Business (2015)

Final Consulting Report: Mihle Personnel Services, Alexis Ilyinsky

Images are on their way. 

08

Fall

 

Final Consulting Report Abuya Consultancy Alexis, Illyinsky Elaine Wairimu, Esteban Arturo, Ian Mitchell, & Susanna Marrero

 

 

Table of Contents

Letter of Agreement................................................................................................................ 5

SUPPORTING EMERGING ENTERPRISES (SEE) MODEL.......................................... 10

I. Core Strategic Issues..................................................................................................... 11

II. The Entrepreneurs........................................................................................................ 12

Monde Foli....................................................................................................................... 12

Arnold Ndindwa................................................................................................................ 14

Business Skills................................................................................................................... 16

III. The Business Concept................................................................................................. 18

Business Description......................................................................................................... 18

Contribution Margin......................................................................................................... 20

Location........................................................................................................................... 20

IV. The Opportunity.......................................................................................................... 21

The Local Market............................................................................................................. 21

Target Market.................................................................................................................. 22

Pricing and Price Competition.......................................................................................... 23

Competition..................................................................................................................... 24

V. Financial Records......................................................................................................... 27

Financial Statements......................................................................................................... 27

Future Financial Growth.................................................................................................... 29

Financial Structure............................................................................................................ 29

Breakeven......................................................................................................................... 30

Operating Leverage........................................................................................................... 31

VI. Internal Infrastructure............................................................................................... 32

Operating Facilities........................................................................................................... 32

Staff.................................................................................................................................. 32

Information System.......................................................................................................... 33

VII. Operational Considerations..................................................................................... 34

Administrative procedures................................................................................................. 36

VIII. Marketing Efforts...................................................................................................... 37

Positioning....................................................................................................................... 37

Segments and Marketing................................................................................................... 37

Sales Efforts and Approach............................................................................................... 39

Marketing Media and Branding.......................................................................................... 39

IX. Financing Needs & Relationships.............................................................................. 42

Capital Needs.................................................................................................................... 42

X. External Networks......................................................................................................... 44

XI. Concluding Remarks.................................................................................................. 45

DELIVERABLES.................................................................................................................... 46

Deliverable 1: Branding................................................................................................... 47

1.1 Problem Statement..................................................................................................... 47

1.2 Desired Results............................................................................................................ 47

1.3 Solution...................................................................................................................... 47

1.4 Argument.................................................................................................................... 49

1.5 Implementation Plan.................................................................................................. 49

1.6 Next Steps.................................................................................................................. 55

Deliverable 2: Marketing Plan and Strategies.............................................................. 56

2.1 Problem...................................................................................................................... 56

2.2 Desired Results............................................................................................................ 56

2.3 Solution...................................................................................................................... 56

2.4 Argumentation............................................................................................................ 67

2.5 Implementation.......................................................................................................... 67

2.6 Next Steps.................................................................................................................. 71

Deliverable 3: Sales Process............................................................................................ 72

3.1 Problem Statement..................................................................................................... 72

3.2 Desired result.............................................................................................................. 72

3.3 Solution...................................................................................................................... 73

3.4 Argumentation............................................................................................................ 81

3.5 Implementation.......................................................................................................... 82

3.6 Next Steps.................................................................................................................. 83

Deliverable 4: Forms and Processes................................................................................ 84

4.1 Problem Statement..................................................................................................... 84

4.2 Desired Result............................................................................................................. 84

4.3 Solution...................................................................................................................... 85

4.4 Argumentation............................................................................................................ 89

4.5 Implementation.......................................................................................................... 89

4.6 Next steps................................................................................................................... 91

Deliverable 5: Develop and Implement Short and Long Term Goals for the Company 92

5.1 Problem Statement..................................................................................................... 92

5.2 Desired results............................................................................................................. 92

5.3 Solution...................................................................................................................... 93

5.4 Argumentation............................................................................................................ 96

5.5 Implementation.......................................................................................................... 97

Deliverable 6: Bookkeeping System............................................................................... 98

6.1 Problem Statement..................................................................................................... 98

6.2 Desired Results............................................................................................................ 98

6.3 Solution...................................................................................................................... 98

6.4 Argumentation.......................................................................................................... 105

6.5 Implementation........................................................................................................ 105

6.6 Next Steps................................................................................................................ 107

Letter of Appreciation......................................................................................................... 108

Appendix............................................................................................................................... 109

APPENDIX 1: COLLEGE FLYER..................................................................................... 110

APPENDIX 2: MARKETING PLAN FOR MIHLE PERONNEL SERVICES.................... 111

APPENDIX 3: RESOURCES FOR ONLINE MEDIA CONTENT.................................... 117

APPENDIX 4: FEEDBACK FORM................................................................................... 118

APPENDIX 5: SALES PROCESS..................................................................................... 119

APPENDIX 6: SALES TEMPLATES.................................................................................. 123

APPENDIX 7: LEAD FORMS........................................................................................... 126

APPENDIX 8: STAFFING CONTRACT........................................................................... 129

APPENDIX 9: INTERVIEW FORM.................................................................................. 133

 

 

 

Letter of Agreement

 

LETTER OF AGREEMENT

EESA PROGRAMME
UNIVERSITY OF FLORIDA and UNIVERSITY OF THE WESTERN CAPE

 

 

June 17, 2014

 

Mr. Monde Foli & Mr. Arnold Ndindwa

Co-Founders

Mihle Personnel Services

I23 Mongezi Road

Khayelitsha   7784

 

Re: EESA PROGRAMME

 

Dear Monde and Arnold,

 

We first want to thank you for your participation in and support of the Entrepreneurship Empowerment in South Africa Programme. We extend a warm welcome to the program. Our goal is to contribute in every way possible to the sustainability and growth of your business and make this consulting engagement a mutually rewarding experience. We look forward to working closely with you and using the opportunity to gain insight into your company.

 

As we understand it, Mihle Personnel Services is primarily involved in providing human resource services to businesses and serving as a local employment agency for skilled young adults in the townships. Moreover, your business that can be characterized in terms of human resources implementation, hiring, and mediating services. You face unique challenges in terms of promoting the business and spreading awareness of the unique services that you offer.   Yet, you have been successful in leveraging your existing relationship with Silulo and gaining a pool of hirees from their graduates.  With this in mind, we see the primary focus of the consulting engagement to be getting the business off the ground and developing contracts with companies to use the hiring services.

 

With the EESA Programme, the focus is on producing tangible deliverables that you can use.  We will be working intensely with you over the three and a half weeks, employing a methodology developed as part of the EESA Programme over the past eight years. Our first task will be to establish priorities in terms of your needs and what can be accomplished in the time that we have. We will be using the S.E.E. model (Supporting Emerging Enterprises) to assess your current situation and set the priorities. 

 

While things are likely to change as the relationship evolves, for the present we anticipate working on the following deliverables:

 

• Develop and implement a branding package for Mihle to create a concrete image for the business;
• Establish bookkeeping processes to prepare for future growth and facilitate management decision-making;
• Assess your approach to operations in terms of recruitment, placement and related service delivery process to identify ways to increase the value proposition to clients;
• Establish a systematic selling process for use in obtaining contracts with companies that are in need of employees;
• Set short and long-term goals for the business, and begin to implement methods to increase cash flow within the business;
• Develop and implement a marketing strategy to increase awareness of and generate greater revenue from the services Mihle offers.

 

The key is that we work with you in producing solutions that you can implement immediately in the business to improve performance. 

 

Our overarching goal is to serve your needs and build a relationship of trust with you. The EESA experience over the years has made it clear that the best consulting relationships are mutual ones---where both parties invest heavily.  Our biggest requirement is your time.  It is critical that we are able to meet with you for 3-5 hours per week over the next three and a half weeks. We will be respectful of your time, as we know how valuable it is.  But our hope is that we can establish regular meeting times each week.  The other key requirement is that we get an intimate feel for your business. This means it is critical that we have access to your records, bookkeeping information, costs, and other insights that help us do a better job.  Our commitment is to hold this information in the strictest of confidence. No one other than the professor will have access to it, or to any of the work we do for you. 

 

The engagement will commence on June 17, 2014 and will last until July 25, 2014.  Our team will regularly meet with Professors Michael Morris, Eric Mueller, and Jamie Kraft, our faculty supervisors, and they will be working closing with us on the consulting engagement.  Their contact details are:

 

EESA Office

Economics and Management Sciences

3.34. EMS Building

University of the Western Cape

Ph:  021 959 9327

Cell: 079 074 2837

Email:  michael.morris@warrington.ufl.edu                  

 

We will work with you on implementation of deliverables as the consulting engagement unfolds. In addition, a final presentation will be made to you and the faculty mentors at the end of the program, in late July.  The presentation and final report will cover the primary deliverables of the consulting engagement.

 

In addition to making a meaningful contribution to your firm, we have some personal goals in pursuing this consulting relationship. First, this opportunity will allow us to further develop our consulting skills. Second, as many of us want to start our own ventures, we will learn first-hand from the operations of a small business in South Africa. Third, we are excited to apply creative techniques to leverage resources and help grow a business in a township context. We look forward to learning from you and with you as we grow together through this engagement.

 

We look forward to working with you and this opportunity for a truly rewarding experience. Once again, we thank you for your time and support.  Please feel free to contact us for clarifications on these issues, if any.

 

 

Yours sincerely, 

 

ABUYA CONSULTANCY

 

Alexis Illyinsky

 

 

Ian Mitchell

 

 

Susanna Marrero

 

 

Elaine Wairimu

 

 

Esteban Arturo

 

 

In acceptance of the terms outlined above:

 

 

     

Signature: ____________________________

      Mr. Monde Foli                                                                     

      (Co-Founder, Mihle Personnel)

 

     

 

Signature: ____________________________

      Mr. Arnold Ndindwa                                                             

      (Co-Founder, Mihle Personnel)         

 

 

 

Date:  _________________________                                                    

 

 

Faculty Supervisor:

 

 

________________________________

Dr. Michael H. Morris

George and Lisa Etheridge Professor of Entrepreneurship

Warrington College of Business Administration

University of Florida

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SUPPORTING EMERGING ENTERPRISES (SEE) MODEL

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

I. Core Strategic Issues

The core issue that Mihle Personnel Services is facing is that they have yet to actually have any turnover, and are not bringing in profit. At the core of this is their lack of marketing efforts, and therefore large brand unawareness. In general, because there have been little efforts put into the business, there is structural organization that must be done in terms of developing the product and establishing a firm sales process. To support this, bookkeeping systems and general publicity will also be developed.

In order to have any future growth and success, Mihle must place processes for sales, interviews, and consulting from day one. Instilling good processes from the beginning will allow the company to be successful and avoid disorganization, leading to decreased profits. This is critical in a business that maintains many accounts receivable, and must stay very financially organized to be profitable. While they have been successful in prior ventures, and are leveraging resources with Silulo very well, Arnold and Monde will need to put together a strong brand identity and marketing strategy to spread the word about their business to the people of Khayelitsha.

 

 

 

II. The Entrepreneurs

Monde Foli

Mihle Personnel Services is co-owned by Monde Foli and Arnold Ndindwa. Monde is 28 years old, and was born and raised in Khayelitsha. He has a seven year old son.  He is well experienced in the Human Resource (HR) industry as he worked in HR department in Silulo Technologies before he begun the business. He studied in Cape Technikon for Business and Financial Management as well as HR and later in Thembelihle Development. He later joined Silulo and become in charge of their human resource department where he applied and assisted in the systems involving hiring and employee issues in the company. After deciding that he wanted to pursue an entrepreneurial path, he saw opportunity in the fact that young, educated adults in Khayelitsha are having trouble finding jobs after graduation. He left Silulo and with Arnold established Mihle Personnel Services. In addition to that, he has established an NGO that helps the youth to acquire their driver license, which can be critical in order to obtain a job.

Monde now works as a consultant at Silulo, and is also pursing a venture with a friend for an upholstery company, along with establishing Mihle. He has a passion for starting a business of his own, and is therefore exploring this instead of working full-time at Silulo.

 

 

Strengths	Weaknesses
Passionate about helping the unemployed	No drive to put full effort into the business
Experience in the industry Knowledgable of HR services	Over-commitment to many ventures Undeveloped sales skills Unaware of the importance of a target market

Table 1: Monde’s Strengths and Weaknesses

Monde’s weaknesses center around the fact that a lot of effort has not been put into the business venture to date. Because there are currently no fixed costs, and both business partners have other things to focus on, developing Mihle Personnel Services has taken the backburner on their priority list. By changing Monde’s priorities, these weaknesses can be reduced and his strengths can shine to develop a strong business.

Monde is passionate about HR and wants to assist candidates to get jobs or assist them to be professional when applying for jobs. He has seen first-hand the basic skills that candidates lack when applying for jobs. He wants to educate these candidates and enable them to have suitable criteria to enable them to get jobs or match them with potential employers. With this he would like to see instead of employees going out of Khayelitsha to go to jobs or look for them, they live and work in Khayelitsha. With this in mind, Mihle should be in that process of finding organizations or companies looking for employees and matching with potential candidates.

 

Figure 1: Monde’s Time Allocation

 

Currently, Monde is not focusing enough time on Mihle per week if he desires to see any growth for the business. His interest in his other venture appears to be a priority because it is further developed than Mihle is, and his role in the business is more clearly established. Because Mihle is still in the beginning development stages, it is easy to set it to the side and come back to it in the future. Also, because there are few processes and standard forms for the business, the development of these things are critical before Monde sees value in dedicating his time to the business. After a sales processes and associated templates, contracts, and forms have been created, it will be easy for Monde to see his role in the business, and dedicate more time to its success.

 

Arnold Ndindwa

            Arnold Ndindwa is the other partner in Mihle Personnel Services. He is 30 years of age, married and has a four-year-old daughter. He was born and raised in Khayelitsha and still lives in the area. He works full time in a Vodacom project based in the same area he lives, specializing in relations with informal merchants.

            He studied in Cape Techikon for Human Resource Management, which he completed. He worked in a radio station for four years but left, because he wanted to open a community radio station to empower the township people and focus on the growth that is coming from the Khayelitsha people. Due to bureaucracy and costs, he opted to do a magazine instead, and Ikasi magazine was born, with the help of Silulo Technology. Ikasi was quickly picked up and purchased by Vodacom, and Arnold became a Vodacom employee, managing the magazine and salespeople in the informal sector.

 

Strengths	Weaknesses
Confident and outgoing	Very busy with Vodacom job
Experienced in the industry Strong community relations	Overlooks basic business functions, all about the sales
	Not proactive with the business Undeveloped sales skills

Table 2: Arnold’s Strengths and Weaknesses

            Arnold’s weaknesses vary slightly from Monde’s, but the central issue is the same – there has not been a lot of effort put into establishing processes for the business, so it is being put on the backburner for now. Arnold has the skills to make a very convincing sale, but the sales process must be fine-tuned so that he knows the proper information to present to a potential customer.

During the time with the magazine, he noticed how the township citizens, were having problems getting jobs and since he knew Monde from childhood and studied with him, they agreed to open a business together. He also wanted to inform the youth of what they needed in order to get jobs. Arnold thought he could prepare the youth by teaching them about self-presentation, conversational tools, and self-esteem.

 

Figure 2: Arnold’s Time Allocation

Arnold works full-time so the majority of his week is spent at Vodacom. Since he also has a wife and child, he spends a good amount of time with them as well. Only a small portion of Arnold’s week is spent on working with Mihle, for the same reason as Monde – the business is so early in development that it is hard to see the reason to dedicate time to something that needs a lot of work before it will bring in profits. After establishing the basis of the business together, we believe that Arnold and Monde will both see the true potential that Mihle Personnel Services has, and will be motivated to dedicate more time to the business because of the time they spend building it together with Abuya Consultancy.

 

Both partners meet about once a week to discuss the business or any agenda that needs attention. Mihle has not spent any money other than the cost of registering the business. The company has yet to start spending money to market itself and penetrate the market. Monde and Arnold already have an idea of what to do although it has to yet materialize into action steps. Without concrete action steps, very little progress will be made with the business. Therefore, Abuya Consultancy will prioritize developing concrete action steps for Mihle’s sales and hiring processes, to help the business develop a foundation for growth.

 

Business Skills

            While the pool of unemployed people in the townships is large, it is critical for Monde and Arnold to develop the proper business skills to gain traction with local businesses looking to use them as a personnel service, because this is where the revenue is coming from. While they do have basic business knowledge, and a strong understanding of what is necessary for the job, teaching and recognizing these specific skills will help Arnold and Monde to succeed in the basic business skills that are needed to foster growth in the business.

Figure 3: Monde and Arnold’s Business Skills

           

Unfortunately since Arnold has a full time job, which he values very much, he does not have a lot of time to meet to discuss the business. This causes the information flow about the business between Arnold and Monde to be limited, and is part of the reason why there has been little growth of the business thus far. While Monde has more time to offer, time needs to be spent equally with both partners in the beginning stages to develop the necessary processes to run the business and make sure they are on the same page when marketing the business offerings.

Figure 4: Time Allocation for Both Partners

Overall, the business is a very small focus for both of the entrepreneurs in their weekly time schedule, which is an issue that must be addressed. By developing the basic tools needed for a sale and for employees to be placed, value will be created in the entrepreneurs’ minds, and they will have a greater desire to dedicate more time to the business in the future. In order for future growth to be achievable, the business must take up a much larger percentage of the partners’ focus, and this will be communicated and learned by all.

 

 

 

 

III. The Business Concept

Business Description

            Mihle Personnel Services is a unique business in that it provides job placement for men and women in need of employment while simultaneously working with local companies looking to fill specific job positions in the Khayelitsha community. Along with job placements, Mihle also assists in disputes that might happen in the workplace, acting as a mediator and holding team-building workshops. In addition, Monde and Arnold hope to provide appropriate services to local businesses that lack Human Resources departments.  It is estimated that hiring services will provide about 85% of revenue, and HR consulting will provide about 15% of revenue. This is because hiring services are the main focus of the business, and therefore will make it most profitable. As the business grows, consulting could either grow to bring in more revenue, or be pushed aside, depending on the desires of the entrepreneurs.

 

85%

15%

 

Figure 5: Mihle Service Offerings

 

            Monde and Arnold are passionate about helping the Khayelitsha community. They want to create a sustainable work environment and to help place as many people in local jobs as possible. As of right now, they have not placed any jobs because the business was established less than two months ago. In the past when a man or woman in Khayelitsha needed a job, they would go into the city and seek help from a job placement service there. These services provide competition because they hire from a similar pool, however they do not provide direct competition because of the high commission % they charge to companies. Mihle will further differentiate themselves from competition in the city by honing in on specific job placements and screening not only the background of the client but to be selective. They need to focus on the skillsets and capabilities of these men and women seeking help in order to set their company apart.

            If the owners are able to narrow their pool of clients by being selective with their criteria, value will be added to the overall process. They will be able to pull potential employees from a strong well-rounded group of candidates and truly satisfy the needs of the business that needs the placement filled. An important aspect of the selection process is not just if they have the hard skills needed for that specific job, but also having soft skills to be a good, long-term investment for the company, such as ability to learn quickly and strong customer interaction skills. These skills will be tangibilized by implementing checklists filled out when interviewing a potential employee, and can be shown to the company hiring, as well as the employee themselves. In doing so, Mihle Personnel Services would focus on maintaining low volumes and high margins.

 

Because of local standards, Mihle has determined that they can charge the business that is in need of the job placement no more than 8% of the job position’s yearly salary. Monde and Arnold expressed that they would charge between 4-6% of the yearly salary when closing a contract for a large group of hirees, for the sake of their competition. Monde, who would be in charge of the HR consulting, would charge R120 per hour of on-site service. This fee is fairly low, due to the fact that Monde has not received his CCMA consulting certificate, although he plans to within the next year. When establishing short and long-term goals for the business, this will be considered and placed as a fairly high priority, to increase revenues.

 

 

 

 

 

Contribution Margin

The two revenue drivers for the business are job placement and HR consulting services, and both have a very high contribution margin because of the low fixed costs of the business. However, what must be considered with contribution margin is the large amount of time that Mihle must dedicate to the services they provide. When business starts to flow in, revenues will quickly increase, because of the current lack of both fixed and variable costs. When the business expands, and they decide to rent a permanent location and hire employees, fixed costs will increase, and this high contribution margin will be very important.

 

Location

As of right now, Mihle is run out of Monde and Arnold’s homes in the Khayelitsha area. Both of the owners have voiced their desire to rent a location, to increase their professionalism and have a concrete street address for the business. Monde has searched in the community for a small storefront to lease. Their ideal location for Mihle would be in the heart of a shopping center or mall in Khayelitsha, where it is easy to come across and close to many potential clients. This would bring in foot traffic and make their services easy for the public to access.

Renting a location is not a top priority for the business but it is something that Monde and Arnold want to pursue in the near future. Currently, the conference room at Silulo can be used for employee interviews, and this is a professional and suitable environment. Because the business was started so recently, no revenue has been generated. Obtaining a leased space would bring in more monthly fixed costs. Abuya Consultancy believes that while having an easily accessible location for clients is important, the owners need to focus on grounding the business and solidifying a steady turnover.

IV. The Opportunity

            Mihle is a service company that allows companies to outsource their Human Resource needs. Due to the unique conditions of the South African labor market, such as persistently high unemployment and skills mismatch, this is a common practice. While the responsibilities of an HR firm include mediation and other tasks as well, the main service is in connecting employers to the talent they need, so there are two distinct markets to deal with for any HR company. The specific market in this case is large companies that are investing in townships, and SMEs that have grown in the area.

Major investments are being made in townships in retail shopping centers and call centers, requiring basic computer skills and typically at least a matric education, skills that are higher than the average township resident possesses. Because of this, the specific market for talent is semi-skilled employees, with certifications, matric qualifications, but little or no full-time work experience, who live in or near townships. There is a separate market for IT-qualified workers as part of these companies as well. Because of the difficulty in finding people with these qualifications, employers and recruitment agents often end up sourcing this type of employee form outside of the township where they are employed.
 

The Local Market

The market that Mihle plans to initially begin operating in is Khayelitsha. Khayelitsha is South Africa’s biggest and fastest growing township, with as many as 1.5 million inhabitants, and an official census population of 381,000 as of 2011. In Khayelitsha, as in similar townships, there is an increasing level of investment in retailing, call centers, and related industries, creating a demand for a semi-skilled workforce who is computer literate with grade 12 qualifications. Accompanying this there is also a major rise in the demand for certified IT professionals to keep everything from POS systems to phone trees up and running, along with maintenance on wireless infrastructure and computers themselves. These businesses are bringing in large numbers of jobs to the area, but currently, they are not always going to residents of the township. Mihle will serve as a way for these jobs to be given to the residents of the area. The industries that are doing the most hiring in the townships are retail chains, such as ShopRite or Spar, and are hiring in whatever means is easiest for them.

There are 75 448 workers in Khayelitsha who commute to work on a daily basis. 80% of them rely on bus, taxi, or train, and another 5% walk to work[1]. This number does not include those who commute from town or adjacent townships into Khayelitsha for work, however many more workers leave Khayelitsha on a daily basis than enter. Due to the geography of Khayelitsha and the Cape Flats area in general, commute times from Cape Town to Khayelitsha, and even between townships, can approach 2 hours per day. Tardiness and absences can be expected for employees who rely on this over-capacity system, who have few if any alternatives. For employers, sourcing employees from outside of Khayelitsha can translate directly into absences, tardiness, and poor performance, however there are no agencies set up specifically to remedy this problem by sourcing employees from within Khayelitsha.

The employees that are in demand in Khayelitsha are more skilled than the labor force of Khayelitsha overall, and the high rate of unemployment in the area creates an issue, as HR departments need to sort over large applicant pools with relatively few qualified for the open jobs. In Khayelitsha just over a third have completed grade 12, and fewer have necessary skills or certificates qualifying them for skilled or semi-skilled work. Because of this, open positions are rarely advertised, since the deluge of applicants can be difficult to manage. Positions are usually filled via either asking existing employees for references for new employees, or via employment agencies based in Cape Town.  

The difficulty in obtaining employees in Khayelitsha who are both skilled and consistently available comes from a lack of agencies with connections within the township, and from relatively few working in the relevant industries with friends or family in the township. As employers cannot function without employees, this is a major issue to be dealt with.

