Blog

Bill Gibson – Take A Lesson From The Airlines

Flying these days is great…look at the extra’s you get!

  • Newspaper
  • Magazines
  • Coffee, Juice
  • T.V
  • Telephone
  • Computer Access

Travelling on a jet has its nice sides, particularly the service. As soon as we sit down we are offered a newspaper or magazines. Coffee, juice or a drink comes after take-off. Small inexpensive favours help people relax and enjoy their experience. Incorporate some of these services into your place of business, particularly if customers are waiting for service by themselves. Computer access, T.V., computer games, books and magazines, a calculator and free coffee or juice bar can really change the customer’s experience.

How about several pairs of eye glasses in restaurants for people who have left their spectacles at home or a small flash light so they can see the menu? One restaurant in Swaziland has a beautiful wooden cigar box full of eye glasses for customers to choose from. How about several permanent wall chargers for people to re-charge their cell phone while waiting?

Banks, financial institutions, and any other companies that deal with financial figures can go a long way toward pleasing their customers with a minimal front-end investment. A few pocket calculators fixed to the front counters are helpful to customers filling out deposit slips etc. This service would be appreciated at other businesses that require calculation, like building supplies, paint, wallpaper and furniture.

Remember, the customer is ultimately trying to figure out how much product to purchase, we should make the process as convenient and painless as possible. What kind of magazine or pamphlets and “How To” information or other tools could be left in your waiting area or given to customers to read or listen to while waiting? They should have real customer appeal.

Bill Gibson – Testimonials / Awards / Recognitions Are Powerful

Everyone likes to read other people’s mail. Provide this opportunity for your customers by displaying letters of appreciation from your satisfied customers. One retailer has a huge 4’ x 8’ board called the “appreciation board” with dozens of thank-you letters from clients. How about one on your website?

Another one of my clients had 4’ x 5’ blow-ups made of several letters. He displayed them on unusable wall space. Some retailers put blown-up testimonials in retail display stands as testimonials adding credibility while enhancing the selling atmosphere.

The key is to ask for a client to put her comments in writing and let her know why you want it. People like seeing their name in lights. You could even write an article per month about one of your clients, put it on your website or on a magazine or newspaper type masthead and display it in your store. Why not interview three or four clients per month on video, talking about how happy they are with your business and play the video in your store or on your site. The potential is unlimited with this idea.

At our company, Knowledge Brokers International, we often start a sales presentation to potential clients by reviewing a couple of our reference letters that indicate the fantastic results a client received by utilising our processes and services. Utilise those testimonial letters at every opportunity.

Quite often potential clients will ask us to send some information to review before having a meeting with them. We often send 4 or 5 reference letters and almost 100% of the time we get the appointment without sending too much information. Right now, make a list of 6 clients or customers you could solicit for an endorsement quote or letter that could be paid of a display, placed on your website or become part of a presentation.

Bill Gibson – Are You Tapping Into The 5 Senses?

Once a prospective car owner takes an automobile for a test drive the chance of her buying goes up 100%. The new car smell, the sound of the stereo, the softness of the plush seats, and the visual impact of the lines and colours of the vehicle all come into play during a test drive. The consumer’s eyes, ears, nose, taste buds and feelers (hands, feet, etc. ) have a tremendous impact on whether or not she buys. Encourage her to touch, taste, look, listen and smell. She could sample food, smell the perfume, sit on the sofa, listen to the sound quality and see how good it looks on her. Utilise the 5 senses to create an atmosphere so people will want to buy.

Michael Vance tells a story about a dentist whose business was not doing very well, so he decided to go to a seminar on how to market more effectively. When he came back from that seminar he and his secretary went through the office on their hands and knees, taking a child’s view of their office. They got a feeling of what it was like to be a child at the dentist’s office.

The first thing they noticed was that the guest desk was too high and the children who came in had to look up over the desk. They had the desk inset into the floor and put little chairs in the front of it so that the children could sit down and have eye contact with the receptionist. They even took the medical forms and made them simple so small children could help fill them out. Colourful graphics that educated children on caring for their teeth were placed on the wall and headphones were installed in the waiting rooms so that children could listen to stories and dental care tips on tapes. They built a play area for the children in the waiting room.

Then they did some research. After the children had their teeth examined, the receptionist would help them fill out a form on how they felt about their trip to the dentist. The most common complaint from the children was that they were terrified before the dentist did the work because they did not know what he was going to do.

The dental staff did some brainstorming and decided to explain the process to the children before the staff actually did anything. The child would work on his or her own teeth without the instruments being turned on. This showed the child exactly what was going to happen, and it took away any anxiety. To top it off, on their way out the children received a signed photograph of their dentist to put on their wall – to keep the crows away. ☺

Later on after the company grew, pictures of the dental assistants were put in the lobby so the children could choose the person they wanted to help them. The business in that dental office doubled.

In the real estate industry you can create a mood in an open house you are showing on the weekend. Light a fire, turn on the stereo, put some cinnamon buns in the oven, coffee on the stove, fresh flowers on the dining room table. Prospective buyers are usually looking for a home, not a house.

Offer your customers extra service. Set up a day care centre and take care of the children so parents can view the home at their leisure.

The question…What can be done in your business to stimulate customer buying response through the following senses of touch, taste, hear, see and smell?

Bill Gibson – The Day I Personally Met Nelson Mandela (Lessons In Leadership)

Friday, the 18th of July was Nelson Mandela Day here in South Africa (His birth date). As a tribute to this great leader I am re-posting my blog article: The Day I Personally Met Nelson Mandela (Lessons in Leadership). It is worth a re-read even if you have read it before. Great Leadership Principles. The thought of Nelson Mandela takes me back to late 1995 when I was preparing for my 3rd visit to South Africa from Vancouver, British Columbia, Canada. On the way out the door, I made a very bold statement to my wife Beverley and my two sons Ryan and Shane. It went something like this, “during this trip to South Africa I am going to personally meet Nelson Mandela!” Well, needless to say there was lots of laughter and comments like “are you dreaming?”, “get real dad”, “I know it’s great to be positive but it will take more than positive thinking!”

