Lay The Foundation

Excerpt from: {see} Digital Magazine - Issue #9
Published: February 4, 2010



LAY THE FOUNDATION

YOU MAY HAVE EVERYTHING IN PLACE TO SELL YOUR PRODUCTS TO NEW MARKETS. {SEE} MAGAZINE SHOWS YOU HOW TO TELL IF YOU DO, AND HELPS YOU AVOID THE PITFALLS.

These days everybody is looking for an edge, some way to open up a new revenue stream and get things going again. One of the simplest ways smart businesses drive revenue is by breaking into new markets for the products they're already producing. Selling to a new market may sound like a lot of work, but as you'll see in these examples (right), you might find that there's a new market for your products right under your nose.

SELLING ZEROES AND ONES JUST FOR FUN
These days everybody is looking for an edge, some way to open up a new revenue stream and get things going again. One of the simplest ways smart businesses drive revenue is by breaking into new markets for the products they're already producing. Selling to a new market may sound like a lot of work, but as you'll see in these examples (right), you might find that there's a new market for your products right under your nose.

GIFTS THAT KEEP GIVING – YOUR CUSTOMERS
When was the last time you went into a candy shop and bought a box of chocolates? If it's been a while, you're not alone. The old-fashioned sweets shops selling chocolates may be seeing their customers opting for drug-store brand packaged candies for convenience; however some have found a business market for their products.

Every year corporate gifts get sent from office to office, from supplier to distributor, from agency to client. For a chocolatier, selling to corporate buyers can greatly increase revenues. And it's not just chocolates; just about any consumer product can be packaged and made into a corporate gift.

MINIMIZING YOUR RISK
Of course reaching new markets isn't as easy as just flipping a switch. For many businesses that offer credit, deciding which consumers or businesses to offer credit can be tricky.

OFFERING CREDIT TO BUSINESSES
Consumers may make purchases with cash or credit. However, when you think about selling to businesses, you’ll likely be thinking of larger orders. On larger orders businesses will typically want to purchase on credit and that can be risky. In these tough times, how do you know that a business will pay back its debt to you?

Thankfully there are a number of reports to help you gauge the ability of a business to pay back its debts. For a large business you might find the Dun & Bradstreet credit report helpful because it gives you credit scoring, a quick and easy way to determine the chances of a company being delinquent on their debts in the next 12 months. When dealing with smaller businesses you can use reports provided by credit bureaus, Experian and Equifax, that not only provide information on the company's history of debt payment, but also on the principal or owner's credit history.

OFFERING CREDIT TO CONSUMERS
You may be accustomed to selling large quantities to business purchasers with established credit histories. If you have consumers who have long established credit histories you can use standard decisioning rules and start offering credit to them today.

But not all consumers have long established credit histories. If you're a regular {see} reader or you saw 'The Right Tools' article in this issue, then you'll know that an estimated 100 million people are credit underserved in the United States. The credit underserved have little or no credit histories. With a credit history that is incomplete, gauging a consumer's ability to pay off debt is extremely difficult.

Now you've gone from making clear-cut decisions about whether or not you'll offer a chain of coffee shops credit for a purchase of 75 industrial coffee makers to deciding whether some guy you've never met is good for the $300 he'll owe you if you sell him a souped-up espresso machine for his house. Suddenly this whole selling to consumers thing doesn't seem so easy.

There is good news, though. Using alternative data, like rent and utility bill payments, you can get a better handle on consumers' credit scores, even the 100 million credit underserved. So with a few minor changes to where you look to find credit data, you can cross over into offering credit to consumers with confidence.

For more on consumer credit reports and alternative data, check out the MicroBilt Website to see what kind of data you can access on consumers.

Read the Original Article and More inside {see} Digital Magazine

View Our Other Articles From This Issue of {see} Magazine

10-STEP BLUEPRINT

THE RIGHT TOOLS

YOUR (BUSINESS) CONSTRUCTION CREW

RECOVER LIKE A PRO

 
 
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