Micro Multinational

BCM50 and IP Telephony for Remote Offices

noreply@blogger.com (Imran Bashir) — Sun, 13 Sep 2009 19:13:00 +0000

I have spent past few weeks figuring out how to extend the Nortel BCM50 telephone extensions to the Heaven Fresh remote offices by spending the least amount of money. My inner computer geek is forcing me to write this post as the only information I could find on this topic is from the companies eager to sell you expensive switches and their “expertise” for hundreds of dollars per hour.

In an effort to cut the payroll costs, we decided to move the phone customer support to our Pakistan office. It meant that we needed to install some telephone extensions there via the Internet so that the offshore staff could pass the calls back and forth to the US and the Canadian offices. We knew that the Nortel BCM50 PBX that we bought from Bell Canada about a year ago had the capability to support both the traditional and the IP telephony. Naturally, we called Bell to help us with the project. Bell was happy to do it but wanted $5000 for something that we finally got done in just $500. It involved buying refurbished IP phones (Nortel IP2004) and the cheapest LinkSys VPN routers (WRV210 / WRV200). Once the VPN was setup between the remote offices and the Canada office, it was just a matter of plugging in the IP telephone sets into the network ports. Voilà, the Nortel IP phones automatically found the BCM50 in the Canada office and the Heaven Fresh was one step further in becoming the true Micro-Multinational. Following is the diagram of our telephone network:

Note: My wife wants me to let every one know the she drew this diagram for me. As you can see, she is good with Photoshop :)

Advice: If you are buying the Nortel BCM (Business Communication Manager), don’t go for the “Standard Bundle” offered by most of the resellers. Just get the licenses for IP seats unless you have a specific reason to go with regular digital telephone. This will save you the money for installing separate phone jacks plus you will have the flexibility to use the IP phones within and away from the office.

Heaven Fresh China – The beginning

noreply@blogger.com (Imran Bashir) — Sun, 26 Jul 2009 22:47:00 +0000

We are launching a pilot project to sell Heaven Fresh products in China. The initial plan is to test the market by launching an e-commerce Chinese website for Heaven Fresh.

The potential for any business in China is not a secret but presumably it is one of the most complicated consumer market in the world. Our strategy is to work with a local partner and concentrate on e-commerce in the beginning. Given all the experiences we’ve had of opening various international offices, only one quarter’s data of online sales will be enough to get a feel for the future business.

Being a micro-multinational, we have learned to keeping the business afloat with an extremely small foot print. The real challenge will be in setting up the nation wide distribution network in China. According to our research, there is a potential to do more business just in the metropolitan area of Shanghai than we do in entire Canada. As part of our plan, we will try to nail Shanghai down before we move on to the other areas of the country.

We are quite thrilled about setting up the shop in China as it will be an exciting challenge to navigate a totally unfamiliar territory in the months ahead.

Promotion with Costco.ca

noreply@blogger.com (Imran Bashir) — Sat, 20 Jun 2009 08:12:00 +0000

We participated in a special 3-weeks discount promotion with Costco.ca in the month of April to sell our HF-380 air purifier. Heaven Fresh is a drop ship vendor for Costco.ca, which means that Costco.ca only takes orders online and Heaven Fresh ships directly to the customer on behalf of Costco. Normally when drop-ship vendors take part in a promotion, Costco requires the vendors to have certain level of inventory sitting in their warehouses to cover the orders from the promotion.

Our decision to join in the Costco promotion might sound like a no brainer but given the tight cash flow situation there was quite a bit of a risk involved for us to order large inventory as the Costco buyer had given us an estimate of anywhere between 100 to 500 units. So we had to have three additional containers sitting in our warehouse above and beyond our regular stock. The catch is that Costco’s estimate of sales during the promotion is just an estimate, not a guarantee for sale. Vendors not only chip-in money to advertise in the promotional catalog but also assume 100% of the risk of stocking the inventory for the promotion. If the promotion is not successful for any reason, vendor’s cash gets stuck in the inventory. We were somewhat reluctant as we had been burned in a similar situation with The Shopping Channel before. To cut the long story short, we went ahead with the promotion as we really needed accelerated selling to balance our books before the start of slow summer months but knowing very well that a bad outcome would put us in a extremely precarious situation. The promotion went well and was a massive help in easing the cash flow.

The interesting new phenomenon for me is that many of the American retailers are separating their e-commerce ventures from their brick and mortar operations. For example, the buyers for both sides of the business are different. The products that consumers can buy online are not necessarily available in the stores or vice versa. An independent e-commerce operation is allowing them to use their brand recognition just for selling while shifting the logistics to the vendors. Canadian retailers have not jumped on that bandwagon yet and the British retailers are partially on board. However, I believe that this trend will continue to grow creating opportunities for small vendors as well as fanning the growth of more micr0-multinational distribution companies.

New Arrivals – Baby boy and BMW 745 Li

noreply@blogger.com (Imran Bashir) — Wed, 13 May 2009 01:29:00 +0000

I haven’t been able to write a post for so long. Life has been quite busy lately both at work and at home. There have been significant new development at both ends. My wife and I had a baby boy, Rayan Bashir, on April 20, 2009. He was born a week earlier than the due date. He had breathing difficulty at birth due to some fluid in his lungs and was kept in in ICU for one week. Although doctors tried to assure us that it was very common with new born babies but still it was very stressful to see him struggle with each breath. He is doing fine now and is diligently performing his duties of keeping us awake every night.

I also bought a BMW 745 Li yesterday. Had no such plans until two days ago but a friend of mine got me into test driving it. Ten minutes later the deal was done and now I am a dad with a BMW.

What does it all have to do with a micro-multinational? Well, not much except that I have to work even harder to pay off my new car and keep up with the supply of diapers for my boy.

A very sad day for Heaven Fresh

noreply@blogger.com (Imran Bashir) — Thu, 22 Jan 2009 03:37:00 +0000

We got the shock of our life this morning (January 21, 09) to get the news that Mr. Roy Frankel had passed away. Roy was 83 years young. The old adage that 'age is just a number' was coined just for Roy. Sometimes I wonder that if I get to live for another 50 years, will my vibrancy be even close to what Roy had.

If luck has some role to play in building a successful business then I can say without any hesitation that crossing paths with Roy in the early days of Heaven Fresh was the luckiest break for us. In response to one of our ads in Toronto Star, Roy walked into our office looking for an air purifier. After talking to us for few minutes, Roy's experienced eyes saw something that we could not. When I told him that we wanted to make Heaven Fresh a household brand name, his response was that 'I know what you need but you cannot afford me'.

I don't know whether it was his desire to give back to the society or his yearning to stay in the game that he offered to work with us for free. It was an offer that no one in their right mind could refuse. Roy lead us on a path that we did not even know existed. He introduced Heaven Fresh to all the major Canadian retailers. It is the hard work and dedication of Roy that Heaven Fresh products got into the Canadian Tire, Shoppers Drug Mart, Nutrition House, The Shopping Channel, PharmaPlus, Costco and several other chain stores.