Three weeks later I’m packing my suitcase getting ready to head back to Canada after a great few weeks of speaking in Johannesburg, South Africa! At the last minute I realized I had forgotten to buy gifts and that most of the shops were closed on a Sunday. I hopped in my car and made my way to the Rosebank Rooftop Market that I heard would be open. Suddenly in the middle of Rosebank, the traffic came to a halt…obviously a car accident. The line of traffic was moving very slowly and people were out of their cars. I asked one of them, “is there an accident?” His answer was, “no…Nelson Mandela (Madiba) is out for his Sunday afternoon walk…that is stopping the traffic!”

Then I noticed to my right a wall of body guards giving President Mandela the privacy and room to walk. I pulled over and parked the car and quickly walked to the wall of body guards and took a deep breath and asked “can I meet President Mandela?” They answered “not today.”

Then from behind the wall of body guards came Nelson Mandela’s voice …”ask him if he is Canadian” I said “yes” and he replied, “let him through.” Wow…the power of thought and the power of taking a chance and asking! (By the way Nelson Mandela is an honorary citizen of Canada.)

I stepped into his presence and he grasped my hand in the most sincere handshake fashion imaginable. He asked me my name and then proceeded to ask where I was from? I told him Nova Scotia…he knew where it was. He wanted to know my father’s name…what he did for a living (diesel mechanic), my mom’s name, my sister…was I from the city or the country. Eventually he asked me what I was doing in South Africa. I explained that I was a speaker and trainer with a focus on entrepreneurship, marketing, sales and people development. His response was, “please don’t just visit…come and spend time here and help us grow our people and our country.” We spoke for about 5 minutes and all the time we chatted he held my hand and looked squarely into my eyes. The only way I can describe it is…I had just had a rare experience of being with a man who was deeply rested in his being! I could feel the peace within Nelson Mandela. It was a spiritual experience. I was electrified.

How wonderful…he recognized the Canadian accent. He wasn’t political or all business…he wanted to know about me as a person. All of us as leaders could take a lesson from Nelson Mandela’s way of dealing with people. There is a saying that people will often forget the words we use but they will always remember how we made them feel. I felt special, I felt his sincerity, his humbleness and his caring yet powerful presence. I will never forget how he made me feel. Thank-you Madiba! 19 years later and I am still here in South Africa.

There is a message here for communities, countries, business and families. Try to remember…“people go where they are invited and stay where they are appreciated.”

When it came to the use of Power, Nelson Mandela also had it right. He was quoted saying after becoming President of South Africa, “The problem I have “is not” how to use power. My biggest problem is how “not” to use power.”

In his book Leading Like Madiba, (Leadership lessons from Nelson Mandela) Martin Kalungu-Banda got it right. He wrote:

  • Where he could punish, he tried to understand the position of the one at fault
  • He practised restraint, when he could have used power to settle scores with those who had treated him and his colleagues as if they did not matter
  • When he was in such a strong position that he could push others to comply with him, he preferred to consult, persuade and even plead in order to settle matters

Instead of intimidating people with his power, he chose to bargain and quite often forgo the short term “sweet victory.”

If all those who are called or think of themselves as leaders, learnt how not to use power, our homes,our work places and our world could be friendlier, happier and even maybe more peaceful.

Madiba you will live on in my mind forever. I am so grateful that I met such a giant of a man during one of my first visits to South Africa. What a privilege! We need more leadership role models like Nelson Mandela in this world. You are and always will be a legend…you will live forever!

“If you have found this blog article to be valuable for you, I would be grateful if you “shared” it with your Social Media Networks. Also feel free to circulate it by e-mail or other means internally within your organization or externally to your clients, suppliers and personal and business network. Thank-you!”    – Bill Gibson

Bill Gibson is a Canadian who is living in South Africa. He is an international speaker and author and a developer of sales, service, marketing, collecting, employee morale building, personal development and entrepreneurial training programs and systems. His blog is www.bill-gibson.com and his website is www.kbitraining.com. He can be reached at bill@kbitraining.com or phone +27-11-784-1720 in South Africa. You can follow Bill Gibson on Twitter: @billgibson1, connect on LinkedIn: http://www.linkedin.com/profile/viewid=143197191&trk=nav_responsive_tab_profile_pic or Knowledge Brokers International SA Pty Ltd Facebook Page: https://www.facebook.com/knowledgebrokers?ref=hl

Bill Gibson – How To Master Risk

A few years ago my wife Beverley and I were discussing the setbacks that we had encountered in our life because of taking uncalculated risks both personally and in business.

We immediately brainstormed the topic of Mastering Risk and came up with some valuable “pain saving” insights on the topic.

Recently on Facebook I posted a “cut down” version and immediately some of my Facebook friends requested the complete version. These short but realistic tips point out that the “short cuts” in life may actually be the “long road” to what we determine to be our successes. Corporates, Governments and non-profits will find this blog posting very useful as well and may want to circulate it.

Mastering Risk

A “Risk” is when we know what we want but we are not taking the time to “think it out” and “source it out” properly.

Instead, we take the risk of a “shorter cut,” a “shorter route” to try and get what we want. This usually results in failure because we didn’t take the time and energy to gather enough information, seek out the know-how, focus with the right action and utilise patience and persistence to see it manifest.

We don’t have to “fool ourselves” by taking unnecessary risks because we actually have the “intelligence” available to us to get there if we will be honest with ourselves about what it really takes to get what we want and follow the steps to get there.

In essence what seems to be “the longer road” to getting what we want may be the “real short cut” that frees us from our own anxious, emotional, impatient ego selves.

