Why are some businesses so successful. Understanding what makes some busi-nesses successful against all the odds.

Business glossary

10 hot marketing tips

Ideas to use the internet to grow your

business

What is globalization &

how it affects your

business

Finding your product niche

in a competitive market

WHAT IS THE FUNCTION OF YOUR BUSINESS?

Find the answer inside this issue

DIY ON YOUR BUSINESS Improving cash flow by managing expenses

ARE YOU MEETING YOUR CUSTOMERS EXPECTATIONS How to measure customer satisfaction

Expert advice, tips & ideas on how to start your own business and be successful

iNBusiness In Collaboration with Stellenbosch

Municipality & the Flying

Kites Foundation R5

Getting you into business today Keeping you in business tomorrow

ACCREDITED COURSE FOR ENTREPRENEURS

Self leadership.| Financial literacy Marketing for success Business behavoiurs

info@flyingkites.co.za www.flyingkites.co.za

R 500 or R1250 for 3 editions

Welcome to our first edition of INBUSINESS, the fortnightly magazine to help turn your dreams of your own business into reality.

Entrepreneurship is the key to growth and prosperity in our country and everybody has the chance to start and run their own business.

INBUSINESS is a source of information, tips and guidelines on all the important information you need to get your business up and running and stay in business.

All your questions asked and answered by experts and fellow entrepreneurs.

Lets get INBUSINESS

Page IN THIS ISSUE

3. Understanding how to manage your cash flow 4. Great marketing ideas for small business 4. Globalization & how it affects your business 5. Success stories 6. Essential communication tips 7. Understanding the essentials of competition 9. Key qualities of a successful entrepreneur 10. Understanding why your customers are your customers 11. Finding your product niche

Plus All the right questions you should ask about your business

Contact us inbusiness50@gmail.com

Flying Kites is a company that specializes in the development of entrepreneurship through leadership.

We put people into business by taking them through our accredited training programs.

This publication is an extension of our program, available to anybody, the magazine is designed to help you follow the essential steps in setting up your business. From developing an idea, turning that into a business, completing a SWOT & PEST analysis, to writing your business plan and securing funding. This publication is designed to become the

framework around which you start to build you business plan and become an entrepreneur

Tell us about your business idea

Do you have a business idea you think will work, email us and we will send you a few ideas on how to get started

A TRUE STORY

CLINTON SWARTZ is a quiet unas-suming guy, friendly and always happy to see you

In December 2010 he decided to follow his passion and open a small tour operator business because he say a gap in the market. There was nobody doing top quality tours of his area, Idas valley. He did some

research, spoke to a few experts in the industry and launched his business early in the new year.

He secured one client to start with, and although it wasn't the perfect job, it gave him access to the very competitive market and cash in his business. He started doing the very early morning transfers to the airport, (4.30am), not ideal and not what he had in mind but it brought him business. He figured if he picked them up from the airport then he would have first option to sell them a wine tour or a com-munity tour, and that what he did and it and it paid off.

Clint also made 100% sure he offered exceptional service and the guests he transported reported back to the guest houses how good he was and so he got more business, and he has developed a regular customer base, and his business has grown.

Well done Clint you are an inspiration it can be done against all odds

FINANCE

WHY BUSINESSES LOSE CUSTOMERS AND SUFFER CASH FLOW

PROBLEMS? 1% die 3% move 5% find a new product 9% stolen by competition 14% unhappy with product 68% unhappy with the service they get from the company and its employees.

NO CASHFLOW

Cash is king when it comes to the finan-cial management of a growing company. The lag between the time you have to pay your suppliers and employees and the time you collect from your custom-ers is the problem, and the solution is cash flow management. At its simplest, cash flow management means delaying outlays of cash as long as possible while encouraging anyone who owes you money to pay it as rapidly as possible.

