing important personal relationships. A classic mistake is approaching friends and family before a formal business plan is even in place. To avoid it, you should supply formal financial projections, as well as an evidence-based assessment of when your loved ones will see their money again. This should reduce the likelihood of unpleasant surprises. It also lets your investors know you take their money seriously. You also need to seriously consider how the arrangement will be structured. Are you offering equity? Or will this be a loan? Perhaps most importantly, you need to emphasize the risk involved. Offer up a strong business plan, but remind them there is a good chance their money will be lost. It's better to mention that upfront to Aunt Gladys rather than over Christmas dinner.

5. Consider factoringFactoring is a finance method where a company sells its receivables at a discount to get cash up-front. When you get an order from a reputable supplier, you can approach the financier for funding. Your customer will then pay direct to the factoring company. Firms providing factoring services presently in Zimbabwe are Micro-Finance companies, Finance Houses and some banks. The catch is that your customer has to be a known and reliable company.

6. Find an equity partnerAn equity partner is somebody with cash who wants to invest in a business that has great potential for growth and profit. Unlike an angel or family or friends, an equity partner will usually want to appoint his own manager to work with you (or watch over you) in order to safeguard his investment. This is a small price to pay if you are really stuck for cash. You need to be careful, though, that you don’t lose your company to unscrupulous people. Ensure all agreements and contracts are mutually agreed and seek professional advice from a lawyer or an accountant.

7. Get supplier credit / Customer advance paymentWith a good proposal, you could get a supplier to give you products on credit, which may allow you to launch your business. Similarly, you could get a customer to pay in advance. The important thing is to build trust and confidence with the people you are dealing with. If the arrangement benefits them somehow, they will be agreeable.

SME BusinessLink TeamFeedback [email protected]

Finance


Start-Ups on a Shoestring The tales of three entrepreneurs who launched companies—for less than $150From the Wall Street Journal Small Business News

You don't have to break the bank to start a business.

For many would-be entrepreneurs, money is the insurmountable hurdle. They hunger to strike out on their own, but don't have a big pile of cash to invest in a start-up that might not churn a profit for years to come. And they're reluctant to stake what cash they do have while the economy is still shaky.

We decided to see if you could launch a venture for less than people think. A lot less. We set out to find bootstrapping business owners who started companies in recent

years—without shelling out more than a couple of hundred dollars.

The ground rules: The entrepreneurs had to be either paying themselves a salary or reinvesting substantial profits in the business, as well as planning to continue down the entrepreneurial path for some time to come. We also nixed people who opened consulting firms in fields where they had already built careers. While that's certainly entrepreneurial, we wanted people who were truly starting from scratch.

What did we discover? With creativity, commitment and resilience, an entrepreneur can turn even a small investment into an impressive business.

The stories we found contain several common threads. Hard work is one. If you don't have a lot to spend, expect to put in a lot of time and energy. As Jeff Swedarsky of Alexandria, Va., put it, he started his food-tour business for "$100 and 100,000 hours."

But the bootstrapping entrepreneur can also get help from lots of technological tools. For instance, professional-looking websites and automated phone-answering systems can speed sales and make a start-up look more impressive to potential customers.

Technology, in fact, is a big reason it's possible to launch a business so cheaply. Thanks to the proliferation of the Internet and the accessibility of once-costly technology, start-up costs "have plummeted in the last 10 years," says Bo Fishback, vice president of entrepreneurship at the Ewing Marion Kauffman Foundation, a Kansas City, Mo., nonprofit devoted to entrepreneurship. "It's gotten so much easier to reach mass markets and test out ideas. This is something that's becoming accessible to anyone with an idea."

Of course, there are limits to what hard work and tech savvy can do. Babson College has estimated that on average it takes about $65,000 to start a business, a figure that can include everything from buying equipment and inventory to paying employees. Some industries come with even higher price tags, according to the Kauffman Foundation—$82,000 for construction, $98,000 for retail and

Finance


$175,000 for manufacturing, to name just a few.

And even if you get your business off the ground for pennies, there's no guarantee that you'll keep rising. About half of all start-ups close within five years, and most research indicates that's usually due to lack of capital.

Those are the risks. For a look at how three entrepreneurs are navigating them—and finding rewards along the way—read on.

Kael Robinson Live Worldly LLC Started with: $40

In 2007, Kael Robinson received an unusual gift—a flimsy cotton bracelet with Portuguese lettering on it and instructions to make three wishes while tying it on. She didn't wish that the wristband would lead her to a successful business venture, but that's exactly what happened.

The good fortune didn't arrive immediately. Six months after she received the gift, Ms. Robinson got laid off from her public-relations job and was putting in a few hours a week as a lacrosse coach at a Denver high school. During this stretch, she took a family vacation in Argentina, where she made an interesting discovery: Her bracelet was a hot item there.

"I saw everybody wearing them," the 27-year-old recalls.