Patience is a virtue. Impatience breeds mediocrity through “short cuts.” Mediocrity breeds risk. Unnecessary risks breeds disappointment and unhappiness through their unsatisfactory outcomes. Therefore, Mediocrity is self-inflicted and genius is self-bestowed.

Be your Genius Self. Take the time and energy to be an absolute Master in all that you do … even the little things and those tasks that you don’t like to do but need to do.

Mastery of any skill, action or task is the path of joy. You achieve this by “being one with the present” and by “being one with the now.” Give and be your absolute best at all times.

Joy and ecstasy are in doing your absolute best in the moment you are in and giving your utmost to the present task at hand. This is Mastery and Mastery eliminates unnecessary risks. Mastery is Genius! Choose to be a Genius!

May the Genius in you shine forever!

Repost: Bill Gibson – 11 ways to raise MONEY without a BANK

Succeed Magazine – www.succeed.co.za – March 2007

It is a bonus if your bank or a government funder lends or grants you money for your business. But more often than not, attempts to raise funding through conventional channels do not turn out positive.

As potential business owners and entrepreneurs, we need to explore all avenues for raising capital to start or grow our businesses. We cannot rely on the banks or the government only.

Take a look at these ideas. They may get your mind working on still more possibilities. 

1. Offer to pay a major supplier a premium in exchange for extended credit.

This approach may work if you have a single big supplier whose credit will fund a part of the business. In the case of a magazine, for example, this may be the printer, as printing costs may account for up to 25% of total expenses. An electrical supply company may approach the manufacturer of electrical goods for extended credit. One potential downside of this approach is that high interest will usually be charged for the outstanding money. However, in many cases, the advantage of being supplied with products or services up front easily outweighs the disadvantages. You may have to offer the supplier company additional incentives in order to convince them. Be prepared to negotiate. For example, a magazine may offer to advertise the company free of charge, or the electrical company may offer to conduct a free electrical installation for the client. When using this approach, success often comes down to a matter of trust. It will also typically depend on some kind of relationship existing between yourself and the supplier. Someone who has held management positions in the field will typically be well known and will have developed a standing in the industry. A reputation for honesty, integrity and business acumen will go a long way when raising capital via this method.

2. Attract numerous small investors

Some of the greatest companies in South Africa were started by young entrepreneurs who had raised capital through many small investors, as opposed to a few large ones.

Not least of these entrepreneurs is Pick ‘n Pay founder Raymond Ackerman, who in 1967 went so far as to put in an offer for his initial three stores without the finance for it.

The asking price of the stores was R620 000 and he offered to settle the asking price as R600 000 cash, with R20 000 provided in shares. The next few days became a nail-biting race of frantic intensity. Ackerman mustered up as much as he could, including the entire R100 000 bequeathed to him by his late father. He then went on to raise stakes of R3 000 each, made up of R1 500 in capital and R1 500 as a loan, from 53 investors – 25 from Johannesburg and 28 from Cape Town. The agreement was that interest on the loan would not be paid for the first two years. This gave him breathing space while he built up the initial outlets. As only half the loans were capital, he easily retained control of the business. Ackerman’s purchase was a success, and the business has since become one of South Africa’s retail giants. Some of those original investors still hold Pick ‘n Pay shares today.

Another great businessman who accumulated his starting capital by attracting small investors is Liberty Life founder Donald Gordon. Forty-nine years ago, he drew up a document detailing his proposals for the formation of a new life insurance company, employing a radically innovative approach. It had been his dream to start a life insurance company since qualifying as an accountant in 1953. With proposals in hand, Gordon set about raising the capital for his venture. After nine months of disappointment, frustration and rejection he managed to raise R84 000 from small investors. By September 1958, Liberty Life was on the road. Back then, if you were one of the brave few to back Gordon with R1 000, it would be worth over R13.7 million today. Liberty Life is one of the leading financial services companies in South Africa, and the third largest insurance company listed on the Johannesburg Securities Exchange today. The company’s assets currently amount to more than R144 billion. Many a successful company has been formed through the accumulation of small investors. If you are that sure of your business concept, it may be the way to go.

 3. Cash in your equity in long-term insurance

Surrendering your life policies to raise finance for a potential venture is an option to be considered with extreme caution. Certain life insurance policies have an investment component that accumulates over time. The objective of paying a portion of your monthly premium over the years into an investment component is that eventually it starts paying for the life cover, and you no longer need to pay premiums. The tricky part of this kind of policy is that, as your investment portion increases, so does the surrender value of the policy and this becomes a temptation if your business needs finance. The surrender value may be useful in your business, but in the long term you will almost certainly be losing. The problem is that the surrender value is a fraction of the insured amount, and when it is withdrawn, the cover amount is significantly reduced. It is usually very difficult to build your life cover to the level that it was at before, and as you get older, the cost of life cover becomes far more expensive. When starting a business it can be very tempting to surrender your life policies to raise capital and the risks need to be carefully examined. You should ask yourself, should it happen that you die and, without you, the proposed business does not take off, what life insurance pay-out will there be for your family? If this type of financing is seriously considered, your estate as a whole needs to be assessed as to whether you can afford to surrender a policy of this nature. If your business succeeds all may be good and well, but the risk you are taking is real. You could offset the risk by taking out a less expensive term life policy that does not build up equity. That can cover you with life cover. The advantage of this method is that the money is there immediately – you do not have to wait for financing. You have to make the decision whether or not it is worth the risk.

