From The Editor's Desk
This month is my first as Editor of a newsletter that will have been an institution for a year, come the end of the month! I would like to say from the outset that Portia will be greatly missed, and being such a popular young lady, I have asked her to "freelance" from time to time. In the same breath, I would like to invite you, the reader (and our raison d'etre), to contribute towards the newsletter. Any success stories, tips or advice you would like to share are always welcome.
This month, October, marks the month of Breast Cancer Awareness. You may have heard mention of the "pink ribbon". The aim of Pink Ribbon International is to create a supportive community worldwide and to educate patients, specialists, families and friends about breast cancer.
During Breast Cancer Awareness Month, money is raised through various activities like theme parties or a "pink day". The money raised is donated to the organizers' choice of breast cancer care, or research programme.
A local interest story is that of twelve breast cancer survivors who are travelling through South Africa, sponsored by Harley-Davidson and Hummer, to raise awareness around the disease. These brave women are simultaneously raising funds to enable twelve other women to undergo reconstructive surgery - surgery they would otherwise not have been fortunate enough to receive. The ladies started their journey from Maponya Mall in Soweto on Saturday 11 October 2008. Follow their fabulous journey on www.journeyofhope.co.za.
In this month's edition of the newsletter
- The "Did You Know?" section will give you a quick business tour through the People's Republic of China.
- We interview Chris van der Merwe, Manager - Nedbank Business Banking.
- Our "How You Can Improve Your Business" section features useful guidelines on what you need to do to retain your customers using reward schemes.
- In "This Edition's Story" we are inspired by a self-made man, Sir Richard Branson.
- "Why Bother With Planning A Deal?" is the question posed by Kim Meredith in the "Guest Article" section on dealmaking.
As we hurtle through these last couple of months towards 2009, we have an unmissable offer for you to attend one of our life-changing programmes at the 2008 prices. Book now!
Enjoy the read - Julie Purkis
Did You Know?
Doing Business in the People's Republic of China
Our articles on conducting business with people of different cultures and countries have been so well received that we've decided to continue with the theme for a while longer. For this month's edition, I have chosen to take a quick look at China and the Chinese culture, what with this country having held the world's attention of late with the Olympics.
The People's Republic of China is well on its way to becoming the superpower of the twenty-first century. Aside from having the world's largest population and the planet's biggest army, it is a nuclear and space power. It has also become a global economic power.
The official national language is standard Chinese, based on the Mandarin dialect. It is spoken by more than seventy per cent of the population, but there are many different dialects. There is, however, only one common written language. Chinese movies often include Chinese sub-titles to help Cantonese speaking audiences understand the Mandarin-speaking actors, and vice versa. English is spoken by many business people.
Three key tips on doing business in China
- Experienced travellers avow that patience is the most important attribute needed. The Chinese are expert at figuring out when a foreigner is under pressure of a tight deadline and turning this to their advantage, particularly in negotiations.
- If possible, avoid travelling to China during the lunar New Year. Also called Spring Festival, this is China's most important nationwide, week-long holiday. Tradition demands that every Chinese person returns to his/her traditional home during this period. With so many migrants to the cities, this means that there are millions of trips taken by car, bus, train or plane over the festival.
- Did you know that the Chinese are avid sports fanatics? While most Chinese have limited experience of playing sport, they are enthusiastic fans - and sports gamblers. When Shanghai-born Yao Ming joined the Houston Rockets in 2002, Chinese interest in basketball soared overnight. The Beijing Olympics have, of course, also generated massive interest in sport. So, when in doubt as to what you should talk about with your Chinese hosts, sport is a safe bet. Avoid the subject of Tibet, unless you want to invoke their ire!
Extracted from "Kiss, Bow, or Shake Hands" by Terri Morrison and Wayne Conaway
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"The Real You" InterviewInterview with Chris van der Merwe
Manager - Nedbank Business Banking
The Dealmaker™ Graduate |
Although we recently featured the interview with Chris van der Walt, and this month we bring you the interview with Chris van der Merwe, we would appreciate no "Van" jokes!
1. When you were a child, what was your favourite toy? Why?
Any ball. It helped me to get rid of my energy and enabled me to dream.
2. When you were six, ten and 16, what were your dream jobs?
My dream was to become a professional sportsman.
3. What was your first job, and how much was your paycheck?
Nedbank trainee. R950 per month (about US$100).
4. In one sentence, describe your current job to a five year old
My job is to help other people do their job.
5. What has been the proudest moment of your life?
The birth of our children, but when they became teenagers, I started to have second thoughts!
6. What has been the most embarrassing moment of your life?
Too many people know about it already.
