8 Toxic Ingredients That Kill Businesses | Common Business Mistakes
Recently I attended a Surrey Board Of Trade breakfast networking event. The breakfast was very professionally presented with great content and networking.
During my breakfast, I met Cheryl Bishop from Make Your Mark and we traded business cards. Later that same day I received an email from Cheryl inviting
me to be her guest at the Make Your Mark’s two-hour event at the Sheraton Guilford in Surrey. I thought sure why not as this should be another good networking
I arrived at 11:55 am for the start of the event not knowing what to expect. When I entered the conference room there were probably 200 people there and
right away I noticed there was a gentleman on the stage preparing to start a seminar. Being in the professional sales industry for 20 years all kinds of red flags
came up, “oh no not another business guru who's going to try and fire me up and then try to upsell me his great business formula at the end of the seminar.” Although
I have seen some wonderful motivational speakers in my years of sales experience, I have also seen others on the opposite spectrum. Being that I had already taking
the time to attend I thought I might as well check out his presentation.
The gentleman introduced himself as Colin Sprake. He arrived in Canada from South Africa a number of years ago and within that time with limited resources he started
four companies all reaching over $1 million in revenue. With this entrepreneurial experience, he used his presentation to review 5 Toxic Ingredients that kill off most businesses.
1. Businesses Focus on Penalties instead of Rewards
Many owners spend too much time focusing on the penalties instead of the rewards that will come from their actions. He referred to it as The Clash of Reward vs. Penalty.
Following down the same path instead of focusing on the results these same business owners will give themselves excuses as why an idea wouldn’t produce results, which
starts the next battle Results vs. Excuses.
The third challenge that confronts an owner is C vs. C = Can vs. Can’t. Mr. Sprake says this mindset simply needs to switch to “How can I.” These first simple steps improve
the owner and companies mental outlook on the future and allow the mind to expand and grow ideas that places the business as the leader.
2. Not Focusing on Sales and Marketing
As a new company starting or an established enterprise what the company invests into hinders or helps growth. Many companies’ cash is invested as follows:
- 25% on production
- 65% on operation
- 10 on sales and marketing
After a year of this formula and wondering why the sales are lacking many owners would decide to shut down the company when the outcome could be reversed by
a simple change. Many successful managers such as a dragon off of CBC’s hit show Dragons Den will make the following cash adjustment with the companies they buy.
- 25% on production (same)
- 10% on operation
- 65% on sales and marketing (the majority of the focus and cash will be allocated to finding new clients and building your brand).
Without the sales, all your wonderful ideas coming from so much focus on operations are a mute point. Sales and generating cash should be the foundation for every
business. You have to invest the most into this sector to generate healthy returns on invested capital.
3. Not Closing Sales Because of Poor Follow Up
This toxic ingredient has the ability to topple any company no matter how much revenue or the number of years in business. Good follow up needs to be one of the
cornerstones of your company. You can allocate all the resources and time to advertising campaigns, trade shows, and networking events but if after each inquiry
or new contact made the line of communication ends, so spells the beginning of the end of your company.
On average it takes 7-12 times asking for the sale before a buyer will buy. If after you have given your prospect a quote and that is the last time they hear from you,
can sales honestly be expected? Poor follow up with existing clients is also a slippery slope. As Pareto’s principle states “80% of your sales will come from 20% of your customers.”
Additionally; if clients are happy there will be an opportunity to ask for an introduction (not a referral) to another company that could benefit from services you
provide. On the opposite spectrum, if your customer is not happy it gives you the opportunity to learn, and find out what needs to be changed in your company to
improve the quality of the products or service being delivered.
Follow up with a smile on your face, if it’s the third time or the 10th, you are that much closer to getting a yes and starting a relationship with your new customer.
Your first follow up with a potential client establishes the relationship that will be built. By responding quickly and providing information that solves a real problem
increases your credibility and closing the sale is only a matter of time.
4. Ineffective Networking Because of No Strategy
Networking has to be more than showing up at random events. You have to go in with a plan. Research will allow you to choose various groups and chambers of commerce
that have members who suit your industry. If your clients are “Big Fish” you have to swim in the same pond. Going where your type of prospects are will allow you to
focus on results. This will be a long term plan but while attending each event your intention should always be to make money and assist new contacts in making more money.
