Ten tips for a successful business development process continued...
Business Development Process – An entrepreneur has identified the business Development Process he or she wanted to start and raised the capital. After due registration and identifying the premises, one starts the operations. Running and sustaining a business is as difficult as starting one. For a Development Process, every day is a challenge that has to be tackled and hence needs to have strategies in place to keep going.
This Are Not A Business Development And Marketing Or Sales
Companies or entrepreneurs have a tendency to equate sales promotion activity with business development activity. Both are different- business development meaning is the macro picture while sales are the micro part of it. business development and marketing development encompasses all the efforts to grow the business to a new level.
As in economic theory, normal supply-demand dynamics works if the output is not varied much so that quantity sold will be fall somewhere on the supply-demand curve. However, if the demand curve has to be a shift to the right then more consumers have entered the market creating the huge demand for the product. Likewise, salesmen for a particular product are more focused on achieving better sales in a chosen territory and distributor network. However, the business development and marketing team may work on creating new tie-ups, business partnerships, develop customized products for markets or start a new manufacturing activity in a farther region not accessible easily from the headquarters.
Maintain good relations with government and regulatory authorities
Any business cannot survive without the assistance and support provided by the state and federal governments. Many state government aggressively woo entrepreneurs to invest more in start-up or incubation facilities or invite large and medium scale businessmen by providing subsidized electricity, an infrastructure facility, tax concessions and so on.
Sometimes land at a very low lease or rent is provided to large investors so that their manufacturing activity generates more employment and business activity in the region. This, in turn, leads to better tax collection and revenue for the government. This, in turn, helps them to carry out citizen friendly services such as roads, hospitals, parks, and cleaning public places.
A business institution may have to deal with a plethora of government and semi-government agencies related to taxes, environmental clearance, fire, safety, labor among others. Tax evasion is not ethical or advisable but tax avoidance or reducing the incidence of taxation as per investment schemes suggested by the government can be opted to be seen as a good corporate citizen. Many entrepreneurs come into the limelight when they have declared the highest taxpayers of the year.
Get in touch with clients and customers
Unlike product companies, those providing service and turnkey solutions need to constantly engage with clients to understand their requirements and feedback. Otherwise, the company may be perceived as only bothered about gaining Business Development Process and not interested in building relationships. Contacts can be maintained through personal visits, phone calls, email and social media platforms.
If the company has an expertise in the field of operations, providing free advice, updating clients on best business practices and they can be invited to attend workshops and presentations by experts.
In business-to-business (B2B), it is very important to be in touch with top decision makers in the target company as there is no idea which team or group may be taking the purchase decision. It could b procurement, product management, engineering, business development team or any other hidden personality in the organization.
Using the fear strategy
Most often the best strategy to close a deal will be to sell on ‘fear’ strategy. If you don’t take this offer the competitor might take and gain in the marketplace. The company could set an artificial deadline stating that the client could miss out on a fast-approaching high-visibility opportunity (conference, big announcement, deal) and that a competitor is already in the arena and they are likely to miss the trend. Or a particular offer that closes by the end of the month and the possibility of a high increase in cost
thereafter, all these strategies may be adapted to close deals in the case of companies that have a tendency to postpone decisions despite the fact that they are convinced about the requirement of the product or service.
Seeking legal counsel, make deals carefully
A company may have to tie-up for marketing, outsourcing their requirements and a variety of other services related to Business Development Process development. If it is a joint-venture (JV)deal to create and market a product or service make sure the deals are right. A legal counsel may be required to scrutinize the documents and some background check of the partners in the deal may be warranted. There should be a proper checking of the track record in honoring commitments and promises.
Many companies have been weighed down by a bad deal and later regret it. This will lead to loss of market share and fall in shareholder returns. Some companies expand through franchise networks and here to caution should be exercised identifying financially sound entrepreneurs with exposure to the domain and previous track record in doing Business Development Process or exceptional career record.
Business Development Process development is a continuing exercise for a company irrespective of how old or its position in the industry vis-à-vis other competitors. A company needs to diversify its operations in due course as their core product market could become saturated not enabling the company to grow. It may have to take the risk of charting into a new territory with accrued reserves and some financial support from outside.
A good mix of debt and equity are resorted to by companies to grow. However, shareholder value is perceived by the investors on a variety of parameters and also market timing is important in the case of public issues and rights issues. If the market is in a recessionary mode, there may not be many takers for the shares issued or in case of falling interest rates, the debt could be a good option if the company sees a good revenue model for its new projects. Ultimately, it boils down to the vision the promoters have about the company, not for the short term but 10 or twenty years down the line. It will have a bearing on all the initiative that they take now.