 4. Trade equity for expertise or services

You may choose to give up shares in the business in exchange for the services or expertise you need. This approach can result in a massive capital injection for your business. Depending on how much financing you require, the stake you offer may be as low as 5% or as high as 50%. You can offer a large percentage of shares to one supplier or expert, or small amounts of shares to several. Whatever you decide, make sure that you offer an attractive package. Somebody starting a business selling bottled water might look for a small supplier who would be able to provide the company with the finished product at very low or no cost. Alternatively, the supplier can provide business contacts or financial expertise that the business starter lacks and sorely needs. In return, the supplier company could become a partner in the business. While at first glance it may appear that the supplier or expert would be going into competition with himself, if many competitors already exist in the marketplace, this method might provide him or her with an additional point of access to the market. These types of deals might appear risky and success will often depend on your reputation in the marketplace. The person you approach is therefore only likely to agree to the concept if he trusts that you will make a success of the business and will honour your commitments. And that he will get more than his money back. Bringing in an outside partner has its own issues. The partner will most likely want to take part in the decision-making process. He or she may want to go one way while you want to go another. If the partner’s vision is different to yours, this can lead to conflict.

5. Find a short or long-term strategic partner with the resources that offset the need for investment

A great idea for a concept, product, service or a business that requires specific expertise is often held back by the lack of it, or enough money to hire someone with such expertise. However, there are ways to get around these obstacles. Scott, a young Johannesburg entrepreneur, investigated suppliers of a high-precision grinding machine, used for the highly specialised grinding down of high-tolerance material. During his search, he found an owner who was a partly retired engineer and who was not using his grinding machine. Scott and an associate entered into an agreement that gave them one year to generate revenue with the machine. If successful, they would buy the machine by paying an agreed monthly amount. They launched their business this way. Without this deal, they could never have raised the money to buy the machine in their first year of operations. Another option would have been to give the owner of the grinder a share of the business. Then Scott could have avoided paying for the machine entirely. The advantage to this approach is that you may be able to go to market much faster than you would if you were waiting until you were able to raise the capital to build your product or open your business. In the case of the grinder, Scott gained valuable equipment, but you can also gain expertise that is needed – not just hired expertise, but expertise with a stake in the business. A strategic partner who has suitable expertise may be exactly what you need, provided you are able to work with this person. At the onset, negotiate a reasonable buy-out option, so that eventually you can be the full owner of your business or concept. It does not mean that you are compelled to buy your partner out – it just gives you the option. Your investor may be more valuable to you as a long-term business partner. You could also negotiate a ceiling amount – the partner is automatically bought out once this amount is paid out. This figure would have to take into account a mutually determined base value of the investment in services, support, overheads and expertise. You may need a third party to help with this. Be sure not to give away too much in the beginning. Expertise is not the only resource you may need. Under certain circumstances, it could be in your interest to open a small business via a large company that allows you to use unused machines. In turn, they could either receive revenue, a percentage of the business or both. Resources cost money. You can trade either shared revenue or equity for the resources. However, remember that equity, once traded, may be gone forever.

6. Build your concept or product for a client at a reduced price and retain the ownership

The idea here is to negotiate with client on a service, product or concept the client company needs. You agree to build it for them at just above cost, with only a small profit margin. In turn, you retain the copyright or patent right, and can take it elsewhere to market and sell it. The client can only use it internally and cannot market it. You may have to agree not to sell to certain competitors – for a specific time only, if possible. The advantage is that the client provides the necessary financing, while you have a new offering of a revenue-generating product or service. You will need to find a client that has a need, with a solution that you can provide at a lower price than anyone else will provide. Your offer needs to be so excellent that the client cannot say no. Once you have developed the new concept, you can sell it to other clients and start showing a profit. This idea will appeal to software people and the designers of training courses, but there may be plenty of other possibilities for this kind of agreement with a large company. Another possibility is that a client may come to you with a specific need. The idea might not be yours, but the expertise to provide the solution is, and you can see the roll-out possibilities. In this case, you might set a low price, while maintaining the right to take it elsewhere. Central to this idea is always that the client does not have any ownership, only the right to internal use. Make sure that the exclusivity time period is clear or agreed upon, otherwise the client company might feel you have taken advantage of them, or that a confidentiality agreement has been broken. This could ruin the relationship or even cause a legal dispute. But be careful. Underestimating your development time and costs could put you out of business or prevent completion of the project, creating all kinds of legal and reputation challenges. Be sure there is a market for your new concept, product or service. This is the only reason for the initial client to receive a discounted service. This method is often used with prototypes, where a client agrees to prove viability and work out potential problems before the product goes to market. The client becomes the test market and receives an excellent discount. Again, it is a win/win arrangement.

7. Have somebody sign for you with a major supplier

Getting a friend or relative to sign surety for you with a major supplier is another way of raising finance. Take Succeed. The first edition of the magazine was printed 11 years ago, after a friend signed for Miriam and Wessel Ebersohn, guaranteeing the printing house that they would be paid. The friend, Martin Dannheiser, then owner of the Springs Advertiser, had previous dealings with the Ebersohns. The couple had sold a previous business that owed Dannheiser money at the time of sale. When the new owner tried to avoid paying back the debt, the Ebersohns honoured it, even though they were no longer legally obliged to. “Having somebody to sign for you is a question of trust,” says Wessel Ebersohn. “That act built trust – he felt he was not running an undue risk.” A close existing relationship with the person or company you are going to ask to sign for you is obviously necessary. Less than that will simply not work. In instances such as these, success will typically depend on your reputation in the industry. People want to be sure that they will get their money back. If you are experienced in the field, and have perhaps held management positions at one or two other organisations, your years of expertise and reputation for honest and ethical behaviour will all count strongly in your favour.

8. Get a company to invest in a product or project

Instead of giving away equity to raise money, you could have someone invest in one of your products or services. They then own a percentage of the product or service, not the company, and gain revenue from just those sales. When starting a business, do this with your main product or service. Initially most of your effort and overheads will go into this, generating most of your income – enough to launch your business. In time, you will almost certainly want to expand or create additional revenue through new offerings. Usually, your product that was originally most important to you will not remain your number one.