Roy had this amazing level of energy and passion for growth. He was like an energizer bunny that did not know how to stop. Even until yesterday he was concerned about all the pending e-mails and wanted to make sure that we had sent the necessary information to Costco for the upcoming promotion. He wasn't feeling well for past few days but I knew that he will be up and running soon as he always did. Anytime he got sick, he bounced back with even more vigor. It was just Roy.

That's why it's so hard to believe that he's not among us anymore. It makes me sad to think that I will not get another call from Roy early in the morning with some "urgent" matter. Heaven Fresh will miss him very much. I will miss him very much.

May his soul rest in peace.

Recession and the Micro Multinational

noreply@blogger.com (Imran Bashir) — Wed, 07 Jan 2009 05:07:00 +0000

Good Bye 2008. What a year it was. Every single business move that we made since starting Heaven Fresh in 2003 was put to test in 2008. With no prior experience of managing a business in an economic downturn, recession was just an abstract in my mind until recently. I remember thinking to myself in early 2008 that we must be really good that the so called recession hasn't made any difference to the Heaven Fresh sales. Then we entered the summer season of 2008 with an expectation of usual low sales volume. Somehow I managed to comfort myself that as always we would break even in the summer months and would recover from the slow season in September. When I got back from the Middle East office by the end of August, I found out that our credit cards and credit lines were all maxed out trying to keep up with salaries and operational expenses.

All of a sudden it hit me that perhaps recession was not some made up story by the news channels and business magazines. It was real and needed to be dealt with. By using my old fashioned calculator and the latest snapshot of our P&L reports, it did not take me long to discover that even if we achieved our "normal" sales level in last four months of 2008, we would not be able to get out of the operational debt accumulated over the summer months. By the end of September 08, it was painfully obvious that our "high season" was not going to be as high and we had to do something about it. Right around that time, my dear trader friend, Celal Okur, forwarded me this presentation by Sequoia Capital.

Out of this lengthy presentation, the following three slides got imprinted in my mind. We had to save our young company from getting into the "Death Spiral" of the 2008 recession.

Well, we took the solutions presented by Sequoia to heart and made some instantaneous moves based on the suggested solution. Some of them were:

Cut the management bonus installments
Cut the base salaries of the sales staff
Eliminated the marketing expenses that did not produce immediate results
Stopped the R&D project and laid off the staff
Moved the UK office from London to Birmingham to save on rent (a massive saving for operation our size)
Held back the payable invoices, where ever we could
Diverted resources to high margin online cash sales
Expanded the offshore staff to reduce payroll expenses

As a result of the above steps, we managed to turn cash-flow positive in November and December 08. As of today (January 06, 09), uncertainty is not over yet. The recession fears still loom and economy is still sliding. However, I feel more confident that we are going to get through this rough economic patch. We have also devised a plan to expand sales without increasing overheads.

As the survival instincts kicked in due to the deteriorating business conditions, our operation in multiple countries and our small size gave us the flexibility to shift resources back and forth very quickly on as needed basis. Thus being micro-multinational became a saving grace. Once the economic chaos is over, this recession might turn out to be the biggest lesson for me on how to steer the ship in choppy waters.

Trip to Dubai. Biz in the Middle East.

noreply@blogger.com (Imran Bashir) — Wed, 10 Dec 2008 03:08:00 +0000

Although we started our Middle East branch 3 years ago, I have not had a chance to visit there for an extended period of time. Heaven Fresh sales have been growing steadily in the Middle East and we believe that it is the time for us to make a bigger move in that part of the world especially with all the uncertainty due to the financial turmoil in the North American and the European markets.

I took a 6 week long trip to Dubai in July/August to see the reality on the ground. It was definitely a productive trip except that being outside in the blazing sun even for a little while was enough to give anyone a heatstroke. So the first lesson that I learned was that July and August are not the best months to be in the Dubai.

There is an amazing construction boom in Dubai. The enormity of the construction projects can be judged from the fact that one quarter of the world's tall cranes are mounted in Dubai. Credit is very abundant and billions of dollars of investment are pouring into Dubai. The rulers of Dubai have turned this little city into Las Vegas of the Middle East and South East Asia. However, it's not just an entertainment center, it has also become a hub for transit trade. Ninety fiver percent of the imports into Dubai are re-exported to the rest of the Middle East, Africa, South East Asia and Central Russian states. This status of a 'central bazaar' is fueling the growth of UAE like a snowball now.

This rapid growth is also creating problems for the region, for example, infrastructure problems, high inflation and social issues among the local population that is in minority now.

From a micro-multinational perspective, I feel that we were lucky to get started there 3 years ago. The cost of living there has gone up so high that we could not have established the office there today without investing 3 to 4 times as much money as we did 3 years ago. One of the most fascinating things for me is that our online business is picking up there.

During my trip, I got a chance to meet with many business people and thoroughly study the market. Based on my research, I strongly believe that a significant future growth of Heaven Fresh is going to come from the Middle East Business. Besides an abundance of petroleum cash, infrastructure projects initiated by many of the GCC governments are fueling the local economy. On top of that, having a business presence in Dubai makes it relatively easy (and safe) to get a piece of the Iraqi reconstruction. I also met quite a few Canadians this time who are working in Dubai in various fields. I strongly suggest that any business thinking to expand outside of Canada and the US must look into setting up a base in the Middle East.

Micro Multinationals in Business Week

noreply@blogger.com (Imran Bashir) — Sun, 06 Jul 2008 21:33:00 +0000

There is an article on micro-multinationals in this week's Business Week. It can be seen on their web site by clicking here. The micro-multinational trend is to stay here and the number of such companies will continue to grow. Based on my personal experiences, I strongly believe that the small business world is in a dire need of a web based business management software platform designed for a small business to go international.

The software platform has to have certain fundamental attributes for a mass adoption by the small businesses around the globe.

1) Such a platform will be complex by nature so there have to be millions of service providers ready to help business with this platform.

2) For this kind of mass acceptance both by the micr0-multinationals and service providers alike, it has to be relatively affordable for any size of business. The only way I see it happening is if the business is charged based on the business activity or pay-per-transaction (a transaction can be defined many different ways).

3) The software platform also has to be open so that it can keep up with the pace of change in today's business world. One company cannot hire enough programmers to incorporate all the needed functionality. So, millions of developers must have an incentive to give their best to this open platform. An open-source package without any heavy-weight companies behind it does not cut it because the modifications/add-ons to the platform have to be regulated by a central authority for it to work in a uniform way.

Every functionality or business model that such a platform needs is already out there so I am not necessarily talking about new features here, it's just that existing stuff has to be combined in a new package with a right philosophy. The fundamental reasons for the success of QuickBooks, Linux, Apache ,Google Adwords, Microsoft Windows and SAP have to be analyzed and cooked in one pan to come up with a perfect mixture for micro-multinational business software platform.

