How to write a business plan

Why should I have a plan?
You could just not have a plan, like two thirds of all owner managed businesses with a turnover of less than £10 million. Even the remaining third usually have one that is out of date or incomplete. However, if you would like to do better than your competition, avoid bankruptcy and grow your turnover, than maybe it is time to get started!

What it is not

It is not a document that is perfect, or set in stone. A business plan should be updated any time you need or want to and should help motivate you and your staff, not be too restrictive (unless you are completely going off on a tangent). It can cover the whole company, or just a part of it if you are not the MD/CEO. Many business people I meet don't start on one way as they are afraid they won't do it right. I say it is better to have an imperfect plan than none at all!

 
How to start

Think of all the areas that are important in your business, such as sales and marketing, finance, staff. Depending on the nature of your company, you may also have to include stock, administration or systems, manufacturing, legal etc. Then start logging where you are and where you would like to be at the end of the year. There are plenty of examples on the web of a plan, so you can either take a template like that or just start writing your own.

The next step

If it helps you, break these figures or results down into quarterly or monthly targets. Then write down what you or each department will do to achieve this. Lastly work out what this will cost and how you will finance this. Ideally have a Word document for the main plan and use a spreadsheet for the numbers side of it. If you have any extraordinary things happening in your business, like you are planning to sell it, or you have an office move coming up, write these down as separate sections.

Most importantly

Have a plan that is easy to understand for you and your key staff. Make sure it makes sense to anyone else who may need to read it, like bank managers or venture capitalists if you are looking to raise money. Share it with everyone who is affected by what is in it.

So good luck writing your business plan and get started today! For any help, contact me on lizannejakobs@ologycoaching.com or 01784 770595.

The Sales Sandwich

The Sales Sandwich and how it helps you get more business!

How to plan your sales approach is not strictly an international business topic, but it is even more relevant there than in national sales! The secret I believe to any sale, especially in a complex one like selling business to business (B2B) services, is the following formula:

First layer of the sandwich

This is your preparation. Use your left brain – the analytical and logical side. Be clear about who you want to have a sales call or meeting with, what the message will be to them. Plan what you will ask them, what you will say and what you want as a result of the call or meeting. Be very structured in who your prospect is (function in the business, location, industry, size of the business etc) and find out where they are and where they get their information from.

(image by gt_pann)

The filling

The sandwich filling is the actual meeting or phone call. Use your right brain – the intuitive, creative, empathetic side. Don't just talk your prospect into submission, ask them lots of questions. Find out about them, what is important in making the buying decision, what their time line is for a decision etc. Use your gut feel to see how the prospect is reacting to you and what is being discussed. If you feel that they are not with you, try subtly asking what doubts they may have. It is important in this part to be pro active and on the ball, but not pushy! It is all about making a connection and having a pleasant conversation rather than being forced to buy. Especially in a cross cultural environment you will need to be even more aware of possible differences between the buyer and seller and in their decision making process!

The outer layer

Lastly there is the close. Here we revert back to the left brain. Be methodical and persistent in your follow up. Agree with the prospect when you should revert to them. Continue to be polite and pleasant, but make sure that in the end you come to a decision. Especially those who are not in a full time sales role but have it as part of their remit are often afraid of being seen as too pushy and therefore don't ask for a yes or no. Don't be disheartened if it takes a long time and if many of your calls and e-mails are not returned. The decision to buy or not to buy probably does not matter as much to the prospect as it does to you. So stay on the ball.

With this recipe you should be able to improve your sales. Good luck and let me know if it works for you!

Financing or pricing international business

Today's post will be very practical: what to do about financing or pricing foreign deals. Whether you are buying or selling, there are always a few things you have to take into account:

Currency
First of all think about which currency you want the deal to be in. Don't assume that you can pay or bill in your own currency all the time. Look at the various charges you may incur for paying in another currency and also at who is taking the risk for currency fluctuations. This may have a huge impact on your profit margins. For example the pound sterling is now worth about 22% less than a few years ago, can you afford to pay that much more or receive that much less money for your goods or services?

Payment terms
Terms will vary hugely depending on the country you are dealing with. Some countries like Spain have a custom of offering 60 or 90 days payment terms, I even had a very large client there once who insisted on 180 days. Do you have that kind of cash flow? Should you charge the other party for the lost interest? In most cases I would factor it into the prices, clients seldomly accept it as an additional charge.