A BEE procurement advisory business may start, assisting companies with their BEE rating scores, as the main source of income. Later, the business can have someone invest and own a percentage of a second service that helps corporations source and identify those BEE companies that can do the job properly and deliver on time, through a categorising system that rates companies on ability to deliver. New staff, paid for by the investor’s money, can be hired to run this division. After commissions, fees, operating overheads and loan payback (if applicable) have been deducted, the investor shares in revenue. The stake in the product or service does not necessarily equal the percentage revenue the investor gets – hard costs have to be deducted first. You could have more than one investor or partner. Focus on people who can open doors, offer expert services, have channels of distribution and generate sales. You can do this with two or three products or services at the same time, especially if the offerings complement each other and can be sold to the same market. Try not to split your focus, making investors wary. The advantages of this method are that you do not give away part of your business, and it is the product, service or opportunity that is at risk, not the business. Pick people you know you can work with and who does not need the money back immediately. If they invest R200 000 in money and you invest R100 000 in sweat equity or intellectual capital investment, negotiate that you get your R100 000 when they get their R200 000 back in loan payments. Negotiate a reasonable buy-out agreement from the start. You may not want them as partners forever.

9. Be part of another successful company for the first two years

You are ready to launch your business. You have worked in the magazine industry for several years, establishing an extensive contact base and gaining experience across many areas of business. You have also done your research. You have pinpointed an untapped niche target market, and have broached the concept to several colleagues who have all responded enthusiastically. You know you are ready to go it alone. You have the experience and expertise, but starting up your own operation is expensive. Rent, salaries, advertising and printing costs add up fast. The lump sum in your bank account may not be enough – an additional cash injection would give your business just the extra boost needed to get it off the ground. Approaching an established company that operates in a similar line of business is one way to get the extra funding. Several publishing houses operate multiple publications under one roof. You could start your business as a part of one of these successful organisations. The company would provide you with office space and equipment, financial controls, suppliers, expertise – and branding. Indirectly, this approach could help you raise several hundred thousand rand. However, you will need to draw up detailed legal documents, listing the rights and responsibilities of each party. Make sure the agreement is clear and that it includes a buy-out option. If your long-term plans involve operating independently of the company, one potential downside to look out for is the fact that you will inevitably be required to buy the company out – and at this point the organisation will almost always ask for more money than it originally put in.

10. Raise money through a stokvel

While retaining their communal nature, some stokvels have sophisticated micro-lending schemes in place. Evolving out of the need to create a trustworthy environment for saving, stokvels were first used by labourers in the early 19th century as an alternative to formal banking. Members contribute a fixed amount to a common pool on a weekly, fortnightly or monthly basis. Money is accessed either when a particular occasion or need arises, or in rotation. The stokvel concept has expanded to include a range of offerings that cover a broad spectrum of life needs. Christmas stokvels allow for savings for a generous Christmas shopping spree, while a stokvel hybrid, the burial society, provides both financial and social support to grieving families. Money realised from stokvels can be put to good use in either starting or growing a business. Although, to make a serious difference, it may be necessary to join one in which contributions are high. Apart from the direct savings benefit, a stokvel can be used in many ways if the members are enterprising enough. An interesting example of how stokvels are used to raise finance is provided by the Community Theatre Stokvel Initiative. Established by the Victory Sonqoba Theatre Company, the stokvel is generating income on several levels. Established as a membership organisation, it charges each group of performers that join a fee of R2 000. This money is then deposited into a trust account. A compulsory monthly fee is charged, and when one member group performs, all the groups each pay R1 000. R500 of this amount is transferred into the trust account, while the remaining funds may be used at the discretion of the host group. In addition, each member group is responsible for selling 20 tickets each, which in effect guarantees the performing group an audience. The stokvel also provides the host with media and marketing services. It has established relationships with two radio stations, Jozi FM and Alex FM, and both stations broadcast interviews with the groups before their events. The stokvel has also developed partnerships with tourism companies that provide tours of townships. Operators charge tourists to watch a group’s performance and enjoy an African style buffet, with ticket sales then deposited into the trust account. More than 9 000 stokvels, burial societies and savings clubs have spread across South Africa in the last 50 years. It is estimated that the close to 50% of black South Africans who belong to these informal organisations contribute savings of around R12 billion annually. One has even been reported in Johannesburg’s northern suburbs.

11. Borrow from friends and relatives

The biggest advantage of this approach is flexibility. Because you are borrowing money from someone you have a personal relationship with, changing the conditions of a loan, making occasional late payments and reacting to changing life circumstances are much easier.

Another advantage is that when all other options have dried up, your family and friends are always there. That being said, borrowing from loved ones should be a last resort, not a first. While other options put your possessions or money at risk, this puts your relationships in jeopardy. If you fail to pay, your personal life could turn sour. Difficulties also arise in payment times. Borrowing from a friend or family member is different to a straight business relationship. A banker can send you a nasty letter, if you are not meeting a loan agreement, and it will not be personal. If a relative gets similarly anxious, the tensions that arise will be much closer to home. For this reason it is advisable to make the loan as formal as possible. Show your potential lender a comprehensive business plan to receive and repay loans – much as you would with a formal lender. Let them know exactly what to expect. Making an agreement in writing is an imperative. This should set out the first and last repayment dates, other repayment dates, repayment amounts, interest rates and, most importantly, what will happen if the loan is not paid back. Regarding the last point, make sure you avoid extreme guarantees. Pledges of handing over your house in the event of failing to pay could put your loved ones at risk. Such a guarantee, essentially, says that your friend or relative will be putting you on the street if you do not pay them back. You have to ask yourself if you really want to put them in that position.

 In brief

Sometimes we expect too much from banks, the government and venture capitalists. What if you raised a fair amount of money indirectly with several of these methods, and then went to a bank? The bank would see the effort you put in, and the financial equity and contribution you made through being creative without its financial assistance. This would sit well with the bank, and increase your chances of borrowing from it as well.

