Wednesday, 12 November 2008

Going global means thinking global

As an entrepreneur there are some choices to be made. First of all – do you want to build a global business or go for a more lifestyle business? Both are good – but the consequences of the next steps are very different. Lord Karan Bilimoria who has built Cobra Beer from an idea to a growing force in beer brands explained his philosophies, strategies and tactics in how he has built Cobra Beer so far.
Here are some of his thoughts:
Whatever size of business you plan or dream about – the first step is to make a decision to do it and to get on with it. When you are thinking about doing it – you will need emotional support from people around you, but more frequently you might hear the term NO than the term YES.
In reality no one thinks you stand a chance when you are young because you lack track record, credibility, finance and any sense of authority over any resources. “What did I know about brewing, branding or building a business when I graduated as a Lawyer from Cambridge?” What you need though is incredible levels of self-belief and faith in your idea and you only need to be able to turn a few key people in your favour and the others will follow. In my case I got the owner of Mysore Breweries and the brew-master to believe in my idea. I owe them a huge debt of gratitude.
When you have faith in your idea and belief – it does not matter when you start a business. "In my case I started during the last recession in the early 1990s. So I have been there and am convinced that in hard times there are opportunities which others do not or cannot see. So this is the time you can get underway. And it is in this situation that you have to be able to spot the right trends. In our case it was seeing the rapid growth of Indian restaurants in the UK – a trend line demonstrating that UK was becoming a nation of curryholics".
If we combine this understanding of where the market is going and use this information with imagination – in our case we focused hard on it (See Geoffrey Moore’s book on Crossing the Chasm) we can grow at a tremendous rate. We have grown from the early years of a single beer – albeit the best – to now having a product range of 35 items.
You also have to think global – right from the start. When we began ale was 99% of the market. Now it is barely 25% - the rest is Lager. So we are part of that global trend towards lagers. And within this we focused on a fast growing restaurant sector. We describe ourselves as a British company of Indian origin.
Raising money for a global business is complex, but there are so many sources of finance – starting ofcourse with your own money, creditors, debts of various kinds, private investors, grants, careful cash management, customers’ advance payments, bills of lading, venture capital and stock markets. You need to understand the breadth of options and get someone who can help you navigate these various sources with imagination.
Building an A-team. This is stated often by entrepreneurs. In essence the definition used here is to take on people better than you are at specified jobs – such as marketing, sales, finance and other functional specialisms. Although entrepreneurs love to be involved with all aspects of a business – their passion overcomes their own need to delegate – one of the early lessons is to let go to grow.
Marketing is crucial for a global business. In the early days it is important to use Guerilla marketing tactics. Use PR, low cost sponsorships, get samples out there into the market – let people try your services, products – until you establish credibility and enough good will. Then you need to get a strategy based on excellence of product/service; a clear understanding of why you set prices the way you do against competition; ensuring people can access you and your products and building excellent customer service.
Constant drive for restless innovation. Sometimes a core product may not suit all market segments and to get into global markets and grow aggressively the company needs to build in the capacity for constant innovation of products, processes, imagery, marketing, rewards. You need an open mind to succeed. The personal qualities of the senior team needs to be one of taking risks and having foresight and sometimes you ask yourself – why has no one done this before?!
But to know if things are working and to check that your company is being successful – you have to be able to measure everything. You need a transparent system for measurement so everyone can understand what is going on in the business and play their part in the success.

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