Making the most of Criticism

In his book Emotional Intelligence, Daniel Goleman explains that you should see criticism as valuable info about how you can do better, and not as a personal attack. You need to guard against your impulses to be defensive and to avoid responsibility. If you do find it becoming too upsetting you could ask to resume a meeting later after a period to absorb the difficult message and to cool down a bit.

You should see criticism as an opportunity to work together with the critic to solve the problem, instead of seeing them as an adversarial in the situation.

Happiness = Success

Success is not the key to happiness. Happiness is the key to success. If you love what you are doing, you will be successful.

Albert Schweitzer

Outstanding Young Business Person of 2009!

On the 25th of September I was selected as the Outstanding Young Business Person of 2009 in the North & West London Business Awards sponsored by HSBC Bank.

A great honour as the awards were marketed to 4000 London businesses. It was a fantastic event held in Wembley Stadium with 600 attendees.

Here's some of the press following the award:
- The sponsors write up of the event (here)
- BikeBiz news article (here)
- An e-copy of the South African Newspaper Article, turn to page 3. (here)

Think and Act 80/20

Those who ignore the 80/20 principle are doomed to average returns. Those who use it must bear the burden of exceptional performance.

Richard Koch - The 80/20 Principle.

How much should I spend on my house?

In The Millionaire Next Door Stanley and Danko tell us that;

"If you're not yet wealthy but want to be someday, never purchase a home that requires a mortgage that is more then twice your household's total annual realised income."

By saving on mortgage payments you have a higher ability to build your wealth foundation through savings which can be invested.

Also, if you don't live in an area where everyone drives sports cars then you won't feel the need to buy one as well as the rolex, i-phone, etc that come as accessories for that lifestyle.
You can rather buy and live somewhere where you can keep up or ahead of the Jones's without overextending yourself with a hyper-consumption lifestyle. This is the philosophy of more then 80% of America's millionaires!

Beating Procrastination

An exert from "The Richest Man in Babylon":
The spirit of procrastination is within all men. We desire riches; yet how often when opportunity doth appear before us, the spirit it procrastination from within doth urge various delays in our acceptance. In listening to it we do become our own worst enemies.

You need to realise what this truly is; a habit of needless delaying where action is required, action prompt and decisive. How it is hated when the true character is revealed. With the bitterness of a wild ass hitched to a chariot, break loose from this enemy to thy success!

Procrastination is an enemy ever watching and waiting to thwart your accomplishments. Recognise and conquer procrastination.

The Richest Man in Babylon - George S. Clason

I highly recommend this book to anyone and everyone who wishes to build up a fortune over their lifetime. It teaches you timeless values, rules and laws that which, when mastered, will lead you down the path of health, wealth and happiness. Here are a the headline lessons taught, however you should still read the book yourself to fully grasp these messages:

1) You will find the road to wealth when you decide that a part of all you earn is yours to keep.

2) The seven cures for a lean purse:
* Start thy purse to fattening by keeping no less then one tenth of your earnings
* Control thy expenditures - budget to live well of the nine tenths
* Make thy gold multiply - to put each coin to labouring that it may reproduce its kind even as the flocks of the field and help bring thee income, a stream of wealth that shall flow constantly into thy purse.
* Guard thy treasures from loss by investing only where thy principle is safe, where it may be reclaimed if desirable, and where thy will not fail to collect a fair rental. Consult with wise men. Secure the advice of those experienced in the profitable handling of gold. Let thy wisdom protect thy treasure from unsafe investments.
* Make of thy dwelling a profitable investment - Own thy own home.
* Insure a future income - Provide in advance for the needs of thy growing age and the protection of thy family.
* Increase thy ability to earn - cultivate thy own powers, to study and become wiser, to become more skilful, to so act as to respect thyself.

3) Men of action are favoured by the goddess of good luck.

4) The Five Laws of Gold:
* Gold cometh gladly and in increasing quantities to any man who will put by not less then one-tenth of his earnings to create an estate for his future and that of his family.
* Gold laboreth diligently and contently for the wise owner who finds for it profitable investment, multiplying even as the flocks of the field.
* Gold clingeth to the protection of the cautious owner who invests it under the advice of men wise in its handling.
* Gold skippeth away from the man who invests it in businesses or purposes with which he is not familiar or are not approved by those skilled in its keep.
* Gold flees the man who would force it to impossible earnings or who follows the alluring advice of tricksters and schemers or who trusts it to his own inexperience and romantic desirers in investment.

5) Better a little caution then a great regret.

6) Where the determination is, the way can be found.