7. Where is the most interesting place you have ever visited? Why?
London, where we lived for a year. I guess the fact that it was our first time overseas might have something to do with it.
8. Tell us one thing that nobody knows about you
An extrovert with a secret?
9. What is the biggest lie you tell about yourself?
I guess pretending that I am not vulnerable.
10. If you were an animal, which animal would you be and why?
A Meerkat. Seems restless, playful and inquisitive.
11. What is the best advice a parent ever gave you?
Never say never, never say always.
12. What is the best advice a business mentor gave you?
It is not so much what you say, it is how you say it.
13. What do you do in your spare time to blow off steam or relax?
Play sport, enjoy music, or hang out with family and friends.
14. Your favourite gadget of the moment?
Sometimes my putter, other times my driver.
15. What is your pet dislike?
People who drive slow in the fast lane.
16. What would you like to be remembered for having achieved in your life?
- Having taken advantage of opportunities
- Having lived life to the full
- Having made a difference
17. How do you define 'networking' and do you feel it is important?
- A little help from my friends
- Not having to do it on your own
- You don't have all the answers
- A sound network certainly makes things easier.
18. Can you share one idea that someone could put into practice that would help them to improve their networking skills?
It helps if you are naturally outgoing and an optimist who enjoys other people's company. Be authentic, be fun and interesting to be around - and show interest in others. Also remember... nothing ventured, nothing gained!
Thanks so much for the insights, Chris. - JP
Tips On How You Can Improve Your Business: Reward Your Customers
Nowadays it's common knowledge that retaining customers can be up to 100% more profitable than acquiring new ones. Research indicates that it costs five times as much to find a new customer than to retain an existing one. Loyalty or Reward programmes are a great way to keep customers and grow their support.
Here are a few benefits your company could gain from a Loyalty or Reward programme:
- Increase profitability
- Improve customer loyalty and retention
- React to changes in customer demand
- Improve average customer spend
- Leverage off your investment in your database
- More predictable forecasting
Increase your profits
Instead of only focusing on customer acquisition, focus on retaining your current customers and increasing their sales. Know when a customer has stopped buying from you and have mechanisms in place to win them back.
The 80/20 rule
Pareto's Law - or the 80/20 rule - shows that 80% of your profit is probably derived from only 20% of your client base. Know who your top 20% are, devise a plan to focus on them, and you will increase your profit! Identify these customers via your database and through tracking their spending patterns and tendencies.
Buy more, more often
Once the top spenders have been identified, they need to be enticed to buy more frequently. Track their spending habits and be able to predict when they next require your products. Catch them before they go to your competitors. Your company will appear to be "on the ball" - and your sales will increase.
Increasing customer spend
Once your customers are buying more frequently, focus on getting them to buy more. They might be buying one product from you but getting others from your competition, blissfully unaware of your full product range. Identify a strategy to keep them well informed. Send out messages, or contact them personally, to tell them about your products.
Focused marketing
Once aware of customers' purchases, focus on marketing campaigns. If you're tracking customer spend, you will know if they have stopped buying from you. Contact them and entice them back. If they have relocated or closed, remove them from your database.
The customer is king!
You have heard the saying, "the customer is king", so treat them like royalty. All customers want to feel special. Make regular contact with your clients, and in so doing, you will build trust and customer loyalty.
Referrals
Word of mouth marketing is very powerful. A referral carries a stamp of approval from a trusted source. Leverage off this by asking existing clients to refer you to others. This way you can tap into other potential customers without spending one cent on advertising!
Identify the rough diamonds
With this in mind, don't ignore the other 80% or you'll run the risk of missing the "rough diamonds" amongst them. Spend some time trying to develop relationships with customers who show potential. Put in place a plan to entice them into the top 20%.
It does take energy and effort to focus on customer retention, but this investment will pay big dividends. Reward and Loyalty cards or points schemes help you to retain the customers you have so carefully cultivated.
An extract of an article by: Kevan McQuade, Director - Maxiclub.co.za
This Edition's Story - Sir Richard Branson
Richard Branson and his partners at Virgin aren't called "Mavericks in Paradise" without good reason. Branson owns not one, but two, tropical islands to prove it. Branson, a high school drop-out who advocates working and playing hard, believes in setting goals.
When Branson was at school and found reading and writing difficult, (dyslexia was mistaken for laziness in those days) he taught himself to learn things by heart. The outcome of this was that Branson's fine-tuned excellent memory turned out to be one of his greatest business tools.
Branson began his career at age fifteen when he started Student magazine. By age sixteen he had left school to work full time on the magazine - in the basement of his friend Jonny Gems' parents' London house. They landed interviews with the likes of John Lennon, Mick Jagger, Vanessa Redgrave and Dudley Moore. From this developed the selling of cut price records by mail order, which developed to the opening of a chain of record stores (Branson not yet twenty years old).
