As a mentor to small entrepreneurs, I am often asked about growth. Expansion, to be more specific about it. Anyone who’s ever started a business will, at one point, entertains thoughts of growth. That’s the beauty of an entrepreneurial mindset: it is ever-optimistic.
Growth can come in many forms. I will attempt to illustrate this through two recent mentorship sessions I had with a couple of small entrepreneurs.
Sometimes, franchising isn’t the best solution. Papaping’s Baked Boneless Bangus is based on a pre-cooking method that allows for the bangus to be either baked or crispy fried. They are careful to source the bangus from Dagupan and sort which ones are best baked and which are best crispy fried. The bangus has become such a hit, the owners sought formal training through Go Negosyo’s structured entrepreneurship program with the DTI, the Kapatid Mentor ME. The business has since expanded to bangus siomai and bottled products. Is it now time to franchise, open an outlet, or begin selling in the supermarkets?
They will also need to make sure to supply only to outlets that can guarantee reliable power. Right now, it is word-of-mouth that keeps customers coming back, and new customers discovering them. Maintaining quality will protect the reputation they’ve already built. This being the case, they will need to keep production tightly controlled, so I offered that they might want to explore building a distributor network instead, so they can still control volume and quality.
The second entrepreneur I mentored was the young lady behind Beautified by Kara Samson. She is a former makeup artist and worked as a bank employee and model, and saw an opportunity with the Pinay’s obsession with eyelashes. She introduced a kind of UV glue that makes eyelash extensions last longer and is well-adapted to the Philippine climate.
Her five-year-old business has become quite successful, but she is now wondering if she has not been aggressive enough to expand beyond the two shops she now owns (in addition to her product line). A viral TikTok post by her digitally savvy sister generated so much business she found herself working from 6 p.m. to 2 a.m. for days on end, and had to get commercial space that eventually became her two shops.
However, both I and Dra. Vicki Belo (who also mentored her) think that she should go for it if it will hit her target market. Personally, I think a mall-based shop will offer the kind of visibility (especially for the market that wants eyelash extensions) that social media can’t deliver. A mall shop also boosts one’s confidence as a business owner. Mall owners like SM, Ayala or Robinsons are not fools; when they see a winning business, they give it space. Again, there is no match for this kind of affirmation.
As for getting into debt, there are now more sources of capital in addition to the usual debt and equity, including affordable loans from government. Also, when a bank or financing institution agrees to lend you money, it means they’ve examined your business model and found it to be sound. There’s another affirmation right there.
If she chooses to franchise, she will need to intensively train her franchisees. The nice thing about franchising is that you get to share the risk, on top of earning a percentage from the franchises. Other people become part of your business, and that is how you grow.
But take this step she must. Right now, this young lady’s eyelash extension services are in demand because she has a unique product proposition. It will only be a matter of time before competition catches up. Like I told her, unahan lang talaga ‘yan. Whoever moves first gets the bigger market share. I know it from experience when I founded my popcorn business.
But I do admire her for being very careful about safety and making sure she’s well-prepared. Often, things move very fast for young businesses, and some fall into the trap of being too eager to become overnight successes. I don’t think she’s prone to this mistake.
Expansion is where the help of big brothers in business and mentors can become useful. Opportunists would think nothing of taking advantage of greenhorns. For many, a professional organization like the Philippine Franchise Association can give the mentoring MSMEs need. At the same time, franchising lets upstarts share their business model with others and become, themselves, mentors to others.
Originally Published in Philippine Star
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