John Linton ......easy to do as long as you're prepared to lose your family and friends and know your limitations.
I have been having an exchange of views with a long time business acquaintance about how best to approach the very small business market over the past ten days. His company is a long term, 20 plus years, supplier to small businesses (not data communications products) and he has a customer base of over 40,000 users in NSW whose average longevity is over ten years - an impressive performance over a very long time. We have, from time to time since Exetel was 'created' talked about 'joint ventures' but we have always agreed that it was not sensible as he had his hands more than full (and was making very good profits) from his relatively simple products and 'going to market' methods which have included the ability to undercut all competitors by very substantial margins from the day he 'opened for business' by using a then very new approach and being able to sustain it over all of that time.
From my, limited, experience it's unusual for any supplier of any product to build a sizable business and maintain a relatively large market share for such a significant length of time. However, obviously, it can be done without the aid of big marketing budgets or 'brand names' if you know what you're doing and work constantly to achieve what you set out to achieve. He has a database of almost 500,000 possible users of his products and uses a Philippines based call centre service (long before that approach became commonplace) to contact possible new customers as well as contacting his current customers to take orders for products (which are consumable so need constant replenishment). He developed the list in the simplest way possible - by initially using the Telstra Yellow Pages and then their various electronic replacements over the last two decades to 'canvass' for new business. He has never used advertising or any other form of marketing and his Sydney personnel are less than thirty to operate a $100 million a year or so business....he says the number of people he contacts for in the Philippines varies from 100 to 200 depending on a variety of circumstances.
I remember when he decided to start this venture with his wife as he worked with me at the time and had done for more than a few years. It seemed both risky and very mundane compared to what he had been doing for more than 20 years at that time but he had thought it through and he believed that it would be successful and though 'mundane' would allow him to achieve financial rewards far greater than he had achieved up to that time - he was more than right about that though I dimly remember that he had his very bad moments that cost him his marriage and most of his 'old' friends quite early in to his venture. However he fought his way through all bad times and has, for many years, succeeded far beyond his expectations.
Our recent email exchanges have returned to his newly rekindled desire to now offer his 40,000 customers and his over 400,000 'contacts' the sort of services that Exetel provides to agents and a few VISPs. Exetel is happy enough to seriously consider such a methodology but, as we discussed, it's a far cry from what he has done so successfully for so long. I doubt that we will actually find a way of him becoming an Exetel VISP but it has been an interesting exchange of views on successful ways to approach small businesses - I have learned a lot from his advice including his experiences of using Philippines based services and hopefully he has got something of value in return - if only a much more detailed understanding of the 'dangers' inherent in providing complex services to users with no real expertise in their use. My interest was and is to get access to his prospect data base at a reasonable price but those discussions will have to wait until he decides whether or not to enter the communications market using his own company.
It's heartening to see that a start up operation can win and keep a large share of a particular market by the simple methods, and excellence of execution, employed by someone whose major abilities are fortitude and hard work over an extended period of time - and always offering the lowest costs.
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