Updated May 9, 2023
Introduction to Business Development Process
An entrepreneur has identified the business Development Process he or she wants to start and raised the capital. After due registration and identifying the premises, one begins the operations. Running and sustaining a business is as complex as creating one. For a Development Process, every day is a challenge that has to be tackled and needs to have strategies to keep going.
10 Tips For Business Development Process
Here are the ten successful tips for Business Development Process
1. Invest in good human resources; they are a vital asset
Depending on the nature of the industry, raw materials, premises, and equipment may be required to start a business development meaning and ongoing operations. However, the most critical asset for any organization is its human resources, whether it is a small retail outlet, a medium-sized manufacturing unit, or a company providing financial, technical, or media services.
Automation may have streamlined operations in many industries, reduced labor requirements, and improved efficiencies; however, robots and automated software are no substitutes for human effort and talent; therefore, it needs to be nurtured. Even in a retail operation, whether it is food, groceries, books and stationery, textiles, and a variety of other sectors, the quality of the salesman matters; his or her pleasing manners, ability to communicate with customers, and understanding their requirements are vital for Business Development Process and income. The golden rule is to pay handsomely for the best talent, even if that means reduced revenue for business owners. Without these talents, the company cannot hope to make a dent in the market.
As the company grows, a full-fledged human resources department may have to be set up to manage payrolls and appointments and ensure that employees are satisfied and sufficiently motivated. In many industries, such as IT and Business Development Process Outsourcing (BPO), attrition rates are high not only because there is a massive requirement for talented professionals but could also due to poor HR management. Huge costs are involved in training a new employee at the entry and mid-management levels. If the company cannot keep their employees for some time, it will impact the projects and customer satisfaction. Keeping attrition rates low and motivating employees through leadership and organizational programs will go a long way in its business development.
2. Ensure cash flows and profits will follow
Many entrepreneurs invest their life savings or borrow to start a Business Development Process or expand operations. However, care should be taken in managing the finances. If the company doesn’t have enough cash flow or revenue stream, day-to-day expenses and monthly expenses such as salaries, rent, consumables, and payments to third-party service providers will be affected. When employees and other stakeholders don’t receive their payments on time, the company’s operations will negatively impact.
Cash flow is like the blood in our body; it needs to constantly circulate in the company’s system to take care of all routine expenses. Some banks provide working capital requirements through an overdraft facility (OD), but that will be against some collateral the entrepreneur provides in gold, property, or shares of major companies. Any such financial support comes with an interest cost which should be covered by the revenue received. Many online startups launched with much fanfare Peter out soon, not because the ideas were inherently unviable, but because no proper revenue model worked out. The company will incur costs without such a model but not generate income.
Initially, the owners or promoters may not be able to take home any money, and gradually they need to build a reserve to grow the Business Development Process.
3. Advertising and the media-get noticed to grow
No business can survive without getting noticed by the people. Consumers need to see whether it is a mom-and-pop store in the neighborhood, a company with regional or nationwide operations, or pure-play online business development and marketing. Companies may need to use hoardings, banners, newspaper and TV advertisements, and online promotions to create a brand presence in the minds of consumers.
Initially, there may not be a massive budget for market promotion activities; however, brand or product awareness is vital for sales growth and can’t be avoided. Even small retail outlets or businesses sent flyers to nearby homes and commercial establishments to make their presence felt. Some companies use hoardings on vehicles specially designed for them and employ young boys and girls to distribute leaflets or play audio-video promotional clippings to attract the crowd and distribute leaflets.
4. Importance of the Unique Selling Proposition (USP)
A company’s product or service may not appeal to a consumer just on qualitative merits but has to provide some value to the consumer. Hence, experts point out that consumers may not be willing to spend for a product on better user experience or increased engagement, even if they find the product excellent and valuable.
One should perceive the benefits quantitatively, such as providing a lower-cost solution, reducing drudgery with a dishwasher or washing machine, and improving convenience parameters. Alternatively, one could consider environmental benefits, such as driving a noiseless battery-charged car or consuming organic food free of pesticides and insecticides.
5. Importance of brand building
Any commodity available in the market may qualitatively be as good as the other. But consumers perceive brands always to provide value and quality to consumers every time. That is the reason why the industry needs to develop brands to grow. Branding begins with creating a logo, the unique selling proposition (USP), and positioning in the market, whether it is an entry-level, regular, or premium category, and all images and ideas should be associated with it.
Real estate firms focusing on sea-view properties highlight the lifestyle and refined taste of natural surroundings. The premium motorbike targeted teenagers, and the youth could concentrate on the power and passion of owning such a vehicle.