ENTREPRENEUR ACTION Income Streams 1. Review your income streams and what your revenue is

from each one. 2. What time of the month do you receive your revenue? 3. Determine how much cash you have in hand over certain

times of the month and year. 1.___________________________________________________ _____________________________________________________ 2.___________________________________________________ _____________________________________________________ 3.___________________________________________________ _____________________________________________________ Payments 1. Review your payment expenses (fixed & variables) 2. What time of the month do most of your expenses occur? 3. Prioritise the expenses - when are you going to pay what? 1.___________________________________________________ ____________________________________________________ 2.___________________________________________________ _____________________________________________________ 3.___________________________________________________

Key Questions a successful entrepreneur would ask

1. Which income streams do I need to im-prove/ spend more time and energy on?

2. How do I need to manage my expenses better?

3. What costs do I need to reduce or re-move?

4. Is my income able to sustain my ex-penses?

5. When am I able to pay my accounts?

1. _______________________

2. _______________________

3. _______________________

4. _______________________

5. _______________________

6. _______________________

7. _______________________

8.________________________

9. _______________________

10 _______________________

11. ______________________

12 _______________________

13._______________________

14._______________________

15. _______________________

CASH FLOW MANAGEMENT EXCERCISE

R R

(A) (B)

CASH IN HAND R (A-B)

1. _______________________

2. _______________________

3. _______________________

4. _______________________

5. _______________________

6. _______________________

7. _______________________

8.________________________

9. _______________________

10 _______________________

11. ______________________

12 _______________________

13._______________________

14._______________________

15. _______________________

1. List all your income for the next 4 weeks

2. List al our expenses for the same period, starting with your fixed overheads first, then your variable ones.

3. Once you have subtracted the expenses from your income you will have a clear idea of cash flow for the period.

TIPS FOR EFFECTIVE CASH FLOW MANAGEMENT It is essential that an entrepreneur knows what his cash flow is at any moment in their business. Cash flow is the life blood of your business, without it you cannot trade. Be sure to guard your cash carefully. 1. Negotiate good terms with your suppliers 2. Try never to let your customers buy on credit (COD = Cash on delivery) 3. Insist on COD when providing a service. 4. Give an early settlement discount (10%) 5. Be sure to pay your fixed overheads first as you have little flexibility with them 6. If you are facing a cash flow problem be sure to communicate this with your suppliers, they

would rather see you through a tough time than let you fail and loose all their money. 7. If need be set up a payment plan, with your suppliers to show them in good faith you are go-

ing to get through the cash flow squeeze. 8. Always insist on a deposit before starting with a job or offering your services. 9. If you suspect you might incur additional costs that will effect your cash flow advise your cus-

tomers as soon as possible 10.Add value to encourage customers to pay on time.

Business Glossary

Accounts Payable - is the

function in an organisation

that pays the invoices to sup-

pliers. The accounts payable

department was also called

bought ledger or purchase

ledger because ledgers or

books were used before com-

puters were invented.

Accounts Receivable - is the

function in an organisation

that collects payment of sales

invoices from suppliers. The

accounts receivable depart-

ment was also known as the

sales ledger department be-

cause ledgers were used be-

fore computers were around.

Assets - Assets of a company

are items that are owned by

the company and could be ex-

changed for cash or something

else. Assets are typically bro-

ken down into fixed assets

such examples might be furni-

ture, equipment and premises

that have a useful life of more

than one year and current as-

sets such as stock or a bank ac-

count that are more liquid and

can be turned into ready cash

faster.

Break even - to emerge from a

transaction with neither a

profit nor a loss

WHAT ARE YOU TAKING TO MARKET?

No matter if you are an entrepreneur or an employee, so many people don’t know what they are selling! They don’t know what their product is!

Think about these examples, Nando’s adverts mention selling chicken only at the very end, one famous one shows Rob Mugabe playing with his friends and having fun; City Lodge sells humour; Vodacom sells connectivity with Gogo and so forth. If Toyota ‘sold cars’ they would loose hands down to all the other cheaper cars out there, they sell ’an experience, safety, reliability and satisfying the ego’!

So ’what are you taking to market’? What makes you stand out amongst the growing competition? Why must the market buy ‘YOU’?

An entrepreneur needs to have a detailed knowledge of their product: Features Benefits PRODUCT KNOWLEDGE IS POWER! BUILDING RELATIONSHIPS IS THE COMPETI-TIVE ADVANTAGE!

Product knowledge results in ... 1. Strengthening of confidence - having a positive self image and confidence

in the product adds great value to marketing a product and securing the sale.

2. Strengthening of communication skills - a thorough understanding of the product enables the entrepreneur to use different techniques and meth-ods when interacting with the customer. Improved communication skills allows entrepreneur to recognize and adapt the presentation for diverse situations and customers.