 

Target Market

While Mihle has not begun operating yet (i.e. there are no revenues), when we initially spoke with the entrepreneurs, they wanted to handle a very broad market, from unskilled elementary with no full-time work experience to college-educated and managerially experienced. However, the business has greater strengths in specifically supplying semi-skilled employees and IT certified professionals via its relationship with Silulo, particularly in Khayelitsha due to strong community ties beside Silulo. This is the market niche in which Mihle can attain a sustainable competitive advantage and best grow their business. Currently, there is no formal arrangement with Silulo, but they are very interested in a way to aid their graduates in getting an actual job, and Mihle is the service that can do this for them.

Mihle has not laid out a segmentation strategy yet, but a strategy of utilizing their connections to Silulo and via Arnold’s connections into the corporate world, there is a strong ability to build much of the business’ market from personal networks. The segments which have the most promise are employers who are new or expanding entrants into Khayelitsha, who require semi-skilled or IT workers and require a streamlined acquisition process and greater accountability from their new hires.  While the company makes revenue from the employers, they need buy-in from applicants to go through the interview process and to trust the company to place them. This is why the personal connections with Silulo and the community of Khayelitsha are particularly important in Mihle’s success.

 

Pricing and Price Competition

The entrepreneurs believe there is a legal barrier to the maximum employment commission of 8% of total compensation. While this is not an explicit law, labor unions in the townships enforce it through strikes, and it is the accepted norm. However, competitors, especially those that are well established in the city, often ignore these rules and charge a commission rate anywhere from 12-15%. Generally the entrepreneurs intend on charging close to 8% commission, but granting discounts for large quantity hires is a strategy they mentioned to help drive business and to quickly gain a track record for the business. This lower price is due to the niche market that Mihle is targeting; businesses and employees in the townships. These people are not as interesting in paying a higher premium on services such as this, and therefore Mihle will be able to hook their target market through their pricing structure.

Because of the variety in the size/income of the company that Mihle is sourcing for and the difficulty of the sourcing process itself, Mihle will have a variable costing structure for their services. A method to determine which price bracket a company falls within will be determined with the entrepreneurs, and used to maximize revenues for the business.

Competition

In Mihle’s situation, it is important not only to look at other HR firms as competitors, but also the current practices of employers in whether or not their services are needed. Placement in low-skilled work is often filled via individual connections – a current employee’s friend or relative is recommended for the job, with the understanding being that the applicant’s performance would reflect on the employee who recommended them. For high skilled work (including IT work), more formal processes including applications, CVs, and often recruiting agencies are typically involved, and commissions of 12-15% of total compensation, not including VAT, are standard.

For semi-skilled work, Mihle’s target market, temp agencies are often used as a recruiting tool.  Employees taken on as temps initially, then offered permanent positions if their performance is adequate. This process is fairly costly (temporary workers usually cost the employer 25% more per hour than equivalent permanent employees, plus a placement fee) and there is the risk that not all temporary employees are willing to become permanent employees, or temp agencies may refuse to continue to deal with employers who hire temps on as full employees. Therefore, if Mihle can offer a lower price for the same quality workers, they will be able to grow their market share and gain a competitive advantage against competitors.

The HR service industry in Cape Town is diverse, advanced, and there are a great deal of competitors offering a wide array of services. These companies have proven track records, greater credibility to corporates and applicants, and well-defined niches of who they cater to in their services. Challenging these agencies head-on in skilled work is unlikely to be successful for Mihle. 

The main strengths that Mihle can capitalize upon are the connections and network of its co-founders. Monde and Arnold are lifelong residents of Khayelitsha, and Arnold has built a successful business venture, which was purchased by Vodacom, having staffed the entire division under his control from his personal network. Additionally, the venture’s relationship with Silulo helps them gain insight, credibility, and a strong talent pool from day one.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Table 3: Primary Sourcing Strategies

 

 

Table 3, seen above, compares the various methods of sourcing a company could use depending on the skill level they desire. For each skill level, there are four methods of sourcing that they may be able to use, although a red X represents that the method is not available. Options highlighted in green represent the best sourcing strategy for that skill level based on ease, cost, and talent pool.

This chart illustrates the fact that Mihle has the potential to capitalize on two levels of skill – IT jobs and semi-skilled work. Based on ease for the company, offered rates, and talent pool, Mihle has the potential to offer the best employees to those skill levels if they are able to properly develop their company and use their strengths to their advantage.

Below, Figure 6 represents the typical customer buying process for a company looking to hire new employees. A key issue identified in this process is that Mihle would most likely not be identified by a customer in the process due to their lack of marketing and almost no company awareness in the community. In order to be considered by a customer in their buying decision, Mihle must build their brand identity and market it to companies within Khayelitsha, or they will not receive any influx of business.

 

 

Figure 6: Customer Buying Process

 

V. Financial Records

Financial Statements

Currently, Mihle Personnel Services has no financial history, because they have not conducted any business. However, using their desired pricing structure and forecasted expenses, a pro forma income statement were calculated for the average month of business. The financial statements were calculated very conservatively, assuming two contracts closed each month for a semi-skilled job, hiring 5 people per contract, and taking 7% commission as a business. This conservative financial statement will help to see a realistic future view, and see where the break-even point lies. Net income is high, but rent expenses were not included in calculations, and should definitely be considered when looking forward. Due to the nature of labor laws and the desire to give people a fair service, the business is structured to be a low margin, high volume business.

Payment from companies that hire through Mihle will be on account for the first month as a quality confirmation from Mihle, and possibly refunded within the first three months. The refund process is validated by requirements for check-ins on the fit of the employee, ensuring that employees are not fired just to get a refund. This assures the company that Arnold and Monde are dedicated to providing quality staff, and are willing to prove this by waiting for payment until after the first month. While this slows cash inflows, it is important to instill confidence in companies and develop lasting relationships with them. However, Mihle is currently facing zero cash inflows, and needs this to change immediately. By increasing marketing and pushing to find companies that need hirees, Mihle can start to gain cash flows as soon as possible.

 

 

Figure 7: Pro Forma Income Statement

 

The biggest issue that is not visible with the bottom line net income above is the delayed cash flows coming in the business. Because they don’t receive payment until after one month, and could possibly issue a refund for up to three months, cash is flowing in much more slowly than expenses are incurring, and this can be an issue for business success. While Mihle could require a deposit when a contract is signed, this is not the norm with competitors, and therefore may drive business away. Therefore, cash flow will need to be very well managed to prevent negative profits. Building a strong bookkeeping system will allow Mihle Personnel Services to keep track of their accounts receivable and related cash flows, and ensure that payment are received in full by the time they are due.

 

The benefit to a lack of financial history is the ability to instill good processes from day one. A financial recording system will be taught to Monde and Arnold, allowing them to track their profits and expenses each month. It will also track dates of contracts established and payments received from companies. Keeping track of dates will keep track of turnover time, and make sure that payments are being received on time. With the existing delayed nature of payment, to get cash flowing, late payments will not be acceptable from clients. This will be enforced through a late pay penalty that increases as time passes, and a bank draft requirement at the time of signing the contract, if the contract meets a required cost minimum. This bank draft will ensure that the client has enough funds in their account to cover the fee charged by Mihle, and will make sure that accounts do not go unpaid.

Future Financial Growth

Future financial growth and stability will depend on having high volumes of contracts, and properly segmenting the market, encouraging the hiring of skilled workers within Khayelitsha. However, a majority of the jobs available are semi-skilled or unskilled, so pushing large volumes of hires within contracts and large volumes of contracts as a whole is critical. Budgets will need to be established for monthly marketing, staffing, and website maintaining, because these three expenses will directly impact the number of contracts established by spreading the word about Mihle’s services. Currently, because there is no money coming in, Monde and Arnold are not taking a commission from the contracts. It is doubtful that they will be able to take a commission for a while past breakeven, because marketing efforts and other expenses will be prioritized. However, an orientation towards future financial growth will allow Monde and Arnold to eventually take commission from Mihle’s contracts, as long as they are putting their efforts towards spreading awareness about their services.

 

Financial Structure

 

Fixed Costs	Variable Costs
Marketing budget	Petrol
Website management	Phone
Staff	Owner’s Commission
Rent	Sales Staff

Table 4: Cost Structure

Because of the nature of the service, Mihle’s structure is almost entirely composed of fixed costs. However, currently, there are no fixed costs, so Mihle has almost no monetary costs. The largest cost to acknowledge is the time commitment from Arnold and Monde. This is good, but high volumes must be brought in to cover these fixed costs. Currently, Mihle is bringing in no business, but is not paying any fixed costs. This is a downward spiral, because expenses must be incurred in order to spark business and bring in revenues.

While rent is listed as a fixed cost, it will not be relevant for some time, because finding a location is currently unnecessary. It is not critical to the structure of the business, and cannot be afforded in the foreseeable future with the lack of business flowing in, so it has not been included in any numerical calculations. However, when business is steady, monthly rent will be a large fixed cost for Mihle and will be necessary for large-scale growth and stability.

Staff is listed as both a fixed and variable cost, depending on the type of staff they are hiring. If Mihle is hiring sales staff to aid in selling the company and closing contracts, these will be a variable cost, because they will be paid on commission. However, if Mihle decides to bring on operating staff when they open a location, such as a general manager, he or she will be paid a fixed rate.

Currently, Mihle has two revenue drivers, their hiring service, and Monde’s HR mediation, consulting, and implementation services. The contribution margin for the hiring service varies depending on the annual salary of the job, so the contribution margin is higher for skilled jobs than for semiskilled or unskilled jobs. While the commission taken will fall within a constant range of 4.5-8%, the contribution margin, in Rand, is variable depending on the annual salary that the 4.5-8% is taken from. Unskilled jobs serve as a loss leader, because while they are all gaining the same percentage on the job, unskilled jobs have a lower annual income, and therefore a lower commission for Monde and Arnold. However, there are many unskilled workers looking for jobs, and many unskilled jobs available, so the profits will be significant with volume.

 

Breakeven

Currently, Mihle is not breaking even simply because they don’t have any sales. However, when sales increase, breakeven will become very relevant. While breaking even is not difficult as long as revenues are coming in, it is the process of gaining contracts that is difficult. The contribution margin for the personnel services is R3446.75, and for human resources consulting is R120/hour. For personnel services, contribution margin was determined per person hired, and for human resources, it is determined per hour. To be comparable, it was determined that an average consulting engagement would take 15 hours in total, and therefore the job contribution margin would be R1800.00.

Using weighted averages to represent 80% of sales coming from personnel services and 20% coming from HR consulting, the weighted average contribution margin was determined to be R3117.4. Therefore, the breakeven point for Mihle is 3.368 contracts, which would mean either jobs signed for, or consulting engagements completed.

 

Operating Leverage

Because of Mihle’s very low variable costs and high fixed costs, they have a very high operating leverage. This high operating leverage provides greater risk for the company, because whether they have sales or not, there is still a fixed monthly expense. In Mihle’s case, their fixed costs are fixed over a fairly short period of time – marketing budgets could be cut and staff could be let go if necessary. However, we believe that their high operating leverage will be an advantage for the company, and will allow them to make large profits after breaking even. After learning financial responsibility and goal-setting, Mihle will be able to mitigate the risk that a high operating leverage can provide, and will allow them to one day be very profitable.

 

Figure 8: Mihle’s Ideal Operating Structure

 

This structure represents Mihle after approximately one year of growth, when they establish a location and rent has to be paid, and staff is hired. Currently, Mihle has almost no fixed costs, and almost no variable costs either. This is because of their small size and need for growth.

VI. Internal Infrastructure

 

Mihle Personnel Services is registered as a Pty (Ltd.) company. Registering the business was a smart choice for Monde and Arnold to make. It provides a barrier between their personal finances and any financial losses from the company that could occur. It is important that they maintain this model because it takes into account contingencies that might happen within the business, and adds credibility to the business.

 

Operating Facilities

            Because of the strong relationship that Monde and Arnold have fostered with Luvuyo, owner of Silulo, over the past several years, they are able to conduct their interviews and meetings for Mihle out of the Silulo facility for the time being. This location is appropriate because it provides a professional environment and is well known within the community. It is important for Monde and Arnold to further leverage this relationship in that Silulo could play a role in promoting and advertising Mihle Personnel Services to the graduates from their program. Down the road, Mihle Personnel Services desires to obtain their own location, which will add credibility and legitimacy to the business, however this is by no means necessary until sufficient profits are available.

Staff

            Currently Mihle’s owners, Monde and Arnold, are the only two employees. During the client meetings, they expressed how they would like to hire two to three other employees in the future. The ideal salary for these employees would be paid monthly, unless they were sales staff, in which case they would be paid on commission. There is no need right now for addition staffing of the business. They are interested in hiring someone who is well versed in IT and secretarial work, and they could use their own pool to find a Silulo graduate to fill this position. If they were to hire additional help this would add to their monthly fixed cost expenses. These expenses are currently unnecessary and should be considered once business picks up.

 

Information System

 

            Monde and Arnold are both technologically savvy and run Mihle from their laptops, tablets, and smartphones. During one client meeting, Arnold expressed how he did not want a paper trail to deal with in this business. That being said, it is important that they maintain a proper records and information systems to keep track of their client base. When constructing templates and processes for the business, Abuya Consultancy plans to develop as many of these as digital documents as possible to reduce the paper trail and maintain organization. By using the Google Drive that is associated with a G-Mail account, Mihle Personnel Services will be able to organize CVs received by their talent pool and access them from any computer at any time.

 

 

 

VII. Operational Considerations

 

At the moment there is not much activity in the business. Although this is the case, the number of graduates from Silulo Academy is a large quantity which Mihle may not be able to service. If they do not strategically position themselves and take advantage of this market they will not find revenue drivers that will bring the money for the business. The bottleneck in this process of accepting a lot of graduates is that there may be more graduates than there are jobs available for the foreseeable future. Abuya Consultancy is looking at ways this number of candidates can be broken down into groups and look for opportunities that can be taken.

One service Arnold mentioned is training in etiquette, self-esteem, or professional appearance. A lot of these students take these criteria for granted. They may often be declined for jobs due to the lack of these things. Another service is the writing of the curriculum vitae, which is a marketable tool that people often do not take the time to use to market themselves. With the provision of these services, candidates can be in a position of being entered in the database if the basic criteria is found to be sufficient.

Mihle Personnel will be in contact with organizations and companies looking for staff and will recommend suitable candidates. The process of how organizations and employees contact each other will be shown below. This is the process that Mihle should follow or has set up in the company. Currently Mihle is based from Monde’s house, with formal operations taking place in Silulo, although they are in the process of looking for suitable premises. They plan to advertise themselves and potential candidates follow the below procedure.

 

 

 

Figure 9: Operational Map of the Business

Input                                     Throughput                                   Output

- Marketing     - Brand awareness     - Pitch to colleges   - Alert Silulo grads

- Sort CVs     - Categorize based on set factors     - Narrow down CVs     - Begin interview process     - Rank pool     - Continue to sort and evaluate

- Train employees to specific job position     - Develop soft-skills     - Ensure company culture fit     - Provide short-listed pool to company for their selection process     - Wait to hear results from company

- Gain feedback from all parties   - Follow up with company     - Follow up with employee     - Alert rest of pool

 

Figure 9 above illustrates the operational map of the business, and the process that occurs from initially marketing the company to following up after an employee has been placed. The inputs are considered the raw CVs from unemployed semi-skilled workers, and the outputs are the employees placed into companies looking to hire. The throughputs are the process of actually sorting these raw CVs, determining which could be appropriate, and expanding on those CVs by training potential employees to be suited for the job’s hard- and soft-skill requirements.

From the above flow process, Mihle can have internal controls to make sure quality service is provided to both clients and candidates. In order for Mihle to make sure they are paid for their services, contracts should be the first thing to be negotiated. Based on criteria such as business size, turnover, employees needed, and time required by Monde and Arnold, a specific one percent bracket will be determined for the commission, within the 4.5-8% set range. This number will be brought to the client, and can be negotiated no more than 1%. For example, if it is a very large company hiring two people for a very specific job, the determined percentage would be 8%. When negotiating, this could be negotiated no lower than 7%.

Another internal control is when the feedback from both client and candidate is received. Mihle insists on this step because they want to establish themselves as a professional personnel service company. This also allows them to be consistent with the quality of employees that they supply. In addition if there are problems that occurred along the way, a solution can be found or rectified.

 

Administrative Procedures

Mihle has a database where categories of potential clients will be placed, making it easier for them to locate suitable employees. Necessary credentials will be supplied from the moment of contact with the potential candidates. It also lets Mihle to screen and take curriculum vitae that will be beneficial and be successful in placing. System of proper filling will need to be implemented but an easier process might be via soft copies.

A prospect database will also be created for current and potential clients to be listed. This will list all of their contact information, along with some information about the company in relation to Mihle (Cold or warm call? Reach company or safety?). This will aid in keeping track of past clients, and for prospecting for future potential clients.

 

 

 

 

VIII. Marketing Efforts

Positioning

Mihle Personnel Services does not have a specific position in the market yet. The entrepreneurs have the desire to empower all people, and they have therefore not narrowed down their offerings, setting a position. Based on the fact that there is need and talent in the semi-skilled industry, this will be the largest strength for Mihle. Because they can capitalize on this industry due to their pool of Silulo grads, Mihle should position themselves as a low-cost, high-quality and highly tailored service. This will appeal to their target market within the townships, and highlight the high quality, affordable services they are offering.

Segments and Marketing

 

Figure 10: Industry Offerings

 

 

 

 

 

 

 

 

 

 

 

 

 

	SME BSM 5-6	SME BSM 7- Managed/Aggressive Growth Firm	Large Business	Corporate
Primary Benefit Sought	-Cost effective -Availability -Locality	-Talent Development -Hassel Free -Cost effective	-1-Stop Shop -Talent development -Video Interviews -Employee Skills and culture match	-Employee culture match -Township Talent pools -MPS References -Success rate
Business Characteristics	-Small -Privately owned -Operate from home -Average turnover of $47,039 R -1-2 employees	-Small/Medium & ready to grow -Privately Owned, multiple shareholders -Operate from home or small office -Average turnover of $100,000 R -2-10 of employees	-Large business -Privately owned or multiple shareholders -Operate from office complex -Average turnover of $577,000 R -10-30 employees	-Large companies -3+ branches -Multiple levels of management -Av. turnover of $757 mil. R - Avg. of 14,944 of employees
Decision Makers	-Owner	-Owner/Partners	-CEO -Owner -Head of HR	-HR top management
Hiring Habits/ Frequency of Usage	-Referrals -1 time/year	-Job Posts -Referrals -1-2 times/ year	-Job Posts -Referrals -2+ times/year	-On-going database -Hiring services -Multiple times/year
Services/ Products Purchased	-Job placement	-Job placement -HR Mediation	-Job Placement -Team-Building Workshops -HR Mediation	Job Placement
Education Level for Jobs	-Some High school -Matric	-Matric -Post-Matric -Specialized training	-Matric -Post-Matric -Specialized training	-All education levels
What are they shopping for?	-Office support jobs -Specialized Skills	-Office Support -Computerized skills -Specialized skills	-Office Support -Technology Assistants -Specialized Skills	- Cashiers/tellers - Call Center Specialized Skills
Typical length of sales process	-Weeks	-Weeks/Months	-Months	-Months /Years
Exposure to hiring services	-None	-Little to none	-Limited	-Very

Table 5: Market Segmentation

While Monde and Arnold currently intend on serving each of these market segments, that strategy requires more resources than the business practically has and would lead to outcomes poorer than the business can accept. The market segment that offers the best opportunities for Mihle are semi-skilled employees, because of the need for semi-skilled workers in the townships, and the available pool that Mihle has to draw from.

 

Sales Efforts and Approach

At the moment, there is no formal sales process or approach. The entrepreneurs have not been able to bring revenue. This is due to the lack of a formal sales process. A formal sales process and approach will not only bring in more revenue to the business, but it will allow for the entrepreneurs to reassess their approach to sales, and solidify a process that allows them raise awareness of their business to drive sales.

The sales process will consist of three main steps, pre-sale, closing the contract, and post-sale. The pre-sale steps will focus on personal selling, cold calling, and spreading awareness of the company. The step involving closing the contract will focus on the details of the contract, including forms such as the contract itself, the pricing scheme, and the ability of Mihle to find the proper pool for the client. The post-sale step will focus on follow up, and building good rapport with clients and future potential clients. This is critical to build relationships and strengthen the brand that Mihle is creating. Abuya Consultancy will work with Mihle to develop a detailed sales process, and create all necessary templates and documents in the process. This will help Mihle to bring in their first clients and understand every facet of their business.

 

Marketing Media and Branding

There is no marketing or branding in place. Potential customers have found Mihle Personnel Services primarily through references to one of the specific owners, or through personal network. While word of mouth, references, and networks are essential to the business, Mihle Personnel Services will need to invest in marketing and branding, as these are also essential when dealing with corporate clients and attracting pools of talent. The marketing media and branding of the company will solidify the validity of Mihle Personnel enterprise, and in this is turn will aid in the closing of sales and bring in revenue. A logo will be created to create a tangible representation of Mihle Personnel Services, and will be applied to various media such as Facebook, business cards, and an email address.

 

Customer Buying Habits

Mihle Personnel Services has not done any sales promotions at the moment in order to attract clients. Sales promotion is something that the entrepreneurs need to consider in order to lure businesses to sign hiring contracts with them. Because the business is not selling a tangible product, the sales promotions could include a bundle of services offered; or different pricing systems for larger pools of candidates. While the sale promotions could cut into profits, it can allow Mihle Personnel Services to establish stronger relationships with clients, and actually draw more profit into the business if the volume of the requested candidates is large enough.

 

Pricing

No specific pricing scheme has been set for Mihle Personnel Services. They operate under the local common that stipulates that only up to 8% of the base yearly salary of the potential employee can be charged. Establishing set pricing brackets for a certain pool volume of candidates could speed up the process of negotiation and closing sales. The business is maintaining a penetration-pricing model, in order to appeal to Khayelitsha companies and avoid pressure or outrage from labor unions. This is a beneficial pricing strategy, because it will encourage trust and sustainable contracts from both hirees and companies.

 

Market Research and Tracking Market Performance

Mihle Personnel Services have no means of tracking market performance. They have not conducted any formal market research, and rely on their own knowledge of the industry. Both Monde and Arnold have experience in the HR industry and studied it in depth through their studies. However, this does not mean that they have a full grasp of the market for personnel services, the competitors, and how they can differentiate themselves in the market.

Formal market research is imperative to the growth and the direction of the company; this will allow the entrepreneurs to capitalize on a segment that provides them with the highest profits and revenues. Understanding the market will allow Monde and Arnold to track their performance both in sales and in marketing efforts.

 

Figure 11: Points of Customer Contact

The points of customer contact are critical in an HR service business, because in order to communicate that you can successfully improve a company’s human relations, you must have strong human relations skills yourself. Due to the structure of Mihle’s services, they must have strong points of communication throughout the entire customer contract process. Therefore, role-playing processes will be established to create strong, positive points of customer contact within the business.

IX. Financing Needs & Relationships

 

            Mihle is registered as a PTY (Ltd), with 50% owned by Monde and 50% owned by Arnold. Currently, Mihle has put no money in the business, so while they are not bringing in revenues, they are not accruing expenses either. This means that their debt history does not need to be assessed, but their future financing needs are very relevant, and for any growth to occur, money will need to go into the business for revenues to begin flowing in.

Both Monde and Arnold have children to support from the business, and while Arnold is also supporting himself with a full-time job with Vodacom, Monde is not, and the financial success of the business is critical for him to support his family. Both entrepreneurs seem to be willing to reach out for financial support, but have not realistically looked into how much money they actually need to get business flowing, and therefore do not know where they would turn for these capital needs.

 

Capital Needs

The current capital needs of the business include startup expenses, such as outsourcing a website and initial marketing expenses. Another important expense for both owners, but particularly for Arnold, is the opportunity cost of working less at Vodacom to support the growth of Mihle. Once short and long-term goals are established, Arnold and Monde will need to dedicate more of their time to Mihle, and be ready to not only put in direct finances, but reduce time spent focusing on other sources of income to spend more time with the business. This transition will occur with more ease through the consulting engagement, because as Monde and Arnold understand the value of the time they put in, they will be more motivated to continue this effort.

The current capital needs are estimated at about 8500 rand, mainly to increase marketing and awareness of the company in the community. Monde and Arnold must determine if they can finance this with their own personal capital, or if they will need to pursue alternative sources of capital. While both are in good standing with the bank, the chance of receiving a loan with no current revenue is very slim. A more realistic possibility is the many financial institutions that support SME growth in South Africa, such as the Small Enterprise Financial Agency or Blue Financial Services. If this kind of financing was deemed necessary, a business plan would need to be finalized to approach these financial services with and be strongly considered for a loan. While it may not be necessary now, it might be necessary with growth down the road and the expenses that renting a location and hiring staff would incur. Because of that, it should be considered not just now, but also down the road, and finances and a business plan should be maintained and organized for future use.

