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The subject expert entrepreneur

The subject expert entrepreneur

13 April coverThis article was written by Ed Hatton for the column the Start up Coach and published by the South African edition of Entrepreneur magazine in April 2013 and is posted here by their kind permission.

 

You have the expertise but where are the customers?

 

 

Challenge
This entrepreneur had 26 years experience in the security industry when he started his own security company. For several years he has been unable to secure guarding contracts, and asks for help
Response
Every start up entrepreneur believes that a sustainable and profitable enterprise can be built and this belief is reinforced by expertise in the product or service that the company will deliver. An expert in the chosen field has big advantages; he or she does not need to climb the product learning curve that affects so many start-up entrepreneurs. However as our questioner has discovered to his cost, expertise in the chosen field alone does not guarantee success.
A successful business must provide customers with services which they perceive to be more desirable and valuable than the services available from competitors. This perception is not just about the product or service; it covers the supplying company, people, styles, and brand association – the whole package on offer. The challenge for start up entrepreneurs is to create a business that provides the package which will attract customers away from alternatives – and then communicate the package to them.
Our questioner’s business may be a small business offering similar guarding services and terms to those of larger established businesses. New businesses trying to enter an established market will often imitate the established players, to fit in with customer expectations. If a new little business offers the same as established big businesses the customer’s viewpoint may be: “Why SHOULD I give you a contract when I have a long term relationship with a substantial and stable company that I trust?”
If our questioner is offers nothing different to established competitors aside from his experience in security matters then he needs to design a more attractive package. He could capitalise on his experience to offer security consulting as a part of the service or his size to promise shorter communication lines, he could include some free services or any other differentiating benefits. These do not need to be product related – an example is specialisation in a niche area to such a degree that he becomes the acknowledged expert in that area.
Challenging industry norms is often a way forward. If contracting favours established businesses there may be more innovative ways of packaging the service to swing the advantage his way. Many organisations have become hugely successful by creating their own rules, in sectors as diverse as airlines, short term insurance and pizza marketing.
Telling and selling
Successful entrepreneurs should understand marketing and selling. Along with financial management these are as important as product knowledge. Once an attractive concept for guarding services has been designed the next step is to tell his market that this facility exists in a way which will get their attention, probably with a very limited budget. This is effective marketing. He needs to convert incoming enquiries into sales by showing prospects that his offer is appropriate for them – this is effective selling. Entrepreneurs should not underestimate the need for effective marketing and selling – these alone can provide the differentiation from other competitors which the entrepreneur seeks.
I can imagine a lot of entrepreneurs reading this and then rolling their eyes while thinking “but I DID all that and it didn’t work”. This could be true for some of them; there are businesses and products that never attract buyer’s attention however well they are developed, presented and sold. If that is the case either get some outside advice and make changes or close the business and try something different. For the majority of struggling entrepreneurs I suggest they take an honest look at their offering as if they were a customer making comparisons to other suppliers. Ask a friend to help and play devil’s advocate. Then, even if this exercise bruises your ego, recover quickly, as entrepreneurs do, and think creatively to design the killer package that will build success.
© copyright Entrepreneur Media SA (Pty) Ltd. All rights reserved. No part of this article may be reproduced, stored in a retrieval system or transmitted in any form without prior permission of Entrepreneur Media (Pty) Ltd. Permission is only deemed valid if approval is in writing.

 

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