Bill Gibson has spoken to over one million people around the world and is the chairperson of and a partner in Knowledge Brokers International SA (Pty) Ltd (KBI), along with Marius Liebenberg. Bill Gibson is the author/developer of the 25-module sales system titled The complete sales action system and the eight-module Managing complex business relationships system. For more information about Bill Gibson as a speaker and the KBI products, contact 011 784 1720 or bill@kbitraining.com

Bill Gibson – Ride The Right Horses To Success

Two weeks ago I spoke at the Good To Great Conference at Emperors Palace here in Johannesburg, South Africa. The title of my speech was “There Is Always Another Way Of Looking At Things.” Part of that speech was on Riding The Right Success Horse which is part of my Turning Entrepreneurial Spirit Into Business Opportunities Manual / Book. Several people requested a more in-depth description that reaches beyond the slides I used. Big thanks to Al Ries and Jack Trout. Note: The content is leaned towards South Africa although it can apply anywhere in the world.

 Riding The Right Success Horse

Al Ries and Jack Trout are the authors of the books Positioning, Marketing Warfare, Bottom-up Marketing, The 22 Immutable Laws of Marketing and a number of other excellent books. In 1991 they wrote a book called HORSE SENSE – “The keys to Success is Finding a Horse to Ride”. HORSE SENSE hasn’t had the recognition and popularity that some of their other books received even though it is an excellent book for helping an individual pick the right idea for success.

In their book they give the “odds for success” (like the odds in betting on horses, boxers, etc.) on each of 14 success horses. We are going to give you a brief description of each one of them and the “odds” for success that Trout and Ries put on each one of them.

A way to use these success horses is that when you are looking at an idea, business opportunity, or an investment into a business or career you can look at how many of these success horses are present in the opportunity and are they the ones with the better odds.

We will start with the Success Horse with the best odds for winning. These are called the Short Shots. From there we move to the Medium Shots and then to the Long Shots that have the worst odds for winning.

The Short Shots

The Family Horse: 3 – 2 Odds

Trout and Ries say that is hard to divorce a daughter, son, brother or sister. If you are lucky to have been born into the right family your odds for success increases. If your father was the Honourable Thabo Mbeki, Nelson Mandela, Harry Openheimer, Ernie Els, George Bush or Mel Gibson your chances of success increases. Doors open easier, more opportunities are put in front of you, the expertise is available to help you and positions in companies are accessible as well as an abundance of capital (money). Even prominent names in local communities and industries increase their “success odds” in those communities and industries.

Many daughters, sons, fathers, mothers, brothers and sisters are too proud to utilise the Family Horse. Trout and Ries say it is an asset so leverage it for what it is worth. Remember some peoples’ success assets are “their good physical looks”, others may be “exceptional athletic talent” or “acting abilities”, while others may be their “intelligence and brilliance” and another may be “access to money” … so don’t be afraid to capitalise on the Family Horse if it is one of your assets.

Even though you may not be part of a prominent family you can capitalise on the Family Horse if you are in business with someone who has the credibility, status and power of their family name on their side. It improves your chances of success in most cases.

The Spouse Horse: 2 – 1 Odds

History is full of examples of people who married the right person and that factor became a major contribution to their success. With many people it is not considered ethical. Trout and Ries’ message is simple … “Everybody needs, a success horse to ride”. If you are married to the right person it obviously opens many doors to success, just like the family horse does. Utilise it … it is your second best option in reference to the success horses available. The downside, compared to the Family Horse is the possibility of divorce. There are many cases where this happened but the two people kept the business relationship or partnership in tact. Fred and Gale Hayman created Georgio Fragrance. They divorced but still worked together and later sold to Avon for $165 million.

The Partnership Horse: 5 – 2 Odds

The advantage of a good partnership or strategic alliance is that “two of the right heads together are much better than one”. Also an “equally valuable” partner can be generating revenue and opening doors to opportunities you may not have the time or ability to do. Also true partners trust each other and can be objective which is sometimes tough to be when you are by yourself.

We are often poor evaluators of our own ideas. With enthusiasm, energy and youth on our side we start strong as loners and often quickly experience the success we are looking for. With our hands on the controls and our confidence building we can easily begin to believe we are the “only one” that can do what we do and “that we do it much better than everyone else.”

Very quickly we can hit the “ceiling of our own success potential” because the opportunities get bigger, more complicated and require additional talents and expertise. Remember, the basic talent of one individual can only grow so much. Trusted, equally talented partners open the doors to many new opportunities and helps spread the responsibilities, risks and yes the profits, but the profits may be much bigger. They also help keep our “egos” in check.

Word of Caution: Be sure you are getting involved with a partner, partners or “strategic alliances” that are equally talented in an area you need in your business and their contribution level is equal to what they bring to the business. Partnerships and strategic alliances must be sustainable and they are only sustainable if both parties continue to believe it is fair and equitable. A bad partnership can also destroy a business.

The Other Person Horse: 3 – 1 Odds

If F W de Klerk had stayed in power as the President of South Africa, Thabo Mbeki would probably not have had a turn at being President of South Africa. Nelson Mandela took a special interest in Thabo Mbeki and saw the potential. The relationship with Mandela (the Other Person) helped Mbeki eventually become President. In large corporations people often attach themselves to a rising star and rise with them. That is riding The Other Person Horse. A boxing promoter may ride the other person horse (a talented boxer) to the top or a boxer may ride the other person horse (Don King) to the top or bottom?

The Other Person Horse could also be an exceptional sales manager, top producing sales person, a marketing genius, a software developer or a financial wizard that you hire to work in your business. The key is be always alert for opportunities to associate, partner, affiliate, promote or hire others that increase your chances for success.