The best lesson Branson learned was to "just do it". (This also works for Nike). As Plato, the Greek philosopher, said "The beginning is the most important part of any work". A journey of a thousand miles starts with that first step.
Branson is known to staff at Virgin as "Dr Yes". He finds more reasons to do things, than not to do them, and his motto really is "Screw it - let's do it!"
Some wisdom from Branson:
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- Believe it can be done
- Have goals
- Live life to the full
- Never give up
- Prepare well
- Have faith in yourself
- Help each other |
Wise Words from Sir Richard Branson indeed.
Extracted from "Lessons in Life: Screw It, Let's Do It" by Richard Branson
Did you know?
The Branson School of Entrepreneurship was opened by CIDA City Campus in October 2006 and was the first such project to which Richard Branson lent his name. The School focuses on supporting entrepreneurs from financially disadvantaged backgrounds.
Guest Article
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Why Bother With Planning A Deal?
By Kim Meredith, Managing Director of Spectrum Solutions |
My previous articles on the subject of dealmaking have referred, more often than not, to the crucial subject of planning. In order to fully understand the impact of planning in doing deals, let's first step back and take a look at the big picture.
Before companies begin to achieve any degree of success, they need to plan their 'go-to-market' strategy. The same applies to individuals. Imagine you are planning to buy a new house. The critical factors you will consider will typically be price, area and size. You will then set about looking for the house and the negotiation follows. In the case of companies, this strategy can be depicted as follows:
Step 1: Business Strategy (eg: defined market, products, etc.)
Step 2: Sales Strategy (eg: 'go-to-market' through channel partners)
Step 3: Sales Tactics (eg: TAS, etc. or The Dealcloser™ process)
Step 4: Negotiation Strategy (eg: mandates, discount levels, etc.)
Step 5: Negotiation Tactics (eg: The Dealmaker™ process)
Step 6: Closed deals
If you had to draw a flow diagram for the steps to your new house, it would result in a model like the one above. You would define the price, location and size, and then you would decide whether to use an estate agent or not, and so on. Personal decisions are similar to those of businesses. For individuals and business alike, here is the alarming reality (extract from "Negotiation: Organizational Alignment of Strategy and Execution Process" by Brian J. Dietmeyer and Samuel R. Tepper (Think! Inc. 2002)):
- 4.8% of organizations have no formal sales strategy and 14.5% no step-by-step processes to execute that strategy but
- 82% of organizations have no formal negotiation strategy and 81% no step-by-step negotiation processes to execute strategy.
Why no negotiation strategy and tactics? Companies recognize that sales processes increase revenues but they don't seem to understand the impact poorly defined negotiation strategies and tactics have on profitability. Increasingly, professional buyers are thinking of negotiation as a process, whereas business and salespeople are still thinking of it as tactical. From an individual's perspective, poor negotiating strategies and tactics have a direct impact on your wealth!
Back to the house-buying example. Assume you have now defined the location, the price range you can afford and the size of house and garden you want. You understand that to get the large garden you need for your children and dogs, a cluster complex is not suitable so you need a stand-alone house. You have also decided to use estate agents as you do not have the time to deal with lots of different sellers. You now start looking for a house.
Your sales strategy and tactics could be along the lines of: as you are in no urgent hurry to buy, you will take a long term view of the market and watch which houses don't seem to be selling. You will wait for the seller to have (assumed) time pressures and then you will go in with a cheeky offer. Just as an aside, you can always increase an offer on a house - but you can almost never make it less!
Your negotiation strategy will be to start as low as possible, without putting yourself too far out of the ball park, and then move up if you have no choice. Your negotiating tactics will be that every time you have to increase an offer, you will ask for something to improve your deal - such as the seller leaves all their tennis racquets and balls behind for the tennis court, or they include the outdoor furniture, or whatever. You should, ideally, end up with a great house at a very good price - your reward for you for doing your "big picture" planning properly!
Before you rush out and start buying yourself a new house, there is another level of planning that needs to take place. Above I referred to a "ball park". We all seem to instinctively know what a ball park is, but how do you define it?
In our example, the ball park would be the highest price you are prepared to pay for a house vs the lowest offer the seller will accept. If you knew the seller's lowest price, that is where you would do the deal. If the seller knew your highest price, that is where he would want the deal to be done.
In the real world, very seldom do we know the other person's limits. So, the best we can do is guess these limits. Not very scientific, I know, but dealmaking is a large part art and only a little part science.
Determining the ball park takes time. You need to conduct research and give the matter considerable thought. In our example, you will need to know for what price similar houses in the area have sold, understand the market trends (eg: are house prices dropping because of a looming interest rate hike?) and the like.