Your team that attends these functions should have a clear message to deliver and if doing so makes you uncomfortable dwell on the fact that discomfort = growth. Once
you have joined a group and attended several events three categories will begin standing out.
- Connectors - You will either be able to help or receive a referral from these individuals.
- Collectors - These individuals will always manage to grab 100 business cards and might as well stay home.
- Jerks - No more words are needed.
Upon meeting a connector it is then important to create a process of intrigue with these individuals. This again is to make money so making a call to action to talk
business is your next step. Timing and opportunity is key and if you don’t invite the connector to meet with you, someone else will. Again, following up becomes the
next step to cementing the beginning of a new relationship.
After making yourself known while mingling and at your table you can take a seat and enjoy the event. Don’t ever be the collector just gathering up cards and not
genuinely showing an interest in the people attending the event. Real professionals will spot it a mile away and quickly write you off.
5. Misguided and Mismanaged Time, Goals, and Vision for the Company
Mr. Sprakes last point during the presentation is valid no matter how many years your company has operated. What is your vision? How will this vision be realized?
When owners or employees do not have clear goals it is easy for the arrow to drift away from the target.
In a company starting out it is too easy for anyone to start doing someone else’s job. Before jumping into a project that is not in your area of expertise ask “what can
I do in my roll that will this company better”? The minute you are spending too much time on things that are not helping your business grow is the the same time your
company is allowing an opportunity for the competition to overtake you. Everyone from owners to the sales team must resonate with the vision that has been laid out.
Each goal accomplished is a step to keep operations moving forward. Not knowing what you want in your business and spending too much time on things that are not
helping spur growth will lead to collapse.
6. Not Investing Heavily in Social Media
Being part of a growing company, I was impressed with Mr. Sprakes presentation. After reviewing these points he pointed out again how important it is to focus on the sales
and marketing. In his own companies he invests $700,000 to $800,000 in social media marketing per year. This earns a return of $12 million in revenue. People have to know
about your company and brand, with their five senses, to feel comfortable stepping up to write the check.
Many companies still resist the power of social media marketing and feel frustrated they are not able to generate consistent growth. When a business harnesses and seriously
invests in the power of social media they quickly are able to see measurable results in ways traditional marketing simply can not.
7. Most Businesses Don't Make Big Offers to Customers
Those of you wanting to get a jump start in revenue or have plans of opening a new business. MAKE AN OUTRAGEOUS OFFER! By outrageous I mean offer a large client your
services for free or at an extreme discount.
If you are a B2B that sells a monthly plan, offer it for free for the first three months to the client you want the most or if you have a new product, hand it to 10 clients you see
having strong networks. The reward can be gaining new clients, referrals, and spark interest in your company.
Of course, there's risk, but remember to focus on the reward. When making this outrageous offer it is important to be well structured and know what you are offering the client.
This should be effectively communicated so there is no misunderstanding on both sides. Be up front and honest about what this offer will entail and what you want back if they
accept (video recommendation of your company as an example). This can open many doors because if Coke wants what you have Pepsi will be close behind knocking on your
door. Always remember when a credible buyer buys, other buyers will buy quicker!
8. Not attending Networking Events Consistently
My last note is how important networking events are. If I didn’t attend the Surrey Board Of Trade networking breakfast, I never would have had the opportunity to participate
in Mr. Sprake’s presentation.
Going to these events can be tedious and inconvenient but it allows you to build a personal network and keep an ear to the ground for opportunities. It is not enough to
attend one or two a year, people do notice. As long as you are able to get along with people the stronger your network will become.
Choosing good networks and networking events can be difficult. Click the following link for tips on how to choose the best networking organizations.
Closing Thoughts About Growing a Business
I was impressed with Colin Sprake’s presentation and highly recommend attending one of Make Your Mark’s programs if you are in business or thinking to start a new company
and want to make it successful and increase your profits.
will be happy to assist you. If you use these rules as a business guide success will follow.
Mr. Hashka is the VP of Sales & Marketing for
Crownsmen Partners has 25 years of experience
in sales, management, and business development.
With a straightforward and honest approach his
driving force is to help each customer maximize
their ROI through sales and marketing.
*Information used in this article is based on the interpretation of the seminar by Mr. Hashka.
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