NOMPU SIZIBA: The COVID-19 pandemic has wreaked havoc on people’s health and people’s livelihoods and future prospects. As we’ve discussed countless times on this platform, jobs have been lost, workers have had to take a pay cut. And the fact that job security is no longer a reality has become that much more pronounced for many of us.
Well, for some the current economic situation may be a time to think about starting up their own thing, coming up with ideas, seeing gaps in the market and activating a plan. And for those still fortunate enough to have a job, you could decide to do this while still in your job.
Well, to discuss how to go about starting up a business during these very difficult times, I’m joined on the line by Lester Philander. He’s a business coach and the managing director of PHL media. Thank you so much for joining us, Leicester. The expression has definitely been worn out, but it remains true, that these are unprecedented times. And I suppose, with all the challenges facing businesses, households and individuals, people need to think out of the box in order to adapt and manage.
LESTER PHILANDER: Absolutely. Thanks for having me on the show, Nompu. In the whole Covid-19 pandemic a lot of gaps have opened up in the market for entrepreneurs to start coming into play. Now, for the longest time we’ve only focused on small business owners, but there is such a huge market in the employee space – and we call them “employeed entrepreneurs”. A lot of them are looking at creating another stream of income, to start their own business, and there’s never been a better time than right now for them to do exactly that.
NOMPU SIZIBA: And what sort of activations are you seeing in this regard? What sort of ideas are you seeing people implementing?
LESTER PHILANDER: Oh, that’s the thing. So many people get offered an opportunity to do this business, or go into that industry. What’s different in this case is that a lot of people have a business idea somewhere at the back of their mind, which they thought of 15 years ago, 20 years ago. And they’ve kept it there. Unfortunately they work in the formal employment space, and that idea has become dormant. They go forward like a soldier, ensuring that the company vision is achieved, as opposed to their own personal goal.
So in this case, someone wants to start a restaurant, someone else an accounting firm, someone else might want to go into construction. Either way, opportunities are opening themselves up in almost every industry. Of course, in certain cases there are exclusions. But what I’m saying is 85% of the market is opening, and what you’ve got as Covid is starting to slow down – and I’m speaking in faith here – is that more and more opportunities are going to start presenting themselves in this space.
NOMPU SIZIBA: I second that faith. So, what’s your advice to that person who is listening, who’s told themselves: I want to pursue my dream, I want to start a company. What process do they need to go through to ensure that that dream is actualised? And, on top of that, surely you need to do a bit of market research because you can’t have lots of people deciding that they’re going to set up a hair salon in the same area.
LESTER PHILANDER: Absolutely. One of the fears that we have is saturation in the market segments. So what I want to say, if I can look at the process, is let’s simplify it into a four-step process – provided we’ve identified a specific opportunity. The first thing I would say is, start with the end in mind. Identify exactly where you want to be 12 months from now. And, when you’ve identified where you want to be 12 months from now, then identify where you are now, and look at the journey that you have to embark on to get from where you are to where you want to be, and identify all the obstacles that you will face. Most businesses only look at the biggest obstacle in front of them right now.
Let’s say person X wants to start a laundromat, and the biggest obstacle that they’re facing at that moment is R150 000 worth of funding that they need, to get the machinery, to get the lease, to get all of these things in place. Let’s say someone decides to give them that R150 000. What happens then? Then you still have to get clients, then you still have to embark on marketing strategies.
So a lot of people only see the first obstacle. When you’re embarking on this journey there are at least 15 obstacles that you have to face, and you as a business owner have to pre-empt an obstacle that will take place in six months’ time, as opposed to still sorting out the obstacle that you faced six months ago. If you can identify what you’re going to face in in six months’ time, and put processes in place already, that problem might not exist at all, because you’ve eradicated it before it existed. That is step one.
Step two – and I cannot emphasise this enough – is get a business coach. There are two reasons you need a coach. Reason number one is a coach can show you the things you don’t know. Most of the time people have a lack of knowledge, things they did not know they needed to do that might have got them ahead. So many people have come to me asking me to coach them, and they’ve asked me “Where were you five years ago when we started our business? If only I knew then what I know now, our business would be very, very different.”
The second thing that a coach is there for is to hold you accountable. Sometimes we know exactly what you need to do to get to the other side but, because nobody is holding us accountable. Our spouse is familiar with us and our bad habits, and we can always justify ourselves to them but, if someone else is holding you accountable, you know that you have to perform.
And then, specifically with regard to sales and marketing, sales have evolved over this pandemic. The way in which marketing is being used now, the digital space and platforms being used accelerate your business far faster than the methods that we used six months ago – or even five months ago for that matter
And then the last one is, once you’ve identified this formula, develop a system that can make money while you’re sleeping, especially if you are still working full time. If you’re working full time you cannot afford to spend six hours per day on the business that you’ve just started, and then go back to your job, so you have to put those systems in place. And when you put those systems in place, that also creates opportunities for other jobs to come into the market. A lot of people have lost their jobs due to this Covid pandemic. If you’re starting a business that you cannot physically be in, you’re creating a job opportunity for somebody else.
NOMPU SIZIBA: And what about for existing businesses, Leicester? You know that the pandemic’s impacts have been so significant that some entrepreneurs may need to go back to the drawing board and relook at their business model, so that they’re able to survive and subsequently thrive post the crisis. Just elaborate on that.
LESTER PHILANDER: Absolutely. One of our clients is a medical doctor and you’d think that medical doctors would be thriving in a pandemic like this. But, because so many have gone to the public sector, not having funds allocated to see private doctors or GPs, doctors have started taking a financial hit. So we sat down and looked at the business systems, and we asked ourselves how we could thrive through an opportunity like this.
What you then do, you actually break the entire model down. You re-build it, you do something completely different, and find a way to ensure or maintain our income.
So now we’re in the process of building five other GP or general practitioner practices, where other doctors can be placed in there. It’s like a franchise model. These doctors are paying R10 000 per month, and everything is being set up for them – which only cost our existing client about R30 000 per month to set up. Within three months he’s already got all his money back, and is making an additional R50 000 per month. So in this pandemic you are giving a lot of other doctors who also lost their jobs in the private sector because of this pandemic.
Another example is a recruitment company out in the UK. As soon as Covid and lockdown came, they lost about R400 million. That is an excessive amount of money. What they needed was to look at the buying behaviours of their existing clients. They reached out to some of them, not to make a sale, not to look for a transaction, but just to find out where they were, obviously looking after their relationship – how had their needs changed, what had they been doing to diversify – and to ensure that their business didn’t go down.
They identified that there was a huge market for people now working from home, and they could allocate certain resources and facilities to ensure that the people working from home could stay productive. They’d found that sweet spot, and did exactly that, and it actually doubled their margins as a result.
So it’s about taking one or two steps back, and identifying exactly how the behaviours of your existing clientele are changing, and are you’re able to diversify and adapt and change accordingly to ensure that you are still relevant, and that you are still servicing the client. That is exactly what needs to be done.
NOMPU SIZIBA: Thank you so much for your time. We’ve hit seven o’clock, so we have to end the show. Thank you so much for your time, sir. That was Lester Philander. He is a business coach and the founder of PHL Media.