Making the payment
Before sending any money, think about securing the deal for yourself financially. That might mean paying only part of it upfront, or if you are the supplier asking for some or all of the money upfront. There are plenty of financial providers including banks who would love to advise you on the use of letters of credit and other forms of secure payment including HSBC. There are also export credits and other forms of support out there, talk to your local Chamber of Commerce or other non profit business organisation.

VAT
Check the VAT rules for the country you are dealing with or get the other party you are working with to do so. You do not need to do this for each and every deal, but if you are working with a new country for the first time it could be worth it. I used to work for a company that was based in the Channel Islands and we billed a lot of Spanish clients. As there is a part of Spanish tax legislation that forbid dealings with tax paradises, I had a great many clients telling me they would not pay the VAT and would simply deduct 25% off our bills. Seeing as our margin was not even 25%, you can imagine this went down really well with my company....

You can probably write entire books on this topic, but as always this is simply meant to get you in the right frame of mind. I hope you find it useful and if you do, please sign up for this blog and recommend it to others. Have a good day!

The British, do's and don'ts

Seeing as a a fair few of my readers are Brits or have lived there, I'd better be make sure I get this post very right!


Work ethic
Brits tend to work long hours compared to many other nationalities. Long commutes are also very common, which means that during the week you will not find them home much. With globalisation into play it means they have to be available to overlap with office hours in Asia as well as the US in many cases. Most Brits won't complain if asked to put in extra hours for conference calls etc. With the current job market, people feel even less in a position to turn own a long commute or working hours. You also see this ethic reflected in shop opening hours, supermarkets are open 24/7 and in the bigger towns and cities all shops are open on Sundays.

Language skills
Most Brits have had some German or French in school, but in general their language skills are restricted to English and English. It is not their fault as they are never exposed to other languages in the media. It is a great opportunity for foreign workers to work for British companies in positions where language skills are required. If you are a Brit who is fluent in another language - well done!

Stiff upper lip / politeness
The biggest thing I probably have struggled with is a combination of stiff upper lip and politeness. Call it what you will, this means that very few tense situations at work (or home) are really dealt with early on and worked out completely. "The office" and many other programmes are a great example of how that can lead to dissatisfaction and office gossip, let alone burnout. A great example was a former manager of mine who behind his back would do an outstanding impersonation of his manager. Needless to say it wasn't a very nice one...Perhaps a solution like the Japanese would be in order? They tend get drunk with their boss after work and tell them exactly what they think. By the next morning everything is forgotten again.

To be fair, there are many plus sides as well to being polite in business. Most people like working with Brits for this reason. If you want to make certain that they really agree with what you are suggesting, ask very open questions and ask them what they suggest you should do. They are also good at being politically savvy, which in larger organisations is a skill worth having.

Class society?
This is a tricky one, it is not as obvious as apparently it once was (being in my late thirties I think I missed the hay day of the class society). However, there definitely still is a divide. Being from a very egalitarian society myself, the idea of private health care and private schools abhors me. At the same time, if you are faced with having to wait for three months for treatment of a medical condition, or for instance having to send your child to a very poor school, this all of a sudden becomes a matter of practicality.
This is a country where you really can build up a nice career based on your skills, education, willingness to work and political savvy. 
A very famous Brit is Alan Sugar. Very proud of his working class roots and still using a London accent, he has been a Sir and is now a Lord. Perhaps being working, middle and upper class is not mutually exclusive, but I still have not come to grips with the whole thing.

What industries are Brits good at?
Undoubtedly it is all about services nowadays, not manufacturing. Even though there are still a few good manufacturers around, most of the economy revolves around IT, finance, telecoms etc. This is especially the case in the South East, where I live. Retail also has its place, with many on-line and high street labels that are big abroad too. If the government can stimulate kids to study the right type of courses, hopefully we can have a future that involves people educated to the right level, with a broad general knowledge base as well as specialist knowledge in the sectors that grow the most.