Everyday, I come back home from work with an ever increasing passionate desire to have the resources and support available to be able to create such a platform. For quite some time, I have thought about going to VCs to get seed funding for this idea. At other times, I wish that a company like Google or Microsoft can introduce such a thing which will be a tremendous help in taking the Heaven Fresh to the next level. But perhaps, a consortium is needed to pull off an ambitious project like this one.

Online Business in the Middle East

noreply@blogger.com (Imran Bashir) — Tue, 10 Jun 2008 04:17:00 +0000

When we opened our office in the United Arab Emirates, we were warned by many people about the difficulties of doing business in the Middle East. We were particularly concerned about the fact that Internet shopping was not big there which is a vital part of our startup strategy.

It took the longest time out of all of our international branches to reach the break even point in the Middle East. However, after three years I can say that Internet has played a significant role in our growth there. We get a decent number of orders in UAE (Dubai, Abu Dhabi, Sharjah etc.) through our web site. The use of credit cards for online sales is still almost non existent, therefore we ship all the orders COD (cash on delivery). Although a few customers have placed orders on the web using online shopping cart, a vast majority bargains and places order over the phone.

As of today majority of our revenues are realized from sales in Saudi Arabia. Saudi Arabia is the richest but the most difficult market to penetrate in the Middle East. The key to success there is to find a good partner to work with. It was a very risky bet for us to invest in Saudi Arabia, but it is starting to pay off now. We have recently signed a distribution agreement with a well established Saudi group. Sales have been growing steadily for past year or so but we are hoping that they will sky rocket working hand in hand with our new partner there.

We are planning to expand into other Middle Eastern countries within a year or so and Online marketing will be a major piece of that expansion strategy.

Trade show participation in the UK

noreply@blogger.com (Imran Bashir) — Sat, 10 May 2008 02:01:00 +0000

Last month we attended our first trade show in the UK called Natural Products Exhibition. The exhibition took place at Olympia in London. This show was geared towards the retailers of natural products and we participated in it with the hopes that we will find a few resellers from there as this category has been working out very well for us in Canada. These trade shows are also helpful in building a brand image as well as sending the message to the existing customers that we are still alive and kicking.

There is quite a bit of cost involved in doing a trade show both in terms of time and money. It also gets very tiring to manage the booth for long hours. Once the show is over, the leads have to be followed up vigorously to get the best out of the show. Natural Products Exhibition was a relatively small two day show that cost us in the neighborhood of £ 3500. This cost does not reflect the time spent before, during and after the show. Shahzad, Gloria, Mariam and John did a superb job to plan, organize and work the show. Congratulations to the entire UK team for their successful first show. Here are few of the pictures:

	A visitor is picking up some brochures and product pamphlets.
	Gloria worked tirelessly for two days to introduce the products to the booth visitors.
	Gloria and Mariam are chatting. The Heaven Fresh banner in the back ground was done at the very last minute.
	Gloria is explaining the products to a couple of show attendees.
	Looks like break time for Mariam. I know from experience that these shows can be very physically and mentally draining.
	The DVD player in the picture was running demo videos. I think we need a bigger screen for the next show.

Hiring Employees for a Micro MNC

noreply@blogger.com (Imran Bashir) — Fri, 02 May 2008 03:04:00 +0000

Before starting Heaven Fresh, I worked for various companies and during my job hunting process I always wondered about the reasons for the existence of head hunters. My thinking was that there was no justification for an employer to pay to an employment agency just to get a resume forwarded especially when the employer could get resumes directly from the candidates. Probably I developed this thought process simply because I was always able to find jobs by sending my resume directly to the employers.

Having been on the other side of the table for past 5 years, I can say that finding right people to work for your organization is probably the most difficult and challenging task. When we first contacted a head hunting company, I was quite astonished to find out that they charge around 20% of the hired person's salary which meant that if we hired someone for $40,000 / year, we would pay $8,000 in fees to the head hunter. However, scanning resumes, calling candidates and interviewing them is such a lengthy and tiring process that not only head hunting companies start making perfect sense but also their fees sound very justified.

The process of hiring people is particularly difficult for a micro-multinational because of the preference to find people who can wear multiple hats and can handle variety of responsibilities. We have been looking for a bilingual person who can speak fluent English and French to help us with marketing and sales along with alleviating some of the burden of incoming customer phone calls in the Canada office. We have not been able to find the right person yet and seeking help from a head hunter is getting more and more tempting but then again, the money that we will pay to a head hunter can cover the compensation of an employee for two months.

I feel lucky to have found very talented and responsible people to work with just by coincidence . But I guess the lucky streak has to end somewhere and now we have a decision to make whether to bite the bullet and pay the fee to a head hunter or to ease our search criteria. We will see who wins, cash strapped bank account that need preservation for slow summer season or already stretched resources desperately in need of having some additional help on board as soon as possible.

DRTV - Mistakes made & Lessons Learned

noreply@blogger.com (Imran Bashir) — Mon, 28 Apr 2008 02:57:00 +0000

When we started the infomercial projects, my personal objective was to observe the entire process from a close distance. We knew from our research that a successful direct response television (DRTV) campaign would require a perfect execution of video production, logistics and broadcasting. We were also well aware that it would be a miracle to hit a home run on the first shot. While hoping for the best, the game plan from the very beginning was to minimize the risks as much as possible. We were focusing on gaining the first hand knowledge of all the pit falls of the direct response marketing while avoiding any severe negative impact on the rest of the business. As part of the risk mitigation strategy, we got several stake holders involved in the potential risk and reward of the project.

Our initial target markets were Canada and the United Kingdom. We found out at a later point that the UK had a very rigorous and strict approval process for the infomercial before it could be aired. We easily got the approvals in Canada but the objections from the UK approval board required us to redo the entire production from scratch. In the future, we would not take a single step in the UK without getting the script approved first.

Another mistake that we made was that we chose to go with a product that was already selling well through our retail customers including the Shopping Channel. Successful direct response products always go from TV to retail sales. As we learned through experience, a backward scenario can create a lot of conflicts especially in the flexibility to structure the price to be successful on TV. A product (or a similar product) that is easily available in the nearby store shelf is generally not a good candidate for DRTV.

There were some good lessons to be learned on the production front as well. If I had to name the most critical factor in the success or the failure of an infomercial, I would say it's the host who is presenting the product. A host must be able to get in front of the camera and get the viewers to a state of mind that it will be the biggest mistake of their life if they do not buy the product right now. We selected the hosts with acting background thinking that they would not be shy in front of the camera. However, a good actor is not necessarily a good sales person also who can sell a product with conviction on TV. An infomercial host has to be an evangelist who can demonstrate his/her passion about the product on camera. One of our big mistakes was that we did not screen-test the hosts before the actual day of filming. If I knew then what I know now, I would have stopped the filming and would have given our hosts few more weeks to rehearse the entire script a few dozen times using a handy cam. We had good hosts but we did not provide them enough time and guidance to master the script.