Another method of alternative financing would be leveraging the relationship with Silulo to establish capital inflow for Mihle. Silulo has a personal interest in the company, because a service that would help their graduates to find employment would be a great resource to use in their favor. Therefore, alternative methods of financing backed by Silulo may be possible, and should be explored.

 

 

 

 

X. External Networks

 

Both Arnold and Monde have a close relationship with Luvoyo, a prominent member of the community, and owner of Silulo Internet Cafe. This connection has given the entrepreneurs access to the Silulo premises to work, as well as access to the Ikasi network (a group of entrepreneurs in Khayelitsha). Monde’s HR career began and matured at Silulo and Mihle began as a result of Silulo compartmentalizing and spinning off their HR operations with Monde at the helm. This relationship with Silulo and Khayelitsha overall gives Mihle an advantage because it is a steady network to leverage for a pool of hirees, and will also lead to recommendations for potential prospects.

            In addition to this network, acquired from a lifetime in Khayelitsha, Arnold has built a wider address book of semi-skilled workers, which will be valuable to the company. He has done this through managing his hiring initially for a successful township magazine, which later led to his employment at Vodacom, managing a division specializing in informal markets, where he also controlled the hiring process and drew talent from his extended personal network. Arnold’s current title in Vodacom gives him access to the corporate world, which he will need to leverage when attaining jobs for Mihle Personnel Services. His personal connections with other corporate employees give him some individual credibility and may assist in making inroads toward prospecting for initial clients for Mihle. When creating a sales process for Mihle, a process for gaining leads within local networks and approaching these leads will be established. This will be done through role-playing and beginning to make actual sales calls.

There are opportunities to improve the entrepreneurs’ personal networks via trade shows; personal visits to businesses, and professional networking sessions in Cape Town. This will in turn increase sales and bring in more revenue as it increases validity and word-of-mouth references. These sessions and events will also benefit Mihle because it will increase the talent pool and possibly secure more contracts with companies that are currently seeking job placements. Abuya Consultancy will begin this process by taking Monde and Arnold to make personal sales visits to businesses, and research networking sessions to take part in. This will show Monde and Arnold the process of how to do this on their own, and will also help them to find leads.

 

 

XI. Concluding Remarks

Monde and Arnold have developed a strong concept for a locally based staffing agency to empower the unemployed youth in the townships and support local economies. The target market is there, although it has not yet been tapped into for best use and growth of Mihle Personnel Services. In general, Mihle Personnel Services lacks the basic structure and processes to grow as a business and begin to bring in sales. Working together, Abuya Consultancy and Mihle Personnel Services will develop the sales process to obtain clients and all necessary templates and forms to assist in the sale. This will allow the business to become better established and gain momentum in the community.

 

 

 

 

 

 

 

 

 

 

 

 

 

DELIVERABLES

 

 

Deliverable 1: Branding

 

1.1 Problem Statement

As a company who is just starting, it is essential that Mihle Personnel Services establish a clear and coherent brand that communicates their intentions and their professionalism visually. Currently, the small company has no established brand identity. The entrepreneurs expressed a need for branding; because they did not have an identity package, they did not feel comfortable going to potential clients and therefore were stagnant and not generating sales.

When conducting the analysis of the business and writing the Supporting Emerging Enterprise (SEE) Model, Abuya Consultancy confirmed that a brand identity and package is essential to the development and start of the company, as it is a crucial point of contact with their customers.

1.2 Desired Results

The identity package should give the entrepreneurs of Mihle Personnel Services a more credible and professional appearance when contacting potential clients. The card will also help to establish the validity of the personnel services provided. The business cards will give the entrepreneurs of Mihle Personnel Services the ability to leave their contact information with relation to their company, and mitigate confusion as to where they work. In addition to this, the established letterhead will give Mihle Personnel Services the opportunity to mail correspondence to its current and future clients while establishing and strengthening their brand presence in the eyes of those clients. It will also help to differentiate their services with a distinct logo.

1.3 Solution

       The problem was tackled with the conceptualization and implementation of a brand identity/logo, development of business cards and official letterhead. In the process of developing the brand identity, it was critical to fully understand the entrepreneurs and their vision for the business, so that this is properly communicated in the logo. A logo must also satisfy the entrepreneur’s personal wishes, and their established image of their company. A process of development and feedback was established to come up with the final product. We used the following criteria to develop a useful logo:

1. Monde and Arnold’s existing ideas of what a logo would look like
2. The vision, mission, and mood that the business wants to convey visually with its logo
3. The industry itself, and if the logo alludes to the industry that Mihle is serving
4. Whether the logo conveyed a sense of trust, credibility, simplicity, and professionalism, and would generally be attractive to a client

Figure 12: Mihle Personnel Logo

Once the logo was determined, it was applied to various useful templates for the business to truly establish a brand image for the company. The logo was applied to business cards, letterhead, and used on their newly created e-mail address and Facebook page. This will create consistency with the identity of the business, and help to market Mihle Personnel Services and get the word out about the new hiring service located in Khayelitsha.

 

 

 

1.4 Argument

       A brand package is important to the company when dealing with clients, as the elements in the package are all points of contact with the customer. In turn, the brand and the association with the brand can be points of added value to the customer. Creating a brand and logo is also key in differentiating themselves from their competition and establishing a strong culture within the company. The branding package will benefit the company in the following ways:

• A strong brand identity will generate awareness of the brand, and will eventually create loyalty and advocacy from clients.
• A brand identity creates credibility for Mihle Personnel Services, and shows their dedication and professionalism to potential clients.
• Acts as a framework for how to present the brand across all mediums, including business cards, letterhead, brochures, and social media.

 

1.5 Implementation Plan

As previously mentioned, to-date, there has been no logo or branding measures for Mihle Personnel Services. It is important to create a logo that represents the brand and use it effectively in both paper and digital branding means. It is critical when implementing a logo to make sure that the entrepreneurs understand how to duplicate the logo and use it in any document, e-mail, or other promotional item to create a sustainable and timeless brand.

 

Logo & Brand Development Process:

 

Step One: Identify and Conceptualize Key Factors for the Logo

      In order to create a logo, Abuya Consultancy sat down with Mihle and discussed their existing ideas for a logo. They communicated their desire for a very simplistic logo, which would have the initials ‘MPS’ displayed and show a man aiming an arrow forwards, similar to the image in their current business plan. The business is one that helps people to find jobs and grow, so some aspect of empowerment was important to be conveyed. Also, being a personnel service, professionalism was a key factor when designing the logo. The key factors narrowed down to be:

• Simplicity
• Professionalism
• Relevance
• Legibility
• Versatility

Step Two: Draft a Logo

      After meeting with Mihle, multiple logos were drafted based on the factors above.

 

 

Figure 13: MPS Draft Logos

 

 

Step Three: Review Logo with Entrepreneurs

      While the consulting team had identified personal favorites, the important opinion was that of the entrepreneurs. After developing options for the logo, they were presented to Mihle so that they could select their favorite and adopt the future logo for the company. When presented, Mihle was disappointed to see that the man shooting the arrow was not present on their logo. This was a critical part, and was overlooked by Abuya Consultancy. However, they did like everything else about the logo, and decided to go with one that had the initials MPS displayed.

Step Four: Adjust Logo

      Based on the logo review session conducted with the entrepreneurs, a “man shooting an arrow forward” was incorporated in the design. This addition was important because it not only satisfied the entrepreneurs, but also helped satisfy an additional criterion for the logo, which is memorability. The man shooting the arrow is simple and unique, and will therefore stick in the minds of potential clients, developing the brand further.

 

Step Five: Implement Finalized Logo on Paper and Digital Media

Figure 14: MPS Business Cards

      A logo is important because it is a tangible aspect of the brand, but truly, the brand is what must be focused especially for a newly developing company. Therefore, communicating the brand via the logo was critical to establishing reliability and trust with potential clients. To develop a brand that customers trust and rely upon, brand consistency must be implemented from day one. To do this, Abuya Consultancy (with the help of Mihle) created templates for business cards, letterhead, and a brochure. These are all critical representations of the business that will be seen by clients and subconsciously build the brand in their eyes.  

 

 

 

 

Figure 15: Mihle Personnel Services’ G-Mail Login

The logo was also applied to newly created digital media sites, including the e-mail account and Facebook page created by Abuya Consultancy. Digital copies of the business cards, brochure, and letterhead were developed and given to Arnold and Monde. Options for printing locations were offered to Mihle, and it was determined that Silulo would be the best place to print.

 

 

Figure 16: Mihle Personnel Services Facebook Page

 

 

In order to show the impact of the brochures, Abuya Consultancy printed 5 sample brochures to show to Monde and Arnold and to hand out while cold calling. This will not only help to capture the brand in the cold calling process, but also show Mihle the importance of printing brochures and business cards, and motivate them to allocate money to this immediately. A flyer was also created to be printed and taken to local colleges. This flyer can be found in Appendix 1.

 

 

 

 

1.6 Next Steps

      Developing a brand image, conceptualized with a logo, will help Mihle to develop a trustworthy, high quality image in clients’ minds and expand awareness of the business. In the future, a website must be developed (a mid-term goal) and the logo will need to be widely present on the site. To ensure that this will happen, Mihle was given a digital copy of the logo, and was taught how to copy and paste the logo onto various documents, sites, and printouts. This will ensure that the logo is sustainable, and that the brand has a positive future impact on the growth of the business.

The critical next step in establishing a brand is having positive customer interactions that will encourage their trust in the brand and create marketing buzz for Mihle Personnel Services. Through the marketing and sales plans that Abuya Consultancy and Mihle have developed together, Mihle Personnel Services will be able to positively grow their brand by resonating as a credible, quality, and reliable company in the client’s mind.

Deliverable 2: Marketing Plan and Strategies

 

2.1 Problem

Mihle Personnel Services (MPS) just registered their business in May 2014, and since then have not gained any clients. While both Monde and Arnold have drafted up a business plan, they do not have a set marketing plan that looks at the market and identifies the potential areas for growth. The lack of a marketing plan goes hand-in-hand with the lack of an established brand and setting up marketing strategies to target different segments within their industry market. Without marketing, Mihle Personnel Services will not be able to generate buzz about their newly developed company and attracting clients will be very difficult.

 

2.2 Desired Results

The development of a marketing plan will allow MPS to identify different strategies to target the different segments within their market. This in turn results in tailored marketing efforts toward each customer. Understanding the market better and how to target each of the segments will allow Mihle Personnel Services to bring in more business with minimal waste of resources. The implementation of a marketing plan will help the business continue to grow parallel to their vision, mission, and branding efforts.

 

2.3 Solution

During the consulting engagement, Abuya Consultancy worked with both of the entrepreneurs to define their market and their marketing plan, to later be able to develop marketing strategies. When beginning the consulting engagement, both of the entrepreneurs understood whom they wanted to target, and had a fairly good grasp of their market audience. However, there was urgency to understand the different buying behaviors of the different segments within their market. Understanding the different buying behaviors would allow MPS to efficiently use their resources with minimal waste. The effective use of resources is dependent on understanding the buying behaviors because campaigns and efforts would be tailored to specific needs and wants. In addition, tailored efforts ultimately make the client feel special, and in turn can aid in closing sales.

 

 

Target Market

 Through field research with the entrepreneurs, we were able to identify the target market as: SME’s, Large Companies, and Corporations who employee low/medium-skilled talent and are in need of fast services to fill job-position.

Abuya Consultancy conducted research, and identified several segments within the market: SME’s that were BSM level 5-6 took 10% of that segment, SME’s that were level 7 to manage/aggressive growth firms 40% of the segmentation, then came the large business with 40%, and lastly the corporations, which made 10% of the segmentation. These percentages were based on the customer’s ability to pay for MPS’s service, and the quantity of the services procured. SME’s with BSM level 1-4 did not form part of the segmentation for Mihle Personnel Services because these businesses qualify as more “survival” based businesses that do not have the infrastructure need or capital to use the services. SME’s with BSM level 5-6 were typically more developed and had significantly more revenue, and were compromised of mostly “lifestyle” businesses that could make use of MPS’s services. The other segments of the markets were businesses that were geared towards growth and would also make use of MPS’s services when hiring/growing. The market segmentation developed can be seen within the SEE model analysis and in the marketing plan found in Appendix 1.

The market segmentation can be used to identify marketing strategies that can be tailored to individual segments, and the services that each segment might be looking for. In addition to this, as we worked on the segmentation, Abuya and the entrepreneurs identified specific jobs within the segments that MPS should capitalize on. These jobs were based on a niche marketing strategy, focusing the efforts of recruiting/job placement on positions that the other competitors cannot focus on (low/medium-skilled jobs) because they lack access to talent pools in sectors like Khayelitsha. This was a way for MPS to differentiate themselves in the individual segments. While Mihle Personnel Services’ main focus will be in the area of low/medium-skilled jobs, they will also have access to small pools of high-skilled individuals and therefore have the ability to supply these potential employees to large businesses. However, Abuya Consultancy recommends MPS not to focus on providing corporate with these high-skilled employees, because they are likely to already have recruiting efforts in place, and will therefore be a segment that is difficult to penetrate.

 

Figure 17: Differentiation

 

 

When looking at corporate, Mihle Personnel Services will to focus on recruiting large volumes of individuals for low and semi-skilled positions such as cashiers, or cart pushers, for branches within the townships.

 

Marketing Strategies

 Complementary to working with Monde and Arnold to understand the nature of the market and the segments, Abuya Consultancy also worked to develop a marketing plan (found in the appendix) and a set of strategies to market to the individual segments.

A key strategy to the success within all the segments was creating a process that would enable the entrepreneurs to quantify the return of investment, and the added value to the potential client. The process entails identifying the segment, defining their current time and monetary cost for hiring, and then presenting the opportunity cost along with the tailored added-value services to the potential client.

 

Figure 18: Marketing Strategy Diagram

Identify Business SME-BSM 5-6 SME-BSM 7-Man./Agg. Growth Large Business Corporate

Monetary Costs What percentage of the budget goes to hiring How much business are they potentially losing due to an unfilled position

Added Value Services Khayelitsha Talent 1-stop shop Convenience Reliability Talent Development

Opportunity Costs Compare time and monetary costs to the MPS services Present opportunity cost

Time Costs How much time does it take from time of posting job, conducting interviews, to signing contracts

 

 

 

Quantifying the value is essential for all of the segments, and most specifically for the SME’s and Aggressive/Managed growth businesses who are more likely to be price sensitive. Through the process, MPS will quantify the return of the investment in terms of hours and monetary costs, and then present an opportunity-cost analysis to the client. This process goes hand-in-hand with the sales process, but it is essential to the understanding of their marketing tactic and approach.

In addition to the process above, Abuya Consultancy also worked on developing low-cost marketing strategies that could be applied to individual segments and continued to work with the entrepreneurs to establish social media presence.

 

Figure 19: Low Cost Marketing Strategies

 

The speaking events were developed through all the segments, but address the potential clients in each segment through different platforms that are directly related with decision makers influence points. For the speaking events, within any segment, MPS does not have to provide their sales pitch; this might deter the attention of the audience. On the other hand, Mihle Personnel Service should provide a short introduction about their company and give a presentation on current issues related to the HR industry. The goal of the presentation is to gain awareness and continue to build rapport and validity as a company. In addition, giving information presentations allow MPS to relate more its potential clients by focusing on building relationships with them and providing information, rather than just selling a product. HR presentations can be geared to show current problems that the HR industry is facing, and through the presentation, MPS should identify what companies can do to overcome the problem (the problems should be somewhat correlated to the services that MPS offers). A potential sales presentation was developed in the sales process deliverable.

Because of the tight budget that MPS handles at the current moment, Abuya concentrated in the low cost strategies, and avoided any type of costly advertisement. It is important for MPS to expose their audience to the brand and services through at least three different mediums to ensure that market segments are aware of the brand and its services.

 

Online Presence

In addition to these tactics, the team worked with the entrepreneurs to ensure that they have a social media presence. At the moment of the consulting engagement, the entrepreneurs still did not have a site, but were working with developers and designers to create a site. Because of this, Abuya Consultancy saw it necessary to have some online presence that potential clients could resort to for additional information. An online presence establishes validity and lack of an online presence could ultimately compromise a potential sale.

The chosen forms of media were Facebook and LinkedIn. While Abuya consultancy was hesitant about a Facebook page having a negative impact on the brand, the team and the entrepreneurs decided that for the SME segments (compromising two of the four segments) a Facebook page would be helpful to raise awareness, inform them, and build rapport. In order to mitigate the risk of it diminishing the brand, Abuya worked with the entrepreneurs in workshops to determine the content of the page and how it can showcase news/articles that talk about developments in the industry. A screenshot of the new MPS Facebook page can be seen below.

 

Figure 20: Mihle Personnel Services Facebook Page

 

 

 

In addition to the Facebook page, the development of a formal LinkedIn page for the entrepreneurs and MPS was essential for establishing an online presence. LinkedIn is rapidly becoming popular in South Africa’s small business and large business branding and marketing efforts. By joining LinkedIn, the company and the entrepreneurs are able to joining the professional online community and raise awareness of their brand by “connecting” with businesses and individuals in two of the four segments (Large companies, and Corporate). Establishing this presence also increases the validity of the company in the eyes of its potential clients. Because LinkedIn pays Google to list their content in the first page when searching, the platform seemed an obvious and cost-free choice to increase awareness.

To best ensure the sustainability of and the up-keep of the online presence, Abuya Consultancy worked with Arnold and Monde to create a posts calendar. The calendar gives estimated time periods of when it relevant to post to online sources, and also has a list of go-to resources where they can find relevant articles about the industry to share with their audiences. The calendar that Abuya created focuses on a 3-week rotational period in order to allow the entrepreneurs to focus on other tasks and to ensure that the content is spaced out throughout the week to avoid annoying the potential client. However, it is necessary to continue to post throughout the week to increase exposure of the brand is consistent and sustained. For a list of resources of where to find useful content, please see appendix.

 

	MONDAY	TUESDAY	WEDNESDAY	THURSDAY	FRIDAY
#1			8AM		4PM
#2		8AM		11AM
#3	8AM		4PM		4PM

Figure 21: Rotational Calendar

 

Measuring Marketing Impact

Figure 22: Impact on Sales

When developing the marketing strategies and tactics, Abuya Consultancy developed short systems to help the entrepreneurs measure the success of their marketing efforts. Understanding the success of these efforts is essential to the business. It will help MPS see if they are targeting their segments correctly, if their allocation of resources is justified, and to if there are any gaps in their current efforts. If there are gaps, understanding the impact of the marketing will help MPS overcome them to better serve the client and bring in more sales from the marketing efforts. Abuya Consultancy focused on measuring the marketing effort’s impact on sales and on brand.

 

Within sales, MPS will want to look at the individuals who started through the sales process, but never finished it; and also the contracts and sales that were closed. As for branding, the different facets that are impacted are the credibility of the company, understanding of the services offered, and overall brand awareness. 

Figure 23: Impact on Brand

Figure 24: Forms to Enhance Marketing

The tactics developed are not able to measure all the aspects of branding, just because of the intangibility of the facets. However, when creating content, these facets should be kept in mind as they do impact the business. Forms were created and systems implemented to ensure that the entrepreneurs understood how to use each tool, and can be seen in Deliverable 4: Forms and Templates

 

The feedback form allows MPS to identify how most of their customers are hearing about them, which in turn allows MPS to reassess their resources allocation. Feedback Forms ask simple questions such as:

• How did you hear about us? (i.e. speaking event, reference)
• Why did you choose to work with us?
• What was your favorite part about working with us?
• Have you worked with another personnel services company before?

In addition the feedback forms allows the business to measure response to be different forms of advertising, selling, or promotion.

            Sign-in at booths entails having a list that has potential clients’ information, and identifying how many people inquire about the services at speaking or networking event. Depending on the people that sign-in and ask questions, the entrepreneurs are able to gauge how many people became aware of their brand and services, and guesstimate an increase in their validity as a company depending on the number of people that sign in.

Analyzing calling and prospect list will give Arnold and Monde the opportunity to understand the impact on closed sales and fallout sales. With the list they can compare the rate of success and failure between warm calls and cold calls. This allows them to see which methods of personal selling are most powerful. Research has shown that warm calling is more powerful in personal selling, and in the case that the sales team is not showing those results, the business will need to reallocate its resources to increasing their warm call list (attending networking events, conferences etc.).

When looking at the number of references vs no-reference customers, the MPS is also able to see if they are meeting their expected number of references in their clientele pool. These allow the business to see the impact of personal selling efforts on closed sales and fallout sales.

Measuring online media interactions is important when looking at the impact of the marketing efforts on brand awareness. For Facebook and LinkedIn, the entrepreneurs are able to the “likes” and “connections” at any given point. These factors help measure the awareness of the brand and quantify it through people exposed to the brand. In addition, with each article that the entrepreneur posts on either platform, they are able to gauge the quality and interest of the posted articles based on the number of profiles that “liked” the post. Keeping track of these is important when understanding what the consumer appreciates online, and what to focus their online efforts on.

 

Throughout the engagement, Abuya Consultancy worked with Monde and Arnold to create all these solutions and develop these tactics for their marketing approach. Below is a graph that summarizes the different tactics used to raise awareness, and how they range throughout the segmentation spectrum. Under each of the segments, there are 3 plausible ways to raise awareness of the brand and the services, and in turn this increases the “acceptance” of MPS from potential clients.

 

SME BSM 5-6

SME BSM 7 – M/A Growth

Large Business

Corporate

LinkedIn

Facebook

Ikasi Network

Chamber of Commerce

Wall-Mural Adv.

Drink-and-Meet

Warm/Cold Calling

HR Associations

Figure 25: Methods of Reach

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.4 Argumentation

• The development of a marketing plan is needed to identify strategies and tactics that reduces waste of resources
• Marketing strategies are needed to raise brand and service awareness, and in turn generate more revenue
• Establishing online presence for MPS is crucial to raise awareness, increase validity of the services, and network with potential clients; this in turn aids in the process of closing the sale and increasing turnover

 

2.5 Implementation

Prior to the consulting engagement, the entrepreneurs had a rough idea of what the market looked like, but did not have defined segments and efforts to reach out to the marker. When implementing the marketing plan and marketing strategies, it is important that they are developed with Monde and Arnold in order for them to understand the reasons why they are done, and how to implement them correctly.

 

Step 1: Because they did not have any market plan efforts in place, Abuya’s first step was to work with the entrepreneurs to understand and define the market. Parameters for the target market were set and the market was segmented. 

 

SME-BSM 7 –Agg./Man. Growth

BUSINESSES IN THE CAPE TOWN AREA LOOKING FOR LOW/MEDIUM SKILLED EMPLOYEES TO FILL POSITIONS FAST, AND HAVE DISPOSABLE INCOME TO PAY FOR THE SERVICE

SME BSM 5-6

Large Company

Corporate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Figure 26: Market Parameters

 

 

 

Step 2: Once we all had a better grasp of the market, we worked with Monde and Arnold to help them identify their added-value/features of the service and the benefits of using MPS’s services. In order to help the entrepreneurs understand the difference between benefits and features, we created workshops in which we provided examples and then broke down the services and what emotional element each of the services provided.

Figure 27: Feature / Benefit Elements

 

Step 3: The next workshop, we combined the previous two steps and brought them to live. We decided which benefits/added-value services each segment appreciated the most, and reorganized the order in which added value highlights would be presented to each segment.

 

Step 4: Once each segment was aligned with a set of benefits, we worked to go one layer deeper, and identify marketing strategies for each of the segments. Strategies were developed throughout a series of meetings amongst the entrepreneurs and Abuya Consultancy. We studied what each of the segments appreciated, how the connected, how they received news about the industry, and where they spent a majority of their time.

 

Step 5: Abuya and the entrepreneurs took individual strategies and broke them down to plausible and realistic action plans and timelines. This in turn helps the entrepreneurs digest the information and take action upon the plans.

 

Step 6: Working with the entrepreneurs to establish a simple process in which to present the opportunity cost to the potential client. This effort will also be included in the sales process.

 

Step 7: Identified online platforms that would best target the different segments, and would promote the business, and increase the validity of MPS.