Ms. Robinson, who had gotten a taste of entrepreneurship in college selling handmade jewelry, had a hunch about the accessories. After she returned home she bought 100 of the bracelets for $40 from a wholesaler in South America. Wearing five of them herself, she offered them to her student athletes for $2.50 apiece and quickly

sold out, prompting her to invest in another 100 units. "I thought about what would be my target market and how high school is where trends start," she says. "The girls immediately hopped onto it."

Ms. Robinson soon had more orders than she could fill—at a new retail price of $5 per bracelet—giving her enough confidence to purchase another 1,000. She then began cold-calling local

Ms. Robinson

Start-Ups on a Shoestring ...continued

Finance


businesses and several agreed to resell her product on a consignment basis.

Gradually, retailers throughout the state and beyond began calling and emailing her to place orders. But she also took on some big expenses that cut into her profits. She donated 20,000 bracelets to charities, retailers and others to get the word out, for instance, and committed 20% of her sales to the nature nonprofit —a pledge she says helps drive business.

By the summer of 2008, Ms. Robinson had earned enough to pay for a professional website and logo for the company, now known as Live Worldly LLC. She also hired a publicist friend who helped her write and distribute press releases. CosmoGirl became the first of several magazines to publish a blurb on her company.

Ms. Robinson says the press attention inspired her to contact high-end boutiques: Barneys New York, Fred Segal and Kitson. She sent each of them a copy of the short article and 50 bracelets in a "really cool glass bowl so they could take it out of the box and display it," she says.

The stores sold out of the free samples within a week and began ordering more. The following winter, Ms. Robinson says, she started asking foreign buyers—individual consumers and retail shops—if they'd be interested in distributing her product in their respective countries, and many agreed. She also began expanding her catalog to include jewelry and apparel from around the globe, all with special meanings or cultural value, she says. For instance, she now offers necklaces, bracelets and earrings from Tibet that have been blessed by monks.

These days, her products are for sale in more than 500 stores world-wide. The company has a more sophisticated website and two full-time employees who handle order fulfillment, new-business development and bookkeeping. Last year, Live Worldly racked up $60,000 in profits on revenue of $160,000, compared with $10,000 in earnings on revenue of $50,000 the year before.

Ms. Robinson says she made some mistakes along the way that ate into her totals. For example, she says she wasn't asking enough for shipping; at first, she charged $8.99 to ship 20 or more bracelets to stores in the U.S., and now she charges $12.99. She was also paying printing costs of 35 cents per bracelet tag; about six months ago, she switched to a cheaper printer and now pays 20 cents per tag.

Ms. Robinson says she hasn't yet begun paying herself a salary and is continuing to put her earnings back into her enterprise. She says she lives frugally and relies on savings and income from coaching to make ends meet. She advises others looking to follow in her footsteps to create a list of objectives with deadlines when starting out. "That helped me a lot," she says. "It made me work hard to get those goals."

Next month

Jeff Swedarsky Food Tour Corp. Started with: $110

Ms. DeBaise is The Wall Street Journal's small- business editor, and Ms. Needleman and Ms. Maltby are staff reporters in the Journal's New York bureau. They can be reached at

, and .

Plantabillion.org

[email protected] [email protected] [email protected]

Start-Ups on a Shoestring ...continued

Finance


Good record-keeping is essential for all businessesWhat records should you keep and for how long?SME BusinessLink team

Apart from helping you keep track of your business transactions, some records are actually required by law to be kept for specified periods of time. Taxation recordsThe Income Tax Act (Chapter 23:06) requires that all businesses keep proper books of accounts for all transactions from which tax returns where prepared for a period of six years.Similarly, the Value Added Tax Act (Chapter 23:12) (Part X-Section 57) compels all businesses that are registered operators to keep VAT records for a period of six years after the completion of the transaction.

Records to be kept by registered companiesPrivate companies registered under the Companies Act (Chapter 24:04) are required to keep the following records for the periods shown:

DOCUMENT Retention Period 1. Incorporation statement ....................................................Indefinite 2. Amended incorporation......................................................Indefinite 3. Minute book as well as resolutions passed at meetings....Indefinite 4. Annual financial statements including annual accounts and the accounting officer's report.................................... 6 years 5. Accounting records, including supporting schedules to accounting records and ancillary accounting records.........6 years

DOCUMENT Retention Period 1. Certificate of Incorporation.................................................Indefinite 2. Certificate of Change of name............................................Indefinite

3. Memorandum and articles of association..........................Indefinite4. Certificate to commence business (if any) ........................Indefinite

5. Minute book as well as resolutions passed at meetings... .Indefinite 6. Annual financial statements including annual accounts and the accounting officer's report......................................8 years 7. Accounting records, including supporting schedules to accounting records and ancillary accounting records.........8 years 8. Books of account recording information required by the Act.................................................................................8 years

