Start Your Own Business Training Programme An Ghláisigh, Doirí Beaga, Leitir Ceanainn, Co Dun na nGall Start Your Own Business Training Programme 1

The Schedule 6 Modules, 6.30 – 9.30 pm + 1 Individual Mentoring Session re Business Plan Development Module 1 Introduction to Business Planning and Self Assessment Module 2 Product and Market Research Module 3 Marketing and the Small Business Module 4 Sales and Sales Planning Module 5 Legal Issues and Managing People Module 6 Finance and Bookkeeping – Sourcing Finance 2

Additional Information/Articles/Templates Supports and Resources Work Books Additional Information/Articles/Templates E-mail Support Riona – riona@trainingpeople.biz Joe – joe@trainingpeople.biz Dedicated Course Website Presentations and additional support materials 3

Username: mcebsyob17a Password: mcebSYOB17*@ Dedicated Course Website www.moodle.mccormackassociates.org.uk Username: mcebsyob17a Password: mcebSYOB17*@ 4

The pre start-up phase…… Social Media €uro? Suppliers Marketing Website Bank? Premises Sources of finance Register name? Staff Suppliers Revenue compliance

The pre start-up phase…… Is the opportunity a “one off?” On my own or with others Is the return worth the effort? Is it practical? Is it sustainable and viable?

€ Is it….. Practical? Feasible? Resource intensive? Right Skills? The pre start-up phase…… Is it….. Practical? Feasible? Resource intensive? Right Skills? Right Location? €

The key is in the Business Planning Process Sales forecasting methods The key is in the Business Planning Process and in the Cash Flow Forecast…… 8

Benefits of financial planning Determines financial viability Helps make informed business decisions Identifies funding needs Improves chances of success Reduces risk Sets financial objectives and targets Businesses don’t fail because they are bad businesses They fail because they run out of cash!

Cash flow forecasts What is a cash flow forecast? A projection of when, and how much money will be received and paid out of a business, usually over a 12 month period – Actual money in and money out Purpose Assess financial viability Support applications for funding Identify the timing of cash shortages and surpluses Plan expenditure Monitor the cash flow Enhance the planning process N.B. One of the single most common causes of business failure = Running out of cash 10

Your Profit Overview of business finance Sales Funding Variable costs Fixed costs Capital costs Financial planning Managing finances Your Profit

Your Profit Business Costs Business costs Sales Funding Variable costs Businesses don’t fail because they are bad businesses They fail because they run out of cash! Business Costs Business costs Sales Funding Variable costs Directly related to output Fixed costs Do not vary with output Capital costs Tangible fixed assets e.g. equipment Your Profit

Sales forecasting needs a structured approach Here’s the trick! Sales forecasting needs a structured approach CAPITAL COSTS: How much will it cost to set the business up? One off costs – equipment – starting stock – working capital The amount you borrow to cover these costs will affect your FIXED COSTS FIXED COSTS: Work out on a monthly basis across a full year Recurring costs Easy to forecast – energy, utilities, broadband This should include what you pay yourself and wages for others Include estimated loan requirements if required VARIABLE COSTS: The more business you do, the more these will vary TOTAL THESE TWO COSTS = RUNNING COSTS FOR ONE YEAR

Sales forecasting needs a structured approach Here’s the trick! Sales forecasting needs a structured approach Here’s an example… You have a business selling Mars Bars? Total running costs = €80,000 Cost of a Mars Bar €0.50c You sell a Mars Bar at €1.00 Your margin on the sale €0.50c Therefore you need to sell 160,000 Mars Bars to cover all your costs - €80.000 but there’s no profit! Sell 200,000 Mars Bars and you cover your costs and make €20,000 profit!

So, how much an hour do you charge for your services? Here’s the trick! Sales forecasting needs a structured approach Here’s an example… You have a business selling a service – vehicle repairs Total running costs = €40,000 Total hours available to do business = 1,000 hours per year Hourly rate = €40 per hour to cover all your costs - but there’s no profit! So, how much an hour do you charge for your services? Discuss

Sales forecasting needs a structured approach Here’s the trick! Sales forecasting needs a structured approach So how do I find customers that will pay for my services – or buy my Mars Bars! Market Research Will people buy it? Who will buy it? What is demand likely to be? How much will people pay for it?

Sales forecasting – some considerations Technology VHS, DVD, Blueray, Digital cameras, Newspapers, Disruptive technologies – Kodi, SKYPE Competitors Local? On-Line Anywhere External factors Political, Economic, Socio-cultural, Technological, Environmental and Legal (PESTEL) factors such as oil prices, seasonal trends, interest rates, legislation, political and health issues will all have an impact. BREXIT How do the economic climate and other external factors impact on your business and on your customers' attitudes? Capacity Make sure that the sales forecast is within the limits of your capacity to produce your product or deliver your service. 17

Selling price x number of units Sales forecasting methods Resource based forecasting Selling price x number of units Market based forecasting Number of customers x average expenditure Value based forecasting Estimating breakeven sales 18

Introduction to prospecting and sales

You’re a good neighbour You know your stuff Why should I do business with you? You’re a nice person You’re cheap You’re a good neighbour You know your stuff I’ve known you since school days We played on the same team Your product is good I can rely on you 20