 

Step 8: Created online profiles through Facebook for the business, and LinkedIn profile for the entrepreneurs and the business as well.

 

Step 9: Identify resources and potential content for MPS to share with its online network

Figure 28: HR Online Resources

 

Step 10: Made the first Facebook post and LinkedIn post with the entrepreneurs in a meeting. The workshop focused on having an consistent voice and creating relevant content online.

Step 11:  Create a calendar for posting online content through all the platforms. It is important for the online presence to be up-kept in order to gain traction with potential clients and raise awareness of the brand. Creating the calendar in turn increases the likelihood that the established online efforts will be sustainable once the consulting engagement has been terminated.  

 

 

2.6 Next Steps

As a continuation of the implementation process, there are steps that must be followed after the engagement has ended for Mihle Personnel Services to continue to market themselves and grow as a business.

 

Step 12: Speak with web developers and designers to establish a deadline for the project. Because the goal has already been established, it is a matter of acting on it. Setting the deadline is essential, because as more sales calls are made, they need a website to be able to post media to.

 

Step 13: Contact/reach-out to individuals from the Chamber of Commerce and the Ikasi network to build relationships and network

 

Step 14: Launch the website and inform their current customer that the website is now live. When launching the website, the entrepreneurs will need to update their forms of advertising and branding to include the new webpage.

 

Step 15: Re-connect with individuals from the Chamber of Commerce and the Ikasi network to set up dates and topics for speaking events.

 

Step 16: Follow-up and utilize new forms for measuring marketing impact to measure growth and re-asses allocation of resources. This is needed to make sure that the business is indeed serving the market correctly.

 

 

Deliverable 3: Sales Process

 

3.1 Problem Statement

Abuya Consultancy found that Mihle Personnel Services (MPS) does not have any concrete sales processes in place. While Arnold– the company’s co-founder and current primary sales representative– has deep experience in business-to-business sales, he does not have a consistent process and guideline for personal selling in different situations.

MPS’s lack of a process for selling (pre, during, and post) hinders the success of the calls. In addition to this, MPS does not have a set business proposal or a developed sales presentation; two essential steps that will increase the likelihood of closing sales and strengthening the company.

 

3.2 Desired result        

Abuya Consultancy sees it necessary to instill a formal sales process in order to successfully grow the client pool. This sales process must be based on a consistent sales method that is parallel to its core values. Abuya Consultancy would like to see MPS begin to utilize the process within the consulting engagement to attain the first client, and continue to use in the future.

The sales process has been geared to focus on three key engagements with the client through a 9-step process. The seller will be focusing on the pre-sell engagement (research), during-sale (tactics for selling), and post-sale (building relationships). The process is meant to shift the mindset of the seller, encouraging to focus more on building relationships with clients and selling the benefits of a product, rather than its features. This in turn solidifies company values, culture, and vision; increasing awareness of the company through an established referral program.

In addition to this, we would like these guidelines to pave the pathway of growth for MPS. When MPS begins to hire other sales representatives, the goal is that they use the established process to provide consistent branded service when building relationships with new clients. Meeting with Monde and Arnold to build the sales process will:

• Train them in the proper selling process through role-play scenarios
• Develop a sales process unique to Monde and Arnold’s strengths and weaknesses
• Create the proper documents and forms to aid the selling process
• Begin to make sales calls and visits to put the new selling process into practice

 

3.3 Solution

 

The Sales Process

Abuya Consultancy, working alongside Arnold and Monde, created a standard sales process that can be referred to in order to increase the success rate of gaining new clients and bringing in revenue. The sales process focused around raising awareness, creating leads, selling benefits, and following up. These basic stages were broken into 9 more specific steps that help the entrepreneurs navigate the process. Details on each of the steps can be found in Appendix 2: Sales Process.

 

Figure 29: The Sales Process

When building the process, we kept in mind Monde and Arnold’s sales techniques, identified gaps within their process, and tailored a formal process that allows easily changing their habits and feel more comfortable when going through it.  

 

In addition, Abuya Consultancy saw a lack of a clear sales pitch, sales proposal objects, and sales presentation. Arnold and Monde have a basic understanding of what the mentioned items entailed, but did not know how to leverage them to increase the likelihood of closing sales. Abuya worked with both of the entrepreneurs through workshops to help them in the process of when to highlight their sales pitch, and the different within the sales pitch that will change according to client. This is highlighted in Step 3: The Call of the sales process.

 

Measuring Sales Success

In order to ensure that the sales process is properly working, success must be measurable. There are three key indicators for Mihle to be aware of to measure if the sales process is successful, or if the sales process should be reevaluated and modified.

1.Growth and Progress. While it may seem like business is not coming in as quickly as possible, growth is a critical measure of success, especially in the beginning. Recording all sales closed is critical so that you can measure growth, and looking at the number of sales closed from month to month will allow the business to see if the sales process is efficiently stimulating growth

2.Sales Cycle Length. The shorter the sales cycle, the more immediately interested a company is in the service you are offering. Therefore, measuring the length of the sales cycle will allow the business to see how quickly deals are being closed. Recording the first point of contact with the business and the date the contract is signed will show the length of the sales cycle.

3.Opportunity-to-Win Ratio. For each opportunity you have to give an in-person sales pitch, how many of those are won over with the client signing a contract? While Mihle might be gaining many leads, it is critical that those sales pitches are leading to sales closure in the end.

 

 

Tools for Sales: Lead Form & Prospect List

Furthermore, we worked together to enhance the process and added guides for building rapport throughout the sales engagement–which were previously lacking. The guide includes thank-you letters to gatekeepers, a system for getting and rewarding referrals, and lead forms.

A prospect database was created in Excel to help in recording when prospecting for future clients, and 50 prospects were found by Abuya Consultancy. The database contains various categories to record basic information about the company and relationships formed to leverage, and can be sorted to help find the best client to pursue at any time. It is a way to help Monde and Arnold stay organized, and to develop relationships with prospects from day one.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The lead evaluation form exists to make the prospecting and lead generating process more streamlined. Using this form during cold calls or warm calls will help to remember key facts about the company, and make future sales calls more personable; making the sales process itself much more about building a relationship with the client. The form was built to be used either electronically (computer or tablet), or to be filled out through paper form. If filled out through paper, the seller would need to input all the information later into the electronic form, which is then transferred to a database. A Google form has been created for this task, to simplify the process for MPS.

 

 

Figure 30: Lead Form

 

 

 

 

 

 

 

 

Figure 31: Sales Process Form

 

 

 

Tools for Sales: Sales Presentation

Because Mihle did not have a process for creating and doing a sales presentation, Abuya Consultancy worked with Arnold and Monde through workshops and role-playing to create and implement ideal sales presentations. In addition to this, Abuya created visual aids for the presentation, PowerPoint formats, in order to provide clarity to the client, and increase credibility.

 

 

 

 

• Step 1: Building rapport
  
  • This is the first step of the sales process because it is very important for Arnold and Monde to create a relationship with the potential client. This makes it more personable and the likeliness of the client signing a contract will increase due to the friendly bond that is formed

• Step 2: Ask targeted questions, listen closely
  
  • During this step, Arnold should have a set list of questions that he wants to ask the potential client. These targeted questions will be tailored depending on the client’s business. Listening is also important because it let’s the client give feedback and strengthens the newly formed rapport.

• Step 3: Ask further questions if necessary
  
  • This step will depend on the course of the conversation with the potential client. Arnold and Monde might find the opportunity to ask addition questions for clarity or for more information regarding the job position that needs filling.

• Step 4: Repeat specific issues, needs, and pin points
  
  • This step allows Arnold and Monde to circle back around to the reason why the potential client is there. It gives them clarity and the chance to pin point their exact needs.

• Step 5: Give Pitch
  
  • This is one of the most important steps of the sales process. This is when Arnold and Monde have the chance to really sell why Mihle Personnel Service is exactly what the potential client is looking for.

• Step 6: Give breathing room
  
  • After the pitch has been presented, it is important that Arnold and Monde allow the potential client to fully absorb the pitch. By taking a step back, they will give the client a chance to process the pitch.

• Step 7: Identify specific needs
  
  • By identifying the client’s specific needs, this makes the sales process more personal and relatable. It shows the potential client that Mihle Personnel Services will tailor their services to what they need

• Step 8: Get agreement from prospect

• Step 9: Ask for the sale
  
  • This step is critical because it puts the ball in the prospect’s court. It allows them to either take the offer or walk away. It is important that Arnold and Monde are relaxed and do not push the client. They are there to offer their services, not push a sale.

• Step 10: Handle objections
  
  • If for some reason the client is hesitant or unsure after Arnold and Monde ask for the sale, this gives them the opportunity to ensure that the client is making the best decision

• Step 11: Close the sale
  
  • At this point, the client will agree to signing the contract!

• Step 12: Sign letter of understanding
  
  • Arnold and Monde will present the client with a letter of understanding. This letter provides information and expectations to the client. The client will sign it and then Arnold and Monde will the company to their database and begin looking through their talent pool to fill the needed positions.

 

Tools for Sales: Thank-you Notes

      As mentioned previously, the new sales process is focused on building a relationship with the client, rather than just selling the product. As part of these efforts, Abuya created templates of “Thank you” letters for the gatekeepers and the decision makers. Thank you note templates can be found in the appendix.

 

3.4 Argumentation

To a business-to-business service-based company, there is no tangible product to show the customer before they have received the service to close a sale. The service cannot be sold truly by its merits since the buyer cannot know these without buying. Mihle Personnel Services will benefit in several ways by structuring a proper sales process.

• Sales process will effectively communicate value of services offered
• Builds credibility with clients
• Lighten the load on the salesperson by providing simple steps to walk through sales pitches
• The sales process will help to provide the company for growth

 

3.5 Implementation

In order to implement a sales process for Mihle, we had to make sure that what we were writing went along with how the company’s co-founder and salesperson, Arnold, conducts sales. To do this, we engaged initially with Arnold in both typical and role-reversed role-play sales situations. We gave him objections from both decision makers and gatekeepers. Abuya Consultancy designed much of the sales process around his natural technique. We also tested the technique with Monde, and found the structure helped reduce his apprehension and could empower him to assist in the sales process, should that eventually become necessary for Mihle to develop their customer base.  Once we did this, we made a few necessary tweaks and took the process to where it could be properly tested- actual calls.

 

Step 1: Develop Role-Play Scenarios

Abuya Consultancy came up with some role-play scenarios to use during a client meeting with Arnold and Monde. The first scenarios were meant to gauge the entrepreneurs’ current sale skills, and to be able to identify the gaps within their methodology. A map was drawn out to analyze their holistic process.

 

Step 2: Gain Feedback from Mihle

After the first session we provided feedback to both Arnold and Monde. Abuya Consultancy created a new process that was tailored to the entrepreneurs’ preferred methodology, and we took it to another meeting for another role-play session with different scenarios.

 

Step 3: Adjust Process

We identified gaps once again within the new process, took it back to the office, refined the process to make it more personable and customer-relation focused. Focusing on a new customer-relation sales process cultivates relationships and makes the potential client more vulnerable to sign and buy the services. A new role play scenario was played out, this time the consultants and the entrepreneurs switched roles, and each had the opportunity to experience the role of the gate keeper, the seller, and the decision maker.

 

 

Step Four: Workshop

 When meeting with Monde and Arnold, Abuya Consultancy conducted sales presentation and proposal workshops. Conducting the workshops allowed us to gain insight into what they wanted for the presentations, and we took this, developed a presentation template and merged it with “best-practices” for sales from the industry.

 

Step Five: Make the Call and Make Sales Trips

The next step was conducting an actual sales call. This gave us the opportunity to ensure that MPS’s process were going to be sustainable and successful. The reaction from the potential client was good, and Arnold was able to make his first contact with the gate-keeper and decision maker of the business. Abuya Consultancy also wanted to also implement the sales process in the retail field. During a half-day trip to the Khayelitsha Mall, Arnold was able to talk to 5 gatekeepers, make future appointments with 2 decision makers, and sit down for 2 full calls with decision makers

 

3.6 Next Steps

            Because the growth of the business is completely dependent on the sales process, practicing and implementing this process will be critical once the engagement has ended. In order to master the sales process, Arnold and Monde must continue to review the role-playing situations practiced, and should continue to make cold and warm calls to put this practice into action. By adding to the prospect list and updating as calls are made, they will be able to establish a concrete sales process and be introduced to the community by closing sales.

 

 

 

 

Deliverable 4: Forms and Processes

4.1 Problem Statement

Mihle is still in the startup stage where processes, especially the basic functions, are not in place. They currently have no systematic interviewing process for job seekers and an engagement of agreement with the client. For Mihle to be able to move forward and have consistent service provision, they need a system to follow in activities like a check list when interviewing. There are also other basic forms, such as an invoice and contract, which must be created to ensure that the sales process can be smooth and all paperwork is available when necessary.

When consulting with Mihle, Abuya Consultancy realized that no system is followed and thus no organized flow of processes. This mostly occurs before interviewing. This process is time consuming but also needs a lot of attention to details. No system is followed to enable the interviewee on what the interviewer has to offer. This can create confusion and can be time consuming if one has to repeat the process again. There is also no contract that enables them to gain some control on what they offer and expected of them as well as the client they are servicing. This places them at a risk where client can change their mind and they lose out of revenue for service. They cannot be hold the client accountable or demand payment for their services. Without an organized process and check list Mihle cannot know what information is relayed. In the process inconsistencies can occur especially when dealing with clients. As a results of this when new employees join they will not know how Monde and Arthur do business and thus introduce their own systems, messing up the already placed plans.

 

4.2 Desired Result

In creating templates of the processes that need to be followed, Mihle will be able to have an operating model that will offer consistent service delivery smooth flow of information. The ease in the flow of information occurs when interviewees’ information is organized in a systematic manner easily found and interpreted. This is created when a checklist is in place when job seekers are interviewed and jobs are matched easily to suitable candidates. This will enable Mihle to have a built in culture that can be transferred to new employees who join in when they expand when they will be interviewing candidates.  

The training of new employees will be easier as a template of what Mihle’s interviewing process will be followed by the book. In addition Mihle will be in a position where clients will take them seriously as they are able to know what skills they can supply and through their use of a contract as both parties will know what is expected of them when they do business.

 

4.3 Solution

In order to create an interview process for the pool of hirees, a form for evaluating applicants and a checklist to follow have been created. This form will be a hard copy, enabling them to see the process they follow when evaluating an applicant and understand the importance of knowing which factors the applicant was judged on. These templates will become even more important as the business grows, and the interviewing process is delegated to other employees. Monde and Arnold will be able to train employees and ensure that the employees can follow procedures for what is required of them. The checklist will ease the process of interviewing and interpret capabilities and skills of the interviewee.

 

Below is a checklist to ensure all necessary documents have been received from the applicant and interview can be arranged. This document will help Mihle to make sure they have all documents from the job seekers before they arrange for an interview with them. This will assist them to make sure Mihle has all information of the job seeker, so that when they are finally placed they can forward these documents to the necessary employer. In addition Mihle will be able to screen the job seekers efficiently and see what they have to offer. It will also enable them to judge among the many candidates the most suitable one for the job that is to be filled.

 

 

 

 

 

Interviewer:	Date:
Name
ID no.
Qualification Certificates
Interview Date
Applied job position

 

 

Figure 32: Interview Checklist

 

Figure 33: Applicant Ranking Form

The interviewing process will be filled in a form that will later be transferred into a database. By using Google Drive, Mihle will be able to type up details that are recorded on the hard copy. The form is used by Mihle during the interview, by either Monde or Arthur at the start of the interview avoiding reading the CV in detail. This will go into details as they present different scenarios to judge the answers from the job seeker and later rate them. A snapshot of the way applicants are ranked on soft-skills can be seen below, and the full form can be found in the appendix.

 

Figure 34: Job Seeker Database

Finally, an Excel database was created to keep track of these forms digitally. The database can be sorted by any category, so people will specific strengths can be found and called for an interview if they seem like they would fit the job.

 

 

A contract was also created for when Mihle Personnel Services signs an agreement to hire employees from a company. This contract was created with Arnold and Monde, gaining information about the pricing structure and terms for payment due. The contract can be found in the appendix.

 

 

Figure 35: Mihle Personnel Services Invoice Form

 

An invoice statement was created, in order to properly invoice clients for Monde’s HR consultation services. The basic invoice statement will record the hours worked, rate, and due dates on payment, and can be seen below.

 

 

With the full functional database, Mihle Personnel Services will be in a position to know the skills sets in their job seekers offer when they go meet potential clients. With a new client. they will need to understand what it is they need and what they have to offer. The negotiation stage will also include use of contract of agreement from both parties. This will ensure abiding of the agreement and also awareness of what the parties have to offer. Establishing basic forms such as the ones above will help to simplify the process of working with a client for Mihle.

4.4 Argumentation

The database will enable Mihle to sort through a lot of information and be able to quickly match suitable candidates with what the client is looking for. The following points will come from an organized database:

• Mihle will be able to know the skills levels they have for potential candidates
• Training of new interviewers is made much easier
• Culture of the company is created implemented and maintained: this is the procedures to be followed and abided, to have quality candidates that will build the relation with clients in the future.
• Mihle is taken seriously as a professional recruitment agent
• Mihle is able to reduce risk for non-payment and compliant through the use of the contract

Other forms, such as the contract and invoice, exist to aid in the sales process, and make sure that Mihle Personnel Services is fully prepared to make a sale on any day.

 

 

4.5 Implementation

 

Step One: Determine and Create Forms Necessary

When discussing the business with Monde and Arnold, developing a sales process helped to identify which forms and templates would be necessary for the business to be prepared for clients. It was determined that these forms would be an invoice, a contract, and forms for ranking and recording the job-seekers that come to Mihle for placement. These forms and templates were created based on industry standards and Arnold and Monde’s specifications.

 

Step Three: Implement with Monde and Arnold

After creating the forms, they were brought to Monde and Arnold to be implemented. Because Monde and Arnold both have prior Excel experience, the database was easily picked up on, ensuring that it will be sustainable in the long-run. It was explained that the idea is to have all information about the business in their fingertips, and that the system will assist them to know who they can target to increase the skills that are lacking in their database. Monde and Arnold brought CVs that they have from the past, and one was inputted into the Excel system to walk through the process. In order to score a job-seeker during an interview and enter them into the database, the following process should be followed:

 

Figure 36: Interview Process with Forms

                             

 

 

 

Step Four: Adjust where necessary

            When meeting with Monde and Arnold, changes were made to the form to make it easier for them and appropriate for the current interview process they have. While before, there were just boxes for “weak”, “average”, and “strong” soft skills, a scale was implemented to make the system simpler and easier to refer to in the future. Also, layout changes were made with the Excel database to make it read more easily for the entrepreneurs.

 

 

4.6 Next steps

During the implementation Mihle mentioned their desire to simplify their data input.  In future, when Monde and Arnold have their own location and have consistent internet access, Google Docs will be a media that will be beneficial. At the moment they are not always online and they need to first and foremost get acquainted with the new systems that have been introduced. A system using Google docs is not practical now, because with their unsteady access to the internet, it may not be sustainable. However, when Mihle Personnel Services opens their own location, this will simplify the process and be the best option for Monde and Arnold to pursue.

 

 

Deliverable 5: Develop and Implement Short and Long Term Goals for the Company

 

5.1 Problem Statement

 

      Because Mihle Personnel Services is such a brand new business, Arnold and Monde have yet to identify short and long term goals for their company. It is very important to do this because it helps to prioritize what they need to do in order to grow the business. Without setting goals, it is nearly impossible to identify what needs to be done and what is expected of the business for the future.

Arnold and Monde have high hopes for Mihle Personnel Services. They are very ambitious and know what they want to their business to look like once it’s well established. At this point in time, they must reel in their attention and focus on the short-term intentions. In order to place their company where they want it and to establish it, they must pinpoint realistic goals and a timeline. As of right now, there are no specific objectives. It will be extremely hard to move the business forward until a plan is set in place.

Once the short-term goals are developed and implemented within the business, Arnold and Monde can then begin to focus more of their attention on the long-term goals.

 

5.2 Desired results

 

      As a consultancy group, we want Arnold and Monde to succeed and grow their business as structured and soundly as possible. In order to do so, they will need to figure out exactly where they want to take Mihle Personnel Services. By developing short and long term goals, it will give them a structured outline of what they will need to do in order to achieve their potential growth.

      We believe that they need to determine monthly sales goals and create timelines for the growth of Mihle. In doing this, it will ground the company and provide parameters for the owners. If Arnold and Monde take the time to pinpoint these goals, it will give the company an outline and purpose. In turn, this will help them lay down a strong foundation for Mihle and to better serve their future clients.

 

5.3 Solution

 

      First we had Mihle set short-term goals. Because they are still establishing the company, we allowed this window of time to be two months. We believe that if Arnold and Monde make the right calculated decisions, they will be able to finish setting up the business and begin working with clients in a timely manner.

 

 

The timeline for Mihle’s short-term goals is listed below in chronological order:

 

Figure 37: Recent Goal Timeline

     

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 This is just a brief overview of the short-term goals in order to get Mihle up and running. In reality, the process of gaining clients will be more in depth, which has been understood by Monde and Arnold through the sales process.

 

Week 1:

• Day 1: Finalize a list of potential clients
  
  • Gather their contact information and locations
• Day 2: Launch website and begin printing brochures/business cards
• Day 3: Begin to fill in employee placement database
  
  • Contact Silulo for graduates looking for employment
  • Categorize by skill level, experience, desired job position, ect.
• Day 4-7: Start process of cold calling and warm calling to potential clients

Week 2:

• Day 1: Continue to call potential clients and grow employee database
• Day 2: Make necessary revisions to client contracts
  
  • Have several copies printed and ready to sign
• Day 3: Try to have at least one in person meeting with a potential client
• Day 4-7: Look at timeline that is set up to make sure Mihle is following its guidelines

Week 3-4:

• At this point, Arnold and Monde will have a grasp on calling potential clients and setting up meetings with them during these two weeks
• They should also continue to develop their employee database
• By this point, it would be ideal that Mihle secures their first client

Week 5-6:

• Walk through the contract with new client
  
  • File the signed copy accordingly
• Receive deposit from the client
  
  • Deposit this money into their new business account
• Open a business banking account to use for client deposits

Week 7-8:

• Continue to call potential clients and set up meetings with them
• Secure another one to two new clients
  
  • Collect deposits accordingly
• Build up brand awareness in the surround community and pipeline for future clients and employees

 

Once the short-term goals are established, Arnold and Monde will be able to focus on some long-term goals they would like to achieve within the next twelve months.

They can be found below in 4-month increments:

Figure 38: Long Term Goal Layout

 

      These long-term goals for Mihle are attainable, but will need to be planned out. In order for Arnold and Monde to achieve what they want, they must focus on gaining their first clients within the first four months. This client will most likely be from a smaller, local business in the heart of Khayelitsha. This is where they need to begin. Once they begin to grow their company and become established, they will be able to start looking for office space to rent. Before they rent an office space, Monde suggested that they look at using Hubspace, Jumpstart Entertainment, or Lingelethu Training Center as possible premises to use. These are very good suggestions because it will give more credibility to the business and these locations are well known so they are easily accessible to others. Because both owners have other jobs, they may need to look at hiring additional help whether it is a part-time worker or an intern.

 

Monthly Sales Goals

      Because Mihle Personnel Services is such a new company, there are hardly any costs to Arnold and Monde as of right now. They do not pay themselves, there are no other employees, and they plan to operate their business out of their homes until further notice. The monthly sales goals will start off as relatively small as well. They will be able to cover their costs (i.e. petrol, printing costs, ect.) as soon as they sign their first client.

      Once the company picks up in the coming months, the sales goals should also increase. Arnold and Monde will accumulate more costs at this point and it is important that they are generating enough of a turnover to cover everything. It should not be difficult for them to breakeven and gain profits relatively quickly.

5.4 Argumentation

 

• Arnold and Monde will have a clear understanding of where their company is currently
• It will outline feasible steps in order for the owners to get Mihle where they want it
• It will establish parameters for the owners so they can keep Mihle on track
• It will allow the business to run smoothly
• The owners will know exactly what they will need to do in order to progress with their services
• By setting monthly sales goals, Arnold and Monde will know how much turnover they will need to breakeven and generate a profit
• The timeline will provide a clear understanding for the business, where it is and what the next steps are

5.5 Implementation 

 

      When we had our first initial meeting with Arnold and Monde, we asked them what they wanted their short-term and long-term goals to be for Mihle Personnel Services. Once they listed them, this gave us a good look at what their visions were and if they were attainable. It was important that we lay out a proper timeline so that they could achieve these goals.