Talking about the script, we had it written by a writer who was very experienced in writing dramas and did an excellent job of writing the script more like a documentary. Once again, if we had to do it all over again, we would give her a proper guideline to write the script. We also counted on a producer that we hired to know all these things, but apparently, while he had some experience with the film industry, was absolutely clueless about the infomercial production.

Although it might sound like we dived into this project without thinking much but the fact is that we did put a lot of thought into this entire process from day one. We overcame many technical challenges, successfully executed the filming process, created wonderful animations, beautifully edited the video footage and came up with an impressive CAT (call-t0-action). We gave this project to Alive Pro Studios knowing it very well that they did not have much experience producing an infomercial for DRTV. However, it was worth the risk given that we had years of working relationship with them and knew that they will give it their best. And they did. The final product was an artistic master piece but just did not deliver the results for the infomercial to be a success.

In the direct response industry, the only measure of success of the infomercial is the amount of revenue that it produces. At the end of the day, being the president of Heaven Fresh, I take all the responsibility of less than perfect outcome of the project. The only thing I would add here is that this is not the end, it's just the beginning. We will go back at it and and I am very confident that all of this time and money investment will pay off in a big way down the road.

If you are interested, you can watch the infomercial here.

Heaven Fresh Infomercial Results

noreply@blogger.com (Imran Bashir) — Tue, 22 Apr 2008 02:28:00 +0000

I have written a couple of posts in the past about Heaven Fresh infomercial and I wanted to summarize the results as we concluded the trial in January 08. To sum it up, this experiment cost us approximately $125,000. A rough breakdown of the figures is as follows:

Total Sales:..............................	$30,000
Product Cost:...........................	-$10,000
Production Cost:......................	-$55,000
Media Cost (Air Time):.............	-$70,000
Miscellaneous Costs:...............	-$20,000
Net Loss:.................................	-$125,000

As it can be seen from the numbers above, we achieved an MER (media efficiency ratio) of 0.5 i.e. for each dollar that was spent on buying the air time, the infomercial produced 50 cents in sales. Even though being on TV does give the company some brand exposure, a micro multinational simply cannot sustain the purchase of expensive airtime without pulling off enough sales to at least cover the air time costs. The rule of thumb is that a direct response TV campaign has to achieve an MER of at least 2.0 for it to be considered 'viable'. I used the word viable because, although monetarily we took a hit on this experiment, I still consider it very 'successful' as we ended up learning a lot from our first direct response venture.

Given that the profit margins are just about 10% in our business, it takes one million dollars in sales to cover a loss of $100,000. As expensive as it might sound for a micr0-multinational to produce and broadcast an infomercial, anyone familiar with this industry knows that the above mentioned numbers are small potatoes even for running quick trial. If an infomercial campaign takes off, it can produce millions of dollars in sales very quickly. Obviously, this potential reward simply cannot be realized without a proportional risk attached to it.

This is not the end for us when it comes to direct response, this is just the beginning. We know what to do and most importantly what not to do next time. Although, we hoped for the best but we also prepared for the worst. Even when we started it, in my mind, it was mostly about going through the process and learning the intricacies of the direct response industry. Obviously these valuable lessons had some tuition cost associated with it. I whole heartedly believe that the time and money spent on this project are going to pay off for us in the near future. I will try to shed some more light on the things that we did not do right in a subsequent post.

Product Research & Development

noreply@blogger.com (Imran Bashir) — Sun, 23 Mar 2008 22:13:00 +0000

As the Heaven Fresh international distribution network is growing, being a Canadian company we often get requests from partners and customers around the globe for 'Made in Canada' products. Besides that I believe that in consumer product business, having the ability to develop new and cutting edge products is one of the most crucial factors to stay ahead of the competition. Therefore, we have been thinking about starting a full fledged R&D department to design and develop Heaven Fresh products from scratch for quite some time now. We recently hired Marvin Gui to establish and manage Heaven Fresh R&D department. Marvin, with a PhD in 'air conditioning and cryogenics', has worked with Samsung Electronics to develop air purification products and has the passion for research. Passion can be the single most important ingredient for doing research, especially working with a micro-multinational with limited time, financing and resources. Having been there, I personally know that an R&D job can be a nerve wrecking experience, but what's going to test Marvin's limits at Heaven Fresh is the fact that we do not have adequate financing for R&D including his salary. For the most part, we will be counting on the assistance from the government of Canada through IRAP (Industrial research assistance program) and SRED (Scientific research and experimental development) tax credits. We, as a company and particularly Marvin, will be under the gun to make swift progress to be able to continue getting the assistance to keep the R&D going. He's well aware of the pressure and is excited to take this challenge on. From talking to him it looks like he definitely has the resilience to pull it off successfully. I am also very confident that we will have 'Made in Canada' products as part of the Heaven Fresh product line within a year or so.

Initially we will be concentrating on designing and building product proto types, but our ultimate goal is to manufacture the products right here in Canada. It might sound like a crazy idea to even be thinking about manufacturing in Canada when much of the existing manufacturing is moving to other countries from North America. There are many benefits to manufacturing products here in Canada while the biggest obvious downside is the manufacturing cost. However, I believe that the low cost manufacturing here in Canada is possible and the global increase in wages, fluctuations in currencies and the rise in transportation costs will make it most more cost effective to produce product here in North America. Therefore, as part of our product development efforts, we will be paying a lot of attention to a design strategy for achieving low cost 'Made in Canada' products.

Customer Satisfaction and Micro MNC

noreply@blogger.com (Imran Bashir) — Thu, 28 Feb 2008 07:03:00 +0000

The day I wrote my last post, I received an e-mail from Zach Nelson, CEO of Net Suite, and a phone call the day after from the VP of finance. Both of them were apparently concerned about our unpleasant experience with the company. I have to acknowledge that it was good to get the reassurance that our negative experience was an isolated incident and was not a management backed culture at Net Suite. I do understand that life is not perfect, things can happen, people can makes mistakes, systems can break, and misunderstanding can occur in any organizations but as a customer I expect them to be politely acknowledged, logically explained and reasonably resolved for me to be satisfied and move on to business as usual without any bad feelings.

