Ask A Mentor Series with Ikechukwu Kalu

1. How do we steer demand, viz a viz growing livestock and cost of feeding?

You need to market your products in a cost-effective manner. I believe your question relates to promotion. You want to steer up demand viz a viz growing livestock and cost of feeding. You need to create quality awareness for your products. You know who you are targeting but they do not know about your products. You must place information about your products out for them to know.

You need to brand your business so it is easily recognisable and products can sell faster. You will need to put your brand out there through promotion.

In these post COVID-19 times, you will need some quick strategies. You must maximise the opportunities the internet provides:

1. Tell your story on social media, amongst your community of friends.

2. Do you have a website? You need one.

3. Make some fliers and share them to your target audience

4. Look for opportunities to tell people what you do. e.g. Trade fairs. Local events

5. Ensure your price is good compared to others in the market and that could be a selling point.

6. Make sure your customer service is great. Think of better ways to interact with your customers. It will make them come again and recommend you to friends, family and associates. A satisfied customer will refer people to you - word of mouth campaign.

7. Focus on delivering value. Look for ways to ensure your customers feels they are getting value.

At the end of the day, there is a cost to doing all these things. However, there will also be better returns. Start with what you can afford now and take it one step at a time.

2. The reduction in passengers boarding my bus will affect my income, how do I deal with this?

I know that transport fares have gone up a bit. It may be difficult for you to charge a fee that is a little higher than normal but that would be your first option to cover the cost, if it is possible.

Secondly, you may have to work longer hours as may be possible within the curfew time slots government has given.  Finally, manage your overhead costs - cut down on any unnecessary costs to ensure you still make an appreciable revenue at the end of the day. It is unfortunate that things are this way. These are trying times but find comfort and hope that this season will pass.

3. I have a red flag on my name at the credit bureau due to my loan not performing, this is making the business not attractive to other credit facilities? what's the best way to restructure the bad loan, get a fresh loan and protect the business from future lockdown? The business is still in operation.

I am glad to hear that the business is still in operation. This means that you still have capacity to pay back the loans.

• Firstly, you need to deal with the challenges that led to your inability to service your loan. What went wrong? To what extent did you service the loan, 10%, 20%. It could be anything from marketing, sales, customer service, bookkeeping to corporate governance etc. Where did you overspend or where did your projections fail? The problem needs to be fixed. You need to do something to show that you understand what the problem was and that you are making some effort to sort it out.
• Are your books up to date? You need to make sure they are.
• Once the two issues mentioned above have been addressed, you can leverage this appeal to your bank or creditor to reschedule the loan, i.e. give you more time to pay.
• Red flag on your credit rating is a bad case, but I believe your creditor would restructure the loan if you show a convincing plan for recovery. That is what Points 1 and 2 are all about, showing the bank or creditor that you have put structures in place to ensure you can pay back the loan.
• Another option is to find another creditor to buy over the loan. They will also require assurance on your part that your business structures will ensure the repayment of the loan. They would be looking to see something in your business plan that would convince them there would be cash flow that can handle the repayment.
• Finally, you can offer current creditor equity share in your business. This would mean selling off a part of your ownership to them. This would be the last option.
• Most important is that you are paying something back in a scheduled plan. And that you meet your end of the obligation as at when due. Keep your end of the bargain.

4. How will my disinfectant products sell in this COVID-19 time?

"You need to market your products in a cost-effective manner. Marketing is the process of anticipating, identifying, and satisfying customer needs at a profit. In Marketing, we have what we call the 4Ps of Marketing? They help us create the products and services that will most likely be attractive to customers. These 4Ps are Product (what you are selling), Price (Cost of the product), Promotion (Telling potential and current customers about the product) and Place (Where to get the product). We develop a Marketing Mix where the 4Ps are put together in a combination that works for the product, it will most likely do well in the market.

Now to your disinfectant, this is a great time to bring such a product into the market. However, you must ask pertinent questions.

• What is the quality of your product compared to others in the market? We have both local and foreign ones. How does your product compare?
• What is your packaging like? Does your product look good to the eye?
• Does the price compare well with others in the market?
• How do you currently distribute your products to your customers? How do they get hold of your product? It is a retail product, so supermarkets and shops are good places for it. Make sure it is convenient for your customers to get hold of the product.
• Finally, promotion. Have you identified your audience and do they know about your product. They need to know where you are and what value you offer? Why should they buy your disinfectant instead of the ones already in the market? You should tell them. These are critical information that will help them decide to buy your product. You must figure out the most efficient and effective way to reach your audience at this time.
• Some strategies will include word of mouth, SMS and WhatsApp blasts as well as telling your story on your social media pages. Encourage your existing customers to recommend your product to their friends and associates.

5. "I want to know more about the structuring of a business entity. I also want to know about personality tests in hiring employees.

"Structuring your company is one of the first and most impactful decisions you will make when starting your business. However, deciding the best business structure for a small business can be a bit tricky. Some of the possible structures are:

• A sole proprietorship, where you have full control of the business. It is not a legal entity but simply refers to a person who owns the business and is personally responsible for its debts
• A partnership, this is when 2 or more people operate a business as co-owners and share income. All co-owners (i.e. partners) represent each other in the business. Like the sole trader structure, a partnership entity is not separate from its operators. Here, your control is as agreed in the partnership deed.
• Limited Liability Company or "LLC"", is a separate and distinct legal entity from the owners of the company. This means that the company can get a tax identification number, open a bank account, and do business, all under its own name.
• A corporation. This is designed to have a board of directors that makes the major decisions that guide the company.
• Having looked at these four types of business, if you want sole or primary control of the business and its activities, a sole proprietorship might be the best choice for you. However, you can negotiate such control in a partnership agreement as well. Every company is different, so there isn’t a standard best business structure for small business.
• My personal view is that you go for the structure that will enable you to actualise your dream while allowing you to provide value to your customers in the most cost-efficient and effective way so you can make good returns to your stakeholders.

6. Please can you share an effective physical marketing strategy for SME with me? By physical I mean excluding social media marketing as I'm knowledgeable about that.

"By Definition, “Marketing is the process of interesting potential customers and clients in your products and/or services.” This is according to Marketing Expert, Susan Ward

There are no magic marketing strategies. You must understand the demographics of your target audience. Who are they? Where do they live? Where do they hang out online? How do they look for products in your niche? Who do they listen to when making decisions relating to your product? Answering these few questions, and others that might come up while brainstorming will help you decide what marketing strategies to adopt.

You can then pick from these strategies; fliers, emails, SMS / WhatsApp blasts, mailing (physical letters with your brochure), referrals from your existing customers.

Finally, you can do some guerrilla marketing with event components to demonstrate how your products work and get customers to experience it.

We can safely say that your strategies will depend on who your target audience is and what motivates. The real challenge is in understanding your target audience. It becomes a lot easier to develop the strategies to Market your products and services to them. It does not matter if the business is an SME or a multinational.