You’re a good neighbour You know your stuff Why should I do business with you? You’re a nice person You’re cheap You’re a good neighbour You know your stuff I’ve known you since school days We played on the same team Your product is good I can rely on you Perhaps one or all of these……. If you can solve a problem for me at a reasonable cost then I’ll do business with you! 21

Product/service - factors to consider Purchasing decisions and psychology? Product/service - factors to consider Google: Maslow's Hierarchy Of Needs 22

Sales and the Sales Process business to business (B2B), business to consumer (B2C) consumer to consumer (C2C) One to one basis selling components or ingredients to a manufacturer Traditional retail or on-line retail Individual people sell to other individuals through classified ads in newspapers or other means of advertising. C2C trade is rising thanks to websites such as eBay.

Sales and the Sales Process Sales Funnel Sales is a numbers game: You have to look at what your monthly, quarterly and annual sales targets are You need to look at what your average sale is in revenue and margin You need to look at what your average sales lead time is You need to look at your ratio of calls to conversion are Then you put a figure on the number of potential prospects that you have to start with What’s a CRM?

Stepping out of your comfort zone Lack of preparation Selling What are the Blockers? Fear! Lack of confidence Lack of time Lack of focus Stepping out of your comfort zone Lack of preparation Perceptions - selling as a business skill 25

Internal Sources: Personal Contact: External Sources: Prospecting Enquiries to advertising Phone/mail enquiries Internet enquiries Customer records Personal Contact: Business contacts Social networks Formal networks Networking Word of mouth Personal observation Cold canvassing Trade shows Conferences Sales seminars Look for the MAN Money Authority Need External Sources: Following leads Referrals/introductions Community contact Other organisations Networks Newspaper Directories 10

Sales and the Sales Process Structure of a sales engagement Opening the sale The diagnostic process Body of the sale Closing the sale

Sales and the Sales Process Who What Where When How Why Diagnose the problem that you can solve or prevent happening again at the right price and at the right time, then you’ve got a sale!

Sales and the Sales Process Once the problem is diagnosed…. The opportunity exists to SELL the fix!

Sell the benefits – not the features! 30

Features Advantage Benefit Sell the benefits – not the features! 1 Gb Memory Rechargeable PC Compatible Features Advantage Portable Pocket friendly Focus of sales pitch Benefit Can store up to 5,000 tunes 31

Requesting names of other customers Commenting positively Buying signals Requesting a sample Requesting names of other customers Commenting positively Indicating problems with previous vendors Asking specific questions re: price, features, availability, options Negotiating 32

Sales and the Sales Process With What Can I Bargain? Price Service Terms Conditions Model / Colour Discount Delivery Continuity Etc Negotiation skills are not the same as splitting the difference

Why Objections Occur Disbelief/not convinced Budget/money issues Satisfaction with a competitive product Previous negative experience Fear of making the wrong decision Misunderstanding

Handling Objections Prepare responses in advance Listen to the objection Check you have understood the objection Answer the objection Advance the sale

Alternative choice close Direct request close Fear close Closing methods Assumptive close Alternative choice close Direct request close Fear close Small decision close 36

Traits of a good salesperson Sales and the Sales Process Outgoing Personality Ambitious Confident Educated Good Product Knowledge Enthusiastic Traits Of a Good Salesperson Traits of a good salesperson 37

Sales and the Sales Process Listen!

Selling online REMEMBER! Transaction is governed by the laws of the country where the server is located 39

Selling online Technical Domain registration .ie, .com, Blacknight.ie Broadband, Hosting, mail server services Choosing an e-commerce platform that suits your business Wordpress, BigCommerce, PDPlumbing example Getting Paid Currencies, embedded systems – PayPal eMerchant accounts, payment validation systems Design and Functionality Functional specification? Brochure, dynamic or transactional – or hybrid This is an example Not an endorsement

Selling online We need the right tools and skills for the job in hand Skills and Resources Audit IT and Broadband Resources Data set manipulation skills – Excel, CSV files, Manipulation of digital images – PowerPoint, Photoshop, Gimp

Selling online Marketing the site – Social Media Facebook and Twitter in a business context LinkedIn Profiles, Search Engine Optimisation Photography – image manipulation Making your product look good Photoshop, GIMP, Powerpoint Lighting and background Site Statistics – Analytics Google Analytics, BigCommerce – traffic analysis Site Management Big responsibility, could be full time, Who? How?

Selling online - factors to consider Costs Payment processing Security Legal issues Ordering Data protection Factors Tracking Marketing Delivery Exchange rates Returns 45

Product specific e.g. alcohol, tobacco Selling and the law Product specific e.g. alcohol, tobacco Distance Selling Regulations - Good Starting Point http://pages.ebay.ie/businesscentre/law-policies.html Data Protection Act Sale of Goods and Supply of Services Acts Consumer Safety Act Labelling Regulations Food Safety Act Consumer Protection Legislation 46

Start Your Own Business Training Programme An Ghláisigh, Doirí Beaga, Leitir Ceanainn, Co Dun na nGall Start Your Own Business Training Programme 47