Having said that, I also strongly believe that most of the customers are like that whether they are buying a software service or an air purifier. Although customer satisfaction is important for every business but this is a concept that any entrepreneur running a micro-multinational must understand. The reason is that the chances of things going wrong are much higher in trying to manage an international business with limited money and staff. Hiccups in the business process that will upset customers are just inevitable but it is amazing the results a business can achieve by simply admitting to a customer that a fault has occurred and comforting him/her that the steps will be taken to remedy the unpleasant situation. The chances are that this particular customer will turn out to be a bigger asset for the business than the one who never experienced any problem. (Note: Now for all those wise entrepreneurs thinking to play the trick on every customer to make them a 'bigger asset', please don't. First of all there is a financial cost associated with making mistakes and then fixing them later. Secondly, don't even think about doing it without having a feature in your business management software to keep track of the 'trick' because customers will only tolerate it once. :)

At Heaven Fresh, when a customer calls or writes with a complaint, we try our best to receive it with open arms and a humble attitude believing that there must be something wrong on our side for the customer to contact us. We listen attentively and we investigate thoroughly and most often it turns out that the customer's satisfaction is just a matter of a simple explanation and a few comforting words. For the times when we find a mistake on our part, admitting the error, apologizing for it, rectifying it, and offering a discount or a complimentary gift for the inconvenience makes a customer the happiest person on earth.

With a limited budget for advertisement and no money for developing new products to compete with resourceful competitors, up close and personal customer service and a deep care for the customers' satisfaction is the single most powerful weapon that can set a micro-multinational apart from the competition to earn the customer loyalty for its brand. That is precisely the kind of loyalty for the Heaven Fresh name we strive for every day to keep these customers coming back and bring their friends with them. The beauty is that we can achieve this goal by just being courteous and respectful , without spending any money - the money that we do not have.

Software as a Service - NetSuite

noreply@blogger.com (Imran Bashir) — Mon, 25 Feb 2008 07:57:00 +0000

Being a software engineer and an entrepreneur, I am a big proponent of Software as a Service (SaaS). SaaS works great for a micro-multinational like Heaven Fresh for several different reasons and the main ones are as follows:

A cash-strapped mmnc does not need to make a huge up front investment for purchasing expensive software licenses and maintaining in-house technical infrastructures.
Since the SaaS is Internet based, partners and employees across the globe can seamlessly use one software platform to share their time and talent among various offices.
The service provider can quickly update the software to incorporate new features and latest trends.
It is much easier to implement or find plug-in modules for a well designed software service.
Due to the vast number of users sharing the cost, the service provider can maintain a robust server pool which benefits all the participants.

When Heaven Fresh grew out of the Quick Books and home grown MS Access/Excel applications phase, we desperately started looking for a business management software that could help us streamline our processes, improve collaboration among various offices, outsource the routine jobs to the developing countries, and unify various data banks in one place. There are many expensive ERP (Enterprise Resource Planning), CRM (Customer Relationship Management), POS (Point of Sale) and accounting packages in the market but not having the luxury of large budget for the software system, we wanted to get one without having to pay an arm and a leg for it. Naturally, the very first thing that came to our mind was 'Open Source'. Therefore, we embarked on the journey of researching the available open source solutions. After looking at various systems such as Tiny ERP (www.tinyerp.com), Open Pro (www.openpro.com) and Compiere (www.compiere.com), we found Compiere to be the one offering most comprehensive set of desired features (at least in theory).

With years of extensive software development experience under my belt and with other friends around me, with degrees in computer science, willing to help customize Compiere at the cost of taking them out for dinner, I was confident that we will have Compiere up and running in no time. But this dream of acquiring an extensive business management software platform for "free" was shattered as we dug deeper into the customization and commissioning of Compiere. To cut the long story short, after struggling with Compiere for three months, we abandoned the project with a candid realization that it would be way more expensive in the long run to deal with an Open Source package than to go for a commercial software. If any one is interested, I will be more than happy to discuss in detail the issues and the reasoning behind our decision in a separate post.

After the eye opening experience of open source, we started investigating the propriety software packages that were being touted for small business. We explored software such as Microsoft Dynamics, Sage, Distribution One, OpenBox and a few others and rejected them one by one because either they were very cost prohibitive, did not have the required functionality or were too difficult to integrate with other applications and customize. A half decent business software package can easily cost anywhere between $50,000 to $100,000 in just license fees not including the consulting costs from the vendor and the cost of any equipment to run it.

At that point in time, we had already been looking for a software platform for few months and it was getting more and more difficult to manage the daily affairs of the business. Disappointed and under pressure, we decided to signup for OrderMotion (www.ordermotion.com) that offered some major functionality instead of the comprehensive feature set for a monthly subscription plus a per transaction fee. The price was right (about $500/month) and we were happy to have the core functionality as a stepping stone until Heaven Fresh was in a stronger financial position to opt for a more comprehensive software package.

As soon as we started using Order Motion, to our dismay, it became apparent that the software was very US centric. It could not handle multiple levels of Canadian sales taxes (GST, PST, QST, HST) and any permutations of them as required by the Canadian law. We could have used Order Motion for Heaven Fresh US but were not very keen on training existing/future personnel on multiple systems as it can be quite a daunting task to get people up to speed on these complex business management software systems. Since the sales department had falsely assured us about the software's ability to handle Canadian taxes, Order Motion acknowledge the mistake and refunded our money.

Frustrated with the lack of software choices for a micr0-multinational company, we stumbled upon Net Suite (www.netsuite.com). The Net Suite looked like a good choice as it had most of the functionality that we were looking for and we had the luxury of paying in quarterly installments. Although Net Suite could cost us more over the years, our rationale was that NetSuite would help us grow with minimum up front investment and as more operating cash becomes available we could potentially switch to other solutions down the road. Initially we implemented Net Suite both for the Heaven Fresh US and Canada offices and eventually started using it for Heaven Fresh UK operations. Without a doubt, Net Suite software has helped us tremendously in running the business over the last year and a half.

Although Net Suite has made life much easier for us in terms of managing the daily operations, implementing it has not been a breeze. There is a huge time investment involved for moving the historical data to Net Suite as well as getting the employees trained to use it even though most of us at Heaven Fresh have a strong technical background. Then there are software bugs as well, but having developed the large software systems myself, I know well that software bugs are inevitable in any new system. However, it seems that Net Suite development team is quite responsive about fixing the broken functionality in each upgrade.

Despite the shortcomings of Net Suite, it is the best of the worst systems in the market today for micro-multinational companies and we have been quite happy with it until the latest episode that has flipped our perception of the company. It has nothing to do with the system itself but the Net Suite's treatment of its customers. I would characterize it the worst customer treatment I have ever experienced. In a nutshell, due to some technical issues in Net Suite accounting, some of our payments were not recorded and our credit card was over charged and also our invoices were not sent to us in a single combined format that we had been promised. When we contacted them to investigate the issue, we encountered a very rude behavior. We had expected it to be a simple matter but instead we started receiving repeated threats to block our access to the system. That's when we realized how vulnerable we were by leaving our business data and software in some other company's hands. After months of back and forth communication, Net Suite only backed off and and decided to investigate our complaints when we told them that we would hold them responsible if there were any damages caused to our business due to the lack of access to the system. And sure enough, they found their mistakes. If this was done to us due to a a glitch on Net Suite's part, I cannot imagine what would a customer experience who happens to be on the wrong side of the fence.

