2020 was no doubt a tough year. We all have our share of the pandemic restrains, the political riots, electoral frauds, terrorist attacks, and other big blows that shaped the year.
However, some smart entrepreneurs figured how to keep strong businesses — maybe not as glamourous as projected but strong enough to thrive into 2021. In fact, one of my businesses makes thrice the previous year volume of sales.
This is not to exonerate my impeccable business acumen or paint every business that collapsed last year as evidence of being run by less than smart entrepreneurs.
Some businesses tend to suffer more than others during the lockdown. Their core value is established on the primal human need to socialize. A lockdown is sure dealt with and gave a heavier blow.
Nonetheless, these lessons helped sustained my two companies through the global upheaval of 2020.
#1. Attention is worth every dime you can pay for it.
Your business will die of oblivion quicker than with bad products, customer experience, lockdown legislation, or anything else that pops into your head. It is no coincidence the marketing industry is considered to worth trillions of dollars globally.
Don’t buy into dump advice from ‘internet gurus’ that you should shut up about your business. In fact, your mouth should enter the room before you.
It is so important you have to hire extra surplus mouths, pens, and minds to preach the gospel of your business. Nobody buys from a business that they haven’t heard of.
No traffic, no traction. Traffic originates from talks.
Get as many words of mouths as possible. Remember that top-of-mouth is top of mind. Be remarkable, make your message the subject of tonight's dinner discussion.
A bunch of my clients during the pandemic are referred. Referrals from customers, friends, members of the audience in my talks, YouTube fans, and Facebook followers. They all did because I can’t just help but talk about my digital agency, FutureX Digital, and my e-commerce software company, KitCart.
#2. Don’t get high on your own supply.
Don’t be carried away by the noise you have generated. Listen to the feedback. Use them as a guide to fix and perfect your products, improve your customer's experience, and attract more press coverage.
Most businesses miss out on this point. They get high on their own supply neglecting the core of the business to pursue noise.
Like Theranos and Nikola, they made their crappy technologies sound great and chase clout all year long with nothing substantial to show for it. Such frivolities account for major downfalls in business.
Beware of the underlying evil of hype, it can ruin your pursuit of meaningful work that truly builds strong businesses. Failure to deliver substantial value amounts to automatic failure during tough times.
#3. Own the Value Chain
If you ever wonder why you shouldn’t own multiple uncorrelated businesses synonymously, there is only one valid explanation: the value chain.
The value chain is every process that leads to the delivery value to your customers including after-sales activities.
Hypothetically, you are a fashion brand. Your chain grows from the government (licenses, permissions, and rights), the farm that produces the cotton to the manufacturing plants, the branding and packaging factories, planes and trucks that foster distribution, warehouses, and the frontline (stores, stalls, and websites) where the sales happen.
It is okay to start from the frontline. What is wrong is jumping around the frontlines of different industries. Track back and own the value chain as you generate profits.
It is the one true move that makes the big and the giants. If you ever wonder what keeps Amazon during the tough year 2020, it is a strong value chain — from an online bookstore to owning planes and robots to do delivery.
#4. Don’t pay for sex, pay for dinner!
When in dire and constant demand for a service or infrastructure that you can’t afford to own, don’t pay for it regularly push to own the relationship.
Think of partnership. Establish a relationship outside the context of pay and receive. Make the vendor an offer that allows you to pay in 90 days window.
Make room for a possible sole supplier if your business case demands it. Push a proposal that takes the relationship from casual to corporate.
Aside from the upside of better bargaining. Such a well-established partnership can avert your business from a sudden collapse.
A friend once failed a possible big idea in logistics. Part of the promise was a meal for the passenger, but the food vendor thwarts the pre-order request at will. My friend got the news unprepared and was forced to process tons of refunds.
There are plenty of other scenarios, think through them for your business. Which of my supplier impart my production the most? Whose failure to show up might ruin the day? How do I establish a ground to own the relationship?
Our partnerships account for the majority of our revenue throughout the year. These are signed long-term contracts with known and established servicing charges.
#5. Collection is what happens after closing…
This idea often stirs controversies in rooms full of noble entrepreneurs.
It is such a common err that even big businesses sink because they couldn’t recover debts. Customers, clients, and distributors will own definitely own you.
I am not in any way guaranteeing full cash upfront business. But if you prioritize collecting, your business will prosper than the majority.
Collecting is ensuring that you eliminate every hurdle that can hold the customer from not making a payment right now. Right now is the keyword.
Sometimes, it implies pushing a lot harder, crossing the red line, but ensuring your hunger is within measures. If you truly believe in your product, push the customer to commit.
Don’t take NO. Don’t take Yes. Take what matters the most, the money — that’s what pays the salaries and other overheads.
#6. Delight is what follows.
Make no mistake, right after collection is Delight.
Ensure instant or quicker than the industry's best fulfillment. If you are going to be successful at making hard sales, you must be super fast at delivery.
Hard selling induces higher buyer’s remorse. Most customers instantly feel cheated or outwitted when handled by an inexperienced salesman.
To curb the possibilities of high refund requests, build speed delivery as a core feature of your company. Personally, I prefer to underpromise and instantly overdeliver after a hard sale.
In the event of a service or product that demands a longer delivery timeline, I instantly reward the customer with a useful but free offering outside the bargain. Sometimes, a book and the company-branded T-shirts make sense as a necessary welcome package right after the onboarding.
#7. Prioritize the Vital Few.
The Pareto principle (80/20 rule) has been observed in almost all spare of life. Peter Thiel labeled it as the Power Law.
Optimization starts with awareness. Be critical with your business. Know the numbers, dance with the stats.
Figure your top 20%, the vital few amidst your marketing channels, salesforce, products, managers, departments, processes, partners, and everything else. Then, cut the bluff (if need be) to focus on them.
During the pandemic, I had to prune my sales team of about 60 to the top 12 that are truly the rainmakers. We also revert some of our products to focus on our bestsellers.
We experience wild turbulence during the first month, thereafter our numbers surge. It will look too risky at first, give it a shot.
Final thoughts
These are 7 of my core business philosophies. They may change tomorrow based on changing market realities. Having nothing to hold on to as guiding light may warrant unrest during tough times.
Remember if you stand for nothing, you will fall for everything. Find your own rules.
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