Bad work ethic???
Last week there was an upheaval in the news that employers now prefer to hire foreign workers as opposed to Brits. Apparently they have a better work ethic. I think that is not entirely fair and is a funny reversal as in the past immigrants were often described as lazy and workshy.
I think it is fair to say that many people who move country, leaving behind family and loved ones, to get work will be highly motivated and do a good job for you. At the same time, many Brits are great workers too. What is amazing is that there seem to be plenty of people - especially youngsters - who have not grown up in an environment that encourages a good work ethic. I personally know someone who has just been fired (again) for consistently being late at work. He is in his early twenties and has been largely unemployed for the last few years. A very nice young man, he has not had much education, no idea of what employers want or what he wants himself in the long run. There are some people who think that they can make as much on benefits now as they would in work. That probably is true in the short term, in the long term it is not.
Anyway, I think it is important to note that a. this problem is entirely fixable, b. not a cultural thing to do with being British but just caused by circumstance and c. only applied to a small group.

The vast majority of Brits are good workers, good employers and good business people.

The Dutch - do's and don'ts when doing business

Of course not everyone is the same purely based on their nationality, but we do tend to share some traits. When you are aware of these, it can become easier to connect with people and avoid frustrations when communicating. I intend to write a series of these short articles, starting with my home country.

Punctuality
The Dutch like to be on time and they would like you to be too. So if you will be late, let them know in advance and explain why. This might seem obvious in a business setting, but also when meeting up in person this very much applies.

Honesty and openness
Honesty is valued enormously in Holland, to other nationalities this can come across as being blunt or even rude. We really value people to say what they think, which links in to some of the next few topics. So do share constructive criticism, give feedback, be involved. We like it! Likewise Dutch people sometimes need to tone it down and wrap their honesty in a blanket of tact.

Productivity
The Dutch are the most productive per hour in the world. We like to work short hours but get a lot done. Getting the end result matters! We have also been good at doing the impossible, building land out of sea, creating a large empire out of a tiny nation (17th century). It does mean that we don't always have time for a chat when in the middle of a job and we hate wasting time in unproductive meetings, so don't be offended...

International attitude
Being such a small country, bordering many other European countries, we have a very international mindset. We virtually all speak multiple languages and spend all our holidays abroad. Our tv channels come in 12 languages and we will gladly speak English with any foreigner we meet. This is a great place if you want to open a European operation to your business as it will be easy to find staff that can communicate well in at least German, Spanish, English and French.

Hierarchy and equality
We don't have much of one within organisation, all staff tend to be treated the same. Equality is very important to the Dutch as is being down to earth. We do show respect by addressing those we do not know or our seniors as "U" rather than "jij" and using their surname. In most cases this is dropped after a short while when we get to know someone.

Not just tulips and cheese
Of course the stereotypes are true about the Dutch being great at producing and selling cheese and flowers. It is a great country to visit the wind mills. But there is a lot more to it. Food companies, banking  and IT are also great parts of the Dutch economic engine. Famous Dutch companies include Philips, Heineken, ASML, Shell (Anglo-Dutch) and ING. Wageningen university is world famous for being a leader in biotechnology and there are many industries and companies related to this.

If you would like to see a posting on a particular nationality or topic, do let me know. Have a great week!

Use of communications technology accross borders

Dear readers,

Today's topic is use of technology across borders. I know there are plenty of courses out there on how to use the media specifically for your marketing, but here is some free advice. Think about how you can use technology to change your entire business model. Take my business for example, as a business coach traditionally you would go and see your clients in person. Nowadays, it is very easy to use means like Skype and of course the good old phone call to talk to them.

Instead of having a potential of about 10,000 companies in the area that could be my clients, this number is almost infinite. It also changes my whole marketing strategy. Instead of using a letter campaign to promote my services, I can send e-mails, join local business boards via LinkedIn and other sites, ask my friends abroad for referrals etc. It also makes it easier to work with big, international companies as I can coach some of their staff remotely.

So think about your business and how you take advantage of new media. What role do Skype, Facebook, Twitter, LinkedIn, blogs and other social media play in your company? How does it affect the services you offer? Could you offer something different to non-local customers? How does it influence the ways in which you market your products or services? How do you contact your existing customers? How do they pay you? Could you work with third parties on the Internet? Examples are E-bay stores where people have set up their own on-line business within the framework of E-bay.

Perhaps you will want to adapt your pricing to reflect the different ways you use technology. For example, I will charge a client who comes to my office or will work with me via Skype less money as it saves me time.

Be careful though that quality and customer services do not get affected. Recently I approached an on-line business to do some printing work for me (business cards etc). It probably works well if you need something standard, but as soon as I had any specific questions, I had to wait for non-UK business hours to call them. Also, the lady who answered the phone seemed to know nothing about printing so I ended up working with a local printer at twice the price but a much better experience.