Private Business Corporations registered under the PBC Act Chapter 24:11 are required to keep thefollowing records for the period shown:

Feedback and comments, email [email protected]

Finance


Marc Compeau Small businesses are facing cash flow problems due to the plagues of lack of demand, shortage of credit and crushing costs. The knee-jerk reaction for many cash-strapped Mom and Pop shops: squeeze pennies until they wail.I've got some news for you: Cost-cutting alone won't guarantee survival. Yes, you need enough cash to fill orders, remunerate employees and cover interest payments. Lose sight of the customer, though, and you might as well pack it in right now.Mark Cornett, co-owner of Northern Interiors, a furniture retailer, gets it. Typical furniture retailers charge as much as three times wholesale costs, followed by frequent deep discounts to entice shoppers. There are two problems with that model. First, those spikes are hard to plan for; second, customers end up having a relationship with those discounts, not the store itself. "Over-priced products that encourage customers to wait for the next huge sale is the norm," says Cornett, 52.That's why Northern Interiors charges in the neighborhood of 1.8 times cost and sticks to it. "Our approach was to offer better pricing consistently and to market the customer experience, eventually building a loyal, repeat customer base."With average revenue per ticket on the wane in the recession, Cornett also has squeezed more out of each operating dollar by taking a closer look at what his customers were buying. Result: He stocked more popular items, including futons and drapes, and displayed them more prominently on Northern's Web site, while recliners and mattresses temporarily took a backseat.Cornett also rationalized his labor costs. "We have carefully tracked store traffic, adjusting store hours to control labor while assuring we are open when we need to be," he says. Throw in some cutbacks in print advertising and Cornett has managed to slash operating expenses by 19% in the last 12 months. And thanks to his customer-focused approach, even the top line is starting to move in the right direction. Adds Cornett: "Rather than go home at night worried about the future, I feel like we are beginning to see some light."Dan Cook, owner of Harry L Cook, a 95-year-old chain of dry cleaners (with three locations), has an even more basic approach to delighting customers. "It's as simple as treating people like you want to be treated," says Cook, 67. "We know everybody that walks in by name. I tell all of my employees that if you don't know their first names you better know their last. Find out something that is unique about them, have an open ear. My goal is to send a customer home smiling and have their spouse say: 'You have been at the dry cleaners again, haven't you?'" Forging those sorts of relationships means combing scads of data, every day, without fail: "When I come in I usually spend the first half an hour getting caught up on who got a promotion, who lost a loved one, whose kid won an award," says Cook.Charismatic, dedicated customer service is nice; offering a better product is nicer. To separate himself from the pack, Cook provides off-season clothing storage free of charge. While the market for the service has dropped a bit with the trend away from wool and toward natural fibers, Cook says he regularly stores upward of 500 boxes in numerical and alphabetic order. "And by the way, we clean all of the clothes," he adds.Cook's final piece of advice: "If it's raining, you should grab an umbrella and meet your customer at the car." Don't have an umbrella? Get one, because there are plenty of rainy days ahead.

Marc Compeau is the director of innovation and entrepreneurship at Clarkson University. He has started several small businesses, received multiple patents and is the founder of

, a small-businesses support seminar series. mysmallbusiness101.com

Cost-Cutting Won't Get You There

Selling & Marketing


By Phillip Chichoni

Small businesses typically have a limited marketing budget if any at all. Does that mean you can't run with the big dogs? Absolutely not! It just means you have to think a little more creatively.This is where the three steps of marketing come in: market segmentation, target marketing and positioning. Understanding and making full use of this three phase marketing strategy is the key to successfully marketing your products and services on a low budget. Your objective is to know what customers want and need; and satisfying those needs while making profit is what we call successful marketing.If we had some magic wand which would tell us what each customer needs exactly, when, where and how they need it, we could just have our products ready for presentation to willing and ready buyers and effortlessly make money. Unfortunately, such a silver bullet does not exist. We have to do some work to find out what customers want. The following steps will help you know your customer and be able to successfully market to them at low cost.a) Know your product

