Starting with a Good Idea: Forty Concepts for a Small Business (Concepts 32-40)

Welcome to the Canada Business audio workshop. This 6 part series will help you with basics of starting and growing your business and will cover some of the most challenging aspects of business ownership.

In this introductory episode we will discuss 9 of the Forty Concepts for a small business.

32. Become An Agent

Becoming an agent involves contracting to sell products or services for a fee or commission. The contract may be with either a producer or a distributor.

Some Examples

A businesswoman from a smaller community became the local sales agent for a large urban Canadian printing firm which produced brochures and postcards.

A sales agent is contracted with several distribution companies to be their representative in that area, selling novelties, records, magazines, electronic equipment and cassette tapes.

How To Do It

Identify a type of product or service you believe you can sell directly to consumers or businesses.

Find producers or distributors who need someone to handle direct sales of their product or service.

Read classified advertisements listed under Business Opportunities, and check the employment section for Sales Agents Wanted.

Join sales and marketing groups, attend their meetings and read their newsletters.

Contact manufacturers, read trade publications and attend trade shows to find items not being sold in your area.

Key Questions

• For what type of product or service could I act as a sales agent?
• What manufacturers can I find who need the services of a sales agent?
• Is there a market for the products or services I would like to represent?

33. Become A Distributor

When you become a distributor, you buy a producer's products or services and then resell them to retail outlets, manufacturers or other businesses. In some cases, you may sell the products directly to consumers.

Some Examples

A woman who owns a direct mail distribution company buys crafts from artists and craftspeople, and then advertises them for resale.

A training company, which contracts to conduct management workshops for various companies, hires management consultants to act as workshop directors. The training company buys the consultants' services and resells them at a higher price.

A trucking contractor buys large quantities of topsoil and resells it by the truckload to garden supply shops.

A large retail carpet store made use of its volume discounts from carpet manufacturers to become a distributor to small contractors.

How To Do It

Analyse your current purchasing volumes and discounts to identify situations where you could take advantage of your buying power to act as a distributor.

Find producers or manufacturers who would give you exclusive rights to distribute their products in return for your advanced financial support for orders.

Find a producer who only wants to handle large orders, but whose products require distribution in small-order lots. This is an opportunity for you to become a distributor and relieve the producer of problems relating to small orders.

Find a group of retailers or customers who have to wait for delivery of products from a manufacturer because of distance or production time. You may be able to become a distributor by carrying stock on hand and offering immediate delivery.

Look for advertisements under Distributors Wanted in trade magazines, and for advertisements under Business Opportunities in the classified sections of newspapers.

Contact manufacturers, read trade publications and attend trade shows to find items without local distribution networks.

Key Questions

• What producers can I find who require a distributor for a product or service?
• What product or service could I buy, stock and wholesale in my region?
• Could I distribute the product profitably?
• What potential retailers or customers have indicated a need for the product I am thinking of distributing?

34. Become An Import Distributor Or Agent

An import distributor or agent brings products and services from another country into Canada for distribution and resale. A wide variety of products and services are available around the world, and many producers are looking for distributors or agents in Canada to expand the market for their items. An import distributor (jobber) buys products for resale while an import agent (representative) sells products on a commission basis.

Some Examples

A local businessman could not find high-quality hairpieces in Canada but located a supply in Germany. He now imports them, along with waterproof tape, for the Canadian market.

A businesswoman had a health problem and could not find a needed medical apparatus of sufficient quality in Canada. She searched abroad, found a suitable model in Europe, and is now the Canadian importer for this line of equipment.

Each year, a company, established by young entrepreneurs, imports Christmas cards in bulk from the U.S. The cards are then packaged in 15 card boxes and resold. This is an example of importing, packaging and breaking bulk.

How To Do It

Read overseas trade magazines.

Identify marketable items made in other countries and not previously sold in Canada. Foreign consulates in Canada can be an excellent source of this information.

Contact trade associations in other countries to ask for information on possible import products.

Identify a client group with special needs that can be met only by foreign products.

Look for new and innovative items made in other countries by travelling to those countries or reading advertisements in their magazines.

Join import-export associations, read their newsletters and attend their meetings.

Look for products that have been successfully imported to other countries but have not been imported to Canada.

Ask friends who travel frequently about products they may have seen that could be successful in the Canadian market.

Ask potential customers whether they would buy the product you want to import.

Key Questions

• What products or services can I import to sell in Canada?
• What needs in the Canadian marketplace could be met by imported products or services?
• Is there a Canadian market for the product or service I am thinking of importing?

