Yemi Shodipo, a director at Charis Management Systems explains the importance for business start ups in gaining independent validation for their products and services to help achieve business growth.
Why is growth difficult for some businesses?
Growth enables a business to employ more people, access new marketplaces, get more returns for entrepreneurs and investors, and boost the local economy. Growth is undoubtedly desirable for all businesses, but often businesses can struggle to sustain growth.
Many factors are responsible for this ranging from inadequate access to finance, resource challenges, poor access to skilled know-how or insufficient training and skills of the entrepreneur and workforce.
Another reason is poor marketing and sales. In simple terms, marketing helps you get seen by your potential buyers. Sales puts your product into their hands and hopefully money into your company’s pocket in return.
When a start-up business grows, one of the first challenges is that customers seem to start getting more demanding. When organisations seek to gain larger customers or higher value contracts, they suddenly realise this new customer base requests more information, expects more structure, and demands more resources.
Have you ever questioned why these larger customers, who are willing to pay more, place these demands on the small business? There is a minimum threshold that assures them and their stakeholders of your ability to deliver on the products or services that you offer consistently. Let’s call that trust.
How to close the trust deficit
The answer lies in independent validation. For the start-up business, independent validation means testimonials given by people who have used your services. In modern times these are testimonials on social media spaces and the internet. Trust pilot, Yell, Google, Facebook all provide the opportunity for users of your products and services to state how happy they are with your services independently.
You can get videos or written testimonials displayed on your website or at various customer touchpoints that will enable potential new customers to trust you by the testimony of other people who do not owe you anything. Many studies have shown the effect of this on increased sales. The same principle makes brands get respected and trusted celebrities to endorse the product; this is all about closing the trust deficit.
This independent validation works for the established business too. While it includes all the factors listed for the start-up businesses, certification is another key factor in gaining contracts with large customers.
One example of a company who has used these principles is a jam manufacturer and had been in business for 40 years, mainly selling its product to specialist shops. The dream was to sell to larger retailers like Asda and Tesco. Tesco advised them they could not purchase anything from them until and unless they had an independent validation of their arrangements for quality of food safety.
The company implemented and obtained certification to the BRC standard for food safety. About a week after this, Tesco returned, placed its first order with them. As the Tesco sales person walked out, the director said that it was the largest single order in the 40-year history of this company.
Nothing addresses the deficit of trust immediately and comprehensively better than an independent third-party validation of your organisation’s systems and arrangements. This is true of companies of all sizes, product or service companies that sell business to business.
What can you do?
If you are a start-up business, focus on every opportunity to get that independent validation through testimonials from current or past customers and other companies you’ve served. The keyword is ‘independent’, so that excludes every good thing you say about yourself on your website or at your networking meetings; it is all about what others say about you.
Yemi Shodipo is a director at Charis Management Systems and Charis The Training Company. Both are Preston-based organisations helping small and medium-sized businesses achieve international management systems standards of operations. Charis Management Systems provides ISO consultancy services and Charis the Training Company provides training approved by CQI/IRCA, the primary organisation that approves ISO auditing courses. Both companies service a primary market in Lancashire and the North West and support Boost.