The more you know about yourself, your products and services, and your customers, the more effective you can be at marketing. The question is not what physical good or service you are selling, but what unique product concept or value proposition you are offering. Anyone can supply the same product or service that you supply. The days of competing on price and service alone are over as customers can get the same product elsewhere at a cheaper price and with better service. To succeed, you need to differentiate yourself from competitors, make your business special in the eyes of customers and prospects. You need to define your unique selling proposition, the one thing that makes your business unique and distinct. Why should people buy from you and not from your competitors? Do you promise great value, benefits or service? Your USP must be truly unique. It must be strong enough to excite your target market and get them talking about it. And it must not be easily copied. Anyone can claim to provide the best service in town- “We are the number one service provider in Zimbabwe”. But it does not sound credible. It's lukewarm and it's an empty promise because you cannot measure it and you cannot hold them accountable for it. Your USP needs to pack a punch. How about: “Your parcel delivered the very next day or it's for free!” This is a measurable USP developed by FedEx, and they made themselves accountable for the promise. Pizza Inn once had a similar slogan: “Your Pizza in ten minutes or you don't pay.” Such a powerful USP can make your company stand head and shoulders above the competition. Take the time to examine your product and articulate your offering as a unique selling proposition. A “me too” business will not bring you sustainable success. Do you know why customers buy whatever they are buying from you? It is important to know that, so that you can focus and improve on it; ideally so that you can do it better than anyone else. Talk to your customers. Carry out surveys regularly so as to ascertain their views and comments about your company and its products. The more information you can garner from your customers about your company the more customers you will have. b) Understand the market you are servingYou need to focus and define your market as narrowly as possible. Your small firm does not have unlimited resources available for marketing. Using the segmentation we discussed earlier, you should

Low Cost High Impact Marketing Strategies for SMEsMarketing Basics for the Small Business

Selling & Marketing


narrow down and define the target market that you want to reach. That way you can apply focused and effective marketing programs that reach your target customers. To properly define your market segments, you need to carry out some research. Some information, such as on population sizes and demographics, are available from data released by the Central Statistical Office, Chambers of Commerce and Industry Associations. The other information can be obtained from various publications, or can be obtained from market research firms for a fee. To cut costs, you may do the market research yourself; surveying samples of the population you want to target so as to understand their various needs and habits.

The data from your research should enable you to estimate the size of your targeted market. Say you want to market a new cosmetic product. Research may inform you that the total population in Harare is 1.5 million people. Half of that number are women, 40% of whom fall within the 18-35 age range, which is 300 000 people. One third of those hold professional jobs, i.e. 100 000. You further estimate that one third meets the rest of your segmentation criteria, giving you a potential target market of 33 000. Assuming that two thirds are loyal to competitors' products, your market then is 11 000 people. Estimating market size is very important because it enables you to judge whether the market is large enough to justify your investment.

d) Understand pricingPricing is important in two ways. First, it is a competitive tool. Second, it directly affects your bottom line.To successfully sell your products, you must charge a price that customers are willing to pay. How do you find this price? You let the customers tell you. Your market research should tell you what customers are already paying for similar products being sold by your competitors. For products that are already available in the market, your price should be competitive while allowing you to make a profit. This means you must know your cost structure so as not to sell at too low a margin, a scenario that could plunge your business into failure. On the other hand, charging too high a price, while good for your margins, can price your products out of the market.

c) Know the size of the market

Phillip Chichoni is the author of the business guide book High Impact Low Cost Marketing Strategies for SMEs

Selling & Marketing


I've noticed an interesting phenomenon in marketing and selling. When you make an offer, you sell something, when you don't make an offer you don't sell anything.I know this sounds simplistic, but in many ways it's really at the heart of successful marketing and also at the heart of many marketing failures. I've noticed that Independent Professionals are notoriously bad at making offers. Let me give you some examples.NetworkingA web designer at a networking event has discussions with several people. He leaves with a few cards and gives his card out to a few people. None of this activity results in new business.SpeakingA consultant gives a talk at a professional organization. The talk is good, the graphics are interesting; people enjoy the talk. But it doesn't turn into any new business. MailingA communication skills trainer sends out a letter and brochure to a qualified list of potential clients. The information is full of benefits and advantages of his services. But nobody responds. What's missing? Why no results?Networking, speaking and mailings are all proven marketing tools for Independent Professionals. They can actually work. They can be very effective. But often they're not, for one very simple reason: No offer is made.What is an offer?An offer is a specific call-to-action to the prospect. It is a request for them to do something. It doesn't have to be an offer to buy now, it may be an offer to find out more. The simple construct for an offer is: "Here's something I have that will provide value to you. Here's how to take advantage of it." An offer always needs to be explicit, not implicit. It needs to be direct, not indirect. It needs to be a request, not a suggestion. And a successful offer also depends on the right timing. Let's look at our three examples again.We often think an offer in networking would go something like this: "I help companies increase their profits, would you like to meet with me to discuss how I can do that with you?"OK, that's an explicit, direct request. But the timing is bad. Why would someone want to meet with you just after a brief conversation? You've barely connected. So you need to make an offer appropriate to the situation: "I help companies increase their profits. I have an article called "Ten Profitability Mistakes Most Companies Make." Can I send you a copy and then get back to you and get your reaction to it?"This is also an explicit, direct request, but with better timing. Timing has to do with sensing the appropriateness of the offer given the situation and relationship with the prospect. Many of us are not too good at this, so we avoid making offers completely. Instead, we need to think through our offers more carefully and design offers that apply good timing You might design this offer in stages:1. An article, followed up by an email, phone call, and an introductory conversation: "How did you like the article? Tell me something about your business." 2. An offer or request for an appointment: "Why don't we set up a time to talk in more depth about your business and how I might be able to help you." 3. A sales conversation in which you offer to do a piece of work: "What I'd recommend to start is a Communication Assessment Session with you and your top managers." Let's look at a speaking engagement. You give a great talk and at the end is the opportunity to make an offer. You want to make it appropriate to the situation, so you need to consider the timing carefully.Recently I saw one of my Action Plan Coaches give a 3-hour presentation to a professional group. In three