You also need to decide the maximum you will pay for the house, the boundaries of the location you will consider, and the biggest vs smallest size the house and garden need to be. It is important to understand that it is only for your key issues - ie: the critical factors - that you will determine a ball park.
You then need to make a list of all the other items you might want to include in the deal - the seller's furniture and art, fixtures and fittings, plants in the garden and in pots, pool and garden toys, etc. This should be a very long list. The items on this list are commonly referred to as your negotiating, or trading, variables. Only once you are armed with a ball park for your key issues and your list of negotiating variables are you in a position to start negotiating!
You have probably realized that the planning part of any deal will take a lot longer than the face-to-face side of the transaction. Experts on the subject of planning believe you should invest anywhere between four and eight hours (depending on the complexity of the deal) for every hour of face-to-face time. Four hours planning for a one hour meeting or presentation is probably the very least you should invest!
When you do finally start negotiating, be sure to focus on your key issues. Do not get bogged down with your trading variables. What is the point of having them, you may then ask? Trading variables allow you to move, ie: be flexible, on your key issues while still getting something of value in return for your flexibility.
In our house example, the agent may ask you to improve your deal by R100,000. If you are prepared to do this, ie: the price is still in your ball park, do not just give in! If you give in, all you are teaching the seller is that if they keep pushing, you may improve your offer again.
If you are prepared to increase your offer then do so, attaching one of your negotiating variables to the move - say something like "if you are prepared to leave all the curtains in the house behind, I will increase my offer by R100,000" (assuming you want the curtains, of course!). If the seller is not willing to leave behind the curtains, dip into your list of variables and say "okay, if you leave the potted cycads behind". By now you are no doubt getting the picture!
So, before you enter into any deal, you need to do proper planning. Start with the big picture and then move on to the ball park and then the negotiating variables. Let the fun begin!
Kim Meredith, 16 March 2007
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Sneak Preview - Book Launch
"Work Diva: How To Climb The Corporate Ladder Without Losing Your Soul" by Kim Meredith will be published in January 2009.
All newsletter subscribers will be receiving an invitation to the book launch so WATCH THIS SPACE! |
The Dealmaker™ Programmes - SPECIAL OFFER for 2008
The Dealmaker Programmes Company has been able to hold the price of the courses for the last two years, but with the changes in the global economy, prices will be increased with effect from 01 January 2009. To avoid this, book for a 2009 course before 31 December 2008, and pay the 2008 price.
The Dealbuilder™ |
Venue |
18 & 19 March 2009 (Wed,Thurs) |
Johannesburg |
11 & 12 August 2009 (Tues,Wed) |
Johannesburg |
The Dealdiva™ - Women Only |
Venue |
25 & 26 Feb 2009 (Wed,Thurs) |
Johannesburg |
25 & 26 Mar 2009 (Wed,Thurs) |
Johannesburg |
1 & 2 July 2009 (Wed,Thurs) |
Johannesburg |
17 & 18 Sept 2009 (Thurs,Fri) |
Johannesburg |
The Dealcloser™ |
Venue |
11 & 12 Mar 2009 (Wed,Thurs) |
Johannesburg |
23 & 24 June 2009 (Tues,Wed) |
Johannesburg |
15 & 16 Sept 2009 (Tues,Wed) |
Johannesburg |
The Dealmaker™ |
Venue |
17 - 19 Feb 2009 (Tues-Thurs) |
Johannesburg |
17 - 19 Mar 2009 (Tues-Thurs) |
Johannesburg |
21 - 23 Apr 2009 (Tues-Thurs) |
Johannesburg |
12 - 14 May 2009 (Tues-Thurs) |
Cape Town |
9 - 11 June 2009 (Tues-Thurs) |
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21 - 23 July 2009 (Tues-Thurs) |
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18 - 20 Aug 2009 (Tues-Thurs) |
Durban |
8 - 10 Sept 2009 (Tues-Thurs) |
Johannesburg |
6 - 8 Oct 2009 (Tues-Thurs) |
Johannesburg |
3 - 5 Nov 2009 (Tues-Thurs) |
Johannesburg |
The Dealguru™ - Executives Only |
Venue |
22 & 23 April 2009 (Wed,Thurs) |
Johannesburg |
14 & 15 October 2009 (Wed,Thurs) |
Johannesburg |
All The Dealmaker™ programmes are guaranteed, high impact interventions for companies and individuals prepared to make the investment to achieve a significant shift in expert skills and behaviours. Why wait?
Please phone us on +27 11 440 0193, or email enquiries@thedealmaker.com to secure your place.
May your October be a healthy and rewarding one - Julie |