 

Step One: Discuss Short and Long Term Goals

      In order to implement goals, we first had to discuss what the short and long term goals were that Arnold and Monde had for the company. In our first client meeting, we asked them about their vision for Mihle, and what their short and long term goals were. We recorded these goals, and took into consideration what short-term goals we could achieve in our three week engagement with them.

 

Step Two: Present Realistic Timeline

      After compiling Arnold and Monde’s goals, we presented them with a timeline of these objectives, and got their feedback. Working together, we developed specific goals over a 3 month, 6 month, and one year period, and detailed steps on how to actually achieve those goals. We focused on not only goals that could be achieved together, but goals that would be prioritized once the engagement was over.

 

Step Three: End of Engagement Evaluation

      Towards the end of the engagement, we sat together with Monde and Arnold to evaluate the goals that we had already accomplished working together, such as building a Facebook page, practicing sales calls and making a first sales call, and developing database systems. Many of these goals were accomplished, and those that were not were scheduled as a short-term future goal. We then set guidelines for the short and long term goals that would be accomplished at the commencement of the engagement, and what these goals would require to be completed. The goals are as follows:

 

 

 

Deliverable 6: Bookkeeping System

 

6.1 Problem Statement

      Because Mihle is a new company, and has not had any sales, they have not developed a bookkeeping system to date. However, when sales begin to occur, a bookkeeping system is critical in order to keep track of cash and of receivables. Mihle has a desire for future growth and expansion, and this will not be able to occur without being financially organized from the start.

 

6.2 Desired Results

      A bookkeeping system will allow Monde and Arnold to keep track of the revenues and expenses that the company is accruing, and see how profitable the company is. Specifically, recording each job will allow Mihle to keep track of receivables, and make sure that they are received on time.  Because of the nature of the business, payments are not made until after the service is completed, and therefore receivables are a critical aspect of the bookkeeping system.

      Along with basic bookkeeping, the system will provide for scenario analysis, allowing Monde and Arnold to play around with the commission they are charging to see how much revenue it will produce. This will help Monde and Arnold to make thoughtful, informed decisions on the compensation that they are taking from each individual job.

 

6.3 Solution

      A bookkeeping system was created in Excel, which will allow Mihle to track any business that comes in. The bookkeeping system records:

• Cash flows in and out of the business
• Accounts receivable, and their collection
• A history of all jobs, for both personnel services and HR services, and full detail for every job Mihle Personnel Services contracts
• Scenario analysis to establish what revenues will come from charging various commissions

The bookkeeping system will most importantly record and identify the process of a payment from being a receivable to the day it is paid and comes in as a revenue. This will ensure that payments are received on time, and that they are not recorded as a revenue until they are actually received as cash. Monde and Arnold are very familiar with Excel, so the system will be easy for them to pick up on, and will be adhered to in the future.

 

Figure 39: Personnel and HR Contract Sheets

Contracts Sheets

 

 

In order to record the contracts that Mihle signs and the clients that they have, the contracts tabs exist to record all of the relevant and critical information about an engagement. This is a record of the money owed by the client and when it is due, and also will show when they have paid in full. It can also be used as a reference in the future, to look at past contracts and compare % commission taken for various contracts. Two different tabs exist separating Personnel contracts and HR Services contracts, mainly because the information recorded is different for the two. Because of this, job #s end in “P” for personnel, and “HR” for HR services. This distinction will be maintained in the receivables tracker and cash flow system.

 

Figure 40: Receivables Tracker

Receivables Tracker

 

 

The receivables tracker allows Mihle to record receivables when a contract is signed, and also to record when payment is received to zero out the receivable account. Two examples are shown above to represent an entry for personnel services and for HR. This receivable tracker is important to ensure that payment is received, and that the account gets paid off by the time it is due. When a payment is recorded in the receivable tracker, it should then be recorded in the cash flow system as cash coming in.

 

 

 

Figure 41: Cash Flow System

Cash Flow System

 

 

     

While the receivables tracker records money that is owed to the business, the cash flow system records actual cash coming in and out of the business. Whenever a payment is recorded in the receivables tracker, it is then transferred to the cash flow system as a revenue coming in. On the right hand side, the profit is totaled to date.

      It is important to recognize that currently, there are very few expenses in the company, so there are very few cash flows out. A majority of the variable expenses are simply time dedicated by Monde and Arnold. However, in the future, when a location is established and employees are hired, this cash flow tracker will have many more cash flows going out.

 

 

 

 

 

 

 

 

 

Figure 42: End of Month Tracker

End of Month

 

     

 

 

The end of month recording tab allows for comparative tracking of growth. At the end of each month, revenues and costs are added up from that month, and this will produce the profits created for the business. It is important to also record receivables still outstanding at the end of the month, to acknowledge work that has been done that has not yet been paid for. This monthly system will allow growth to be seen, because if more business is coming in, the profits will increase monthly. It will also allow Mihle to see the receivables outstanding at the time, and allow them to take action to collect on receivables that are overdue.

 

 

 

 

 

 

 

 

Scenario Analysis

Figure 43: Scenario Analysis

 

 

 

 

This scenario analysis will allow Mihle to quickly calculate how much varying commission will increase or decrease the revenue they receive from a job. Because Mihle’s pricing is variable, depending on many factors, they may adjust the commission % received. This tool will allow them to see how much of an impact that commission will play on the revenue they receive.

This is particularly valuable when adjusting commission based on time and effort put in by Mihle. For example, if the job that they are filling is very skill specific, and will take a lot of effort to develop a pool, the commission that they take may be higher to reward this increased effort. This tool will let them manipulate the various factors in a personnel hiring job.

 

 

Monthly Fixed Costs

Recording monthly fixed costs will help Mihle to understand how much money they should be bringing in to cover costs and make a profit. Because there are no variable costs, besides simply the time commitment to a job, the revenue that needs to be made per month to turn a profit can be based solely on the monthly fixed costs. While it is difficult to establish exactly how many people should be placed per month, because it is dependent on the commission taken and annual salary, ensuring that these total monthly costs are covered each month will allow Mihle to ensure that they are breaking even and making a profit.

Figure 44: Monthly Fixed Costs

 

 

 

 

 

6.4 Argumentation

Bookkeeping is a necessary practice for any business to understand their profitability and track orders to ensure that receivables are being paid on time. In order for the business to expand, sustainable bookkeeping procedures must be implemented to avoid lost cash through receivables that are lost track of and never collected.

      The bookkeeping system created will allow Arnold and Monde to record information about each contract signed and keep track of payment dates and amounts. The system is appropriate for them because it is simple to keep up with, and Arnold and Monde have past experience using Excel. In the future, if Mihle is interested in any financing from a financial institution, well-kept books are critical to show their profitability and their understanding of basic business concepts.

 

6.5 Implementation

      In order to teach the bookkeeping system to Monde and Arnold, and ensure that it resonates, it is important to go through the recording process step-by-step with an example client to practice with them. Monde and Arnold understand the value in a bookkeeping system, but in order to make sure that this system is used to its full potential, it must be ensured that they fully understand the process for recording a client contract from start to finish. If steps are skipped because they are confusing or need to be simplified, this will decrease the benefits that the bookkeeping system can provide to Mihle Personnel Services.

 

When a contract is signed with a client, the following process occurs:

1. The details of the contract are recorded in the proper Contract List – either personnel or HR. The contract is assigned
2. The information from the Contract List should be transferred to the Receivables Tracker with the customer information, due date (30 days from the contract being signed), initial amount, and balance.
   
   1. The initial amount and balance should be the same, because no money has been paid thus far

When a cash flow comes in on that specific contract…

1. Record the cash that was received on the Receivables Tracker as a payment. Record the balance as the initial amount minus the payment. If the payment was the entire initial amount, the balance should be zero.
2. Record the payment onto the Cash Flow System as a revenue
   
   1. Make sure to transfer the job id consistently on all sheets

If the contract has now been paid in full…

1. Return to the Contracts form and update the “Paid?” column to say “YES”, the job has been paid for in full.

 

The following checks and balances exist in the system:

• Whenever a contract is signed, it should be recorded in:
  
  • The appropriate contract tab
  • The receivables tracker tab
• Whenever a cash payment on a contract comes in, it should be recorded in:
  
  • The receivables tracker tab
  • The cash flow system, as a revenue
• Whenever a contract has been paid in full, it should be recorded in:
  
  • The receivables tracker tab, to ensure that the balance on that job is zero
  • The cash flow system, to mark the cash coming into the business
  • The appropriate contract tab, to signify that the contract has been paid in full

The system was fully explained to Monde and Arnold, and reviewed for understanding. After looking at the system together, the tab for monthly fixed costs was added to help Monde and Arnold see what kind of revenues they need to be bringing in monthly to cover their costs in the future.

 

 

6.6 Next Steps

      The bookkeeping system can be used with the sales process to ensure that sales goals are being reached. It is important to analyze end-of-month revenues, expenses, and profits to see if there is growth in the business, and have a unit of measurement to understand this growth.

While this bookkeeping system is good for Monde and Arnold to keep track of their accounts receivable and cash flow, it does not create income statements or balance sheets. These will be important in the future, especially if Mihle Personnel Services desires to receive funding from a bank or private institution. Therefore, in the future, when revenues are coming in, money should be spent to hire an accountant to annually create financial statements for the business. Relationships can be developed with local accounting firms to reduce the cost of this.

Letter of Appreciation

 

Letter of Appreciation to Mihle Personnel Services

 

Dear Arnold Ndindwa and Monde Foli,

 

We appreciate you for opening up your business to us. We admire your passion for your business and your community. We believe you will accomplish your goals because of the drive and determination you have. We are very impressed with the work we did together in the short time we had, and are grateful for your dedication to the engagement. We can’t wait to see how much your business will progress in the future.

 

We hope the implementation of these deliverables will allow you to grow your business and take your business to where you want it. We have enjoyed ourselves tremendously these past six weeks and we have learned so much from you. Thank you for your kindness and patience.

 

Warm regards,

 

Abuya Consultancy

 

Esteban Arturo

Alexis Illyinsky

Susanna Marrero

Ian Mitchell

Elaine Wairimu

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Appendix

 

APPENDIX 1: COLLEGE FLYER

 

Figure 45: Flyer for local colleges

APPENDIX 2: MARKETING PLAN FOR MIHLE PERONNEL SERVICES

NICHE STRATEGY: DO SOMETHING THAT YOUR COMPETITORS CAN’T DO

 

 

Situation Analysis

Mihle Personnel Services (MPS) is just starting operations in the month of July 2014. The Cape Town and surrounding areas are in need of a job placement company that focuses on recruiting potential employees with low-skill and medium-skills from the townships.

 

Market Analysis

Need more information on the size of the industries that are hiring low-skill and medium-skill individuals.

 

Market Needs

At the moment, the market in Cape Town lacks a job placement/recruiting company that focuses on low-skill and medium-skill jobs. MPS is providing business in Cape Town and its surrounding Townships with pools of talent that comes straight from the Townships itself.

 

• Low/Medium-Skill employee pools
• Quick fulfillment of low/medium-skill positions

 

Target Market

SME’s, Large Companies, and Corporations who employee low/medium-skilled talent and are in need of fast services to fill the position required.

 

Market Segmentation

The market was segmented into four primary targets, the SME’s who qualify under BSM 5-6 status, SME’s who qualify BSM 7 and Managed/Aggressive Growth Firm, Large Businesses, and Corporates.  Seen in the next page

 

	SME BSM 5-6	SME BSM 7- Managed/ Aggressive Growth Firm	Large Business	Corporate
Primary Benefit Sought	-Cost effective - Availability -Locality	-Talent Development -Hassel Free -Cost effective	-1-Stop Shop -Talent development -Video Interviews -Employee Skills and culture match	-Employee culture match -Township talent pools -MPS References -Success rate
Business Characteristics	-Small -Privately owned -Operate from home -Average turnover of $47,039 R -1-2 employees	-Small/Medium & ready to grow -Privately Owned, multiple shareholders -Operate from home or small office -Average turnover of $100,000 R -2-10 of employees	-Large business -Privately owned or multiple shareholders -Operate from office complex -Average turnover of $577,000 R -10-30 employees	Large companies 3+ branches Multiple levels of management -Average turnover of $757 mil. R - Average of 14,944 of employees
Decision Makers	-Owner	-Owner/Partners	-CEO -Owner -Head of HR	-HR top management
Hiring Habits/ Frequency of Usage	-Referrals -1 time/year	-Job Posts -Referrals -1-2 times/ year	-Job Posts -Referrals -2+ times/year	-On-going database -Hiring services -Multiple times/year
Services/ Products Purchased	-Job placement	-Job placement -HR Mediation	-Job Placement -Team-Building workshops -HR Mediation	Job Placement
Education Level for Jobs	-Some high school -Matric	-Matric -Post-Matric -Specialized training	-Matric -Post-Matric -Specialized training	-All education levels
What are they shopping for?	-Office support jobs -Specialized Skills	-Office Support -Computerized skills -Specialized skills	-Office Support -Technology Assistants -Specialized Skills	-Cashiers/tellers -Call Center Specialized Skills
Typical length of sales process	-Weeks	-Weeks/Months	-Months	-Months/Years
Exposure to hiring services	-None	-Little to none	-Limited	-Very

 

Competition

While there are no direct competitors that offer the same services that MPS offers, there are indirect competitors that are just independent individuals who also have access to talent pools in the Townships and are able to make recommendations to companies for potential hires. In addition, Cape Town has about 12-15 job placement companies that focus on providing the market place with medium/high-skilled talent pools; however, MPS is  the only one of these based out of Khayelitsha that offers access to low/medium-skill talent pools.

 

Placement

 

High Cost

Low Cost

High Skilled

Low Skilled

MPS

Comp

Mihle Personnel Services works with companies in the Western Cape. They focus their efforts in recruiting potential employees from Khayelitsha (and other townships) for low-skilled or medium-skilled jobs.

 

 

 

 

 

 

 

Product

MPS provides job placement for individuals based on the townships. They seek to fulfill positions that are mostly low-skilled/medium-skilled positions. In order to develop the product that they provide to the client, in this case the potential employee, MPS provides them with workshops in which they can develop and learn about essential etiquette for the workplace.

 

Price

      Prices for MPS will vary depending on the segmentation and the requested services. The fee that MPS charges is based on a percentage of the amount of the placed employee’s year salary.

The fee is based on the firm ability to pay for the services. The prices are competitive in the industry. Competitors charge minimum of 8% for all their services, but their services are geared towards more high-skilled industry.

SME BSM 5-6	SME BSM 7- Managed/ Aggressive Growth Firm	Large Business	Corporate
4.5%	4.5%-6%	6%-7.5%	7%-8%

 

 

Marketing Strategies:

Promotion

      80% of the business promotional efforts will be focused on Personal Selling. The business revolves around sales and at the moment the business has zero traction with potential clients. The other 20% of the promotional efforts and resources will be geared 10% towards advertising and 10% towards public relations. As MPS starts to gain traction from clients, they will also need to continue to grow their talent pool (which they already have traction with from Silulo), therefore advertising to this sector will be important. As for public relations, the company’s validity and rapport will come from these, and will in turn aid in the closing of sales with potential clients

      POINTS OF CONTACT WITH POTENTIAL CLIENTS THAT RAISE AWARENESS

 

SME BSM 5-6

SME BSM 7 – M/A Growth

Large Business

Corporate

LinkedIn

Facebook

Ikasi Network

Chamber of Commerce

Wall-Mural Adv.

Drink-and-Meet*

Warm/Cold Calling

HR Associations

 

 

 

 

 

 

 

 

 

 

 

*Drink-and-meet: Going with managers or decision makers to get a drink. This is part of building relations, raising awareness, and informing on services

 

MARKETING TACTICS FOR SPECIFIC SEGMENTS

The chart below lists specific tactics that can be used for the specific segments to increase sales and revenue

 

 

Identify Business SME-BSM 5-6 SME-BSM 7-Growth Large Business Corporate

Monetary Costs What percentage of the budget goes to hiring How much business are they potentially losing due to an unfilled position

Added Value Services Khayelitsha Talent 1-stop-shop Convenience Reliability Talent Development

Opportunity Costs Compare time and monetary costs to the MPS services Present opportunity cost

Time Costs How much time does it take from time of posting job, conducting interviews, to signing contracts

QUANTIFYING VALUE FOR THE POTENTIAL CUSTOMER

 

 

 

APPENDIX 3: RESOURCES FOR ONLINE MEDIA CONTENT

 

Resources for Online Media Content:

• Forbes Africa
  http://www.forbesafrica.com/

 

• Business Insider
  http://www.businessinsider.com/

 

• Quora (specific subjects especially useful):
  http://www.quora.com/

 

• Cape Town Chamber of Commerce
  http://capetownchamber.com/
   

 

 

 

 

APPENDIX 4: FEEDBACK FORM

Feedback Form

 

 

 

 

How did you first hear about us?

 

________________________________________________________________________

 

 

What made you chose MPS?

 

________________________________________________________________________

 

________________________________________________________________________

 

 

What was your favorite part about working with us?

 

 

________________________________________________________________________

 

 

 

 

Thank you for choosing us. We believe in working together for a brighter future

APPENDIX 5: SALES PROCESS

 

 

 

 APPENDIX 6: SALES TEMPLATES

1.  Thank You Note Templates

1. Thank You – Gatekeeper

Dear _____,
Thank you for directing my call. I appreciate your assistance. If you have any questions, comments, or if there is any way I can assist you in the future, please let me know.
Sincerely,
-xxxx

1. Thank You – Non-Signing Prospect

Dear _____,
I understand that your time is valuable, and would like to formally thank you for your time. While you may not need Mihle’s services currently, please do not hesitate to contact me at (083) 531 1753 should your needs change. If you or someone you refer find an employee through Mihle Personnel Services, please contact me for a *FREE* teambuilding workshop on us.
Thank you,
-xxxx

1. Thank You – New Client

Dear ______,

It is my personal pleasure to begin our relationship on behalf of Mihle Personnel Services. I want to personally ensure that your experience exceeds your highest expectations, and welcome you to call me personally, should you have any questions or concerns during our engagement.

I look forward to working with you.

Sincerely,

- xxxx

These thank you notes serve as a template for how to interact with a business after approaching them for a sale. They benefit the business by continuing lines of communication after the in-person sale has been made.

1. Sales Points – Gatekeeper

When talking to the gatekeeper, especially when cold calling, there are certain selling points to discuss with them that can be helpful to develop a relationship and differentiate yourself.

Problems Mihle can Solve for the Business-

• Resume influx / backlog issues
• Failure of personal network recruiting
• Turnover / expense of temps
• Inconsistency of employees hired from outside Khayelitsha/Cape Flats

 

Benefits that Mihle’s Services Provide-

• More family time, by saving time going through endless resumes
• Deeper employee relationships / pool for promotion, because employees are trained, screened, and rooted in the community
• Peace of mind, because Mihle will do just about everything for you
• Saving money for the business by saving your time and efforts.

 

Loaded Questions for the Company-

• What’s the biggest issue you’ve had in hiring in Khayelitsha>
• What do you look for in an HR agency?
• How much excess time do you currently spend on HR?
• What is your HR department’s time worth?
• How much more would you pay for a perfect employee?

 

 

1. Quick Sales Scripts – Cold Calls

When cold calling, it can be difficult to strike up conversation, especially with the gate keeper. These quick scripts can inspire you and spur conversation to get to the right person and set up a meeting from the call.

1. Initiating the Call

This is Arnold (introduce self)

I’m sorry to bother you (if you feel someone is frustrated), but I would like your help with something, do you have a minute?

We have this great service where we are matching people with X skills, and we are having X success. I was hoping that you could help me identify someone who I could sit down with at your company who would be in a position to make a decision about hiring practices?

 

1. Passing the Gatekeeper – Reference is everything

“X recommended that I talk to you, did I catch you at a right time?”

If he says no, “Ok would it be ok if I call you tomorrow at X time”

“Hi X, this is Y, I spoke to [day] and you told me to call you back at [time] and I wanted to make good on that”

 

 

APPENDIX 7: LEAD FORMS

Lead Forms

 

Name of the Business:

 

 

Segment:

 

 

People spoken to (order from first to last) with short fact about each person:

 

 

 

 

 

 

 

 

Decision Makers Name and Contact Info:

 

 

 

 

 

 

 

 

 

 

 

Sales Process Form

 

Business Name:

How discovered:

Quick facts:

 

Likely needs:

 

People spoken to (order from first to last) with short fact about each person:

 

 

 

 

 

 

 

 

Decision Makers Name and Contact Info:

 

Appointment scheduled:

Needs identified:

 

 

Sale Closed:

Followed up (week):

Followed up (month):

Followed up (quarter):

Referral(s) given:

 

Notes:

 

 

APPENDIX 8: STAFFING CONTRACT

 

General Staffing Agreement

 

_______________________, with its principal office located at _______________________ (“STAFFING FIRM”), and _____________________, with its principal office located at _______________________ (“CLIENT”) agree to the terms and conditions set forth in this Staffing Agreement (the “Agreement”).

 

 

 

1. STAFFING FIRM’s Duties and Responsibilities

1.1 ​STAFFING FIRM will

a.​Recruit, screen, interview, and assign its employees (“Assigned Employees”) to perform the type of work described by CLIENT

 

b. Properly train Assigned Employees for the job at hand

 

c.​Require Assigned Employees to sign a contract agreeing that they will hold a job with CLIENT and are agreeing to work as a permanent employee

 

2. CLIENT’s Duties and Responsibilities

2.1 ​CLIENT will

a.​Properly supervise Assigned Employees performing its work and be responsible for its business operations, products, services, and intellectual property;

 

b.​Properly supervise, control, and safeguard its premises, processes, or systems, and not permit Assigned Employees to operate any vehicle or mobile equipment, or entrust them with unattended premises, cash, checks, keys, credit cards, merchandise, confidential or trade secret information, negotiable instruments, or other valuables outside of the job description provided to Mihle Personnel Services

 

c.​Provide Assigned Employees with a safework site and provide appropriate information, training, and safety equipment with respect to any hazardous substances or conditions to which they may be exposed at the work site;

 

d.​Not change Assigned Employees’ job duties without the knowledge of the Assigned Employee or the knowledge of Mihle Personnel services

 

3. Assigned Employees Guarantee

3.1. Mihle Personnel Services offers a three month period of time in which the Assigned Employee may be removed from the job if performance is not appropriate according to job description, and a partial refund may be provided

 

3.2 Mihle Personnel Services requires weekly and monthly updates about the Assigned Employee, and reserves the right to refuse a partial refund if the Assigned Employee appeared to be serving CLIENT according to the job description provided

 

3.3 After the first three months, semi-annual check-ins are still required by Mihle Personnel Services, to assure that the Assigned Employee is still meeting the needs of CLIENT

 

3.4 In the case that the Assigned Employee quits within the first three months, a partial refund will be received by CLIENT, depending on circumstances. For this clause to be applicable, the Assigned Employee must have been provided with a safe work site and not be required to do additional work outside of the initial job description. Therefore, a refund may not be received if the Assigned Employee was put into a dangerous situation by CLIENT

 

4. Payment Terms, Bill Rates, and Fees

4.1 CLIENT will pay Mihle Personnel Services for its performance at the rates set forth between the two parties, and will pay any additional costs or fees if they were set forth in this Agreement. Mihle Personnel Services will invoice CLIENT for services provided under this Agreement at the time of Assigned Employee placement. Payment is due on receipt of invoice. Invoices have a net30 payment schedule, and must be paid after the first completed month of work by the Assigned Employee.

 

4.2 In the case that they employee is not meeting the terms of the job description, CLIENT may put in a request to not pay or a request for a new Assigned Employee. Mihle Personnel Services retains the right to deny this request depending on the situation.

 

4.3 Placement Fees are calculated at ___% of the employees commencing annual package (includes commissions and all other benefits) and become due for payment when the introduced candidate commences employment. Placement Fees must not be taken out of employee salary.

 

5. Confidential Information

5.1 ​Both parties may receive information that is proprietary to or confidential to the other party or its affiliated companies and their clients. Both parties agree to hold such information in strict confidence and not to disclose such information to third parties or to use such information for any purpose whatsoever other than performing underthis Agreement or as required by law. No knowledge, possession, or use of CLIENT’s confidential information will be imputed to Mihle Personnel Services as a result of Assigned Employees’ access to such information.