This incident made us lose our confidence in Net Suite. It left such a bitter taste in our mouth that if it was a simple task, we would have moved to another system the very next day. Net Suite is very well aware of this dependence and for some reason they have chosen this power and responsibility to black mail their customers and make them feel like a hostage. Net Suite has the edge with a relatively decent product in their hands at this point but I am sure that this edge will not be there for long. Since the software system itself is not unique, it is just a matter of time before other companies will be competing with Net Suite. I believe that a vendor offering SaaS should use a threat to disconnect the service to a business only and only if the world has turned upside down. Secondly, we are paying about $36,000 / year to use Net Suite for the Heaven Fresh US, Canada and UK offices. We were very keen on implementing the system for our other offices as well but the current Net Suite pricing model is more cost effective for up to 3 countries. When combined cost of more than 3 international offices is compared, the other higher end business management software systems start looking more lucrative. Unless Net Suite drastically changes its customer treatment culture and the pricing model to accommodate a micro-multinational, we are very unlikely to expand our business relationship with the company or even continue the existing one. It is a pity that a company can develop a good product but can lose customers due to utter disregard of its customers' satisfaction.

Cuba - Beyond the Tourist Resorts

noreply@blogger.com (Imran Bashir) — Tue, 19 Feb 2008 05:03:00 +0000

It was a cold welcome back home from Cuba couple of weeks ago and I have been busy trying to catch up with all the piled up work since then. We have had record snow in Toronto this year. When I look out my balcony, I see mountains of snow in the parking lot and along the roads. If I close my eyes, I still find myself on the sunny beach in Cuba with countless gorgeous and sexy women in bikinis from all over the world. I stayed at Sol Sirenas Coral resort and it was like being in a dream. As soon as I got there, I wasn't even thinking about the extreme cold weather of Toronto or crushing stress of running a micro-multinational. For one whole week, there was nothing else to do but to enjoy the clear blue ocean, lovely scenery, Caribbean music, local hospitality, delicious food, tropical drinks, Cuban cigars, peaceful sleeps, reading books, beach strolls, flirting around, aimless wandering, beautiful sunshine and heaven fresh air (no pun intended).

Here are few of the pictures:

	I'm enjoying the afternoon with a book and two cups of cappuccino.
	A relaxing view lying down by the swimming pool at the resort. Don't you wish you were there? :)
	My friend Celal with the Havana museum in the background. The boat used by Castro to come to Cuba and the missiles from the Cuban crises are on display there.
	A pictures in the streets of Havana showing the horse carriages. How's my tan :)
	Tourists and the locals in a festive mood.
	I had the most delicious Piña Colada at a pit stop on our way to a day tour in the capital city of Havana. One glass cost me 2.5 Peso (about 3 dollars)
	Lot of old American cars on the streets of Cuba. Our tour guide told us the reason behind it. Interesting story. Little too long to type here.

Cuba was all heaven in my eyes until I asked the courtesy question, "How is business?", from the two Cuban gentlemen selling souvenirs at the beach on their bicycle cart. The boss, Jose, spoke several different languages fluently and sounded like a shrewd businessman as I had already heard him negotiate prices with a Canadian tourist in French. Jose told me that on a good day they could sell as much as 200 peso worth of merchandise and on a bad day the sales could be as little as 15 pesos. According to them it was a tough job as they had to pull and push the bicycle cart on the sand more than 5 miles every day. As the conversation unfolded, to my biggest surprise in Cuba, I found out from Jose that the small bicycle cart was owned by the Cuban government and each one of them only got about 5% of the sales as a compensation for operating the cart. A sudden visit by the government auditor could get them in trouble if they were found selling any articles other than the ones provided by the government. Apparently the men were happy to have a job that paid an average of 150 pesos every month as compared to the jobs outside the tourism industry that only paid about 40 pesos. It was not the amount of their compensation that struck me, it was the fact that the government was involved in managing a small souvenir cart. In my opinion, these two very capable gentlemen would have done a million times better job of running that small business if the government was not meddling in their affairs.

My second shocker came during the day tour to Havana. Our tour guide, Orlando, was giving the group a very detailed history of the cities, buildings, currency and other related subjects. His presentation was so impressive that I could not keep myself from speaking my mind to him that he was more than a mere tour guide. He hesitated for few seconds and then told me that he was a professor of history and literature before taking on this tour guide job. In a country where average salary is about 40 to 50 pesos per month, being a bartender in a tourist resort was probably the most lucrative job where the Canadian and European tourists did not even think twice about paying generous tips in all-you-can-drink bars for mojitos, piña coladas, tequila sunrises, rum cokes and all the glasses of beers. According to Orlando, doctors, engineers and other qualified Cubans were quitting their regular jobs to work in the tourism industry for the sake of gratuity.

A micro-multinational thrives on utilizing the individual talents, knowledge and hard work to the maximum possible degree. An environment that does not reward such traits would be the worst place on earth to incubate the new breed of 21st century multinational businesses - the might micro-multinationals.

Stretching dollars & Resources

noreply@blogger.com (Imran Bashir) — Sun, 20 Jan 2008 16:32:00 +0000

It has been almost a month that I wrote a post. There were quite a few things that I wanted to write about but the Xmas season turned out to be extremely busy. By the time I got home after work, I was too burned out to sit in front of the computer. There is a constant stream of chores at work that never stops. One thing after another keeps getting queued in my to-do list. Very often it gets so overwhelming that it is even difficult to spare 30 minutes for lunch. Having had the experience of working with slow moving large corporations and the stressful startup environments, I can say that my level of productivity at Heaven Fresh is significantly higher than my previous jobs. One of the reasons for that is because I wear many different hats here. But I am not the only one, most of the people working with Heaven Fresh are responsible for a variety of tasks. Each person performing an array of tasks is a key characteristic of a micro-multinational as it, among other benefits, helps stretch the dollars by hiring less people and keeping the payroll smaller. Consequently, the time resources are utilized to the maximum and every one gets used to ploughing through various tasks to keep the business going.

On the flip side, this constant pressure and running around can wear people out as well. Being in the situation myself, I am very conscious of that. Although utilizing every single minute productively is a must for a micr0-multinational, at one point the system simply breaks due to the overload. I am very lucky to be working with the most dedicated and hardworking people who never say no to any challenge. However, during the busy Xmas season, I could see them cracking and snapping with the work load. The ultimate test came when Kamal had to leave the office for few days due to an emergency and his daily responsibilities had to be shared among others too. It simply broke the system and we went from stretching resources to chocking the business with just one person missing from the office for few days.

In my mind, it is a perfect indication that something needs to be changed to be able to take the company to the next level from this point. Therefore, we will be restructuring the organization and investing in acquiring excess capacity and start the cycle of pushing it to the breaking point once again.