Starting out takes twice as long and costs twice as much

Just about everyone starting out a new business underestimates how long and how much it is going to take to get the business up and running. Be realistic about your time-scale and budget.

Try testing the market and doing your initial work on a shoestring budget. If you see it is working then go full steam ahead but if it is not going to work then you will not loose a high initial investment.

90% of start-ups fail, of those 10% remaining only a small percentage survive to see the 5 year mark.

Be absolutely clear upfront about what is going to make yours work?

"Employ your time improving yourself by other men's writings so that you shall came easily by what others have labored hard for." - Sokrates

Some fantastic books that I've been reading over and over lately are:
# Good to Great - Jim Collins
# Business Stripped Bare - Sir Richard Branson
# The Richest man in Babylon - George Samuel Clason
# Think and Grow Rich - Napoleon Hill *** My Favourite at the moment!

"Good is the Enemy of Great" - Jim Collins

Never accept mediocrity, never settle for being "good" at what you are striving to achieve. Good is not good enough. Be the BEST!

Knowing why you are successful

"The single biggest danger in business and life, other then outright failure, is to be successful without being resolutely clear about why you are successful in the first place." - Robert Burgelman (Stanford Business School).

Wise words of advice

Here's a few words of wisdom offered to me by a successful entrepreneur:

Be open and honest with your partners. Be generous in taking them on. If they are silent partners always pay them their share of their profit. Never forget that they were there in the beginning and helped with the above items. Never begrudge them sharing in your success. Always deal with them, suppliers and customers in a win-win arrangement. If your supplier sends you one extra memory stick and it is not on the invoice – phone them and tell them (always). Then maybe one day your customers will show you the same courtesy.

Giving someone the sack

We've recently gone through the unenviable process of having to cut one of our team members loose. It's a tough job but you have to be certain that emotions don't come into your decision of whether or not to keep them on, after all, it's just business.

The concept to keep in your mind is that in order to create a world class team you need to get the right people onto the bus, the wrong people off the bus, and then get the people on the bus into the right seats.
If you can do that then you can drive the company wherever you desire!

Focus in a Recession

In difficult economic times such as when a recession hits, if you're sales are taking a serious knock because of lack of spending then you can turn your focus towards the public sector such as the police and fire department.
These departments never have their budget cut because of economic difficulties and so they are a perfect customer to deal with when the rest of the economy goes pear shaped.

Info to Trade Customers before Launching a New Product

We've recently had a supplier of ours launch a new version of their product. They decided to not keep us informed of the new product.
Because the previous version had sold well we bought a lot of stock to get the lower price but this was just before the press release was sent out about the new version. Now the customers are keen to wait for the new version which leaves us with dead stock which we will have to discount to get rid of before the actual launch date of the new version otherwise we will not be able to sell them.

Discounting the old version isn't good for us as we earn less on each one and it isn't good for the manufacturer/ brand as everyone sees their products being sold much cheaper which leads to a lower perception of the brand (especially at a time when they are all over the news).

The lesson here is from a manufacture's point of view you should keep your main customers fully updated about new product launches even if it required them to have to sign a non disclosure agreement to keep it a secret.

Increasing your price

It is much easier to drop your prices than to increase your price. Trade customers will resist the increase and will prolong increasing their end user price as long as possible. Each customer will refuse to raise their price until everyone has done so, this is obviously because the end customer will buy from the cheaper supplier more often then not.
It is a difficult process to manage, one of our suppliers has been forced to increase both the trade price and subsequently the end retail price due to the USD strengthening over the past year which increased their buy price.
They asked us to raise our price but never put a deadline on it which they should have. We are a few months down the line now and are not happy to raise our price as there are still other people selling the items at the previous lower price. If they had been firmer and stricter they may have been able to avoid this problem.

Red Flag for Fraud

If a customer is buying from you with a credit card and having the item collected then beware as this could be a fraud. Of course, if they were to be there personally and insert the pin code then you can be pretty sure that it's legit but if the customer phones through the card details and then says he'll have it collected by courier or a mate then this may be a stolen card.
This fraudster may have stolen the card and knows the address where the card is registered to, in this case they could have a product collected and you wouldn't realise that it is fraud until after they have collected the item and the bank gives you a charge back for the money.
This is a bad situation that we must avoid.

Difference between Income and Cashflow

Income is any money that comes to you regularly that you can count on.
Cashflow is the income that is left over after you've paid your expenses.

You should divide your cashflow into three separate pots:
 Charity
 Savings
 Investment

The Three Keys to Success

1) Opportunity
2) Knowledge
3) ACTION

Positive Mental Attitude

To be successful you need to purposefully develop a positive mental attitude and a millionaire mindset!