Timing Your Offers to SellAction Plan Marketing by Robert Middleton

Selling & Marketing


hours you can build a strong connection, and she had succeeded at that. Her offer went like this:"I have a 6-CD set called "Seven Steps to Energize Your Marketing." The price for that is $199. For anyone who gets one today, I will also give you a complimentary "Marketing Energy Audit" valued at $395."Eleven people (about a third of the audience) bought the CD program and signed up for the audit. In that audit she explored the situation, needs and opportunities for their businesses. Then she made an offer for a four-month group coaching program valued at $2,000. Seven of the eleven signed up for it. With this two-step offer, she generated $16,200 in business. And it happened because she thought through her offer, and made explicit, direct requests with the right timing. For a direct letter you think through this in the same way. You need to realize that probably you won't get a sale only from the letter. And if your letter says, "Here's what we do. When you need help in this area, just give me a call," you're not likely to get very good results. (I've seen thousands wasted this way.)That's poor timing because they likely don't need you now, so you're asking for action in the future. All offers need to be for NOW, not the future. So you could offer a special industry report, an introductory presentation or something that will be relatively easy to say yes to now. The first thing to notice is how often you fail to make any kind of offer in your marketing. The next thing to work on is crafting offers that are explicit, direct and ask for action. Finally, you need to fine-tune your offers so the timing is appropriate to your audience. Before long, your offers will generate new business.*Until next time, all the best,

Robert Middleton - Action Plan Marketing- Helping Independent Professionals Attract More Clientshttp://www.actionplan.com

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Selling & Marketing


Every business owner and organization knows if they want to attract and retain more loyal

customers, they need to provide high-quality customer service. That's why organizations today focus

heavily on communicating how valuable their customers are to the organization. Now, the question

is... How much do they truly value their customers?

Most of you probably had the experience of being a "valued" customer, yet you didn't feel valued at all! For example, you call a company for either customer service or to order one of their products and you enter into the electronic triage system only to be put on hold. You're told: please stay on the line, your call is important to us. Sometimes we dutifully follow the electronic request, and we wait, and even wait longer. Other times we hang up in pure frustration.

Or, have you been asked to complete a customer satisfaction questionnaire?

Again, you are told that your comments are "very important to us."

Really?

How maddening it is when you have taken the time to complete such surveys after receiving poor service, spelling out in detail what the issue was and why you were dissatisfied, only to receive no acknowledgment of your issue or concern?

Perception, as we have heard endless times, is reality. The reality here is that you won't go back or use them in the future. And likely, you will tell your friends!

We believe that providing excellent customer service should be an obsession.

Here Are Our Growth without Sabotage™ Tips That Will Help Your Organization Differentiate Your Customer Service

1. Have a real, live person answer all of your calls. If you cannot have someone answer all your calls, subscribe to a voice message service and include a message that you will return all calls within one business day – and do it. If it is late in the day, it can acceptable to wait till the next business morning. Remember, the message and perception in timing/promptness is, "you count"-- you are important and a priority to me.

2. Return emails within one business day (two days maximum).

3. Learn to be comfortable introducing yourself by your full name. When meeting in person, look at people directly in the eye, especially when you first meet them and ensure you know how to give and reciprocate a firm handshake.

4. Ensure you clearly understand the customer or prospects need and priorities. Do this by listening sincerely and asking clarifying questions. Listen FIRST and actively listen more than you talk. Ask questions to clarify your understanding of your prospect's motivation to buy – but do so respectfully and carefully.

5. Keep agreements you make to the prospect or the customer. When you say you will do something, do it when you said you would do it. Emergencies should be the only exception.

10 Ways to Differentiate Your Customer Service

& Make Your Clients Actually Feel Valued

Selling & Marketing


6. Eliminate negative surprises for the customer. If there is a problem, acknowledge it quickly, apologize if appropriate and do your best to fix the problem to the customer's satisfaction.

7. Always have your clients' and prospects' best interest in mind. Think of ways you can help them improve their needs to be in the forefront.

8. Think of the long term sale. That means go slow, don't push now to sell or attempt to up-sell. Think of the longer-term relationship and resulting opportunities forthcoming.

9. Warming- Flirting and fawning are forms of overselling (as well as demeaning) yourself. Realize how unprofessional and damaging these behaviors are with your customers and prospects.

10.Warning - Don't expect the customer to understand that you are busy or short staffed. They won't and they shouldn't have to.