Before we get started on the new projects for 2008, I am taking a week off from Heaven Fresh to go to Cuba. While relaxing on the sandy beaches of Cuba and sipping Piña Coladas, hopefully a few ideas with pop up in my head on how to move the business forward. Until then, Adiós.

Hasta luego

R&D Tax Credits in Canada

noreply@blogger.com (Imran Bashir) — Tue, 11 Dec 2007 02:40:00 +0000

Canada is one of the best countries to provide SRED (Scientific Research & Experimental Development) tax credits for businesses. A Canadian owned company can get up to 70% of the money spent on SRED. By providing tax credits, Canadian government encourages more experimentation and research. This program is especially helpful for small businesses with limited funds. Even if a new experiment or development fails, the business essentially gets that money back just for trying, thus reducing the risk inherent in trying new things.

At Heaven Fresh, we have done quite a bit of experimentation on process improvement and product development. Some of these experiments worked, but others did not as we ended up abandoning them for various reasons. However, it is the result of trying the new tools, technologies and processes with which we are able to manage all of our offices with very minimal resources.

Our efforts to improve processes and products were really an attempt to run an efficient and profitable business as we were not even aware of the SRED credits in Canada. We came to know about it through Brian Hartman of RDFM (http://www.rdfm.ca) whom I met in a business network meeting. RDFM helped us put a SRED claim together for a percentage of the claim as the fee for their services. The fee was only charged once the claim was approved and it was definitely worthwhile as it required expertise to determine what can or cannot be claimed and to put the actual claim together according to the Canada Revenue Agency's guidelines.

We received a check from CRA last week for our approved claim. This is a tremendous help for a small business like Heaven Fresh. As a result, we are also planning to step-up our research and development activities. During the SRED claim process, we also learned another government program called IRAP (Industrial Research Assistance Program) where the government provides financial and business assistance for research and development. We have scheduled a meeting with the IRAP adviser on December 17, 07 and I will post more on IRAP once I get further information.

If you are a Canadian business, I would strongly encourage you to get in touch with Brian Hartman at RDFM and you might be surprised to find out that many of your "routine " activities qualify for the SRED credits.

Loonie effect on Canadian business

noreply@blogger.com (Imran Bashir) — Sun, 02 Dec 2007 00:45:00 +0000

Canadian Loonie has been strengthening against US dollar for quite some time now. Last month it hit parity with the US dollar. Although, the prices for Heaven Fresh products in Canada have been higher than the prices in the US from the very beginning, we have been getting much more calls and e-mails from Canadian customers complaining about the higher prices. Since the Canadian dollar is equal to the US dollar, Canadian consumers expect the US and Canadian prices of various products to be the same as well.

The cost of doing business is higher in Canada and the sales volume is lower therefore if we try to reduce the prices in Canada, we will simply be out of business in 6 months. However, it is very difficult to make customers understand the cost difference. Therefore, to make them happy, we end up offering discounts to the customers who are really upset about the price difference.

Our prices in Europe and Middle Eastern offices are even higher than Canada due to the similar reasons, but we do not face the same challenges as we face here in Canada because customers in those countries do not have the luxury of driving a couple of hours to the largest economy of the world to buy cheaper goods.

I totally understand consumers' frustration in Canada for paying higher prices for the same products than the US consumers as I was in the same shoes before starting the business. But running Heaven Fresh for last few years has made me more aware that although in North American we, the Canadians, live in a separate country. The government policies, the business environment and the costs of running a business are different here. As Canadian citizens, we enjoy a lot of social benefits which the US citizens do not and the higher product prices are a small payback in return for all that. What do you think?

Heaven Fresh UK: Current Standing

noreply@blogger.com (Imran Bashir) — Mon, 12 Nov 2007 02:06:00 +0000

It has been almost one year that we started selling Heaven Fresh products in the UK. Past twelve months have been a great learning experience. We faced more challenges than we had anticipated but UK is turning out to be a very good market for us. Just the online UK sales gave us enough confidence and cash flow to be able to lease a decent warehouse and office. We moved to the new office four months ago. We are in touch with most of the nationwide retailers to put our products on the shelf in the stores. We have already signed up as a vendor for some of the prominent names in the UK including Harrods (http://www.harrods.com), Revital Health Stores (http://www.revital.co.uk) and JB&C Pharmacy (http://www.johnbellcroyden.co.uk). We have launched a separate web site for Ireland. We have also brought some independent small distributors on board.

We will continue expanding our sales and marketing efforts in the UK and the neighboring countries. Based on the results so far, I believe that the Heaven Fresh UK's revenues will surpass Canadian revenues (our home market) within next two years.

Heaven Fresh UK: Expanding into Europe

noreply@blogger.com (Imran Bashir) — Sun, 04 Nov 2007 20:19:00 +0000

Opening offices in the UK and Germany is part of our ambition to expand the Heaven Fresh distribution and sales network all over Europe. The German office has been distributing products to the neighboring countries for quite some time now. To do a test run, we translated the UK web site in French and ran an advertisement campaign on Google both for France and Ireland. The frequency, the size and the number of online orders as well as the customer inquiries are usually good indicators of the size and the readiness of a potential new market, at least from the perspective of a micro-multinational.

As soon as the Ireland advertisement campaign was launched, we started getting orders and the customer inquiries from Ireland. Because of the business friendly regulations of the European Union (EU), shipping products to other EU countries from our UK warehouse is just as easy as sending the shipments within UK. Although the results of the ad campaign in Ireland were very persuasive, the outcome from the French campaign was not very encouraging. We were getting very targeted visitors from France but did not get many orders or customer inquiries. Our little experiment led me to believe that French customers are not very comfortable buying from a web site with strong UK markings, including the URL, phone number, address and currency (Sterling instead of Euro). It is just my personal theory about French consumers' mind set as it is very hard for me to believe that our product features and the prices are not attractive for the French customers.

As a result of our test campaigns in Ireland and France, we launched a new Heaven Fresh web site for Ireland (http://www.heavenfresh.ie) just a couple of days ago. The prices on the Irish site are listed in Euros, and to confirm or refute my own theory about France, we will also advertise this new site in France to compare the outcome with the UK centric Heaven Fresh site with listings in Pound Sterling.

Our plan is to continue our experimentations for various European countries and make bigger moves to setup sales and distribution centers based on the magnitude of the online sales. The whole idea is to minimize the risk by expanding our European distribution network in a step by step and methodical fashion.

Heaven Fresh UK: Sales Initiatives

noreply@blogger.com (Imran Bashir) — Sun, 04 Nov 2007 05:52:00 +0000

The Heaven Fresh UK web site started generating sales as soon as it was launched in November 2006. After observing the online sales activity for few weeks, we were very confident that just the online business in the UK would be sufficient to break even. This initial cash flow from web sales was our life line. Being a micro-multinational we did not have the luxury to drain our investment account for more than 3 months. Also, the second round of financing depended on our ability to quickly get the UK office on its own feet.