Zig Ziglar Quote

"You were born to win, but to be a winner, you must plan to win, prepare to win, and expect to win!"

A few pearls of wisdom about becoming wealthy

 Wealthy people don't use their own money.
 Wealthy people understand tax laws and use them to their advantage
 Wealthy people have decided to be rich
 Wealthy people work to learn, not to earn

But most importantly, to answer the question "What do successful people do?". Quite simply; Successful people do what successful people do.

Source of your marketing efforts

Be conscious of where your marketing ideas are coming from; have you sat down and thought through what you need to do, what is the best way to achieve this, and how you can get it done at the best price...
OR, have you reacted to a salesmen who's phoned you up offering a great deal on the marketing media that is "perfect" for your target market?

You need to be productive with your marketing plans rather then reactive to external influences.

Marketing plans of action

While a company should always be willing to try out new ideas and marketing tools, you may find all your effort is futile if you have no overriding plan of attack leading your actions.
In our past marketing efforts we have sometimes tried marketing attempts here and there with no real thought behind it and no real measurement of success other then if there were any sales generated.
With present and future marketing efforts we are first discussing and deciding on a bigger plan of action, breaking this down into smaller efforts, taking these actions and then measuring the success or downfall of each step.

Contracts for core business activities

Eighteen months ago our company signed up a FishEye web design to create a new e-commerce website for us. As our company is an online based shop it was imperative that this was a success and delivered quickly.
Today we are still doing our best to get the website out of their control as they have been an absolute nightmare to work with; their incompetence and lack of effort has really had a terrible effect on our business in many different ways.
The lesson that we can take from this is two sided;
Firstly, when looking to contract someone to help you with any part of your business that is core to your success you need to do your due diligence. Speak to their past clients, have in depth meetings with them, look at past projects that they have worked on, and read online reviews if possible.
Secondly, once you are further down the line, if things start to go pear shaped then be prepared to pull the plug and look for someone else to take over. Don't continuously give them the benefit of the doubt. If they prove to be rubbish and don't deliver on their promises then get away.

Procrastination is a killer - kill it.

If you don't conquer the procrastination which whispers into your subconsciousness then it will always be there to trip you up and encourage you to miss out on opportunities that are presented to you.

Recognise it and overcome it through taking ACTIONS towards PURSUING opportunities with PERSISTENCE.

Going into business with family and friends

Often I have read about situations where families and friendships have fallen apart because of business relations causing too much stress on the otherwise happy relationships.
Recently I have learnt first hand that if you choose to go into a business venture or any project together with a loved one or close friend be sure that you are doing so for the right reasons; being that you believe that these people are bringing the right strengths and attributes to your team that you need and can do this better then any one else could. Doing this for any other reason could lead to issues which carry more costs then just financial.

The Devil is in the Detail

No one enjoys missing out on opportunities, especially in business when there is a lot of money involved in deals that go amiss.
We recently had a fantastic deal on the table but let it fall through because both parties hadn't paid enough attention to the delivery date that we were both believing to be the due date. The customer had an earlier date on their purchase order then we had said we could deliver, without seeing this we celebrated a great deal and looked forward to delivering but when the misunderstanding was spotted the customer pulled out leaving us in the lurch.
To avoid this from happening you need to pay full attention to every detail in a contract on in an order to make sure that there are no misunderstandings for whatever reason as the devil could be hiding in the detail.

Property Company

No one wants to pay a property manager to run and manage your properties because you have to pay around 10% of rental income to this company for their services. What you can do to get around this is to manage your own until you have more properties than you can manage on your own.
Now get together with other investors in your network and create a company that will manage all your and the other peoples properties. This way the fee that would be paid to the property management company would not be going to other people’s pockets. Plus this way you will end up paying less than 10%.

Elevator speech of what you do

When doing a very brief explanation of what you (or your company) do make sure to do the following:
• Speak clearly and slowly,
• Be confident about what you are talking about,
• Address a need,
• Tell people that they have a problem and then provide the solution, and
• Give a reason to buy.

What do successful people do differently?

Successful people do things that successful people do

Knowledge isn’t power

Everyone knows how to loose weight but not everyone does it. Knowledge isn’t powerful, you empower yourself when you put what you know into action.

Knowing your costs from day one

On our most important product we had worked out the costs involved, from there we calculated our margin, and then the price. The margins were slim as we were mostly selling this to trade customers. A few months down the line the tax man contacted us to tell us that they were re-classing the product for import duties and that we would be liable for an extra 5% on the value of the imports in the future plus we would have to cover this 5% for all past imports! This came to about £30k - what a bitter pill to swallow!
Know your costs from the beginning and in a case such as this one be sure to have signed documents to ensure that your costs don't change further down the line.