You may be thinking that this is obvious. Yes, indeed, it is not rocket science. While it may be obvious, the truth is that it is also frequently not practiced. And because it is not done well or consistently, it represents a key differentiator.

You need to capture the attention of your future customers and keep your current customers. Without consistent excellent customer care, customer loyalty is improbable, especially in this economy where buyers are more cautious. Now more than ever in business, we need to find ways to differentiate ourselves. We find that customer service is a simple yet powerful differentiating strategy.

Sara LaForest and Tony Kubica are management consultants with more than 50+ years of combined experience in helping organizations improve their business performance. They say, failing to improve customer service by showing your clients that you value them is just one way to sabotage your business growth. Get their complete "Self-Sabotage in Business White Paper" now at: http://www.kubicalaforestconsulting.com/resources.php



"It's not you, it's me."Every spurned lover has heard some version of that line and wanted to scream. Not only were they getting the shaft, they were getting it in the most irritating,unsatisfying, slippery way a hack comedy writer could conceive--and all because the person didn't have the courage to come out with it, unvarnished and sincere.But then, no one likes to deliver bad news, whether it's ending a romantic relationship or admitting the loss of an investor's money on a bet gone bad. Mustering the fortitude to get those words out in the first place is hard enough;communicating the message in a meaningful, compassionate and respectful way can feel nearly impossible.We went searching for well-honed scripts to help navigate some of life's thorniest occasions. General rule of thumb: Stick to the facts and follow up later when emotions have cooled.That goes for romantic rifts, too. For casual relationships, walking away can be as simple as not calling, says David Steele, founder of Campbell, Calif.-based Relationship Coaching Institute. To end a more committed relationship, meet your significant other in person, preferably in a public place (park, coffee house) to keep any breakdowns in check. Don't negotiate; state the truth and move on, as in: "We've had fun, and I've appreciated the time we've spent together, but I'm going to start focusing my time on other people." A bit of reflection is OK, says Steele, but don't linger. If things deteriorate quickly, simply say: "I can see you're upset, and I'm sorry about that. Let's talk more about it next week." That gives both parties time to process the decision--and buys you time to decide if a follow-up meeting is really what you want. Here are a few other highlights from our search:

Break this painful delivery into multiple steps, says Dr. Quyen Ngo-Metzger, associate professor in the Division of General Internal Medicine and Primary Care at the University of California, Irvine, and author of End-of-Life Care: Guidelines for Patient-Centered Communication. Start by clearly stating the diagnosis ("You have fourth-stage lung cancer"), then move to treatment options("There are experimental procedures you may choose to try")and the relevant statistics on survival rates ("One-quarter of patients with this disease live for more than a year"). Inject optimism without ladling out false hope. Don't delve too deeply into the diagnosis off the bat, as the initial shock can be disorienting for patients. Offer to spare them the burden of relaying the news to their loved ones by asking, "Would you like me to talk to your family?" Once they've had time to absorb the initial blow, make an appointment to go over the next key steps."Your child is suspended from school."Stick clearly to the facts, says Eric Sparks, director of school counseling for Wake County Public School System in Raleigh,N.C. Parents often take bad news about their children particularly harshly, so explain the policy violation and that, as an administrator, you have no choice in the situation. This works: "I'm sorry to inform you, but your son violated our policy.He got into an altercation with another student. As a result, our policy states that when there is a fight between students, we are required to suspend them from school for at least three days."Most school districts allow parents to appeal a suspension, so make sure parents understand their rights, adds Sparks. If the district allows, ask parents to pick up any schoolwork so that their child may keep up while serving the suspension. Finally, offer to address the underlying problem by setting up an appointment with a guidance counselor."I ran over your pet."Pets can be like family members to some owners, so appreciate the gravity of the accident. If the animal has a tag, go immediately to the owner's home and explain what happened, says Janice

How To Deliver Really Bad NewsWell-honed scripts for the thorniest occasions.

"You have terminal cancer.”



