Volume Vs Value: Why More Isn’t Always Better For Growing Businesses.
When we first started Triift Africa, we jumped at every new lead that came in the door, hungry for revenue and resume-building opportunities. This was great in the short term because we didn’t have anything else competing for our time and were blinded by our sole focus of powering small businesses in Africa. But time is a precious resource and one that is not renewable. As the year broke, the team at Triift Africa sat back to prioritize and make goals that would fit into our long-term plans. As suckers for growth, we decided to focus on finding the little things that will cause the largest ripples for business. While our customer-chasing habit hasn’t halted, we are more intentional about building structures for our next level of growth.
Call it what you may, this blog post is a chronicle of that journey.
More is not always better.
More of the right kind of clients is a good thing. The kind of clients that drain your resources — especially your time — and don’t provide a relative amount of profitability are a hindrance to your growth. And when you are growing fast, your time and your human capital are at a premium. Continued growth will depend on how well you steward these resources of time and human capital.
The business side of things needs us to manage loans and scale portfolios for small businesses. An enormous amount of labor goes into keeping up, taking feedback to improve our process, monitoring progress, and making sure loan repayments are made while trying to keep our small circle of friends turned investors happy with good financial records and proper use of money. In all of this, It comes as a shock sometimes when we tell people that we haven’t found a justification for paying ourselves as founders.
This year, Yemisi has made it a point of duty to identify market segments that understand our value and are willing to pay for it, and for us, the lesson in that is being able to focus our efforts on the real things that matter. With some small scars here and there from running the business and understanding the market, we know better.
We realized early in the year that we had our equity sitting in the bank account and while Yemisi kept talking about how we should invest the money, we both came to agree that we’d rather the money stays there. Until we figure out the balance between volume and value moving forward, we’d rather pause.
I (Charles) manage a number of personal clients on digital projects and one of the most amazing realizations I found for February was that if I had focused on one client who I had sent the highest invoice, I may have closed on that project. So these are a few observations on how to identify whether a client or decision is right for your business:
1. Client knows what they’re looking for.
Some Clients reach out to us with a clear-cut proposition, they have done their research and know what their expectations are before even sending us an email or WhatsApp message. A lot of the time, they are putting you on your toes and leading you through a conversion path that you should be leading them through. Sometimes, the reverse is the case and by the time you realize this, you would have spent resources trying to get a client who just wants a price comparison for a service that they are building as well (Strange world we live in).
2. Client is open to hop on a phone call with us.
Every small business need is unique, and the better Triift Africa understands your goals and objectives, the better our plan will be. If they can’t take thirty minutes to discuss it with us, or when they do, leave important details behind, then they are likely shopping for price or free advice (which we give, but under the confines of a consultation agreement).
Earlier in the year, My partner told me not to say a word until due consultation fees have been paid, but I can’t restrain myself on most days, because I assume the knowledge is conventional. So this time, I met with a client, he wanted to talk (in his own words) and from talk, he started sharing about his planned business idea, and how he had worked out all the modalities, I was impressed. I shared a couple of marketing bits with him and I noticed he would pick up his notepad and write. Was this a sign? maybe yes, because by the time we lifted our heads from sharing growth hacks that he could leverage for his business as well as all the things he should be doing, we had spent 4 hours talking, and all he needed to know was on the table. We said our goodbyes after a few selfies. I reached back to ask for a testimonial or at best that I send an invoice, both as we say in Nigeria ‘enter voicemail’
It turned out we couldn’t finance the business, because it was a lot of money we couldn’t risk at the time considering our growth stage, I couldn’t stick my head out to ask for equity or lead marketing for this brilliant idea. Worse off, I had just shared how they can succeed without me. Do I feel it? of course, I do.
3. Client’s request and expectations are realistic.
This speaks for itself. I personally provide marketing services for brands, Triift Africa supports businesses to scale and reach profitability. It is true, we will never be the low-cost provider in any situation, but we will be partners for driving conscientious and real growth for growing businesses in Africa.
So one time, we had this business who showed us the numbers, it was quick money for him (consistent income stream for us over 6 months), but something about it was not realistic; he wasn’t willing to do the hard work, he just wanted to take a huge leap, While that is amazing, small businesses need to have it figured out before making that leap, get strapped with a safe landing, guts is not a strategy. I remember him saying he needed x20 of his current business input, so he can scale his production by 15. When I asked, who he would sell his output to, he listed names and other businesses. Had he spoken to them about an exclusive supply partnership? you know the answer.
Small businesses need to have it figured out before making that leap, get strapped with a safe landing, look left and right, cover all the loopholes or most of them. Ultimately, you must understand that guts is not a strategy!
4. Cost of doing business.
A quality proposal requires sufficient time for us, we need to close all the gaps, study your business, and ask real questions, among a lot of other things. Clients who don’t understand the process or don’t respect our time may not be good partners in the short or long term.
While these markers are specific to Triift Africa, there are some sales universals that translate across industries. I hate saying no to anybody, this is me, I naturally want to win every opportunity that comes in the door, and make everybody happy, but I’m glad to have a partner who can burst the bubble and lay out the facts for what it truly represents.
It is worthwhile to analyze how costs play out and to condition your team to the concept of sometimes saying “Thanks, but No Thanks”. The fact is, every minute they spend on a low-profit group is a minute they are not spending on a high-margin group, I learned this the hard way when I made a refund to a low-margin client who wasn’t satisfied with my service and this was after 2 weeks of getting the work done and treating the business like it was mine. Did I hate it? Do I hate myself for not listening to the voice in my head? You bet I did.
Our evolving process at Triift Africa prioritises the fact that the only thing you cannot get back once it is lost is time. So our advise; invest your time with the preciousness it deserves. Lead your team to understand this, and you will see your profitability grow.
Written by Charles Isidi, Head of Growth, Strategy and Design, Triift Africa.