The Idea Horse: 4 – 1 Odds

To win with the Idea Horse you’ve got to be willing to stick your neck out and handle the criticisms and ridicule you may have to take. To succeed with an idea or concept you often have to be the first with it or the first with a “new twist” to the old. That means the experts may challenge you or say it won’t work. The experts said the Beatles would never succeed in the United States and that people would never buy bottled water. They were wrong. Unique advertising concepts, different ways of marketing and selling would be viewed as Idea Horses. When it comes to the Idea Horse there are several questions to ask.

Is it first, is it bold, does it have impact, is it unique, is it something obvious, logical, timeless and makes sense but no one has tried it. Is it simple to launch and produce, and can it upset or rock the market. Remember, it is easier to find a good idea, package it and market it rather than invent and develop it. The Idea Horse can also combine with The Other Person Horse by having Other People around you who are brilliant idea people. You also have to be sure others will buy into or market your idea.

The Product Horse: 5 – 1 Odds

The Product Horse or Business Concept Horse has great value because if done properly, it can make you money while you sleep. Often it is the person that recognises the value of a product or business concept and how to market it that makes the real success out of it rather than the inventor, originator or founders. Ray Kroc got wealthy off of McDonalds. The McDonald brothers did not. The importance here is that it should be a product, concept, process or business that can be replicated and others can market it, operate it, or expand it without you being present.

The Medium Shots

The Publicity Horse: 10 – 1 Odds

A few years ago Rebecca Loos definitely capitalised on the Publicity Horse claiming she had an affair with David Beckham, world famous football star. She received several hundred thousand pounds for her Sky One interview with Kay Burley called Rebecca Loos: My Story. At London’s premier of Uma Thurman’s new film in London, Loos showed up with her female TV presenter friend Emma Basden. Basden was dressed in a similar football outfit to the one David Beckham wore at a showbiz party the previous night … sparking speculation that Rebecca was mocking the Beckhams. General Swarztkoff, just after the first Gulf War in Iraq was booked out solid at $90 000 per speech as a public speaker. He was riding the Publicity Horse. The majority of people are not independent thinkers. They believe what they read in the newspapers, hear on radio or see on television or from “other” people and those “other” people usually get their information from newspapers, TV and Radio as well.

Donald Trump leverages The Publicity Horse, so do politicians, entertainers, professional athletes, corporate executives and even special interest groups. Can you, your idea, your product, your business or your people capitalise on the Publicity Horse. If you can create “publicity” and “celebrity status” with your assets you increase your odds for success.

The Geography Horse: 15 – 1 Odds

If you owned a piece of property where the developers decided to build the V & A Waterfront in Cape Town you would have had the Geography Horse working for you. If you were a security specialist living in South Africa you are in the right Geographical Area. A specialist in Small Business Development in Sweden could not capitalise on his/her small business expertise like he/she would be able to if living in South Africa with the big focus on SME’s. If you own property next to Kruger National Park and you build a Game Lodge, geographically you are in the right spot. The Geographical Horse means increasing your odds of success because of Geography (location of you or your idea is in the right place at the right time).

The Hobby Horse: 20 – 1 Odds

Some people love to eat so they turn their love, passion or hobby into a marketable restaurant, a cook book or TV show on cooking or restaurant guide. Others like to exercise so they become personal fitness coaches or open a health club. When you like to do something, you tend to do it a lot and the more you do it, the better you get at doing it. Your confidence builds and eventually with that increased knowledge you become a specialist. One gentleman who loved opera opened a part time business as an “Opera Tour” operator and promotes and markets opera tours to Europe. He goes along, sees the operas and makes money while doing it. One of the advantages of the Hobby Horse is you are doing what you love to do. The downside is it doesn’t necessarily guarantee you business success. Many people who loved Golf, became Golf Pro’s and now hardly ever play and golf because they are busy trying to run their Golf Pro Shop and Golf Lessons business and do not have time to play golf. Sometimes when your hobby becomes your business you lose the passion and enthusiasm because of the responsibility that goes with it.

The Creativity Horse: 25 – 1 Odds

Even though you may have been born with an exceptional talent … in writing, playing an instrument, painting, acting, singing, speaking, you may need more than that talent to succeed. You need recognition. John Lennon’s aunt told him “you’ll never make a living playing that guitar”, Paul Mc Cartney failed the audition for the Cathedral Choir in Liverpool and neither of them would’ve become famous with their talents if Brian Epstein had not recognised them, created an image and marketed them. The Creative Horse is a tough horse to ride because creative people get their priorities reversed. They believe their expertise, creativity and talent will get them there. More than any other horse the Creativity Horse requires outside recognition!! Whether you write, paint, act, sing, dance, photograph or what-have-you, invest a good portion of your time searching for the outside expert who can certify your creativity. Also look for ways to make yourself stand out … be different, e.g. Bruce Springsteen – The Boss nickname, “Swim with The Sharks” is more powerful than “Getting Ahead in Business” as a book title.

The Long Shots

The Company Horse: 50 – 1 Odds

Out of 100 people in a company according to Trout and Ries, one will make it to the top of the organisation. The competition is heavy for upward mobility in a large company. “A company, especially a big company, might not represent much of a future to you, but it does have one major benefit” according to Trout and Ries, “A big, well-known company is a great place to get your ticket punched (utilise it as credible credentials), provided it is the “right” big company.”

When joining a company it is important to ask what can I do for the company but equally important is to ask what this company can do for me. In South Africa, right now if you are a Historically Disadvantaged Individual and you can rise through the ranks of a well known company you are increasing your odds of success because of the shortage of senior executives of colours. There is a good chance you will be “head hunted” by executive recruitment companies eventually being placed into a phenomenal position with an excellent package even with share options.

Another way to make it is in a smaller company. The key is to get in early with a company with great growth potential and be next to the Founders and ride the Other Person Horse and Company Horse to the top.