If my boss were to start another company from scratch

When talking to my boss one day about what he would do if he were to start another company from scratch he said that his number one priority would be to get the numbers straight from day one.
With our current company he and his business partner got into a bad habit of focusing on sales and never really paying too much attention to the books, putting it off for tomorrow. Now, four years down the line and our books are still a mess and we struggle to extract any useful info - the most important info that we should be using in every decision!

Positive Feedback to Suppliers

If you have important suppliers then build a positive relationship with them by contacting them with good publicity that you have achieved - don't only contact them when things go bad.
Example: Our competitor built a negative perception of his company with the supplier of the most important product in our range. He did this without knowing, he would only contact them to complain or with bad news.
Be proactive about this and it will work in your favour.

Your retailer knows your product better than you do

One of our biggest suppliers wanted to set up a meeting with us; they wanted to know how their product compared to the other products on the market. What is selling? What are the important differentiating factors between products? What makes customers buy one thing over another?
The retailer is closer to the customer and deals with them on a day to day basis therefore they have priceless knowledge on the customer needs. The lesson here is that if you are a distributor or manufacturer you should constantly meet and talk to the retailer to find out how your product is doing.

Is your product marketable?

One of our suppliers in China made a new camera that they thought would be very successful. When we looked at it we saw that it was not marketable for a number of reasons. The bottom line was that they were too far away from the end customer to know what the customer wanted.
The question that was put to them was; why did you decide to make this product? Was it because someone had come to you and asked for it or rather because you assumed there was a need?

Moving along the learning curve

Sab was talking about learning as we go, he said something along the lines of: "You've got to try stuff, if you're not trying stuff then you're stuffed! If we keep trying different stuff and keep learning from each thing what works and doesn't work then the next time we try something then hopefully we'll piss less money up the wall and make some good profit. You just have to keep trying stuff!" ...Wise words

How you can use one GREAT product to grow and drive your company

A guy that came into our offices got chatting and he said that he made his company successful this way: He had his company up and running then he got one great product in that no one else could get and was wanted by all the customers so his marketing activities on this one product lead the customers to his company and he built a brand name through this. Then these customers started buying all the other standard products from him and the other sales rode on the coat tails of the one successful product. This single product differentiation led to his success

How to get trade customers to carry your products

Probably the most important issue for trade customers is for them to have very attractive margins for selling your product. This is first and foremost importance. An issue that can cause these trade customers to want to sell your stuff is: "If it's flying off the shelves, I want it on my shelves!” Another important thing when it comes to getting these people to choose between you and a competitor is availability; if your competitor has a better product or better margins but the lead time is a month and you have it on hand, then they will go with you - so always ensure that you have stock readily available.

Using a brand to sell your product

A battery importer in the UK wanted to import their own brand of batteries but know that they would struggle as it would have no branding behind it to sell the batteries. They found out that Everyready brand was stagnant and so they licensed it and put it on their poor quality batteries. Now they are selling loads of them and they are in most retailers. Best of all is that this company is using cheap batteries and making a killing although they do have to pay a royalty to the owners of the Everyready brand.
So the lesson here is that if you don't have an established name and brand then it could be better to buy another brand to help launch your product.

The biggest risk of all in a small company

The biggest risk for a growing company is to not take any risks! Stagnation is a killer and complacency will close you down after a while. You always need to be thinking biggest and best (instead of bigger and better) to reach huge successes.

A problem with being in a niche

The company I am involved with now sells into a niche market. An issue that we've come across is when other companies which also sell the same goods but just as a part of their product range seem to chop the prices very easily. They can do this because they are making profits across the board across a wide range of products. But when they do this Action Cameras needs to drop prices too which cuts into the main profit source - big problem.
The answer is to keep a sharp eye on these players and try your best to regulate the prices any (legal) ways possible.

Distributing and controlling product prices

If you are distributing a product and need to try control the price of it in the market you can have difficulties as your customers will all essentially be competitors. To try to stop them from trashing the pricing too much to beat one anther and thereby reduce the overall price and perception of the product, you may have to supply to different customers at different prices. The one's that have proven themselves to be reliable and you know won't trash the price, you can supply to them at the low trade price. But the customers that you think are likely to trash the price to get more sales should be sold to at a higher trade price so that they have less margin to reduce by cutting the price. If they persist then you do need to stop selling to them all together to keep your products image in tact.