 

6. Cooperation

6.1​ The parties agree to cooperate fully and to provide assistance to the other party in the investigation and resolution of any complaints, claims, actions, or proceedings that may be brought by or that may involve Assigned Employees.

 

7. Indemnification and Limitation of Liability

7.1​ To the extent permitted by law, CLIENT will defend, indemnify, and hold STAFFING FIRM and its parent, subsidiaries, directors, officers, agents, representatives, and employees harmless from all claims, losses, and liabilities (including reasonable attorneys’ fees) to the extent caused by CLIENT’s breach of this Agreement; its failure to discharge its duties and responsibilities set forth in paragraph 2; or the negligence, gross negligence, or willful misconduct of CLIENT or CLIENT’s officers, employees, or authorized agents in the discharge of those duties and responsibilities.

 

7.2 Neither party shall be liable for or be required to indemnify the other party for any incidental, consequential, exemplary, special, punitive, or lost profit damages that arise in connection with this Agreement, regardless of the form of action (whether in contract, tort, negligence, strict liability, or otherwise) and regardless of how characterized, even if such party has been advised of the possibility of such damages.

 

7.3 As a condition precedent to indemnification, the party seeking indemnification will inform the other party within ______ business days after it receives notice of any claim, loss, liability, or demand for which it seeks indemnification from the other party; and the party seeking indemnification will cooperate in the investigation and defense of any such matter.

 

 

8. Miscellaneous

8.1 ​Provisions of this Agreement, which by their terms extend beyond the termination or nonrenewal of this Agreement, will remain effective after termination or nonrenewal.

 

8.2 No provision of this Agreement may be amended or waived unless agreed to in a writing signed by the parties.

 

8.3 Each provision of this Agreement will be considered severable, such that if any one provision or clause conflicts with existing or future applicable law or may not be given full effect because of such law, no other provision that can operate without the conflicting provision or clause will be affected.

 

8.4 This Agreement and the exhibits attached to it contain the entire understanding between the parties and supersede all prior agreements and understandings relating to the subject matter of the Agreement.

 

8.5 The provisions of this Agreement will inure to the benefit of and be binding on the parties and their respective representatives, successors, and assigns.

 

8.6 The failure of a party to enforce the provisions of this Agreement will not be a waiver of any provision or the right of such party thereafter to enforce each and every provision of this Agreement.

 

8.7 CLIENT will not transfer or assign this Agreement without Mihle Personnel Services’ written consent.

 

 

9. Term of Agreement

9.1 The terms and conditions stated above are between Mihle Personnel Services and CLIENT. Acceptance of Mihle Personnel Services’ services deems client acceptance of these terms and conditions. The engagement of an applicant introduced by Mihle Personnel Services in any capacity will signify your acceptance of these conditions.

 

 

 

 

 

 

 

I, ______________________________________________, being duly authorized, have red and understand the terms and conitions of this agreement and I agree hereto.

 

 

 

Signature ______________________________________________________

 

Signed at _______________ on this __________ day of 20_____ 

 

Company/ Client Name ____________________________

 

Co. Registration No _______________________________

 

 

APPENDIX 9: INTERVIEW FORM

 

Applicant Name:                       Applying for:                                         Date:

Education level:

Current position:

Period on the job:

Reasons for leaving:

Skills attained:

Previous job:

Period in the last job:

Describe a situation, applied reaction and rate below

 

 

	1 2 3 4 5 6 7 8 9 10
	Weak	Moderate	Strong
INITIATIVE
Comments
STRESS TOLERANCE
Comments
PLANNING AND ORGANIZING
Comments
TECHNICAL AND/OR POSITION SPECIFIC
Comments
WORK STANDARD
Comments
TEAMWORK
Comments
COMMUNICATION SKILLS
Comments
LEADERSHIP
Comments
JOB MOTIVATION
Comments

 

Suitable for the job : Yes           NO        .

Comments:     

 

 

 

 

 

 

 

 

 

 

 

Images are coming soon. 

08

 

Fall

Final Consulting Report Abuya Consultancy Alexis, Illyinsky Elaine Wairimu, Esteban Arturo, Ian Mitchell, & Susanna Marrero

 

Table of Contents

Letter of Agreement................................................................................................................ 5

SUPPORTING EMERGING ENTERPRISES (SEE) MODEL.......................................... 10

I. Core Strategic Issues..................................................................................................... 11

II. The Entrepreneurs........................................................................................................ 12

Monde Foli....................................................................................................................... 12

Arnold Ndindwa................................................................................................................ 14

Business Skills................................................................................................................... 16

III. The Business Concept................................................................................................. 18

Business Description......................................................................................................... 18

Contribution Margin......................................................................................................... 20

Location........................................................................................................................... 20

IV. The Opportunity.......................................................................................................... 21

The Local Market............................................................................................................. 21

Target Market.................................................................................................................. 22

Pricing and Price Competition.......................................................................................... 23

Competition..................................................................................................................... 24

V. Financial Records......................................................................................................... 27

Financial Statements......................................................................................................... 27

Future Financial Growth.................................................................................................... 29

Financial Structure............................................................................................................ 29

Breakeven......................................................................................................................... 30

Operating Leverage........................................................................................................... 31

VI. Internal Infrastructure............................................................................................... 32

Operating Facilities........................................................................................................... 32

Staff.................................................................................................................................. 32

Information System.......................................................................................................... 33

VII. Operational Considerations..................................................................................... 34

Administrative procedures................................................................................................. 36

VIII. Marketing Efforts...................................................................................................... 37

Positioning....................................................................................................................... 37

Segments and Marketing................................................................................................... 37

Sales Efforts and Approach............................................................................................... 39

Marketing Media and Branding.......................................................................................... 39

IX. Financing Needs & Relationships.............................................................................. 42

Capital Needs.................................................................................................................... 42

X. External Networks......................................................................................................... 44

XI. Concluding Remarks.................................................................................................. 45

DELIVERABLES.................................................................................................................... 46

Deliverable 1: Branding................................................................................................... 47

1.1 Problem Statement..................................................................................................... 47

1.2 Desired Results............................................................................................................ 47

1.3 Solution...................................................................................................................... 47

1.4 Argument.................................................................................................................... 49

1.5 Implementation Plan.................................................................................................. 49

1.6 Next Steps.................................................................................................................. 55

Deliverable 2: Marketing Plan and Strategies.............................................................. 56

2.1 Problem...................................................................................................................... 56

2.2 Desired Results............................................................................................................ 56

2.3 Solution...................................................................................................................... 56

2.4 Argumentation............................................................................................................ 67

2.5 Implementation.......................................................................................................... 67

2.6 Next Steps.................................................................................................................. 71

Deliverable 3: Sales Process............................................................................................ 72

3.1 Problem Statement..................................................................................................... 72

3.2 Desired result.............................................................................................................. 72

3.3 Solution...................................................................................................................... 73

3.4 Argumentation............................................................................................................ 81

3.5 Implementation.......................................................................................................... 82

3.6 Next Steps.................................................................................................................. 83

Deliverable 4: Forms and Processes................................................................................ 84

4.1 Problem Statement..................................................................................................... 84

4.2 Desired Result............................................................................................................. 84

4.3 Solution...................................................................................................................... 85

4.4 Argumentation............................................................................................................ 89

4.5 Implementation.......................................................................................................... 89

4.6 Next steps................................................................................................................... 91

Deliverable 5: Develop and Implement Short and Long Term Goals for the Company 92

5.1 Problem Statement..................................................................................................... 92

5.2 Desired results............................................................................................................. 92

5.3 Solution...................................................................................................................... 93

5.4 Argumentation............................................................................................................ 96

5.5 Implementation.......................................................................................................... 97

Deliverable 6: Bookkeeping System............................................................................... 98

6.1 Problem Statement..................................................................................................... 98

6.2 Desired Results............................................................................................................ 98

6.3 Solution...................................................................................................................... 98

6.4 Argumentation.......................................................................................................... 105

6.5 Implementation........................................................................................................ 105

6.6 Next Steps................................................................................................................ 107

Letter of Appreciation......................................................................................................... 108

Appendix............................................................................................................................... 109

APPENDIX 1: COLLEGE FLYER..................................................................................... 110

APPENDIX 2: MARKETING PLAN FOR MIHLE PERONNEL SERVICES.................... 111

APPENDIX 3: RESOURCES FOR ONLINE MEDIA CONTENT.................................... 117

APPENDIX 4: FEEDBACK FORM................................................................................... 118

APPENDIX 5: SALES PROCESS..................................................................................... 119

APPENDIX 6: SALES TEMPLATES.................................................................................. 123

APPENDIX 7: LEAD FORMS........................................................................................... 126

APPENDIX 8: STAFFING CONTRACT........................................................................... 129

APPENDIX 9: INTERVIEW FORM.................................................................................. 133

 

 

 

Letter of Agreement

 

LETTER OF AGREEMENT

EESA PROGRAMME
UNIVERSITY OF FLORIDA and UNIVERSITY OF THE WESTERN CAPE

 

 

June 17, 2014

 

Mr. Monde Foli & Mr. Arnold Ndindwa

Co-Founders

Mihle Personnel Services

I23 Mongezi Road

Khayelitsha   7784

 

Re: EESA PROGRAMME

 

Dear Monde and Arnold,

 

We first want to thank you for your participation in and support of the Entrepreneurship Empowerment in South Africa Programme. We extend a warm welcome to the program. Our goal is to contribute in every way possible to the sustainability and growth of your business and make this consulting engagement a mutually rewarding experience. We look forward to working closely with you and using the opportunity to gain insight into your company.

 

As we understand it, Mihle Personnel Services is primarily involved in providing human resource services to businesses and serving as a local employment agency for skilled young adults in the townships. Moreover, your business that can be characterized in terms of human resources implementation, hiring, and mediating services. You face unique challenges in terms of promoting the business and spreading awareness of the unique services that you offer.   Yet, you have been successful in leveraging your existing relationship with Silulo and gaining a pool of hirees from their graduates.  With this in mind, we see the primary focus of the consulting engagement to be getting the business off the ground and developing contracts with companies to use the hiring services.

 

With the EESA Programme, the focus is on producing tangible deliverables that you can use.  We will be working intensely with you over the three and a half weeks, employing a methodology developed as part of the EESA Programme over the past eight years. Our first task will be to establish priorities in terms of your needs and what can be accomplished in the time that we have. We will be using the S.E.E. model (Supporting Emerging Enterprises) to assess your current situation and set the priorities. 

 

While things are likely to change as the relationship evolves, for the present we anticipate working on the following deliverables:

 

• Develop and implement a branding package for Mihle to create a concrete image for the business;
• Establish bookkeeping processes to prepare for future growth and facilitate management decision-making;
• Assess your approach to operations in terms of recruitment, placement and related service delivery process to identify ways to increase the value proposition to clients;
• Establish a systematic selling process for use in obtaining contracts with companies that are in need of employees;
• Set short and long-term goals for the business, and begin to implement methods to increase cash flow within the business;
• Develop and implement a marketing strategy to increase awareness of and generate greater revenue from the services Mihle offers.

 

The key is that we work with you in producing solutions that you can implement immediately in the business to improve performance. 

 

Our overarching goal is to serve your needs and build a relationship of trust with you. The EESA experience over the years has made it clear that the best consulting relationships are mutual ones---where both parties invest heavily.  Our biggest requirement is your time.  It is critical that we are able to meet with you for 3-5 hours per week over the next three and a half weeks. We will be respectful of your time, as we know how valuable it is.  But our hope is that we can establish regular meeting times each week.  The other key requirement is that we get an intimate feel for your business. This means it is critical that we have access to your records, bookkeeping information, costs, and other insights that help us do a better job.  Our commitment is to hold this information in the strictest of confidence. No one other than the professor will have access to it, or to any of the work we do for you. 

 

The engagement will commence on June 17, 2014 and will last until July 25, 2014.  Our team will regularly meet with Professors Michael Morris, Eric Mueller, and Jamie Kraft, our faculty supervisors, and they will be working closing with us on the consulting engagement.  Their contact details are:

 

EESA Office

Economics and Management Sciences

3.34. EMS Building

University of the Western Cape

Ph:  021 959 9327

Cell: 079 074 2837

Email:  michael.morris@warrington.ufl.edu                  

 

We will work with you on implementation of deliverables as the consulting engagement unfolds. In addition, a final presentation will be made to you and the faculty mentors at the end of the program, in late July.  The presentation and final report will cover the primary deliverables of the consulting engagement.

 

In addition to making a meaningful contribution to your firm, we have some personal goals in pursuing this consulting relationship. First, this opportunity will allow us to further develop our consulting skills. Second, as many of us want to start our own ventures, we will learn first-hand from the operations of a small business in South Africa. Third, we are excited to apply creative techniques to leverage resources and help grow a business in a township context. We look forward to learning from you and with you as we grow together through this engagement.

 

We look forward to working with you and this opportunity for a truly rewarding experience. Once again, we thank you for your time and support.  Please feel free to contact us for clarifications on these issues, if any.

 

 

Yours sincerely, 

 

ABUYA CONSULTANCY

 

Alexis Illyinsky

 

 

Ian Mitchell

 

 

Susanna Marrero

 

 

Elaine Wairimu

 

 

Esteban Arturo

 

 

In acceptance of the terms outlined above:

 

 

     

Signature: ____________________________

      Mr. Monde Foli                                                                     

      (Co-Founder, Mihle Personnel)

 

     

 

Signature: ____________________________

      Mr. Arnold Ndindwa                                                             

      (Co-Founder, Mihle Personnel)         

 

 

 

Date:  _________________________                                                    

 

 

Faculty Supervisor:

 

 

________________________________

Dr. Michael H. Morris

George and Lisa Etheridge Professor of Entrepreneurship

Warrington College of Business Administration

University of Florida

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SUPPORTING EMERGING ENTERPRISES (SEE) MODEL

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

I. Core Strategic Issues

The core issue that Mihle Personnel Services is facing is that they have yet to actually have any turnover, and are not bringing in profit. At the core of this is their lack of marketing efforts, and therefore large brand unawareness. In general, because there have been little efforts put into the business, there is structural organization that must be done in terms of developing the product and establishing a firm sales process. To support this, bookkeeping systems and general publicity will also be developed.

In order to have any future growth and success, Mihle must place processes for sales, interviews, and consulting from day one. Instilling good processes from the beginning will allow the company to be successful and avoid disorganization, leading to decreased profits. This is critical in a business that maintains many accounts receivable, and must stay very financially organized to be profitable. While they have been successful in prior ventures, and are leveraging resources with Silulo very well, Arnold and Monde will need to put together a strong brand identity and marketing strategy to spread the word about their business to the people of Khayelitsha.

 

 

 

II. The Entrepreneurs

Monde Foli

Mihle Personnel Services is co-owned by Monde Foli and Arnold Ndindwa. Monde is 28 years old, and was born and raised in Khayelitsha. He has a seven year old son.  He is well experienced in the Human Resource (HR) industry as he worked in HR department in Silulo Technologies before he begun the business. He studied in Cape Technikon for Business and Financial Management as well as HR and later in Thembelihle Development. He later joined Silulo and become in charge of their human resource department where he applied and assisted in the systems involving hiring and employee issues in the company. After deciding that he wanted to pursue an entrepreneurial path, he saw opportunity in the fact that young, educated adults in Khayelitsha are having trouble finding jobs after graduation. He left Silulo and with Arnold established Mihle Personnel Services. In addition to that, he has established an NGO that helps the youth to acquire their driver license, which can be critical in order to obtain a job.

Monde now works as a consultant at Silulo, and is also pursing a venture with a friend for an upholstery company, along with establishing Mihle. He has a passion for starting a business of his own, and is therefore exploring this instead of working full-time at Silulo.

 

 

Strengths	Weaknesses
Passionate about helping the unemployed	No drive to put full effort into the business
Experience in the industry Knowledgable of HR services	Over-commitment to many ventures Undeveloped sales skills Unaware of the importance of a target market

Table 1: Monde’s Strengths and Weaknesses

Monde’s weaknesses center around the fact that a lot of effort has not been put into the business venture to date. Because there are currently no fixed costs, and both business partners have other things to focus on, developing Mihle Personnel Services has taken the backburner on their priority list. By changing Monde’s priorities, these weaknesses can be reduced and his strengths can shine to develop a strong business.

Monde is passionate about HR and wants to assist candidates to get jobs or assist them to be professional when applying for jobs. He has seen first-hand the basic skills that candidates lack when applying for jobs. He wants to educate these candidates and enable them to have suitable criteria to enable them to get jobs or match them with potential employers. With this he would like to see instead of employees going out of Khayelitsha to go to jobs or look for them, they live and work in Khayelitsha. With this in mind, Mihle should be in that process of finding organizations or companies looking for employees and matching with potential candidates.

 

Figure 1: Monde’s Time Allocation

Currently, Monde is not focusing enough time on Mihle per week if he desires to see any growth for the business. His interest in his other venture appears to be a priority because it is further developed than Mihle is, and his role in the business is more clearly established. Because Mihle is still in the beginning development stages, it is easy to set it to the side and come back to it in the future. Also, because there are few processes and standard forms for the business, the development of these things are critical before Monde sees value in dedicating his time to the business. After a sales processes and associated templates, contracts, and forms have been created, it will be easy for Monde to see his role in the business, and dedicate more time to its success.

 

Arnold Ndindwa

            Arnold Ndindwa is the other partner in Mihle Personnel Services. He is 30 years of age, married and has a four-year-old daughter. He was born and raised in Khayelitsha and still lives in the area. He works full time in a Vodacom project based in the same area he lives, specializing in relations with informal merchants.

            He studied in Cape Techikon for Human Resource Management, which he completed. He worked in a radio station for four years but left, because he wanted to open a community radio station to empower the township people and focus on the growth that is coming from the Khayelitsha people. Due to bureaucracy and costs, he opted to do a magazine instead, and Ikasi magazine was born, with the help of Silulo Technology. Ikasi was quickly picked up and purchased by Vodacom, and Arnold became a Vodacom employee, managing the magazine and salespeople in the informal sector.

 

Strengths	Weaknesses
Confident and outgoing	Very busy with Vodacom job
Experienced in the industry Strong community relations	Overlooks basic business functions, all about the sales
	Not proactive with the business Undeveloped sales skills

Table 2: Arnold’s Strengths and Weaknesses

            Arnold’s weaknesses vary slightly from Monde’s, but the central issue is the same – there has not been a lot of effort put into establishing processes for the business, so it is being put on the backburner for now. Arnold has the skills to make a very convincing sale, but the sales process must be fine-tuned so that he knows the proper information to present to a potential customer.

During the time with the magazine, he noticed how the township citizens, were having problems getting jobs and since he knew Monde from childhood and studied with him, they agreed to open a business together. He also wanted to inform the youth of what they needed in order to get jobs. Arnold thought he could prepare the youth by teaching them about self-presentation, conversational tools, and self-esteem.

 

Figure 2: Arnold’s Time Allocation

Arnold works full-time so the majority of his week is spent at Vodacom. Since he also has a wife and child, he spends a good amount of time with them as well. Only a small portion of Arnold’s week is spent on working with Mihle, for the same reason as Monde – the business is so early in development that it is hard to see the reason to dedicate time to something that needs a lot of work before it will bring in profits. After establishing the basis of the business together, we believe that Arnold and Monde will both see the true potential that Mihle Personnel Services has, and will be motivated to dedicate more time to the business because of the time they spend building it together with Abuya Consultancy.

 

Both partners meet about once a week to discuss the business or any agenda that needs attention. Mihle has not spent any money other than the cost of registering the business. The company has yet to start spending money to market itself and penetrate the market. Monde and Arnold already have an idea of what to do although it has to yet materialize into action steps. Without concrete action steps, very little progress will be made with the business. Therefore, Abuya Consultancy will prioritize developing concrete action steps for Mihle’s sales and hiring processes, to help the business develop a foundation for growth.

 

Business Skills

            While the pool of unemployed people in the townships is large, it is critical for Monde and Arnold to develop the proper business skills to gain traction with local businesses looking to use them as a personnel service, because this is where the revenue is coming from. While they do have basic business knowledge, and a strong understanding of what is necessary for the job, teaching and recognizing these specific skills will help Arnold and Monde to succeed in the basic business skills that are needed to foster growth in the business.

Figure 3: Monde and Arnold’s Business Skills

           

Unfortunately since Arnold has a full time job, which he values very much, he does not have a lot of time to meet to discuss the business. This causes the information flow about the business between Arnold and Monde to be limited, and is part of the reason why there has been little growth of the business thus far. While Monde has more time to offer, time needs to be spent equally with both partners in the beginning stages to develop the necessary processes to run the business and make sure they are on the same page when marketing the business offerings.

Figure 4: Time Allocation for Both Partners

Overall, the business is a very small focus for both of the entrepreneurs in their weekly time schedule, which is an issue that must be addressed. By developing the basic tools needed for a sale and for employees to be placed, value will be created in the entrepreneurs’ minds, and they will have a greater desire to dedicate more time to the business in the future. In order for future growth to be achievable, the business must take up a much larger percentage of the partners’ focus, and this will be communicated and learned by all.

 

 

 

 

III. The Business Concept

Business Description

            Mihle Personnel Services is a unique business in that it provides job placement for men and women in need of employment while simultaneously working with local companies looking to fill specific job positions in the Khayelitsha community. Along with job placements, Mihle also assists in disputes that might happen in the workplace, acting as a mediator and holding team-building workshops. In addition, Monde and Arnold hope to provide appropriate services to local businesses that lack Human Resources departments.  It is estimated that hiring services will provide about 85% of revenue, and HR consulting will provide about 15% of revenue. This is because hiring services are the main focus of the business, and therefore will make it most profitable. As the business grows, consulting could either grow to bring in more revenue, or be pushed aside, depending on the desires of the entrepreneurs.

85%

 

15%

Figure 5: Mihle Service Offerings

 

            Monde and Arnold are passionate about helping the Khayelitsha community. They want to create a sustainable work environment and to help place as many people in local jobs as possible. As of right now, they have not placed any jobs because the business was established less than two months ago. In the past when a man or woman in Khayelitsha needed a job, they would go into the city and seek help from a job placement service there. These services provide competition because they hire from a similar pool, however they do not provide direct competition because of the high commission % they charge to companies. Mihle will further differentiate themselves from competition in the city by honing in on specific job placements and screening not only the background of the client but to be selective. They need to focus on the skillsets and capabilities of these men and women seeking help in order to set their company apart.

            If the owners are able to narrow their pool of clients by being selective with their criteria, value will be added to the overall process. They will be able to pull potential employees from a strong well-rounded group of candidates and truly satisfy the needs of the business that needs the placement filled. An important aspect of the selection process is not just if they have the hard skills needed for that specific job, but also having soft skills to be a good, long-term investment for the company, such as ability to learn quickly and strong customer interaction skills. These skills will be tangibilized by implementing checklists filled out when interviewing a potential employee, and can be shown to the company hiring, as well as the employee themselves. In doing so, Mihle Personnel Services would focus on maintaining low volumes and high margins.

 

Because of local standards, Mihle has determined that they can charge the business that is in need of the job placement no more than 8% of the job position’s yearly salary. Monde and Arnold expressed that they would charge between 4-6% of the yearly salary when closing a contract for a large group of hirees, for the sake of their competition. Monde, who would be in charge of the HR consulting, would charge R120 per hour of on-site service. This fee is fairly low, due to the fact that Monde has not received his CCMA consulting certificate, although he plans to within the next year. When establishing short and long-term goals for the business, this will be considered and placed as a fairly high priority, to increase revenues.

 

 

 

 

 

Contribution Margin

The two revenue drivers for the business are job placement and HR consulting services, and both have a very high contribution margin because of the low fixed costs of the business. However, what must be considered with contribution margin is the large amount of time that Mihle must dedicate to the services they provide. When business starts to flow in, revenues will quickly increase, because of the current lack of both fixed and variable costs. When the business expands, and they decide to rent a permanent location and hire employees, fixed costs will increase, and this high contribution margin will be very important.

 

Location

As of right now, Mihle is run out of Monde and Arnold’s homes in the Khayelitsha area. Both of the owners have voiced their desire to rent a location, to increase their professionalism and have a concrete street address for the business. Monde has searched in the community for a small storefront to lease. Their ideal location for Mihle would be in the heart of a shopping center or mall in Khayelitsha, where it is easy to come across and close to many potential clients. This would bring in foot traffic and make their services easy for the public to access.

