Entrepreneurial Articles
Change in Business - Personal Experience
The year is 1993 and three young men, who share a penchant for business, are searching for the right materials to get involved with after deciding that distribution as compared to manufacture is the way ahead in the day’s particular climate.
The studies went on for almost two years and as luck would have it, a relative of two of the men controlled a soft drink’s production factory; it was then intimated to the men that if they could source a certain product for him, even at the same price, he would give them a contract.
The men duly did this, the product was sourced and the new business was up and running.
Over the following several years, the product range expanded and the customer base continued growing, using the same business model of distribution with ever-increasing storage facilities, creating an ability to from an efficient part of any company’s supply chain management.
Then, as is the subject title of this article, the business had to change, was forced to change -- through clever marketing and good fortune we won a supply contract for packaging related materials that we did not even supply!
Hence we suddenly required a great deal of additional space, a great deal of new equipment and guess what? We were involved in a business model which went against the grain of every ounce of our studies and took us in a totally different direction to that planned. Thus, we had changed.
One may argue that business is always the same -- it’s just the commodity that changes.
So there we were with 45000 square feet of storage and manufacturing space, a large work force, health and safety issues and lorries to boot-everything we had planned against -- but we had a contract.
However, the years went by and we began to see a pattern emerging throughout the country of manufacturing businesses closing around UK in favour of moving to Eastern Europe or indeed the Far East.
Since our business was primarily in the field of primary or secondary packaging and it is essentially manufacturing company’s that use packaging we decided that it was time to sell the business as too many companies were chasing an ever-decreasing market.
So when we received an offer from our managers to buy, we accepted it and moved on.
Summarising, it is no longer possible to be inflexible in business and more than ever, since general market knowledge is greater than ever before due to the internet, the customer must be treated with kid gloves and cannot be pressed too strongly.
Whereas in times gone by, it was relatively easy to work with decent margins, even on generic products, customers can access swathes of information at the press of a button, thus forcing the seller’s position down and down.
This is all very well but it must be remembered that a business producing anything or storing anything must work off a decent profit level to be able to maintain the standards of quality and delivery performance.
Naz Daud is the founder of CityLocal. This Business Franchise Opportunity is for people who would like to work from home and be their own boss.
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