3. Strengthening of passion - the best selling tool is passion! An enthusiastic entrepreneur can sell sand to a Namibian! He/ she needs to truly believe in the product and strive to identify the customer’s needs/ wants. Listen to the voice of the customer!

4. Strengthening of ability to change challenges into opportunities - know-ing the product inside out helps in countering objection’s and queries.

Successful entrepreneurs know the competitor's products and operations. However, never try and get cheap mileage out of pulling the competitor down! How to gain Product Knowledge? Use the product - explore! Research it Be trained in it Listen to customer feedback Learn the market

Go and explore…… How is the product made? What is the value of the product? How should the product be used? What are the other uses? What works well with the product?

HAVE YOUR PRODUCT CONCEPT CHALLENGED! If you want to improve or test your product and take it to the next level, let Flying Kites Business incubator be your challenger! Submit your Product idea using the e-mail address: nic@flyingkites.co.za The best Product will win R 300.00!

ENTREPRENURIAL COMMUNICATION

SKILLS Saying ‘no’ with style!

For many of us, the most challenging assertive skill is to be able to say, ‘no’ when the situation requires it. We often feel we may loose respect, love or responsibility at work when we say ‘no’. Quite often it is very difficult to say ‘no’ to some people. Following the guide-lines below, one might be a step closer to being able to say ‘no’ with

grace and tact:

be honest and direct | don’t make excuses | remember that saying

‘no’ shows self-respect.

Sometimes assertiveness gets a bad name, because people confuse it with aggressiveness. But if there were a yardstick to measure human behaviour, assertiveness would fall in the middle, with passiveness at

one end and aggressiveness at the other.

Perceptions around passive, assertive and aggressive people: Passive People Have difficulty saying no Do what others ask, even if they need to compromise, or inconven-

ient Get ‘stepped on’ a lot. No boundaries Talk softly - don’t stand up for their rights. Not sure of rights Do anything to avoid conflict Are taken advantage of. They get resentful but don’t tell anyone Aggressive People Are loud Can be bossy and pushy Like to get their way, no matter what React instantly Like to get even - believe that winning is everything Don’t care about feelings Often use aggression to cover up insecurity - ‘not so ok feelings’

Assertive People Are firm and direct Don’t blame others, but take responsibility for their own

feelings Concentrate on the present Can express their needs and feelings calmly and easily Are confident about who they are Speak firmly and make eye contact Respect other’s rights and expect the same in return

There are few people who are exactly in the middle. We can all benefit from con-sciously practicing assertive behaviour. Very passive and very aggressive people often have an underlying lack of self-esteem. If you see your-self as usually at one of the extremes, you may want to explore self-esteem further. Self-assertiveness is being confident about what you want and need and being able to communicate this ef-fectively. This behaviour il-lustrates your own worth and what you value without having a negative impact on those around you. It enables you to control the manner in which you would like to reach your goals and live your life without any detri-ment to other people.

ENTREPRENEUR ACTION: GROWING SELF AWARENESS

1. Think of someone who really brought out the best in you. Describe the person’s behaviour, abilities, skills

and style.

2. What was the best part they brought out in you? How did you behave/ feel?

3. Now think of someone who brought out the worst in you. Describe the person’s behaviour, abilities, skills

and style.

4. What was the worst part that they brought out? How did you behave/ feel?

People do not and should not control your emotional state. As far as possible, the behaviour of others should not impose on your wellbeing.

FIVE FORCES OF COMPETITION explain the attractiveness and profitability of a company. They include 1. Threat of New Competitors/ Entrants can raise the level of com-petition, thereby reduce its attractiveness. The threat of new en-trants largely depend on the barriers of entry. High barriers e.g. shipbuilding; low barriers are easy to enter e.g. hair salon/ fruit & veg store/ tour guides/ etc. Key barriers: 1. economies of scale 2. capital/ investment requirements 3. customer switching costs 4. ac-cess to industry distribution channels 5. retaliation from existing players. 2. Threat of Substitutes – substitute products can lower industry at-tractiveness & profitability as they limit price levels, e.g. Chinese clothing, imitation brands, etc. They depend on: 1. Buyers’ willing-ness to substitute 2. Relative price & performance of substitute 3.