35. Become An Export Distributor

An export distributor promotes and ships Canadian-made products and services to other countries. Pacific Rim countries, the United States and the European Economic Community present particularly good export distribution opportunities for Canadians.

Some Examples

A Canadian couple vacationing in New Zealand noticed that motorcycles there had very few accessories. They did some research and discovered that there was no local supplier. When they returned to Canada, they immediately contacted manufacturers of accessories and began to export these parts to New Zealand.

A company makes skid plates for mufflers and exports them to a truck manufacturing company in the United States.

A firm manufactures mobile barbecue meat carts, which are similar to mobile popcorn stands, and exports them to Southeast Asia.

How To Do It

Find a void in a foreign countrys marketplace and contact local producers of those products to see if they may want to sell their products in other countries.

Identify a country to which you would like to export, then contact local producers of goods for the rights to distribute them in that country. Many provincial and federal departments may be able to provide assistance with this. Read provincial and federal government publications about export opportunities.

Examine foreign countries to study their needs for types of products made in Canada. The public library may be of help with this.

Contact Canadian foreign trade consuls to identify needs which require service in other countries.

Read books on how to export--these can be readily found in libraries and bookstores.

Key Questions

• What local products and services could I export to other countries?
• To which countries would I like to export local products?
• Is there a market for the product or service I want to export?

36. Market Someone Else's Product

If you are more interested in marketing than production, you may choose to find a good product that is made by someone else and assume full responsibility for all aspects of marketing it. You may decide to enlarge on this idea by offering a full range of marketing services for a large number of clients.

Some Examples

A sales agent located an innovative game developed by a local inventor, and became its marketing agent. She managed the marketing process, including packaging, advertising and distribution.

A marketing consultant markets the services of other consultants. He represents them, promotes their talents, schedules their appearances and negotiates their contracts.

Independent manufacturers' agents often market similar but non-competing products for many manufacturers. For example, one agent sells sporting goods made by different producers.

How To Do It

Look for products which have not been marketed at all (hard to find) or which have been marketed poorly.

Look for new businesses that need marketing services but have not established a marketing department.

Look for existing manufacturers which cannot afford to directly market to rural areas or specialized niche markets.

Ask business consultants and advisors whether they know of any products that need better marketing.

Examine classified advertising sections and mail order advertisements to locate individuals or small companies that are selling products on a small scale. As you search, consider which products offer the potential for larger volume sales. Look for good products using inadequate advertising.

Contact marketing or advertising agencies. They can sometimes provide leads for products they were unable to take on, for such reasons as a conflict of interest with another account or a full client list.

Locate inventors' clubs, attend their meetings and read their newsletters (i.e. Inventor Society).

Contact trade or industry associations.

Key Questions

• Where can I find a good product requiring marketing?
• Which products have a potential for increased sales if marketing is improved?
• Is there a strong market for the product?
• What marketing skills and services can I offer?

37. Expand Market Areas

When a locally made product or business is successful in the local area, an opportunity often exists to expand marketing efforts to new geographic areas. Sometimes this can involve opening another outlet in another location.

Some Examples

A co-operative that supplied equipment to mountain climbers and hikers was so successful it expanded to include a second operation in another province.

A successful restaurant with a unique concept expanded by setting up similar restaurants in other cities across North America.

How To Do It

Identify products or services currently offered by your company within your region and consider whether marketing efforts could be expanded to new areas.

To find successful local products or services which are produced by someone else and not distributed to other areas:

• talk to purchasing agents;
• place classified advertisements in newspapers;
• contact your local Canada Business;
• analyse local advertising and talk to local business people;
• look for locally made products in stores;
• look for stories on local products and services in business magazines and newspapers; and
• talk with tourists visiting your region, as well as local travel industry personnel, to find specific products and services that attract businesses, and consider which of these could be imitated, franchised or marketed in other areas.

To find successful one-of-a-kind businesses that have been developed by local people:

• analyse the Yellow Pages in your phone directory;
• identify local fashions and lifestyle activities;
• observe retail stores and services in your area and Iisten for positive comments from local consumers and business people about local businesses; and
• ask visitors to your area for the names of unique local businesses they have noticed and which they might like to have in their own community.

Talk to potential customers to discover whether there is a market for the products or services in the new area.

Key Questions

• What local products or services could be expanded to new markets in other regions?
• What successful local products have not been distributed in other areas?
• What local businesses could be successful in another area?
• Is there a demand for the product or service in the new territory I am considering for expanded marketing?

38. Offer Discount Goods For Resale

If you can obtain goods from an especially low-cost source, you can discount them from the normal suggested retail selling price and possibly find a market. Some discount-selling operations are set up to take advantage of a short-term opportunity, (e.g. truckload of freight damaged goods) others may be operated as long-term businesses, when there are ongoing reliable sources of supply.