However, brands create a considerable responsibility for the company to invest in research to bring out product innovations and modifications. Many companies don’t even spend 1% percent of their turnover on R&D, which is vital for their growth.
6. This Are Not A Business Development And Marketing Or Sales
Companies or entrepreneurs tend to equate sales promotion activity with business development activity. Both are different- business development meaning is the macro picture, while sales are the micro part of it. Business and marketing development encompasses all the efforts to grow the business to a new level.
As in economic theory, everyday supply-demand dynamics work if the output is not varied, so the quantity sold will fall somewhere on the supply-demand curve. However, if the demand curve has to shift to the right, more consumers have entered the market, creating a massive demand for the product. Likewise, salespeople for a particular product focus on achieving better sales in a chosen territory and distributor network. However, the business development and marketing team may work on creating new tie-ups, and business partnerships, develop customized products for markets, or start a recent manufacturing activity in a farther region not accessible easily from the headquarters.
7. Maintain good relations with government and regulatory authorities
Any business cannot survive without the assistance and support provided by the state and federal governments. Many state governments aggressively woo entrepreneurs to invest more in startup or incubation facilities or invite prominent and medium-scale business people by providing subsidized electricity, infrastructure facilities, tax concessions, etc.
Sometimes, the authorities provide large investors with land at a very low lease or rent to encourage manufacturing and generate more employment and business activity in the region. This, in turn, leads to better tax collection and revenue for the government. This, in turn, helps them to carry out citizen-friendly services such as roads, hospitals, parks, and cleaning public places.
A business institution may have to deal with many government and semi-government agencies related to taxes, environmental clearance, fire, safety, and labor. Tax evasion is not ethical or advisable, but tax avoidance or reducing the incidence of taxation as per investment schemes suggested by the government can be seen as a good corporate citizen. Many entrepreneurs come into the limelight when they have declared the highest taxpayers of the year.
8. Get in touch with clients and customers
Unlike product companies, those providing service and turnkey solutions must constantly engage with clients to understand their requirements and feedback. Otherwise, people may perceive the company as only interested in gaining business and not building relationships. Personal visits, phone calls, emails, and social media platforms are ways to maintain contact.
If a company has expertise in operations, it can offer free advice to clients, update them on best business practices, and attend workshops and presentations by experts.
In business-to-business (B2B), it is essential to be in touch with top decision-makers in the target company as there is no idea which team or group may be making the purchase decision. It could b procurement, product management, engineering, business development, or any other hidden personality in the organization.
9. Using the fear strategy
Most often, the best strategy to close a deal will be to sell on the ‘fear’ strategy. If you don’t take this offer, the competitor might take and gain in the marketplace. The company could set an artificial deadline stating that the client could miss a fast-approaching high-visibility opportunity (conference, big announcement, deal). A competitor is already in the arena and will likely miss the trend. Or a particular offer that closes by the end of the month and the possibility of a high increase in cost after that, all these strategies may be adapted to close deals in the case of companies that tend to postpone decisions although they are convinced about the requirement of the product or service.
10. Seeking legal counsel, make deals carefully
A company may have to tie up for marketing, outsourcing their requirements, and various other services related to Business Development Process development. If it is a joint-venture (JV)deal to create and market a product or service, make sure the deals are right. Scrutinizing the documents and conducting background checks on the partners in the deal may require the assistance of a legal counsel. The track record should properly be checked in honoring commitments and promises. Many companies have regretted making a bad deal that weighed them down. This will lead to a loss of market share and a fall in shareholder returns. Some companies expand through franchise networks. Exercise caution when identifying financially sound entrepreneurs with exposure to the domain and a proven track record in business development or exceptional career record.
Business Development Process development is a continuing exercise for a company irrespective of how old or its position in the industry vis-à-vis other competitors. A company must diversify its operations as its core product market could become saturated, not enabling it to grow. It may have to risk charting into new territory with accrued reserves and some financial support from outside.
Companies resort to a good mix of debt and equity to grow. However, investors perceive shareholder value based on various parameters, and market timing is also essential in the case of public and rights issues. If the market is recessionary, there may not be many takers for the shares issued, or in case of falling interest rates; the debt could be a good option if the company sees a good revenue model for its new projects. Ultimately, it boils down to the vision the promoters have about the company, not for the short term but ten or twenty years later. It will have a bearing on all the initiatives that they take now.
This has been a guide to Business Development Process. Here we have discussed the basic concept with ten successful tips for Business Development Process. You may also look at the following articles to learn more –