The boss's view on competitors

He prefers to looks at a competitor not as a competitor but rather as an opportunity to turn them into either a customer in some way or to develop a mutually beneficial relationship by helping one another in a win-win relationship.
Keep your enemies close - which is better than making enemies with them as you never know when you might actually need something from them.

New Products Procurement

This may sound like a logical point but I must be aware that buying a brand new product in bulk without testing a few units first is a big risk. Action Cameras took on a new recording unit which caused endless problems, also most of the units sat on the shelves for ages with money tied up and were eventually sold at a loss just to recover some cash.

B2B sales

When selling a service from business to business you need to be a great listener. Ask them to explain their problem to you and let them talk as much as they want without interrupting them, perhaps just with prompting questions. Somewhere in there you will hear the part that you will want to address.

Start up capital

When taking out a loan to finance the start of a new company you could use this tactic. If, for example, you calculate that you will need R100,000 to get your company up and going, you could actually try to get a loan for R130,000 so that the extra money can be used to pay for the interest repayments and other bills & expenses of the start up before you start to earn serious cash! If you don't do this then you can put a financial strain on your company from day one.

Getting Venture Capital

When trying to get venture capital investment you've got to make the investors believe that the train is leaving the station with or without them and that it will be a bigger success with their money invested. But if they are not keen then you are happy to do it without them or with other investors.
The reason for doing this is to negate their negotiating power over you as you are asking them for their money and so they have control over the deal but not with this trick.

Turnover is vanity, profit is sanity but cash is king

Especially in a start-up

Hiring mistake to avoid

When it's time to bring a new person or a number of new people on board, its important not to rush into it. It is very important to get the right people in and also that they are going to get along with the current employees. Hire carefully and slowly.
When we brought in a new guy we went by a referral from a business contact. The person that we brought in was crap and we fired him soon after.
The lesson here was that when someone refers a possible employee to you, always ask them "if they are referring this person because they believe that this person is perfect for the job and will take your company forward or whether they are just trying to help this person to find a job?"

As mention by Jim Collins in "Good to Great"; for a successful team you need to get the right people on the bus, the wrong people off the bus, the right people in the right seats, and then only do you need to figure out where you are going.

Niche Products

My boss told me that selling general products to a general market isn't nearly as good as targeting & positioning specific products or a mix of products at a specific market. (He has also told me on another occasion that if he starts another company it will sell to the broader market...)

When deciding on a name for a company, if you are targeting a niche then it helps to have a descriptive name specific to that niche however if you are targeting a broad market then the name of your company could be random or abstract.

Consulting Tricks

When consulting or trying to sell your service, start off by asking a few probing questions about the topic to make them realise that they aren't equipped to handle it themselves/ that they know nothing about this topic/ that they are in trouble if they don't bring you in.
Also when someone is trying to sell themselves or something to you, be aware of this trick.

Home Ground Advantage

When dealing with a serious deal, you should make the other party come to see you at your offices. It makes them feel as if they are coming to see you to ask you something and gives you the psychological advantage.

Signs of Fraud

The signs that I have learnt to watch out for regarding fraud are:
• Invoicing and delivery addresses are different
• The e-mail address given is not for a business. E.g. it is a gmail account etc
• The phone number doesn't connect
• It is usually items that can be resold easily on the black market like camcorders etc
• They pay for courier delivery
• The credit card is addressed to a different country as the delivery address.
• You can check the risk status of the transaction on the secure site.

Conducting Meetings

At a dinner meeting I was having a conversation with and gent who was a very successful businessman from his hay day. When speaking about business he made it clear that he believes that learning how to conduct a meeting is one of the most important skills that a businessman can learn!
A few days earlier I had arranged a guy to come into our office to show us some new products in the market, I left the meeting room to go do some other stuff (which was quite urgent) but afterwards my bosses told me that if you arrange for someone to come in then it is your meeting to host as this person is your guest and so you need to take care of them from the second they walk in the door until they leave.

Turning an angry customer into a happy one

When one of my colleagues was confronted by probably the worst customer possible who was screaming down the phone at him, he stayed calm and promised to do his best to solve this guy’s issue. He laughed it off and said that if he could turn this guy into a happy customer than this guy would be a great source of referrals for the company as he would have a good story to dine out on. By the next day the guy had phoned us to say that everything was solved and apologised for being so rude. If you can turn a unhappy customer into a happy one then they will be loyal and refer more customers to you then just a regular happy customer.

Welcome to my Blog

Up till now I have always kept notes of important lessons that I have learnt in life, love and business. This blog will now be an online version of all of these notes from the past and all the new ones that I learn as I go forward on my way to the top!