Barnard, program director for the Pittsburgh-based Animal Rescue League of Western Pennsylvania. A good approach: "There is no easy way to say this, and I'm terribly sorry. I accidentally hit your pet with my car. I stopped immediately to see if he was OK, and I'll do whatever I can to help you get the proper care." Don't make excuses or blame the animal for darting out into the road--the owner doesn't want to hear it. If you have the means, offer to pay for any necessary treatment. If the animal is untagged, Barnard suggests calling the local animal-control office or police department for assistance."I lost your money."Hedge funds, venture capital firms, even that good buddy who wanted $10,000 to open a hot new bar that fizzled in three months--all have had to admit to losing someone else's money.The key to cushioning the blow is constant communication from the moment the initial checks are cut, says Gary Kreps, Manhattan-based managing director of an emerging-markets hedge fund. "When things are going well, I generally write a letter to my clients every quarter explaining how I am positioned, what I expect to happen in the next few months and what I have adjusted from the previous quarter," he says. "But since the recession began, I switched to a monthly letter. When the markets decline, reiterate why they invested with you in the first place and remind them that all investments carry some risk.""I crashed your car."This one requires major damage control, says Melissa Leonard, an etiquette and protocol consultant in Mamaroneck, N.Y. First, don't call the person in a frantic state. Collect all contact and insurance information, file a police report, then pull over to a safe place and call the owner. Don't make excuses about swerving around a squirrel or the other guy coming "out of nowhere." Instead, say: "I'm so sorry, but I've been in an accident with your car and there's some damage that needs to be repaired. Is there a particular repair shop you'd like me to bring it to?" Offer to contact their insurance company and to pay for the repairs and a rental car. "Be honest and sincere, avoid inconveniencing them any further and cover all the costs associated with your mistake," says Leonard."You've been passed over for a promotion."Deliver this message face-to-face, and immediately after alerting the person you did promote, says Paul Bernard, a Manhattan-based executive coach. Don't wait for the passed-over party to hear about their loss from peers, and don't pass off the conversation to a human resources manager. A solid script: "I want to let you know this was a difficult decision. I value what you do here, and I want you to stay with the company. Unfortunately, I cannot offer you a higher position at this time."Don't get into a detailed performance evaluation in the initial conversation. If the person wants to know how she can improve down the line, arrange a separate meeting for that discussion."I double-booked the catering of your wedding--this weekend."In 1995, catering sales manager (and spokesperson for the National Association of Catering Executives) Linwood Campbell had to fess up to double-booking the space for a 125-guestwedding just days before the bride's big day. To defang Bridezilla, Campbell secured a comparable venue and caterer, arranged for transportation and change-of-venue notices to be sent overnight to every guest--all before he came clean about his gaffe. When he finally confronted the bride, he swallowed hard and said: "We need to discuss something that will affect your perfect day. I'm sorry, but we accidentally double booked."After that he went on to explain the steps he took to ameliorate the problem. Being available--no matter the time of day--and giving out your personal cell number is also advisable.

www.forbes.com

How To Deliver Really Bad News...continued



In 2001 Dr. Julie K. Silver, a staff physiatrist at Harvard Medical School, sensed something wrong with her body. She saw her doctor, but the tests came back negative. Taking her own advice, she sought a second opinion. It too came back negative. But the feeling persisted, and two years later, at age 38 and with three children (ages 3, 7 and 11), Silver got tested again. That time she was diagnosed with breast cancer.

Treatment took its toll, and when Silver returned to work a year later, she was a shell of her old self and struggled to perform. "I realized with cancer you go into treatment feeling a lot better than you do when you're done," she says.

Sickness, grief, stress: At one point or another, we all have to deal with them. The real trick is coping while performing a job, being a spouse and raising a family. How to give your best when you're feeling your worst?

The first thing Silver realized was that skipping breakfast and grabbing some coffee wasn't going to cut it anymore.The worst thing people can do during this time is skip or delay meals--and that is probably the first thing that happens,

It is recommended to eat within an hour of waking up. Don't shy away from protein and carbohydrates, as both are needed to maintain dopamine and serotonin levels. Everyday stress depletes dopamine and serotonin. When those two are down, you end up feeling depressed, not knowing why and then overeating.

Sitting in front of a computer may not feel draining, but it is, and stress burns fuel too. Eat a few meals throughout the day, but keep them small. Limit intake to 600 to 800 calories (500 to 600 for women); digesting more will make you feel sluggish. Some good ideas for snacks: cheese and apple slices, Greek yogurt and fruit, and whole wheat crackers with deli meat.

Fire up your metabolism by drinking plenty of water. If your metabolism is slowing down, you are going to slow down. Coffee and soft drinks aren't good substitutes: The first dehydrates, the second comes with a sugar slump. Dehydration also makes you feel hungry, increasing the odds of a junk-food binge.

Have adequate sleep

When deadlines loom, "sleep becomes an expendable thing," says Dr. Tracey Marks, author of . "That is a mistake because it affects your memory

and your sharpness."

Marks recommends seven to nine hours of sleep, plus one electronics-free hour to unwind before bed time. (Silver, for her part, made sure the last thing she did at night was peaceful--like reading an uplifting book.) To make the sleep you do get really count, avoid exercise two hours before bed, alcohol four hours before, and caffeine and nicotine at least six hours before.

Another stress-relieving trick: Make to-do lists. If the task ahead looks overwhelming, break it into small pieces and check them off as you go. "People feel gratification and satisfaction out of seeing things that they have accomplished," says Marks.

