As a former franchisor and service operator, I have some important advice to discuss with you today. You see, these days I do a bit of consulting and therefore, I am constantly reading business plans for small start-up businesses. One thing I always find is that smaller companies always seem to want to go immediately to customers, consumers and high-end customers, and if they plan to make business-to-business contracts, young and often naive entrepreneurs tend to go after the big Corporate brand clients. However, I recommend a different tactic in this area, let’s talk.
Of course, it makes sense to go after high-end customers and name brands, but do not dismiss the less glamorous businesses to do business. Have you ever heard the saying; “Selling the masses and living with the classes?” Makes sense. In fact, when operating my companies, we never forget this strategy. I think many entrepreneurs want to get their product at Home Depot, Target, Wal-Mart, Sears, etc. Or they want to partner with Starbucks, Apple, Nike or Google, but be careful, those companies have the garbage selection, Everyone wants to do business with them, so they always get the best price, which means they will earn less money And you will have to work on the volume to make a profit, and you will have to invest large to upgrade just to manage the account – so you are essentially buying the account, not just getting the account.
In my previous company, we did contract cleaning on the site and had sales teams and worked out a Bonzai-Blitz mission marketing strategy, which works for any company that does B2B services. What we found was the less glamorous accounts; Cleaning trash trucks, for example, actually paid more money because no one else bid on the account.
In fact, we end up cleaning up all sorts of things that no one else competes for, like cleaning solar panels, restaurant yards, garage doors, awnings, culverts, driveways, lookouts, Drought, jacuzzi in hotels, locomotives and railroad cars. It was really amazing how easy it was to secure a strong cash flow without having to lower our offer to get the job done. That’s not to say that becoming a supplier for a large company will not be lucrative, it certainly can be, but they also realize how many companies have gone bankrupt trying to perform with razor margins as a Sears or Wal- Mart.
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