I think the next element too, is to be careful of pride. Just because my business was in a certain position a year or two ago does not mean it’s going to be a continual climb. I didn’t call this the ascension system or the ladder. It is a hierarchy of needs. It’s like Maslow’s hierarchy of needs. Mazlow says at the foundational level of need of all humanity is physiological needs… you need to breathe air, eat and drink.
We revert to the base. In our business, if it’s under stress, we have to evaluate where we are and revert to it and don’t be prideful and say, “Well the presentation just keeps going on, even though I’m suffocating.” Just one example this the mighty Amazon. That Global organisation that it is, even the mighty Amazon lives by this hierarchy of needs that’s true for small business and true for all business.
The new sales challenge was, it wasn’t about delivering all products, as fast as possible, there’s delivering essentials
When the pandemic hit, Amazon arguably was working on legacy type of efforts, (creation of artificial intelligence… their cars… that’s our autonomous… all these different things), yet the day the pandemic hit, they reverted back to the base of the pyramid and said, “We have to resolve the new sales challenge”.
The new sales challenge was, it wasn’t about delivering all products, as fast as possible, there’s delivering essentials. They moved on to an essential product model. They prioritised that. As a result Amazon had 28, I think, percent more growth in 2020 by reprioritising their business and changing their model.
We have got to remove our pride from and be able to adjust dynamically. The flip side is a balance. Don’t do it so rapidly that you’re in desperation mode, but do go to what your business needs from you next and realise it may be a step back in order to take two steps forward next year.
How Can We Serve You?
You could even do it today. You’ve been better if you did then but now is the moment you can grasp it. Reach out to your past clients or existing clients, your past patrons and simply say two things, “We’re still open for business,” and a lot of customers are affected from this they go into shutdown mode, but it’s not just a physical shut down, it’s a mental kind of lockdown. We just block things out. We don’t think about our vendors that we were purchasing from in the past. So some of the clients are not active with you just if they haven’t heard from you, they’re’s assuming that that business is ‘out of business’ and I’ve got other things to focus on.
So, step one is to reach out to them, “Hey, we’re still in business…” Step two is to say, “How can we serve you now?” Because the prior model may not be what will serve you. If I have a pub you simply can’t come in anymore, but is there a new way I can serve you? In fact there’s a lot of restaurants in our own little town here. It’s a very kind of Colonial type town. There’s about 20 restaurants, half of them are now out of business sadly because they didn’t ask customers how to serve them now. One of them though said, “How can we serve you?”
Hey, we’re still in business…
The response was, “We love your special meals and so forth. But we can’t come into your restaurant. How can you service us? But could you tell us how to prepare the meals at home?”
They started a cooking club. Same restaurant. They send out the ingredients to their customers and on a Monday night, they do an online cooking class from five in the afternoon till seven, and now not only are they selling meals, but they are teaching classes which at a premium. They’re charging for this and it is more profitable. They’re also bringing about a new community. People are connecting with people and that’s what people need.
So it’s these businesses that are bold enough to ask, “What’s the new way we can serve you?”, and then acting upon it, they are navigating this situation.
Tips for Start-Ups
MF: We have seen record numbers of small businesses being registered in the last three months than any other time since records began, so if you were starting up today what two tips would you give a start-up, so that they’ve got a better chance of surviving their first year?
MM: The first tip I would do will be the one-to-many. I’d build a model. Actually. I have a start-up I’m launching right now. So we’re doing a one-to-many model. How can I deliver a product or service that many people want to consume and therefore as more people consume, it doesn’t have an equivalent rising cost?
Classic models would be like an information product. I can create a video or a training series for example and sell the exact same recording to as many people as possible. So my costs don’t go up significantly, but the revenue approximately does.
So what’s the one-to-many model? And I’ll tell you if you wouldn’t know a trade for example, say your glass blower or something like that, then the model was make one item, sell it; make another, sell it. Now the one to many model is how I teach other people to be glass blowers. So I want to make that mind shift.
The exchange of that knowledge is really desirable internationally
The other thing is look internationally immediately, from day one. The mentality used to be “Oh, I’ll sell to my neighbourhood, my community, my country. Think south of the globe from day one. I think the market UK has such an opportunity to sell into the U.S. Sell into any country just like we do here.
If I have a restaurant that makes extraordinary American Classic Hamburgers and hot dogs…why not train? Start providing that training to other areas and say, “Hey bring those hamburgers and hot dogs to wherever you are. And now train other restaurants”. The exchange of that knowledge is really desirable internationally.
The one thing that we all have is our culture and I don’t think we put significance in it because this is just who we are. With a realisation for other people there’s appeal and here’s a classic example. The little country of Jamaica, which is an Island, has sold reggae music into the globe. I mean, they’re really smart. They took a cultural thing and amplified it and sold it.
Mike Michalowicz was talking to Marc Ford for the YBKBS Small Business News Podcast and Video.