How to start a successful business in less than 3 days: The story of the ideal egg-man
There is no such thing as a crazy idea. If it sounds crazy it means you’re doing something right.
This is exactly what we had to believe when one of the eight entrepreneurs we are coaching decided that he wants to sell eggs. Everyone else counted him out – “Eggs? You must be crazy…You run an MPESA shop (mobile banking) and you sell mobile phone accessories. What do you know about eggs? You don’t even have any customers!”
However this is what we asked: “When can we start?”
Pharis is a hardnosed businesses man and likes to get things done – just like we do. The very day he told us his idea of selling eggs we got him to agree to obtaining a small unit that was being built around the corner from his current shop. By unit I mean a 4ft by 3ft metal shell that sticks out of the side of a building, just big enough to stand in – but nonetheless, it was a place to stock our eggs. That day the welders were in and the wall panels were being forged.
That evening I went away and designed a clean, simple straight to the point business card for Pharis.
We included the offering of milk because of a partnership we created between Pharis and another one of our entrepreneurs, creating an alternative product offering that we are soon to launch to market.
Anyway, off we went with nothing but 3 resources – a half built metal box, a farm based egg supplier and some black and white business cards… confident as ever.
There was one key to our approach – understanding our customers. Restaurant and hotel managers are busy people; they don’t have time to get annoyed at unreliable suppliers who can’t deliver. Nobody likes an egg draught! They want dependable, on-time, good quality and well priced supplies; and this is what we had to offer them.
We didn’t hesitate when walking straight into every restaurant and hotel within a 1km radius of Pharis’ under construction storage location to sell eggs. We simply told the managers of each business that we sell eggs at 300ksh per crate, no frills attached, simply delivered for free in any required quantity on any given day.
By laying out for them everything they could ever want from an egg supplier it became a no brainer. Within 2 hours we had sold 8 crates (240 eggs) but we weren’t satisfied. We pushed harder and asked customers if they were willing to establish a contract for the supply of eggs if Pharis proved himself after delivering once to them. One restaurant gave him this chance right away, and within of 5 minutes of starting the conversation with the restaurateur, we had our first contract – the supply of 5 to 10 crates per day to Tipsy Restaurant.
That very day deliveries were made from the 10 crates we had in stock (our starting inventory). And by the end of the next day we had contracts established with 5 locations – Tipsy Restaurant, Leopard Hotel, Three ways hotel, Kanu Street Hotel and Passersby. The total value of the contracts was for 42 crates (1260 eggs) delivered everyday or every two days (depending on when each restaurant or hotel needed supplies).
However, even with this success we didn’t get complacent and at this point we really stepped it up…
We had enquired with the owner of a one of the most popular restaurants in Nakuru (Rift-Fries) about supplying them with eggs; however the owner was reluctant to break off his current supplier. We understood his situation, so didn’t chase him up immediately again.
After pitching day (a great day for Pharis and his egg business) we went back to the same restaurant. The owner had very quickly become a great friend of ours as we often went to his restaurant for lunch, and now knew him on a first name basis. We very strategically diverted the conversation (away from how he marinates his chicken) to again bringing up the awkward topic of supplying him with eggs…
We told him how Tipsy restaurant had been buying 10 crates from Pharis nearly every day and he saw this as a challenge by a fellow restaurateur. Out of nowhere the tide turned and he suddenly told us to deliver him 40 crates of eggs the very next day at 8am (1200 eggs!). We jumped on the phone to Pharis who said he could make the order. This was an order that consequently turned into a contract for the supply of 1200 eggs every 2 days to his restaurant!
Since day 1 our aim was to have Pharis supplying 100 crates of eggs per day (3000 eggs) and after having only been in business for 2 weeks we are nearly already at this point. It looks like we will have to raise the target.
I had a rush of brief excitement the next day when I went into Rift-Fries to order my usual egg-special for lunch. I smirked to myself as the waitress dropped a plate of 2 of Pharis’ finest eggs that had been delivered that morning, now perfectly fried with a side order of smugness.
My advice to anyone is this – if you are doing something right, don’t hesitate to push your customers for more. Trustworthy relationships with customers can be translated into contracts – which are the ultimate way to secure demand for your business.
We applied exactly the same approach for John and Alex; two of our other entrepreneurs who operate transport businesses as boda-bike drivers (motorbike taxis). We went around obtaining contracts for the supply of goods (and people) on a regular basis. This meant picking up and dropping-off school children to and from school, delivering meat from a slaughterhouse to a butchery, delivering bottles of soda to bars/pubs, hardware to building sites, gasoline cans to families, and one really big contract….
With Alex we won a contract for all deliveries in and out of a large boarding school in the area. This meant being responsible for delivering food such as lentils and maize, acting as a messenger, taking unwell students to hospital and delivering stationery and library books to the school.
The total value of new contracts for both of our boda-bike drivers was a combined 7730ksh per week. This represented a 221% increase for Alex and a 103% increase for John. They couldn’t stop smiling, and neither could we.
The moral of the story is: If you don’t ask you don’t get. By making sure you are offering your customers exactly what they need you’ll be writing yourself a formula for success which will enable you to obtain a strong and steady flow of demand. Also remember that business at its core is based around successful interactions that help your customers establish trust and confidence in your offering. This is why it’s so important to network and talk to anyone and everyone you meet. It was by doing this that we were able to secure the largest contract for the supply of eggs worth 36,000ksh per week, and why we know we will continue to secure more just like it…
By Shammi Raichura, ICSE Balloon Volunteer 2014
Follow my Balloon Story on http://www.facebook.com/shammi.balloonkenya