The cost of switching to substitute. 3. Bargaining Power of Suppliers – suppliers are the businesses that supply material & other products into the industry, e.g. foodstuffs, cabling, material, fuel, etc. Costs can have significant impact on businesses’ profitability. If suppliers have high bargaining power over a company, then in theory the company’s industry is less attractive. Bargaining power of suppliers will be high when: 1. Many buyers and a few dominant suppliers 2. Undifferentiated, highly valued prod-ucts 3. Suppliers threaten to integrate 4. Buyers do not threaten to integrate backwards into suppliers 5. Price fixing 6. Buyer is not a key customer.

UNDERSTANDING COMPETITION

4. Bargaining Power of Buyers – these are the people and organizations that create the demand. Their bargaining power is great when:1. There are few dominant buy-ers and many sellers 2. Products are standardized 3. Buyers threaten to integrate against the industry 4. Suppliers don’t threaten to integrate 5. Industry is not a key supplying group for buyers. 5. Intensity of Rivalry between competitors depends on when there are many small or equally sized competitors. Rivalry is less when an industry has a clear market leader. Questions an entrepreneur would ask 1. What level of competition am I playing in? 2. Which forces of competition are a challenge to my business? 3. How am I overcoming the above identified challenges? 4. What challenges may arise in the future that I need to consider now 5. Where are my competitors pitching themselves.

YOUNG ENTREPRENEUS Research has shown that by nature most children are entrepreneurial, they will take a risk ad try something. As a parent this is an ideal opportunity. This makes for an ideal opportunity for you to encourage that spirit in your child. A few pointers from research done around the world 1. Ensure they look for ideas that relate to what they are naturally good at. If they are sporty

then encourage them to hold a small sports competition. 2. Encourage them to do research before they start, this is essential to long term success, it

also saves the from reinventing the wheel 3. Look for the Gap, encourage your children to see what other children are wanting to buy of

do, copying others is not entrepreneurial, if they can find something novel to sell they will have a market.

4. Add value, key to any business sense is adding value to a raw material, it often makes for a more profitable business, homemade lemonade is a good example of this.

5. Asses results, key to success is being able to reflect on what went well and what didn't work so you can do it better next time.

Ideas: Ideas: Home made lemonade is winner Selling frozen suckers with cool drink in them Condense milk syringes Hosting a 5 aside sports tournament Walking people dogs Selling packets of sweets. Helping others with homework Running errands Washing cars Growing fresh vegetables

1. DRIVEN TO SUCCEED = Goal orientated, sets a goal ad goes after it.

2. CLEAR VISION = Knows and understand where they want to be in the future.

3. SELF LEADERSHIP = Takes ownership, accountability for actions & has a positive influence

4. POSSITIVE SELF IMAGE = Assertive behaviours when needed.

5. INNOVATIVE = Constantly looking for new ways of doing things and improvement.

6. COMFORTABLE WITH CHANGE = Agile and dynamic, can adapt quickly to new events

7. COMPETATIVE = Sets high standards and constantly maintains them

8. SELF MOTIVATED & PASSIONATE = Embraces life and all it has to offer, sees opportunity

9. FEEDBACK = seeks positive criticism so as to always improve and develop

QUALITIES OF AN ENTREPRENEUR

WORDSEARCH for young entrepreneurs! Find and circle the 15 listed words in the Wordsearch. The words can be horizon-tal, vertical and diagonal. The words selected are all important when becoming an entrepre-neur. Post your completed Wordsearch to 24 Den-nerand Road, Stellen-bosch, 7600 with your full name and contact number and WIN R 50.00!!

A B C T D B E F G S H

K J S Y N E R G Y E I

L O M N O H P Q R R S

C A Z M Y V E X V V T

U O A B O I L L C I D

S E O G W O A F P C E

T H I P N U I J K E L

O U Q R E R C P O N M

M V X O R R N A X Y V

E Z A D S B A T C D I

R R B U H U N T N O S

S Q C C I X I I I G I

A Z D T P Z F T M O O

Q U A L I T Y U M G N

X X E U L E A D E R H

E O F S U C C E S S Q

Entrepreneurs choose a level of personal, professional or financial risk to pursue op-portunity. They take possession of a new enterprise, venture or idea and assume significant accountability for the inherent risks and the outcome. Entrepreneurs tend to identify a market opportunity and exploit it by organizing their resources ef-fectively with an outcome that changes existing interactions within a given sector.