Some Examples

A retail store buys time-expired, bankruptcy, production over-run and manufacturer's clearance stocks and then resells the items at discount prices to consumers.

An enterprising woman buys Christmas cards that individuals and companies have not used, repackages them and resells them at a discount.

A common practice is to source products manufactured in developing countries where material and labour costs may be lower.

How To Do It

Decide what type of goods or services you want to market at a discount, and determine whether there is a market for them.

Locate sources of supply which will sell to you at an extremely low price. These may include: bankrupt companies; manufacturers with seconds; companies with custom orders that have not been sold; firms with an oversupply of goods they cannot sell; companies with out-of-season leftovers; or companies in need of immediate cash.

To assist you in locating these sources of supply, contact: sales agents; discount operators in other non-competitive markets; bankers and receivers; trade association staff members; accountants; distributors; or marketing consultants.

Join a purchasing group that has been set up to buy goods at a discount.

Make sure you have an adequate source of supply before you start selling.

Talk to potential customers to make sure there is a market for the items you want to sell at a discount.

Key Questions

• Where can I find a low-cost source of supplies that I could buy and resell at discount prices?
• If I am setting up a long-term operation, is my source of supply reliable and ongoing?
• Is there a market for the items I plan to offer at a discount?
• Do I have a scheme for making these goods available for sale?

39. Plan And Promote Events

Special events provide opportunities for planning, organizing, advertising and promoting. Such events are usually types of gatherings which attract large numbers of people.

Some Examples

A woman specializes in bringing top quality speakers and educators to the city for education workshops.

A firm promotes entertainment events such as rock concerts, folk festivals and touring theatre groups.

A company organizes trade shows, corporate conferences and other group meetings.

How To Do It

Identify a type of event or meeting you believe you could successfully promote in your region.

Find specific groups that would let you represent them to organize their appearances in your area.

Identify trade associations or other groups that meet in your region and may need the services of a meeting planner and promoter.

Find facilities in your area that would let you act as their agent to organize events which would use their space.

Join associations of professional meeting and event planners, read their literature and attend their conferences and meetings to pick up new ideas.

Contact organizers of events in other areas to identify successful events, groups, themes or that could be used for local events.

Key Questions

• What types of events could I plan and promote in my region?
• What facilities in my area are available as a location for events I organize?
• What groups may require the services of an event organizer in my area?
• What groups of people would be attracted to the event I am planning? Is there a market for the event?

40. Provide A Consultation Or Information Service

You can establish a consultation or information service if you are able to offer advice, services or information in a subject area you know well. This may involve searching for, gathering, assimilating, using and reporting information on specialized topics that are of importance to others. It may also include matching resources you know about with clients for a consulting or service fee.

Some Examples

A researcher provides a clipping service for many major corporations. Her employees clip newspaper articles and record anything that may be of interest to clients who purchase the service.

Computer on-line searching services are provided by a woman whose company has connections with computer databanks all over the world. Information is gathered from these databases and supplied to clients who want answers to specific questions.

A specialist in government operations provides a consulting service to companies wanting to do business with governments. She advises them about efficient procedures to use when dealing with government departments.

How To Do It

Develop expertise in an area that is important to others who lack the resources or ability to develop such expertise themselves.

Search for clients who can use your services. These may include organizations who need help with:

• production problems;
• management decisions;
• marketing strategies;
• personnel changes;
• computer and information programs;
• financial procedures;
• training and personnel development;
• political activities; or
• public relations tasks.

Analyse organizations and industry sectors to identify potential opportunities for your services. To do this:

• read trade magazines;
• contact association managements;
• read annual reports;
• read business newspapers and magazines; and
• talk to employees.

Analyse sectors of the community to identify potential opportunities for your services among the general public. To do this:

• read community newspapers;
• consult with community representatives;
• listen to radio talk shows;
• watch TV public affairs shows;
• analyse statistical reports on the community; and
• participate in community activities.

Identify sources of up-to-date information that you can use to create an information base for your service.

Read books and attend seminars related to consulting and advising.

Talk to potential clients to determine whether there is a market for the consultation or information service you want to establish.

Key Questions

• Do I have experience, skills or knowledge that I can sell to others?
• Could I use my areas of expertise to establish a consulting or information service?
• What potential clients have said they would use the consulting or information service I want to establish?

This concludes our introductory episode of the Canada Business audio workshop series, for further information on anything discussed in this episode please contact the Canada Business service centre near you by calling 1-888-576-4444.

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