The Education Horse: 60 – 1 Odds

Trout and Ries are not saying that education is not important. As a matter of fact, they are saying that the Education Horse is especially good “out of the starting gate.” Just like in a horse race getting quickly out of the Starting Gate is important in your business and career life. They also say, just like working for the right company to get the right credentials the same applies to the schools you attend. The Brand Name of the educational institution can make a difference especially in your early years. The Educational Horse is there to get you in the race. A degree by itself won’t make you successful! It is the application of that information and credentials that gives you your success. Many well educated people spend a business life time being frustrated because they see “less educated people than themselves” doing better than them. How they get caught is they believe their education entitles them to be ahead in the race. That is a myth. It is not true in the real world. Trout and Ries also suggest: “Be careful that you don’t lose that precious commodity called common sense. Many people are born with common sense and go to school and lose it. Remember, there are lots of people who are educated beyond their intelligence.

In a country like South Africa, where millions have been deprived of a good education, it is important to tread cautiously with the Trout and Ries comments, on this subject. Education is vital and there is and continues to be a need for making the education of our people a top priority at the same time we need to continue to re-enforce, “it is our attitude, our outlook, our life skills, ambition and application of the education that guarantees our success, not education alone! “What Trout and Ries are saying is: “If you bet on education alone it is a Long Shot.”

The IQ Horse: 75 – 1 Odds

Intelligence quotient (IQ) is a measurement of the intelligence of a person. The quotient is calculated by dividing a person’s mental age by her/her actual age and multiplying the result by 100. A mathematical genius would usually have a phenomenally high IQ. The world renowned elite organisation called MENSA, which is an elite group of people with extremely high IQ’s, only accepts those with an IQ of 140 or higher. So why would Trout and Ries only give the IQ Horse a 75 – 1 odds of success? The following research may shine a light on this. In Canada a number of years ago there was an article in the “Star Weekly” a weekly publication that came out on Sundays country wide. It talked about IQ levels of people in the various careers in the country. After putting hundreds of people through IQ tests they were able to determine which two careers have the people with the highest IQ’s. Guess which careers they were?

The people with the highest IQ’s were bartenders and taxi cab drivers. According to Trout and Ries “there’s a reason why intelligence doesn’t correlate very well with success. The smarter the people are, the more they depend upon themselves. After all, they know everything! They depend on themselves to get ahead. But it is a long shot to depend only on yourself!

Now in Canada, the researchers discovered something similar. They discovered that these very intelligent bartenders and taxi drivers did the jobs that they did because it gave them continual interaction with people, they could have many different conversations with many different types of people which was stimulating and above all they had independence and felt like they worked alone even though they were around other people. The researchers also found out that most people with high IQ’s had little patience for other people who did not mentally pick things up as fast as them. They preferred to work alone.

As one college President said to the faculty, “Be nice to you’re A students because they will come back and be your colleagues, but be exceptionally nice to your B and C students because they will come back and give us a new auditorium and a new science building.”

Less intelligent people usually know they are less intelligent and they usually look for others to help them up the ladder. In other word they look for additional Horses to Ride in order to succeed.

It is a blessing to be smart and an advantage if you can maintain a perspective on that fact and continually look for additional Success Horses to ride.

By the way, for the last couple of years there has been a lot of talk about the importance of EQ which is Emotional Intelligence. Successful entrepreneurs usually score higher on EQ than IQ. EQ is really “common sense.”

The Hard-Work Horse: 100 – 1 Odds

Hard work and a Winning Horse will get you anything in life. The hard work could be optional but the Winning Horse isn’t optional.  You need it. What is being said here is that the belief that hard work will bring you success is not true. Now, you may say that successful people tend to work hard … and usually harder than most people. Yes, they do. But, that is quite different than saying “people who work hard tend to become successful.”

Lots of entrepreneurs have been on “sinking ships” and they kept working harder and harder and it didn’t solve the problem. W A Fields once said, “If at first you don’t succeed, try again … and then quit. No use in being a darn fool about it.” There are times you need to change horses. You may be on the wrong horse. Hard work alone is not the answer; it is the adding of the right horses with it.

To put in a good days work and give it the best you’ve got is a necessary attribute in every job in every field. At the end of the day you walk away with the internal gratification that you are living within your own integrity and you are contributing your share to your company, organisation and country. Don’t ever lose your good work ethic. It is valuable. All we are suggesting is that you add some of the other Horses to take yourself as far as possible.

The 14 Success Horses that you’ve just reviewed can also be utilised inside an organisation by an employee to improve their odds of upward mobility. They can also be utilised by those with Professional Practices to help themselves and business be more successful. Marketers, business owners, sales people, entrepreneurs, artists and entertainers as well as those in political careers and working within our parastatals and government organisations can receive great value by utilising these principles.

From an evaluation or testing perspective we’ve taken these 14 Success Horses and created a “Potential for Success Assessment Tool” that you can test your ideas, opportunities, career choices, investment possibilities, business options, success options with. If you have an idea, strategy or opportunity in mind see how many of these Success Horses you can make part of your success strategy. The more you have going for you, especially the Short and Medium Shots, the better your chances of success are.

 “Potential For Success” Quick Assessment Tool

 

Your idea, Opportunity, Venture, Investment or Success Option “Description”

 

Tick R the box for each one of the Success Horses that are present or could be part of your idea, opportunity, venture, investment, success option or strategy.

Success Horse

Odds

Shot

P

Comments

The Family Horse 3-2 Short
The Spouse Horse 2-1 Short
The Partnership Horse 5-2 Short
The Other Person Horse 3-1 Short
The Idea/Concept Horse 4-1 Short
The Product/ Process Horse 5-1 Short
The Publicity Horse 10-1 Medium
The Geography Horse 15-1 Medium
The Hobby Horse 20-1 Medium
The Creativity Horse 25-1 Medium
The Company Horse 50-1 Long
The Education Horse 60-1 Long
The IQ Horse 75-1 Long
The Hard Work Horse 100-1 Long