No matter how drained or busy you are, make time for some exercise. “Exercise energizes you and increases endorphins, which help with the stress," says Villacorta. "Exercise doesn't mean you have to kill yourself at the gym. Going out for a walk in the middle of the day can be very helpful in lowering cortisol levels and helping you feel energized." During her recovery, Silver would get on a treadmill or walk around the neighborhood while on the phone. She also wore a pedometer, making sure to take

Master Your Sleep: Proven Methods Simplified

How To Keep Going When You're Out Of Fuel



at least 10,000 steps a day.

Finally, and above all, don't forget to be good to yourself in tough times, says Silver: "Try not to be too critical. Nurture yourself the way you would nurture someone you love."

Silver put her experience to work, writing . She also founded STAR (for Survivorship, Training and Rehab), a company to bring cancer rehab to hospitals. Says she: "I wanted cancer survivors to not be dropped off at the end of treatment, but to be scooped up and offered rehab to help them physically and emotionally heal as well as possible.”

After Cancer Treatment: Heal Faster, Better, Stronger

Levi Davis Forbes.com

How To Keep Going When You're Out Of Fuel

Innovation


Many people have come to think wrongly of innovation as a separate activity, walled off from their regular course of business, something they have to pursue intentionally. We saw this firsthand recently while participating in a workshop on small-business innovation. One small-business owner disavowed the notion that anything his business did could be classified as innovative, saying, "We're not creating the iPod."

Our recent experience showed that many small-business owners are highly innovative but not aware of it. The notion that you have to be creating an iPod to be innovative reveals that people are very confused about what innovation is.

In fact, iPod wasn't Apple's sole reason for success in the digital music space. This innovation went well beyond the technology. Apple understood that some customers wanted to buy MP3s, not steal them. Thus the combination of iTunes with the slick iPod device proved a winning business model that upended digital music.

Understanding your customers is required for successful innovation. Small-business owners, with their intimate knowledge of their customers, actually are incredibly well-positioned to innovate. One example is a story told at the workshop by a man we'll call "John" who owns a pool-service business.

John started out in the traditional way, servicing equipment and maintaining pools for residential, commercial and government customers. The pools that were controlled by the municipalities and some of the very large commercial installations were required to maintain strict water quality standards. These customers invested heavily in monitoring technology that ensured the water quality was up to local standards. The rest of John's pool customers were certainly interested in maintaining pool quality but viewed monitoring technology as far too expensive for them to reasonably deploy.

At a local trade show some time later, John was taken by new technology that would provide remote monitoring services at a much lower cost than the systems deployed in the large pool installations. Recognizing this enabling technology, John developed an entirely new business model for his customers. He purchased a limited number of the devices and then offered monitoring to a group of small to mid-sized pool owners as a service. Overnight, this entrepreneur evolved his business model from a fee-for-service model to a leasing business.

However, John did not consider this change to his business model to be highly innovative for his field. When asked about the innovation, John explained he felt the decision to expand into leasing equipment was an easy one. He didn't need a business plan to evaluate this innovation. He pointed out that, in fact, he hasn't had a plan for a number of years. He started out with a business plan but stopped updating it years ago. He said, "I know in my mind by how much I want to grow and what I need to accomplish each month to achieve my target."

What John didn't realize is that he does in fact have all the elements of a business plan. Instead of the annual, stagnant planning process that characterizes many large businesses, John and other small-business owners have clear metrics, a clear direction and the ability to change course immediately if they need to.

There are lessons here for small-business owners. Small companies should realize that their close customer connection provides a great springboard for innovation. The small businesses we talked to were incredibly market-connected. To them, a customer problem is an opportunity to sell that customer another solution. They are responsive, iterative and flexible.

Innovation Lessons From Small Business

Innovation


Further, small-business owners might think they don't have the resources to innovate. In fact, constraints are a friend to innovation, not a foe. More promising innovations have been killed by too much time and money, and too many people, than have been killed by lack of any of these.

Big companies can also learn from the way small companies approach innovation:

* Connect with your customers in order to truly understand them; pay particular attention to framing

the conversation around the problems the customer has rather than the problems you think your

current product or services could solve for that customer.

* Be iterative in regards to strategy and planning, in order to maintain flexibility and be most

responsive to outside change.

* Be open to experimentation with new business models.

* Be wary of the curse of too much capital and resist the temptation to throw resources at innovation

efforts.

Above all, businesses of all sizes need to remember that innovation is not limited to products, services, technology or creative thinking. Creating a new iPod isn't always the goal--rather, focus on understanding why the customer can't adequately solve important problems and develop an innovative business model that does the job in a new, novel fashion.

The last six months have certainly taught us that all businesses need to be open to change. If there was ever a time to start thinking like a small, nimble business, 2011 is it.

Written by Andrew Waldeck, a partner with Innosight and Renee Hopkins Callahan, editor of Strategy & Innovation. This article was excerpted from a recent online issue of Strategy & Innovation by Innosight, a consulting firm co-founded by Clayton Christensen and Mark Johnson specializing in innovation and disruptive strategy.

Innovation Lessons From Small Business...continued


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