Business owners usually start a business which is low risk, low reward and try to build it into a successful business. Business owners usually develop a differ-ent business plan right from the word go. They like to play it safer than an entre-preneur would, much safer. By the very nature of the entrepreneur definition, there are fewer true entrepreneurs and many more business people out there.

PRODUCT

SUCCESS

ATTITUDE

BEHAVIOUR

FINANCIAL

SERVICE

LEADER

QUALITY

OWNERSHIP

VISION

CUSTOMERS

TEAM

SYNERGY

COOPERA-

TION

HELP

Questions an entrepreneur should ask

1.What are my customer’s expectations?

2.What are my customer’s needs?

3.What are my customer’s perceptions about my business?

4.What gaps exists between what my business offers (service) and what my customers receive?

5.What are the common problems that customers keep complaining about?

Do you know why your customer is your

customer ?

IN OUR NEXT EDITION WE WILL BE HIGHLIGHTING HOW TO DESIGN A CUS-TOMER FEEDBACK FORM

1. Most businesses do not know why their customers are their customers. To be suc-cessful you need to be sure you are meeting their needs.

2. Price, availability and quality are the reasons most businesses give for their custom-ers remaining loyal to them, but research says differently. The reality is that most consumers can get your product or something of similar quality and price from your competitors.

3. Successful marketing ensures that your customers remain loyal to you because they believe in why you are in business, buying from you proves to them what they be-lieve in.

4. Successful businesses remain successful because their customers believe in WHY they are in business

5. Service is the key ingredient to long term success in your business. Understanding what your customers want and how to best meet their needs.

Successful entrepreneurs are those who have defined their niche market. They have a clear picture of whom it is they are marketing to. Entrepreneurs who are unsure, waiver or keep changing their focus often fear they narrowing their sales or possibly cutting poten-tial profits. The truth is, a niche market defines who you are marketing to, it focuses your energy and where your investment needs to be spent. When planning a marketing strategy, especially using the internet a very well-defined niche market plan needs to be in place. Defining your niche market before you start any marketing strategy is critical for the fol-lowing 5 reasons: 1. You have the ability to maximize your marketing budget by targeting your defined niche

market. You'll know exactly where and how to advertise. 2. If/ when you have a website it can then be optimized for search engines so that your

niche market can easily find you and you are able to cater your website to your niche market. You can develop your site to guide your viewers and help them find solutions or products that you offer.

3. You know exactly where to position your product/s, what terminology to use and what tastes to cater for.

4. A well-defined niche market makes it easier to develop ideas for new products or ser-vices that inherently appeal to your specific niche.

5. You have an upper-hand in establishing yourself as a leader in your industry.

Questions an entrepreneur should ask 1. Who is my target audience? 2. What is it that my current clients have in common? 1. Am I focusing my energy & resources in the most effective manner? 2. Does my target audience need my product? 3. Are they able to afford my product and sustain the growth of my business? 4. What is different about my services or products that I offer? 5. What are the ‘extras’ that I bring to the market?

Once these have been answered, analyse the answers and reflect on your niche market. Make a decision, get out there and ‘just do it

FINDING YOUR BUSINESS NICHE

BUSINESS INCUBATOR Ideas to start a business

INFORMATION STORAGE- is essential to the success of any busi-ness. Safe storage of information is often overlooked by small busi-nesses. Information is seldom backed up onto CD or external hard drives in case of a virus or theft of a computer. To offer support to sme’s to protect and safely store their information you need a com-puter, and an external hard drive R4500 set up cost.

ADMINISTRATION - People hate admin, but its an essential fact of life, every household has to keep track of its expenses and very few peope are able to do this accurately. They would welcome the chance to get somebody else to take care of all the hassle.

DOG WALKING SERVICE- People love their animals and will do al-most anything to keep them happy and fit. We live such busy lives nobody has time. There is an opportunity fr somebody who loves animals to offer a quality dog walking service, the wine lands has the natural surroundings to make it easy.

For more info mail us on inbusiness50@gmail.com

“NO IS NOT THE END OF NEGOTIATION, IT’S THE

BEGINNING”

Specialist mentoring for young

professionals

Effective planning for long term

career success

info@futureindefinite.co.za

Future indefinite

Communication Negotiation Leadership Self Esteem Self Confidence Vision& Values

R650 or R1500 for 3 editions