If you enjoy this blog, please get anyone you know to sign up to it too. Any comments are also always very welcome. I hope this week's post got you thinking about your work and more importantly, to do something with it. Have a good week! 


 

Is your communication working for non-native English speaking customers?

Hello,

Today's topic could be important to anyone doing business in the UK with non native speakers, or with clients abroad. If clients don't understand you, they will of course never buy from you. However, that does not stop some companies from:

• Using lots of abbreviations and jargon in their sales material, web site etc.
• Only providing information in English
• Only providing success stories of clients in English speaking countries
• Using very complicated and long sentences

 

First of all you need to understand if your potential client base speaks FLUENT English. I have put that in capital letters as it is key. It will not help your sales efforts if clients who only speak some English have to struggle their way through information they can only half make out. Their proficiency is usually based on two factors, nationality and need to use foreign languages.

 

Some countries like Sweden and Holland are renowned for their language skills, so usually it will not be an issue to approach those in English. This is of course talking about business to business, if you are advertising toys to an eight year old, you will have to go in with the local language. Secondly there is the need to use English for work. A qualified European Patent Attorney should be pretty fluent, as would a shop keeper in a tourist resort in Spain. Do not assume that just because someone has a high ranking job or a good job that they can speak anything other than Spanish or Finnish. I know plenty of business owners in Spain who are barely understood outside of their own province as they can only speak their local dialect.

 

So what should you do? If you have the budget, get your marketing materials translated in all the languages of your target markets, provided it is going to cost you less of course than it would gain in additional sales.
Start with the countries where you absolutely must have local language brochures and manuals such as Germany and France (assuming you want to do business there) and expand further into other countries. Where possible also make sure you take into account regional difference - US vs UK English, Dutch vs Flemish.

Get customer facing staff (sales, client service etc) who speak the local language. If this is not an option, make sure that all your communication is in the plainest English. This does not make your company look silly or less sophisticated, it makes it easier to do business with you. When speaking to your customers, ask them regularly if they understand and get them to recap what you said, at least until you know for sure that they are following you. This is generally good practise in any sales process any way.

As always keep well and keep forwarding this blog to anyone who could be interested. Please let me know if you have questions you would like to have answered or topics posted on.

Marrakech - lesson number two

Hello,

Today I wanted to write about another topic that came to mind when visiting Marrakech, which is about honesty in business. This is a fluid notion in many parts of the world and in quite a sharp contrast to someone like me, being Dutch. We hold the truth to be very rigid, inflexible and paramount to our integrity. Not that we don't all tell the odd white to stop us from looking rude (yes, you look hideous in that outfit....), but that is usually as far as it goes.

Depending on the sort of role you are in, the type of industry and company you are in and where you live the truth can have a very different meaning. I used to work in a manufacturing environment with a great number of engineers. A fork lift truck will either be able to lift a certain amount of weight, or it will topple over and kill lots of people. So if you are designing or manufacturing one, being precise and forthcoming with the truth is very important.

In my recent dealings with shop keepers, tour guides and other people trying to make a living out of tourists in Marrakech, of course the truth was less important than the amount of money that could be made. We were told stories that were blatantly untrue. The amount of times we were told a street was closed because it did not lead past the shop they wanted us to visit! 

So what can you do? First of all never accept anything that is important to you at face value. And do not assume anything!!! Just because you would do things in a certain way, or would be more or less truthful than someone else doesn't mean that they will. Ask detailed questions and get the answers in writing. If you are dealing with a foreign agent or supplier for example who tells you everything is fine, get them to detail how many leads they have, how much stock, what their cash flow is, when they can deliver by etc. Do not be afraid that these request will offend people, as long as you are tactful about it and explain why exactly you need this information.

At least if you have this information in writing and things still went wrong, you have evidence of it. Ideally put down as much as possible in legally binding contracts. And if people want you to just trust them on their word? Then weigh up how catastrophic it would be if things did not go as promised.

Hope you enjoyed this posting or found it useful, if so please spread the word on my blog!

Marrakech - a city of commerce

Hello,

After a nice few days in Marrakech I have so many ideas for this blog - so I might stretch this one out for a few weeks! The thing that I noticed most about this area is how it has adapted to making money from tourism. Morocco has kept its own identity with its traditional food that is served in all restaurants, snake charmers in the town square, traditional houses clad in the local pink mud. However, the locals are extremely good at finding ways to monetize this.

