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Cape Town - The sustainable growth of a business meant more than just having great products, but rather having access to more shelf space where your brand could attract consumers.
Ravi Govender, head of small enterprises at Standard Bank, said this was where most entrepreneurs made a mistake and lost the opportunity to keep their businesses on an upward growth trajectory.
Even if your products are innovative and appealing to consumers, if they are not easily accessible, the prospects for growth can be bleak.
‘Victim of success’
“The entrepreneur can become a victim of his/her own success, limiting opportunities for growth by overlooking the importance of capitalising on additional finance sources to open up new markets for the business,” he said.
“At this stage the failure to sell some equity and take on partners or shareholders or additional debt to finance growth means stagnation for the business. Ultimately you create more opportunities for competitors who are happy to make sacrifices for future growth,” said Govender.
When a business had done well and sales had reached a satisfactory level, the entrepreneur could then afford the luxury of taking time to review his/her growth strategy.
Key factors
- Checking the name of your brand, its packaging and the overall appeal it has to customers. If necessary, look at refreshing packaging so that the product has more appeal.
- Researching product markets and finding out where your potential customers are most likely to shop. Then, find out who the corporate buyers are and market your product to them so that you can potentially get space on their shelves.
- Using the web to establish your brand. By having your own company page you can reach anyone using the internet.
- Consulting professional marketers to get your products placed.
Think Big
Episode four of the Standard Bank Think Big: Building Business Champions series highlighted that many successful businesses that had promising growth prospects often found it challenging to break into new markets, because their owners lacked the required expertise to take their businesses to the next level.
Watch:
Hire expertise
Govender said if you were not ready for this major step, you should consider hiring company representatives that could help you to achieve national sales and further gain access to larger chains for future growth.
“If you feel there is still enough room for major product sales within smaller outlets, use your company representatives to gain more access to these markets,” he said. “Independent outlets will not only stock your products, but will also generally welcome any brochures and advertising material you may offer.”
“Once you have reviewed your growth strategy and have taken all factors into consideration, you will realise that your ambitions for accessing new markets will require a new source of finance. It pays to explore these opportunities as they could provide the impetus to grow the business.”
Be prepared
“After all, if you are exploring new markets you have to be prepared to meet anticipated demand by growing production and manufacturing lines,” said Govender.
There is nothing worse, he said, or more destructive for a business than creating demand through new markets and then not having products available. “Once retailers lose faith in your supply chain, they will simply stop ordering products and move on to the next available supplier,” he said.
“If you do not meet your customers’ expectations, not even the best advertising, marketing and web campaigns will keep your business on track. Service is, and always will be, the criteria upon which you are most often judged,” said Govender.
Derek Thomas and Nobuntu Webster discuss key learnings from episode 4 of Think Big.
Watch:
- Think Big episodes can be viewed on SABC 3 at 21:30 every Thursday evening until 18 September. The show is repeated at 16:30 on the Sunday following the evening broadcast. You can also log on at BizConnect to view the show.