Renting a location is not a top priority for the business but it is something that Monde and Arnold want to pursue in the near future. Currently, the conference room at Silulo can be used for employee interviews, and this is a professional and suitable environment. Because the business was started so recently, no revenue has been generated. Obtaining a leased space would bring in more monthly fixed costs. Abuya Consultancy believes that while having an easily accessible location for clients is important, the owners need to focus on grounding the business and solidifying a steady turnover.

IV. The Opportunity

            Mihle is a service company that allows companies to outsource their Human Resource needs. Due to the unique conditions of the South African labor market, such as persistently high unemployment and skills mismatch, this is a common practice. While the responsibilities of an HR firm include mediation and other tasks as well, the main service is in connecting employers to the talent they need, so there are two distinct markets to deal with for any HR company. The specific market in this case is large companies that are investing in townships, and SMEs that have grown in the area.

Major investments are being made in townships in retail shopping centers and call centers, requiring basic computer skills and typically at least a matric education, skills that are higher than the average township resident possesses. Because of this, the specific market for talent is semi-skilled employees, with certifications, matric qualifications, but little or no full-time work experience, who live in or near townships. There is a separate market for IT-qualified workers as part of these companies as well. Because of the difficulty in finding people with these qualifications, employers and recruitment agents often end up sourcing this type of employee form outside of the township where they are employed.
 

The Local Market

The market that Mihle plans to initially begin operating in is Khayelitsha. Khayelitsha is South Africa’s biggest and fastest growing township, with as many as 1.5 million inhabitants, and an official census population of 381,000 as of 2011. In Khayelitsha, as in similar townships, there is an increasing level of investment in retailing, call centers, and related industries, creating a demand for a semi-skilled workforce who is computer literate with grade 12 qualifications. Accompanying this there is also a major rise in the demand for certified IT professionals to keep everything from POS systems to phone trees up and running, along with maintenance on wireless infrastructure and computers themselves. These businesses are bringing in large numbers of jobs to the area, but currently, they are not always going to residents of the township. Mihle will serve as a way for these jobs to be given to the residents of the area. The industries that are doing the most hiring in the townships are retail chains, such as ShopRite or Spar, and are hiring in whatever means is easiest for them.

There are 75 448 workers in Khayelitsha who commute to work on a daily basis. 80% of them rely on bus, taxi, or train, and another 5% walk to work[1]. This number does not include those who commute from town or adjacent townships into Khayelitsha for work, however many more workers leave Khayelitsha on a daily basis than enter. Due to the geography of Khayelitsha and the Cape Flats area in general, commute times from Cape Town to Khayelitsha, and even between townships, can approach 2 hours per day. Tardiness and absences can be expected for employees who rely on this over-capacity system, who have few if any alternatives. For employers, sourcing employees from outside of Khayelitsha can translate directly into absences, tardiness, and poor performance, however there are no agencies set up specifically to remedy this problem by sourcing employees from within Khayelitsha.

The employees that are in demand in Khayelitsha are more skilled than the labor force of Khayelitsha overall, and the high rate of unemployment in the area creates an issue, as HR departments need to sort over large applicant pools with relatively few qualified for the open jobs. In Khayelitsha just over a third have completed grade 12, and fewer have necessary skills or certificates qualifying them for skilled or semi-skilled work. Because of this, open positions are rarely advertised, since the deluge of applicants can be difficult to manage. Positions are usually filled via either asking existing employees for references for new employees, or via employment agencies based in Cape Town.  

The difficulty in obtaining employees in Khayelitsha who are both skilled and consistently available comes from a lack of agencies with connections within the township, and from relatively few working in the relevant industries with friends or family in the township. As employers cannot function without employees, this is a major issue to be dealt with.

 

Target Market

While Mihle has not begun operating yet (i.e. there are no revenues), when we initially spoke with the entrepreneurs, they wanted to handle a very broad market, from unskilled elementary with no full-time work experience to college-educated and managerially experienced. However, the business has greater strengths in specifically supplying semi-skilled employees and IT certified professionals via its relationship with Silulo, particularly in Khayelitsha due to strong community ties beside Silulo. This is the market niche in which Mihle can attain a sustainable competitive advantage and best grow their business. Currently, there is no formal arrangement with Silulo, but they are very interested in a way to aid their graduates in getting an actual job, and Mihle is the service that can do this for them.

Mihle has not laid out a segmentation strategy yet, but a strategy of utilizing their connections to Silulo and via Arnold’s connections into the corporate world, there is a strong ability to build much of the business’ market from personal networks. The segments which have the most promise are employers who are new or expanding entrants into Khayelitsha, who require semi-skilled or IT workers and require a streamlined acquisition process and greater accountability from their new hires.  While the company makes revenue from the employers, they need buy-in from applicants to go through the interview process and to trust the company to place them. This is why the personal connections with Silulo and the community of Khayelitsha are particularly important in Mihle’s success.

 

Pricing and Price Competition

The entrepreneurs believe there is a legal barrier to the maximum employment commission of 8% of total compensation. While this is not an explicit law, labor unions in the townships enforce it through strikes, and it is the accepted norm. However, competitors, especially those that are well established in the city, often ignore these rules and charge a commission rate anywhere from 12-15%. Generally the entrepreneurs intend on charging close to 8% commission, but granting discounts for large quantity hires is a strategy they mentioned to help drive business and to quickly gain a track record for the business. This lower price is due to the niche market that Mihle is targeting; businesses and employees in the townships. These people are not as interesting in paying a higher premium on services such as this, and therefore Mihle will be able to hook their target market through their pricing structure.

Because of the variety in the size/income of the company that Mihle is sourcing for and the difficulty of the sourcing process itself, Mihle will have a variable costing structure for their services. A method to determine which price bracket a company falls within will be determined with the entrepreneurs, and used to maximize revenues for the business.

Competition

In Mihle’s situation, it is important not only to look at other HR firms as competitors, but also the current practices of employers in whether or not their services are needed. Placement in low-skilled work is often filled via individual connections – a current employee’s friend or relative is recommended for the job, with the understanding being that the applicant’s performance would reflect on the employee who recommended them. For high skilled work (including IT work), more formal processes including applications, CVs, and often recruiting agencies are typically involved, and commissions of 12-15% of total compensation, not including VAT, are standard.

For semi-skilled work, Mihle’s target market, temp agencies are often used as a recruiting tool.  Employees taken on as temps initially, then offered permanent positions if their performance is adequate. This process is fairly costly (temporary workers usually cost the employer 25% more per hour than equivalent permanent employees, plus a placement fee) and there is the risk that not all temporary employees are willing to become permanent employees, or temp agencies may refuse to continue to deal with employers who hire temps on as full employees. Therefore, if Mihle can offer a lower price for the same quality workers, they will be able to grow their market share and gain a competitive advantage against competitors.

The HR service industry in Cape Town is diverse, advanced, and there are a great deal of competitors offering a wide array of services. These companies have proven track records, greater credibility to corporates and applicants, and well-defined niches of who they cater to in their services. Challenging these agencies head-on in skilled work is unlikely to be successful for Mihle. 

The main strengths that Mihle can capitalize upon are the connections and network of its co-founders. Monde and Arnold are lifelong residents of Khayelitsha, and Arnold has built a successful business venture, which was purchased by Vodacom, having staffed the entire division under his control from his personal network. Additionally, the venture’s relationship with Silulo helps them gain insight, credibility, and a strong talent pool from day one.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Table 3: Primary Sourcing Strategies

 

 

Table 3, seen above, compares the various methods of sourcing a company could use depending on the skill level they desire. For each skill level, there are four methods of sourcing that they may be able to use, although a red X represents that the method is not available. Options highlighted in green represent the best sourcing strategy for that skill level based on ease, cost, and talent pool.

This chart illustrates the fact that Mihle has the potential to capitalize on two levels of skill – IT jobs and semi-skilled work. Based on ease for the company, offered rates, and talent pool, Mihle has the potential to offer the best employees to those skill levels if they are able to properly develop their company and use their strengths to their advantage.

Below, Figure 6 represents the typical customer buying process for a company looking to hire new employees. A key issue identified in this process is that Mihle would most likely not be identified by a customer in the process due to their lack of marketing and almost no company awareness in the community. In order to be considered by a customer in their buying decision, Mihle must build their brand identity and market it to companies within Khayelitsha, or they will not receive any influx of business.

 

 

Figure 6: Customer Buying Process

V. Financial Records

Financial Statements

Currently, Mihle Personnel Services has no financial history, because they have not conducted any business. However, using their desired pricing structure and forecasted expenses, a pro forma income statement were calculated for the average month of business. The financial statements were calculated very conservatively, assuming two contracts closed each month for a semi-skilled job, hiring 5 people per contract, and taking 7% commission as a business. This conservative financial statement will help to see a realistic future view, and see where the break-even point lies. Net income is high, but rent expenses were not included in calculations, and should definitely be considered when looking forward. Due to the nature of labor laws and the desire to give people a fair service, the business is structured to be a low margin, high volume business.

Payment from companies that hire through Mihle will be on account for the first month as a quality confirmation from Mihle, and possibly refunded within the first three months. The refund process is validated by requirements for check-ins on the fit of the employee, ensuring that employees are not fired just to get a refund. This assures the company that Arnold and Monde are dedicated to providing quality staff, and are willing to prove this by waiting for payment until after the first month. While this slows cash inflows, it is important to instill confidence in companies and develop lasting relationships with them. However, Mihle is currently facing zero cash inflows, and needs this to change immediately. By increasing marketing and pushing to find companies that need hirees, Mihle can start to gain cash flows as soon as possible.

 

Figure 7: Pro Forma Income Statement

The biggest issue that is not visible with the bottom line net income above is the delayed cash flows coming in the business. Because they don’t receive payment until after one month, and could possibly issue a refund for up to three months, cash is flowing in much more slowly than expenses are incurring, and this can be an issue for business success. While Mihle could require a deposit when a contract is signed, this is not the norm with competitors, and therefore may drive business away. Therefore, cash flow will need to be very well managed to prevent negative profits. Building a strong bookkeeping system will allow Mihle Personnel Services to keep track of their accounts receivable and related cash flows, and ensure that payment are received in full by the time they are due.

 

The benefit to a lack of financial history is the ability to instill good processes from day one. A financial recording system will be taught to Monde and Arnold, allowing them to track their profits and expenses each month. It will also track dates of contracts established and payments received from companies. Keeping track of dates will keep track of turnover time, and make sure that payments are being received on time. With the existing delayed nature of payment, to get cash flowing, late payments will not be acceptable from clients. This will be enforced through a late pay penalty that increases as time passes, and a bank draft requirement at the time of signing the contract, if the contract meets a required cost minimum. This bank draft will ensure that the client has enough funds in their account to cover the fee charged by Mihle, and will make sure that accounts do not go unpaid.

Future Financial Growth

Future financial growth and stability will depend on having high volumes of contracts, and properly segmenting the market, encouraging the hiring of skilled workers within Khayelitsha. However, a majority of the jobs available are semi-skilled or unskilled, so pushing large volumes of hires within contracts and large volumes of contracts as a whole is critical. Budgets will need to be established for monthly marketing, staffing, and website maintaining, because these three expenses will directly impact the number of contracts established by spreading the word about Mihle’s services. Currently, because there is no money coming in, Monde and Arnold are not taking a commission from the contracts. It is doubtful that they will be able to take a commission for a while past breakeven, because marketing efforts and other expenses will be prioritized. However, an orientation towards future financial growth will allow Monde and Arnold to eventually take commission from Mihle’s contracts, as long as they are putting their efforts towards spreading awareness about their services.

 

Financial Structure

 

Fixed Costs	Variable Costs
Marketing budget	Petrol
Website management	Phone
Staff	Owner’s Commission
Rent	Sales Staff

Table 4: Cost Structure

Because of the nature of the service, Mihle’s structure is almost entirely composed of fixed costs. However, currently, there are no fixed costs, so Mihle has almost no monetary costs. The largest cost to acknowledge is the time commitment from Arnold and Monde. This is good, but high volumes must be brought in to cover these fixed costs. Currently, Mihle is bringing in no business, but is not paying any fixed costs. This is a downward spiral, because expenses must be incurred in order to spark business and bring in revenues.

While rent is listed as a fixed cost, it will not be relevant for some time, because finding a location is currently unnecessary. It is not critical to the structure of the business, and cannot be afforded in the foreseeable future with the lack of business flowing in, so it has not been included in any numerical calculations. However, when business is steady, monthly rent will be a large fixed cost for Mihle and will be necessary for large-scale growth and stability.

Staff is listed as both a fixed and variable cost, depending on the type of staff they are hiring. If Mihle is hiring sales staff to aid in selling the company and closing contracts, these will be a variable cost, because they will be paid on commission. However, if Mihle decides to bring on operating staff when they open a location, such as a general manager, he or she will be paid a fixed rate.

Currently, Mihle has two revenue drivers, their hiring service, and Monde’s HR mediation, consulting, and implementation services. The contribution margin for the hiring service varies depending on the annual salary of the job, so the contribution margin is higher for skilled jobs than for semiskilled or unskilled jobs. While the commission taken will fall within a constant range of 4.5-8%, the contribution margin, in Rand, is variable depending on the annual salary that the 4.5-8% is taken from. Unskilled jobs serve as a loss leader, because while they are all gaining the same percentage on the job, unskilled jobs have a lower annual income, and therefore a lower commission for Monde and Arnold. However, there are many unskilled workers looking for jobs, and many unskilled jobs available, so the profits will be significant with volume.

 

Breakeven

Currently, Mihle is not breaking even simply because they don’t have any sales. However, when sales increase, breakeven will become very relevant. While breaking even is not difficult as long as revenues are coming in, it is the process of gaining contracts that is difficult. The contribution margin for the personnel services is R3446.75, and for human resources consulting is R120/hour. For personnel services, contribution margin was determined per person hired, and for human resources, it is determined per hour. To be comparable, it was determined that an average consulting engagement would take 15 hours in total, and therefore the job contribution margin would be R1800.00.

Using weighted averages to represent 80% of sales coming from personnel services and 20% coming from HR consulting, the weighted average contribution margin was determined to be R3117.4. Therefore, the breakeven point for Mihle is 3.368 contracts, which would mean either jobs signed for, or consulting engagements completed.

 

Operating Leverage

Because of Mihle’s very low variable costs and high fixed costs, they have a very high operating leverage. This high operating leverage provides greater risk for the company, because whether they have sales or not, there is still a fixed monthly expense. In Mihle’s case, their fixed costs are fixed over a fairly short period of time – marketing budgets could be cut and staff could be let go if necessary. However, we believe that their high operating leverage will be an advantage for the company, and will allow them to make large profits after breaking even. After learning financial responsibility and goal-setting, Mihle will be able to mitigate the risk that a high operating leverage can provide, and will allow them to one day be very profitable.

 

Figure 8: Mihle’s Ideal Operating Structure

This structure represents Mihle after approximately one year of growth, when they establish a location and rent has to be paid, and staff is hired. Currently, Mihle has almost no fixed costs, and almost no variable costs either. This is because of their small size and need for growth.

VI. Internal Infrastructure

 

Mihle Personnel Services is registered as a Pty (Ltd.) company. Registering the business was a smart choice for Monde and Arnold to make. It provides a barrier between their personal finances and any financial losses from the company that could occur. It is important that they maintain this model because it takes into account contingencies that might happen within the business, and adds credibility to the business.

 

Operating Facilities

            Because of the strong relationship that Monde and Arnold have fostered with Luvuyo, owner of Silulo, over the past several years, they are able to conduct their interviews and meetings for Mihle out of the Silulo facility for the time being. This location is appropriate because it provides a professional environment and is well known within the community. It is important for Monde and Arnold to further leverage this relationship in that Silulo could play a role in promoting and advertising Mihle Personnel Services to the graduates from their program. Down the road, Mihle Personnel Services desires to obtain their own location, which will add credibility and legitimacy to the business, however this is by no means necessary until sufficient profits are available.

Staff

            Currently Mihle’s owners, Monde and Arnold, are the only two employees. During the client meetings, they expressed how they would like to hire two to three other employees in the future. The ideal salary for these employees would be paid monthly, unless they were sales staff, in which case they would be paid on commission. There is no need right now for addition staffing of the business. They are interested in hiring someone who is well versed in IT and secretarial work, and they could use their own pool to find a Silulo graduate to fill this position. If they were to hire additional help this would add to their monthly fixed cost expenses. These expenses are currently unnecessary and should be considered once business picks up.

 

Information System

 

            Monde and Arnold are both technologically savvy and run Mihle from their laptops, tablets, and smartphones. During one client meeting, Arnold expressed how he did not want a paper trail to deal with in this business. That being said, it is important that they maintain a proper records and information systems to keep track of their client base. When constructing templates and processes for the business, Abuya Consultancy plans to develop as many of these as digital documents as possible to reduce the paper trail and maintain organization. By using the Google Drive that is associated with a G-Mail account, Mihle Personnel Services will be able to organize CVs received by their talent pool and access them from any computer at any time.

 

 

 

VII. Operational Considerations

 

At the moment there is not much activity in the business. Although this is the case, the number of graduates from Silulo Academy is a large quantity which Mihle may not be able to service. If they do not strategically position themselves and take advantage of this market they will not find revenue drivers that will bring the money for the business. The bottleneck in this process of accepting a lot of graduates is that there may be more graduates than there are jobs available for the foreseeable future. Abuya Consultancy is looking at ways this number of candidates can be broken down into groups and look for opportunities that can be taken.

One service Arnold mentioned is training in etiquette, self-esteem, or professional appearance. A lot of these students take these criteria for granted. They may often be declined for jobs due to the lack of these things. Another service is the writing of the curriculum vitae, which is a marketable tool that people often do not take the time to use to market themselves. With the provision of these services, candidates can be in a position of being entered in the database if the basic criteria is found to be sufficient.

Mihle Personnel will be in contact with organizations and companies looking for staff and will recommend suitable candidates. The process of how organizations and employees contact each other will be shown below. This is the process that Mihle should follow or has set up in the company. Currently Mihle is based from Monde’s house, with formal operations taking place in Silulo, although they are in the process of looking for suitable premises. They plan to advertise themselves and potential candidates follow the below procedure.

 

 

Figure 9: Operational Map of the Business

 

Input                                     Throughput                                   Output

 

- Marketing     - Brand awareness     - Pitch to colleges   - Alert Silulo grads

 

- Sort CVs     - Categorize based on set factors     - Narrow down CVs     - Begin interview process     - Rank pool     - Continue to sort and evaluate

 

- Train employees to specific job position     - Develop soft-skills     - Ensure company culture fit     - Provide short-listed pool to company for their selection process     - Wait to hear results from company

 

- Gain feedback from all parties   - Follow up with company     - Follow up with employee     - Alert rest of pool

Figure 9 above illustrates the operational map of the business, and the process that occurs from initially marketing the company to following up after an employee has been placed. The inputs are considered the raw CVs from unemployed semi-skilled workers, and the outputs are the employees placed into companies looking to hire. The throughputs are the process of actually sorting these raw CVs, determining which could be appropriate, and expanding on those CVs by training potential employees to be suited for the job’s hard- and soft-skill requirements.

From the above flow process, Mihle can have internal controls to make sure quality service is provided to both clients and candidates. In order for Mihle to make sure they are paid for their services, contracts should be the first thing to be negotiated. Based on criteria such as business size, turnover, employees needed, and time required by Monde and Arnold, a specific one percent bracket will be determined for the commission, within the 4.5-8% set range. This number will be brought to the client, and can be negotiated no more than 1%. For example, if it is a very large company hiring two people for a very specific job, the determined percentage would be 8%. When negotiating, this could be negotiated no lower than 7%.

Another internal control is when the feedback from both client and candidate is received. Mihle insists on this step because they want to establish themselves as a professional personnel service company. This also allows them to be consistent with the quality of employees that they supply. In addition if there are problems that occurred along the way, a solution can be found or rectified.

 

Administrative Procedures

Mihle has a database where categories of potential clients will be placed, making it easier for them to locate suitable employees. Necessary credentials will be supplied from the moment of contact with the potential candidates. It also lets Mihle to screen and take curriculum vitae that will be beneficial and be successful in placing. System of proper filling will need to be implemented but an easier process might be via soft copies.

A prospect database will also be created for current and potential clients to be listed. This will list all of their contact information, along with some information about the company in relation to Mihle (Cold or warm call? Reach company or safety?). This will aid in keeping track of past clients, and for prospecting for future potential clients.

 

 

 

 

VIII. Marketing Efforts

Positioning

Mihle Personnel Services does not have a specific position in the market yet. The entrepreneurs have the desire to empower all people, and they have therefore not narrowed down their offerings, setting a position. Based on the fact that there is need and talent in the semi-skilled industry, this will be the largest strength for Mihle. Because they can capitalize on this industry due to their pool of Silulo grads, Mihle should position themselves as a low-cost, high-quality and highly tailored service. This will appeal to their target market within the townships, and highlight the high quality, affordable services they are offering.

Segments and Marketing

Figure 10: Industry Offerings

 

 

 

 

 

 

 

 

 

 

 

 

	SME BSM 5-6	SME BSM 7- Managed/Aggressive Growth Firm	Large Business	Corporate
Primary Benefit Sought	-Cost effective -Availability -Locality	-Talent Development -Hassel Free -Cost effective	-1-Stop Shop -Talent development -Video Interviews -Employee Skills and culture match	-Employee culture match -Township Talent pools -MPS References -Success rate
Business Characteristics	-Small -Privately owned -Operate from home -Average turnover of $47,039 R -1-2 employees	-Small/Medium & ready to grow -Privately Owned, multiple shareholders -Operate from home or small office -Average turnover of $100,000 R -2-10 of employees	-Large business -Privately owned or multiple shareholders -Operate from office complex -Average turnover of $577,000 R -10-30 employees	-Large companies -3+ branches -Multiple levels of management -Av. turnover of $757 mil. R - Avg. of 14,944 of employees
Decision Makers	-Owner	-Owner/Partners	-CEO -Owner -Head of HR	-HR top management
Hiring Habits/ Frequency of Usage	-Referrals -1 time/year	-Job Posts -Referrals -1-2 times/ year	-Job Posts -Referrals -2+ times/year	-On-going database -Hiring services -Multiple times/year
Services/ Products Purchased	-Job placement	-Job placement -HR Mediation	-Job Placement -Team-Building Workshops -HR Mediation	Job Placement
Education Level for Jobs	-Some High school -Matric	-Matric -Post-Matric -Specialized training	-Matric -Post-Matric -Specialized training	-All education levels
What are they shopping for?	-Office support jobs -Specialized Skills	-Office Support -Computerized skills -Specialized skills	-Office Support -Technology Assistants -Specialized Skills	- Cashiers/tellers - Call Center Specialized Skills
Typical length of sales process	-Weeks	-Weeks/Months	-Months	-Months /Years
Exposure to hiring services	-None	-Little to none	-Limited	-Very

Table 5: Market Segmentation

While Monde and Arnold currently intend on serving each of these market segments, that strategy requires more resources than the business practically has and would lead to outcomes poorer than the business can accept. The market segment that offers the best opportunities for Mihle are semi-skilled employees, because of the need for semi-skilled workers in the townships, and the available pool that Mihle has to draw from.

 

Sales Efforts and Approach

At the moment, there is no formal sales process or approach. The entrepreneurs have not been able to bring revenue. This is due to the lack of a formal sales process. A formal sales process and approach will not only bring in more revenue to the business, but it will allow for the entrepreneurs to reassess their approach to sales, and solidify a process that allows them raise awareness of their business to drive sales.

The sales process will consist of three main steps, pre-sale, closing the contract, and post-sale. The pre-sale steps will focus on personal selling, cold calling, and spreading awareness of the company. The step involving closing the contract will focus on the details of the contract, including forms such as the contract itself, the pricing scheme, and the ability of Mihle to find the proper pool for the client. The post-sale step will focus on follow up, and building good rapport with clients and future potential clients. This is critical to build relationships and strengthen the brand that Mihle is creating. Abuya Consultancy will work with Mihle to develop a detailed sales process, and create all necessary templates and documents in the process. This will help Mihle to bring in their first clients and understand every facet of their business.

 

Marketing Media and Branding

There is no marketing or branding in place. Potential customers have found Mihle Personnel Services primarily through references to one of the specific owners, or through personal network. While word of mouth, references, and networks are essential to the business, Mihle Personnel Services will need to invest in marketing and branding, as these are also essential when dealing with corporate clients and attracting pools of talent. The marketing media and branding of the company will solidify the validity of Mihle Personnel enterprise, and in this is turn will aid in the closing of sales and bring in revenue. A logo will be created to create a tangible representation of Mihle Personnel Services, and will be applied to various media such as Facebook, business cards, and an email address.