In the old centre traditional houses have been converted to riads or bed and breakfasts. Traditional lamps are still hand made and sold in hundreds of shops, spice shops lure you in with the promise that they can cure you of any ailment. Old fortresses or Kasbah's are being used to film in, a long list of pictures including Gladiator, Prince of Persia, Lawrence of Arabia, Babel and more have all been filmed in the area. Even local children will give you directions for a price, often even when you don't need them. Sadly if you don't give them what they want they do swear at you....

So what are the lessons to be learned? First of all look at what your company or you as a person are good and unique at and stick to that. Be proud of being a family owned business, or a giant one stop shop. If you are a gregarious sales person, make that the thing that works for you, or if you sell through your knowledge of your field then make that your USP. Do not let other people tell you you should fit into a mould or your company should do exactly what everyone else does. No one is perfect and we can all learn and grow, but if you have something you are good at it, stick with it and become even better at it.

Secondly, how can you make money out of it? Here is the bit where you do have to look at the competition and ask your customers what they want. What is a reasonable price? The reason I bought in one spice shop over another is that it was beautifully laid out, the owner was a charming man who demonstrated his products very well and entertained us with his story. Half the money making was in his products, the other half was the show he put on for us.

Lastly, if you do find people don't want to pay (enough) for your services or goods, unlike some of those  kids put on a brave face and walk away. There will always be more customers and your reputation is more important than to react badly!
 
If you like this blog or think that anyone else you might know, please make sure you click the follow button to be notified of any new posts. This is a public blog that is open for anyone to follow and I do welcome any feedback. Do you have certain questions on international sales or business that you want answered? Examples you want to give? Let me know!

Have a good week.

International business

Hello!

Want to learn something for free that will help you grow your business? Why restrict yourself to your home country for clients when there is a huge and ever expanding market out there. So read on!


Why could you do with this advice? Surely you know how to run your own company or division...Because a. globalisation is here to stay, b. the recession is forcing companies to either cut costs or increase their customer base and c. going global is not as easy as you may think.

Even large companies like Fiat make big blunders, for example when they created the Croma model of car and launched it in Holland. Unilever had very prominently marketed the exact same brand name for butter for decades, resulting in very poor car sales. If Fiat had used a good trademark attorney and consulted staff in any of their Dutch dealerships this could have easily been avoided.

An American company I worked for could not understand why we could not roll out their marketing campaigns across the whole of Europe, Africa and the Middle East in a matter of weeks. It was often hard to explain that not only did we have to have all the material translated into several languages and products priced in different currencies, we also needed to make sure there was a requirement for these products in the various territories. Having one of the senior managers come over to Europe for several months really helped overcome this issue.

Many companies approach acquiring foreign clients, serving clients with a global footprint, finding foreign agents and distributors or setting up a foreign office the same way they would approach these matters if they were inside their borders. This simply is not the case and can cause you to make very expensive mistakes!
 
Here are a few of the indicators of what to look out for:

• Cultural issues. Is bribery accepted or expected in any of the countries you are targeting? How do people express themselves, what characteristics are appreciated in a manager or sales person? Is there a culture of asking questions or just doing as you are told?
• Language issues. Do you need to publish your marketing materials in every language on the globe? What languages are key? Do you need a native speaker to do this?
• Intellectual property. Do you have it secured for your products, company name, promotional materials etc? Do you know what countries will actively enforce any breach of this and which ones won't? What do you do to stop others from simply copying your work or reputation?
• Legal. Where are you getting your legal advice? Do your lawyers know the local laws of the countries you are working with? Do you have all your work with both suppliers and clients legally secured?
• Go direct or via channels? What is more important to you, having full control and retain all profit or get instant local knowledge and contact? Do you wish to work with third parties?
• Customer and technical support. Do you have staff who can communicate in the customer's own language or be on site the same day?

These are just a few examples, there are many more issues to consider! The main thing to do is keep your customer, employees and competitors in mind with everything that you do when dealing on an international basis. Make sure you are set up so that your competitors can't copy you, customers find it easy to deal with you, employees are happy to work for you and legally you are safe. Of course there are costs involved with taking care of these matters as there always are when you expand your business. However, sitting still is not an option unless you want to lose huge amounts of market share!

This is a first posting on my blog and I welcome anyone who has any questions, funny anecdotes in this area etc. I may be off line for a little while as I am going to Morocco this week - a sunny 23 degrees forecast!