Although e-commerce has changed the rules of engagement for starting the 21st century businesses, the traditional sales and marketing channels still play a significant role in the growth of a business, especially the businesses involving the marketing of consumer products. We knew that the real growth of Heaven Fresh UK was dependent on our ability to penetrate the market using all the possible sales channels particularly television and the retail shops. Therefore, we took different sales initiatives to determine the most cost effective ways to increase off line sales in the UK. Following are the short description and the outcome of those initiatives.

Telemarketing

Telemarketing campaigns have worked very well for us both in the US and Canada to get small business owners to sell Heaven Fresh products in their shops. We ran a trial to contact small UK shops in various categories but did not get a very positive response. From the initial reaction, it seems like the people in the UK do not prefer to conduct business over the phone. My theory is that the telemarketing works well for us in North America because it is already a norm here. Because of the great distances involved, it is very costly for the suppliers to send sales representatives for a face to face meeting with the owners of thousands of small businesses scattered between the Atlantic and the Pacific oceans. On the other hand, one could easily drive from one end to the other end of the UK within hours, Therefore, the suppliers introduce their products in person and that is exactly why we do not get a very warm reception when trying to do this over the phone. If anyone has a different experience, I'd be very interested to find out if my conclusion has any merit or not.

TV Infomercial

TV is probably one of the best media to introduce a consumer product to the masses. We specifically tailored the Heaven Fresh infomercial to be able to run it in the UK. Before we even started the production process, we knew that we will have to get the production approved by BACC (http://www.bacc.org.uk/) for broadcasting in the UK. We skipped the script approval part and decided to send the video production instead for approval as we were quite confident that we were well within the guidelines based on our experience in Canada. While the infomercial was approved for broadcasting by the Canadian regulatory body with minor changes, we had a surprise of the lifetime when we got result of the initial review from the BACC in the UK. The extent of the strictness of the infomercial advertising in the UK can be realized from the suggestion for us to remove the word "necessity" as it was debatable whether air purifiers were really a necessity in the UK. In a nutshell, our only choice was to completely redo the infomercial. It was an expensive lesson for us that before even a single minute is spent on recording and production, we should get the advertisement script approved for TV advertisement in the UK.

Large retailers and chain stores

Getting a few of the large nationwide retailers to carry the Heaven Fresh products in the UK is one of the most crucial factors in our long term success. However, getting these big retailers on board can be a long and costly process. A process that requires both perseverance and patience. We started approaching the large UK retailers in June 07 and got a very mixed response in the beginning. Gloria Baptist-Smith, Heaven Fresh UK sales director, has been doing a tremendous job of introducing the company and the products to various buyers. With her tenacity and experience in the industry, the doors are starting to open for us. She has done a phenomenal job of getting Heaven Fresh UK on the supplier list of few key accounts including Harrods, Revital and John Bell & Croyden in a very short period of time. I believe it is just a matter of time that the customers will be able to pick up the Heaven Fresh products from a nearby retailer.

Heaven Fresh UK: The Beginning

noreply@blogger.com (Imran Bashir) — Tue, 30 Oct 2007 03:00:00 +0000

I will be dedicating the next few posts to the UK experience as it relates to a micro-multinational distribution company. It has been over a year that we started Heaven Fresh UK and the UK web site (http://www.heavenfresh.co.uk) was launched in the last week of November 06.

Given that the Heaven Fresh branch was already doing quite well in Germany, UK was a natural choice for us to further expand our operation in Europe. I contacted the UK Trade Commission in Toronto with our intentions to open an office in London in early 2006. UK consulate put us in touch with London based organization called Think London (http://www.thinklondon.com). Think London helps foreign companies get started and settled in London UK. Before I flew to London, Think London's staff had already laid out a week long schedule for me to meet solicitors and bankers as well as had the appointments setup with real estate agents to see commercial properties in North, South, East and West London. While I was in London, they took me around to get me oriented with the city to be able to chose a proper location for business. My initial experience of the business environment in the UK was extremely positive mainly due to the professionalism of the Think London's staff.

I was well aware that London was an expensive place to live and operate a business and that we needed to allocate sufficient working capital to compensate for London's expensiveness. Our target was to break even in first 3 months but just to be on the safe side we allocated funds for 6 months, or so we believed. With Think London's help I found an office/warehouse that I liked but when it came to signing the lease I came to know that the landlords in the UK wanted a deposit equal to 3 month's rent along with 3 month rent in advance. To top it all off, property taxes are tenant's responsibility in the UK that have to be paid to the government directly by the tenant above and beyond the rent payment to the landlord. I had only allocated rent for two months in the plan and paying six month rent in advance along with "counsel taxes" meant being left with no working capital.

Seeking more capital from the investors before making even a single sale in the UK meant sending a message that I did not know what I was doing. Therefore, I decided to activate the plan B to store the products in a public storage and had one and only company employee, Shahzad, operate the business from home. As expected, we got our first online order within first 48 hours of launching the UK web site. Christmas season turned out to be a perfect time to start the online sales in the UK. In the very first month, we did about £7,000 in online sales. This figure tremendously boosted my confidence. By looking at the first month sales, I knew that the UK was going to be a goldmine for us, given that we overcame all the "UK surprises" and carried out the business as we had planned.

Two busy weeks at Heaven Fresh

noreply@blogger.com (Imran Bashir) — Sat, 27 Oct 2007 15:48:00 +0000

It has been more than two weeks that I wrote my last post. I do not ever remember myself being so busy as it was for last couple of weeks. Besides entering the high season for the sales activity, Kamal was out of the office because of his new born baby boy. It was a stark reminder that Heaven Fresh is not a typical MNC but a micro-multinational, where the absence of even one key person can stretch the entire organization across the globe. We also had a blurb published in Globe & Mail about the new Heaven Fresh Personal Air Purifier. These few lines by the Globe editor made the phone ring off the hook for almost one week. This write-up in Globe & Mail was a result of the PR campaign by Celia Love for Heaven Fresh. I wrote a post about our successful trial PR campaigns in August. We finally came to an agreement with Blessington Love PR where Heaven Fresh will pay them a monthly minimum retainer for writing one press release every month along with 1% of the PR value generated from those releases. Our formula for calculating the PR value is as follows:

PR Value = Advertisement rates in the print media for the space allocated to Heaven Fresh stories multiplied by 3

The reason for giving three times the weight of the equivalent advertisement space in the same media is that the editorial stories get more attention by the readers and have a greater impact. We are planning to expand our PR activities in other countries as well as on the Internet.

There has also been quite a bit of activity in the UK office for last couple of months. I will be dedicating this coming week writing about our experiences of starting the Heaven Fresh office in London, UK.