 

Customer Buying Habits

Mihle Personnel Services has not done any sales promotions at the moment in order to attract clients. Sales promotion is something that the entrepreneurs need to consider in order to lure businesses to sign hiring contracts with them. Because the business is not selling a tangible product, the sales promotions could include a bundle of services offered; or different pricing systems for larger pools of candidates. While the sale promotions could cut into profits, it can allow Mihle Personnel Services to establish stronger relationships with clients, and actually draw more profit into the business if the volume of the requested candidates is large enough.

 

Pricing

No specific pricing scheme has been set for Mihle Personnel Services. They operate under the local common that stipulates that only up to 8% of the base yearly salary of the potential employee can be charged. Establishing set pricing brackets for a certain pool volume of candidates could speed up the process of negotiation and closing sales. The business is maintaining a penetration-pricing model, in order to appeal to Khayelitsha companies and avoid pressure or outrage from labor unions. This is a beneficial pricing strategy, because it will encourage trust and sustainable contracts from both hirees and companies.

 

Market Research and Tracking Market Performance

Mihle Personnel Services have no means of tracking market performance. They have not conducted any formal market research, and rely on their own knowledge of the industry. Both Monde and Arnold have experience in the HR industry and studied it in depth through their studies. However, this does not mean that they have a full grasp of the market for personnel services, the competitors, and how they can differentiate themselves in the market.

Formal market research is imperative to the growth and the direction of the company; this will allow the entrepreneurs to capitalize on a segment that provides them with the highest profits and revenues. Understanding the market will allow Monde and Arnold to track their performance both in sales and in marketing efforts.

 

Figure 11: Points of Customer Contact

The points of customer contact are critical in an HR service business, because in order to communicate that you can successfully improve a company’s human relations, you must have strong human relations skills yourself. Due to the structure of Mihle’s services, they must have strong points of communication throughout the entire customer contract process. Therefore, role-playing processes will be established to create strong, positive points of customer contact within the business.

IX. Financing Needs & Relationships

 

            Mihle is registered as a PTY (Ltd), with 50% owned by Monde and 50% owned by Arnold. Currently, Mihle has put no money in the business, so while they are not bringing in revenues, they are not accruing expenses either. This means that their debt history does not need to be assessed, but their future financing needs are very relevant, and for any growth to occur, money will need to go into the business for revenues to begin flowing in.

Both Monde and Arnold have children to support from the business, and while Arnold is also supporting himself with a full-time job with Vodacom, Monde is not, and the financial success of the business is critical for him to support his family. Both entrepreneurs seem to be willing to reach out for financial support, but have not realistically looked into how much money they actually need to get business flowing, and therefore do not know where they would turn for these capital needs.

 

Capital Needs

The current capital needs of the business include startup expenses, such as outsourcing a website and initial marketing expenses. Another important expense for both owners, but particularly for Arnold, is the opportunity cost of working less at Vodacom to support the growth of Mihle. Once short and long-term goals are established, Arnold and Monde will need to dedicate more of their time to Mihle, and be ready to not only put in direct finances, but reduce time spent focusing on other sources of income to spend more time with the business. This transition will occur with more ease through the consulting engagement, because as Monde and Arnold understand the value of the time they put in, they will be more motivated to continue this effort.

The current capital needs are estimated at about 8500 rand, mainly to increase marketing and awareness of the company in the community. Monde and Arnold must determine if they can finance this with their own personal capital, or if they will need to pursue alternative sources of capital. While both are in good standing with the bank, the chance of receiving a loan with no current revenue is very slim. A more realistic possibility is the many financial institutions that support SME growth in South Africa, such as the Small Enterprise Financial Agency or Blue Financial Services. If this kind of financing was deemed necessary, a business plan would need to be finalized to approach these financial services with and be strongly considered for a loan. While it may not be necessary now, it might be necessary with growth down the road and the expenses that renting a location and hiring staff would incur. Because of that, it should be considered not just now, but also down the road, and finances and a business plan should be maintained and organized for future use.

Another method of alternative financing would be leveraging the relationship with Silulo to establish capital inflow for Mihle. Silulo has a personal interest in the company, because a service that would help their graduates to find employment would be a great resource to use in their favor. Therefore, alternative methods of financing backed by Silulo may be possible, and should be explored.

 

 

 

 

X. External Networks

 

Both Arnold and Monde have a close relationship with Luvoyo, a prominent member of the community, and owner of Silulo Internet Cafe. This connection has given the entrepreneurs access to the Silulo premises to work, as well as access to the Ikasi network (a group of entrepreneurs in Khayelitsha). Monde’s HR career began and matured at Silulo and Mihle began as a result of Silulo compartmentalizing and spinning off their HR operations with Monde at the helm. This relationship with Silulo and Khayelitsha overall gives Mihle an advantage because it is a steady network to leverage for a pool of hirees, and will also lead to recommendations for potential prospects.

            In addition to this network, acquired from a lifetime in Khayelitsha, Arnold has built a wider address book of semi-skilled workers, which will be valuable to the company. He has done this through managing his hiring initially for a successful township magazine, which later led to his employment at Vodacom, managing a division specializing in informal markets, where he also controlled the hiring process and drew talent from his extended personal network. Arnold’s current title in Vodacom gives him access to the corporate world, which he will need to leverage when attaining jobs for Mihle Personnel Services. His personal connections with other corporate employees give him some individual credibility and may assist in making inroads toward prospecting for initial clients for Mihle. When creating a sales process for Mihle, a process for gaining leads within local networks and approaching these leads will be established. This will be done through role-playing and beginning to make actual sales calls.

There are opportunities to improve the entrepreneurs’ personal networks via trade shows; personal visits to businesses, and professional networking sessions in Cape Town. This will in turn increase sales and bring in more revenue as it increases validity and word-of-mouth references. These sessions and events will also benefit Mihle because it will increase the talent pool and possibly secure more contracts with companies that are currently seeking job placements. Abuya Consultancy will begin this process by taking Monde and Arnold to make personal sales visits to businesses, and research networking sessions to take part in. This will show Monde and Arnold the process of how to do this on their own, and will also help them to find leads.

 

 

XI. Concluding Remarks

Monde and Arnold have developed a strong concept for a locally based staffing agency to empower the unemployed youth in the townships and support local economies. The target market is there, although it has not yet been tapped into for best use and growth of Mihle Personnel Services. In general, Mihle Personnel Services lacks the basic structure and processes to grow as a business and begin to bring in sales. Working together, Abuya Consultancy and Mihle Personnel Services will develop the sales process to obtain clients and all necessary templates and forms to assist in the sale. This will allow the business to become better established and gain momentum in the community.

 

 

 

 

 

 

 

 

 

 

 

 

 

DELIVERABLES

 

 

Deliverable 1: Branding

 

1.1 Problem Statement

As a company who is just starting, it is essential that Mihle Personnel Services establish a clear and coherent brand that communicates their intentions and their professionalism visually. Currently, the small company has no established brand identity. The entrepreneurs expressed a need for branding; because they did not have an identity package, they did not feel comfortable going to potential clients and therefore were stagnant and not generating sales.

When conducting the analysis of the business and writing the Supporting Emerging Enterprise (SEE) Model, Abuya Consultancy confirmed that a brand identity and package is essential to the development and start of the company, as it is a crucial point of contact with their customers.

1.2 Desired Results

The identity package should give the entrepreneurs of Mihle Personnel Services a more credible and professional appearance when contacting potential clients. The card will also help to establish the validity of the personnel services provided. The business cards will give the entrepreneurs of Mihle Personnel Services the ability to leave their contact information with relation to their company, and mitigate confusion as to where they work. In addition to this, the established letterhead will give Mihle Personnel Services the opportunity to mail correspondence to its current and future clients while establishing and strengthening their brand presence in the eyes of those clients. It will also help to differentiate their services with a distinct logo.

1.3 Solution

       The problem was tackled with the conceptualization and implementation of a brand identity/logo, development of business cards and official letterhead. In the process of developing the brand identity, it was critical to fully understand the entrepreneurs and their vision for the business, so that this is properly communicated in the logo. A logo must also satisfy the entrepreneur’s personal wishes, and their established image of their company. A process of development and feedback was established to come up with the final product. We used the following criteria to develop a useful logo:

1. Monde and Arnold’s existing ideas of what a logo would look like
2. The vision, mission, and mood that the business wants to convey visually with its logo
3. The industry itself, and if the logo alludes to the industry that Mihle is serving
4. Whether the logo conveyed a sense of trust, credibility, simplicity, and professionalism, and would generally be attractive to a client

Figure 12: Mihle Personnel Logo

Once the logo was determined, it was applied to various useful templates for the business to truly establish a brand image for the company. The logo was applied to business cards, letterhead, and used on their newly created e-mail address and Facebook page. This will create consistency with the identity of the business, and help to market Mihle Personnel Services and get the word out about the new hiring service located in Khayelitsha.

 

 

1.4 Argument

       A brand package is important to the company when dealing with clients, as the elements in the package are all points of contact with the customer. In turn, the brand and the association with the brand can be points of added value to the customer. Creating a brand and logo is also key in differentiating themselves from their competition and establishing a strong culture within the company. The branding package will benefit the company in the following ways:

• A strong brand identity will generate awareness of the brand, and will eventually create loyalty and advocacy from clients.
• A brand identity creates credibility for Mihle Personnel Services, and shows their dedication and professionalism to potential clients.
• Acts as a framework for how to present the brand across all mediums, including business cards, letterhead, brochures, and social media.

 

1.5 Implementation Plan

As previously mentioned, to-date, there has been no logo or branding measures for Mihle Personnel Services. It is important to create a logo that represents the brand and use it effectively in both paper and digital branding means. It is critical when implementing a logo to make sure that the entrepreneurs understand how to duplicate the logo and use it in any document, e-mail, or other promotional item to create a sustainable and timeless brand.

Logo & Brand Development Process:

Step One: Identify and Conceptualize Key Factors for the Logo

      In order to create a logo, Abuya Consultancy sat down with Mihle and discussed their existing ideas for a logo. They communicated their desire for a very simplistic logo, which would have the initials ‘MPS’ displayed and show a man aiming an arrow forwards, similar to the image in their current business plan. The business is one that helps people to find jobs and grow, so some aspect of empowerment was important to be conveyed. Also, being a personnel service, professionalism was a key factor when designing the logo. The key factors narrowed down to be:

• Simplicity
• Professionalism
• Relevance
• Legibility
• Versatility

Step Two: Draft a Logo

      After meeting with Mihle, multiple logos were drafted based on the factors above.

 

 

Figure 13: MPS Draft Logos

 

Step Three: Review Logo with Entrepreneurs

      While the consulting team had identified personal favorites, the important opinion was that of the entrepreneurs. After developing options for the logo, they were presented to Mihle so that they could select their favorite and adopt the future logo for the company. When presented, Mihle was disappointed to see that the man shooting the arrow was not present on their logo. This was a critical part, and was overlooked by Abuya Consultancy. However, they did like everything else about the logo, and decided to go with one that had the initials MPS displayed.

Step Four: Adjust Logo

      Based on the logo review session conducted with the entrepreneurs, a “man shooting an arrow forward” was incorporated in the design. This addition was important because it not only satisfied the entrepreneurs, but also helped satisfy an additional criterion for the logo, which is memorability. The man shooting the arrow is simple and unique, and will therefore stick in the minds of potential clients, developing the brand further.

 

Step Five: Implement Finalized Logo on Paper and Digital Media

Figure 14: MPS Business Cards

      A logo is important because it is a tangible aspect of the brand, but truly, the brand is what must be focused especially for a newly developing company. Therefore, communicating the brand via the logo was critical to establishing reliability and trust with potential clients. To develop a brand that customers trust and rely upon, brand consistency must be implemented from day one. To do this, Abuya Consultancy (with the help of Mihle) created templates for business cards, letterhead, and a brochure. These are all critical representations of the business that will be seen by clients and subconsciously build the brand in their eyes.  

 

 

 

Figure 15: Mihle Personnel Services’ G-Mail Login

The logo was also applied to newly created digital media sites, including the e-mail account and Facebook page created by Abuya Consultancy. Digital copies of the business cards, brochure, and letterhead were developed and given to Arnold and Monde. Options for printing locations were offered to Mihle, and it was determined that Silulo would be the best place to print.

Figure 16: Mihle Personnel Services Facebook Page

 

In order to show the impact of the brochures, Abuya Consultancy printed 5 sample brochures to show to Monde and Arnold and to hand out while cold calling. This will not only help to capture the brand in the cold calling process, but also show Mihle the importance of printing brochures and business cards, and motivate them to allocate money to this immediately. A flyer was also created to be printed and taken to local colleges. This flyer can be found in Appendix 1.

 

 

 

 

1.6 Next Steps

      Developing a brand image, conceptualized with a logo, will help Mihle to develop a trustworthy, high quality image in clients’ minds and expand awareness of the business. In the future, a website must be developed (a mid-term goal) and the logo will need to be widely present on the site. To ensure that this will happen, Mihle was given a digital copy of the logo, and was taught how to copy and paste the logo onto various documents, sites, and printouts. This will ensure that the logo is sustainable, and that the brand has a positive future impact on the growth of the business.

The critical next step in establishing a brand is having positive customer interactions that will encourage their trust in the brand and create marketing buzz for Mihle Personnel Services. Through the marketing and sales plans that Abuya Consultancy and Mihle have developed together, Mihle Personnel Services will be able to positively grow their brand by resonating as a credible, quality, and reliable company in the client’s mind.

Deliverable 2: Marketing Plan and Strategies

 

2.1 Problem

Mihle Personnel Services (MPS) just registered their business in May 2014, and since then have not gained any clients. While both Monde and Arnold have drafted up a business plan, they do not have a set marketing plan that looks at the market and identifies the potential areas for growth. The lack of a marketing plan goes hand-in-hand with the lack of an established brand and setting up marketing strategies to target different segments within their industry market. Without marketing, Mihle Personnel Services will not be able to generate buzz about their newly developed company and attracting clients will be very difficult.

 

2.2 Desired Results

The development of a marketing plan will allow MPS to identify different strategies to target the different segments within their market. This in turn results in tailored marketing efforts toward each customer. Understanding the market better and how to target each of the segments will allow Mihle Personnel Services to bring in more business with minimal waste of resources. The implementation of a marketing plan will help the business continue to grow parallel to their vision, mission, and branding efforts.

 

2.3 Solution

During the consulting engagement, Abuya Consultancy worked with both of the entrepreneurs to define their market and their marketing plan, to later be able to develop marketing strategies. When beginning the consulting engagement, both of the entrepreneurs understood whom they wanted to target, and had a fairly good grasp of their market audience. However, there was urgency to understand the different buying behaviors of the different segments within their market. Understanding the different buying behaviors would allow MPS to efficiently use their resources with minimal waste. The effective use of resources is dependent on understanding the buying behaviors because campaigns and efforts would be tailored to specific needs and wants. In addition, tailored efforts ultimately make the client feel special, and in turn can aid in closing sales.

 

 

Target Market

 Through field research with the entrepreneurs, we were able to identify the target market as: SME’s, Large Companies, and Corporations who employee low/medium-skilled talent and are in need of fast services to fill job-position.

Abuya Consultancy conducted research, and identified several segments within the market: SME’s that were BSM level 5-6 took 10% of that segment, SME’s that were level 7 to manage/aggressive growth firms 40% of the segmentation, then came the large business with 40%, and lastly the corporations, which made 10% of the segmentation. These percentages were based on the customer’s ability to pay for MPS’s service, and the quantity of the services procured. SME’s with BSM level 1-4 did not form part of the segmentation for Mihle Personnel Services because these businesses qualify as more “survival” based businesses that do not have the infrastructure need or capital to use the services. SME’s with BSM level 5-6 were typically more developed and had significantly more revenue, and were compromised of mostly “lifestyle” businesses that could make use of MPS’s services. The other segments of the markets were businesses that were geared towards growth and would also make use of MPS’s services when hiring/growing. The market segmentation developed can be seen within the SEE model analysis and in the marketing plan found in Appendix 1.

The market segmentation can be used to identify marketing strategies that can be tailored to individual segments, and the services that each segment might be looking for. In addition to this, as we worked on the segmentation, Abuya and the entrepreneurs identified specific jobs within the segments that MPS should capitalize on. These jobs were based on a niche marketing strategy, focusing the efforts of recruiting/job placement on positions that the other competitors cannot focus on (low/medium-skilled jobs) because they lack access to talent pools in sectors like Khayelitsha. This was a way for MPS to differentiate themselves in the individual segments. While Mihle Personnel Services’ main focus will be in the area of low/medium-skilled jobs, they will also have access to small pools of high-skilled individuals and therefore have the ability to supply these potential employees to large businesses. However, Abuya Consultancy recommends MPS not to focus on providing corporate with these high-skilled employees, because they are likely to already have recruiting efforts in place, and will therefore be a segment that is difficult to penetrate.

 

Figure 17: Differentiation

 

When looking at corporate, Mihle Personnel Services will to focus on recruiting large volumes of individuals for low and semi-skilled positions such as cashiers, or cart pushers, for branches within the townships.

 

Marketing Strategies

 Complementary to working with Monde and Arnold to understand the nature of the market and the segments, Abuya Consultancy also worked to develop a marketing plan (found in the appendix) and a set of strategies to market to the individual segments.

A key strategy to the success within all the segments was creating a process that would enable the entrepreneurs to quantify the return of investment, and the added value to the potential client. The process entails identifying the segment, defining their current time and monetary cost for hiring, and then presenting the opportunity cost along with the tailored added-value services to the potential client.

Figure 18: Marketing Strategy Diagram

 

Identify Business SME-BSM 5-6 SME-BSM 7-Man./Agg. Growth Large Business Corporate

 

Monetary Costs What percentage of the budget goes to hiring How much business are they potentially losing due to an unfilled position

 

Added Value Services Khayelitsha Talent 1-stop shop Convenience Reliability Talent Development

 

Opportunity Costs Compare time and monetary costs to the MPS services Present opportunity cost

 

Time Costs How much time does it take from time of posting job, conducting interviews, to signing contracts

 

 

Quantifying the value is essential for all of the segments, and most specifically for the SME’s and Aggressive/Managed growth businesses who are more likely to be price sensitive. Through the process, MPS will quantify the return of the investment in terms of hours and monetary costs, and then present an opportunity-cost analysis to the client. This process goes hand-in-hand with the sales process, but it is essential to the understanding of their marketing tactic and approach.

In addition to the process above, Abuya Consultancy also worked on developing low-cost marketing strategies that could be applied to individual segments and continued to work with the entrepreneurs to establish social media presence.

 

Figure 19: Low Cost Marketing Strategies

 

The speaking events were developed through all the segments, but address the potential clients in each segment through different platforms that are directly related with decision makers influence points. For the speaking events, within any segment, MPS does not have to provide their sales pitch; this might deter the attention of the audience. On the other hand, Mihle Personnel Service should provide a short introduction about their company and give a presentation on current issues related to the HR industry. The goal of the presentation is to gain awareness and continue to build rapport and validity as a company. In addition, giving information presentations allow MPS to relate more its potential clients by focusing on building relationships with them and providing information, rather than just selling a product. HR presentations can be geared to show current problems that the HR industry is facing, and through the presentation, MPS should identify what companies can do to overcome the problem (the problems should be somewhat correlated to the services that MPS offers). A potential sales presentation was developed in the sales process deliverable.

Because of the tight budget that MPS handles at the current moment, Abuya concentrated in the low cost strategies, and avoided any type of costly advertisement. It is important for MPS to expose their audience to the brand and services through at least three different mediums to ensure that market segments are aware of the brand and its services.

 

Online Presence

In addition to these tactics, the team worked with the entrepreneurs to ensure that they have a social media presence. At the moment of the consulting engagement, the entrepreneurs still did not have a site, but were working with developers and designers to create a site. Because of this, Abuya Consultancy saw it necessary to have some online presence that potential clients could resort to for additional information. An online presence establishes validity and lack of an online presence could ultimately compromise a potential sale.

The chosen forms of media were Facebook and LinkedIn. While Abuya consultancy was hesitant about a Facebook page having a negative impact on the brand, the team and the entrepreneurs decided that for the SME segments (compromising two of the four segments) a Facebook page would be helpful to raise awareness, inform them, and build rapport. In order to mitigate the risk of it diminishing the brand, Abuya worked with the entrepreneurs in workshops to determine the content of the page and how it can showcase news/articles that talk about developments in the industry. A screenshot of the new MPS Facebook page can be seen below.

 

Figure 20: Mihle Personnel Services Facebook Page

 

 

In addition to the Facebook page, the development of a formal LinkedIn page for the entrepreneurs and MPS was essential for establishing an online presence. LinkedIn is rapidly becoming popular in South Africa’s small business and large business branding and marketing efforts. By joining LinkedIn, the company and the entrepreneurs are able to joining the professional online community and raise awareness of their brand by “connecting” with businesses and individuals in two of the four segments (Large companies, and Corporate). Establishing this presence also increases the validity of the company in the eyes of its potential clients. Because LinkedIn pays Google to list their content in the first page when searching, the platform seemed an obvious and cost-free choice to increase awareness.

To best ensure the sustainability of and the up-keep of the online presence, Abuya Consultancy worked with Arnold and Monde to create a posts calendar. The calendar gives estimated time periods of when it relevant to post to online sources, and also has a list of go-to resources where they can find relevant articles about the industry to share with their audiences. The calendar that Abuya created focuses on a 3-week rotational period in order to allow the entrepreneurs to focus on other tasks and to ensure that the content is spaced out throughout the week to avoid annoying the potential client. However, it is necessary to continue to post throughout the week to increase exposure of the brand is consistent and sustained. For a list of resources of where to find useful content, please see appendix.

 

	MONDAY	TUESDAY	WEDNESDAY	THURSDAY	FRIDAY
#1			8AM		4PM
#2		8AM		11AM
#3	8AM		4PM		4PM

Figure 21: Rotational Calendar

 

Measuring Marketing Impact

Figure 22: Impact on Sales

When developing the marketing strategies and tactics, Abuya Consultancy developed short systems to help the entrepreneurs measure the success of their marketing efforts. Understanding the success of these efforts is essential to the business. It will help MPS see if they are targeting their segments correctly, if their allocation of resources is justified, and to if there are any gaps in their current efforts. If there are gaps, understanding the impact of the marketing will help MPS overcome them to better serve the client and bring in more sales from the marketing efforts. Abuya Consultancy focused on measuring the marketing effort’s impact on sales and on brand.

Within sales, MPS will want to look at the individuals who started through the sales process, but never finished it; and also the contracts and sales that were closed. As for branding, the different facets that are impacted are the credibility of the company, understanding of the services offered, and overall brand awareness. 

Figure 23: Impact on Brand

Figure 24: Forms to Enhance Marketing

The tactics developed are not able to measure all the aspects of branding, just because of the intangibility of the facets. However, when creating content, these facets should be kept in mind as they do impact the business. Forms were created and systems implemented to ensure that the entrepreneurs understood how to use each tool, and can be seen in Deliverable 4: Forms and Templates

The feedback form allows MPS to identify how most of their customers are hearing about them, which in turn allows MPS to reassess their resources allocation. Feedback Forms ask simple questions such as:

• How did you hear about us? (i.e. speaking event, reference)
• Why did you choose to work with us?
• What was your favorite part about working with us?
• Have you worked with another personnel services company before?

In addition the feedback forms allows the business to measure response to be different forms of advertising, selling, or promotion.

            Sign-in at booths entails having a list that has potential clients’ information, and identifying how many people inquire about the services at speaking or networking event. Depending on the people that sign-in and ask questions, the entrepreneurs are able to gauge how many people became aware of their brand and services, and guesstimate an increase in their validity as a company depending on the number of people that sign in.

Analyzing calling and prospect list will give Arnold and Monde the opportunity to understand the impact on closed sales and fallout sales. With the list they can compare the rate of success and failure between warm calls and cold calls. This allows them to see which methods of personal selling are most powerful. Research has shown that warm calling is more powerful in personal selling, and in the case that the sales team is not showing those results, the business will need to reallocate its resources to increasing their warm call list (attending networking events, conferences etc.).

When looking at the number of references vs no-reference customers, the MPS is also able to see if they are meeting their expected number of references in their clientele pool. These allow the business to see the impact of personal selling efforts on closed sales and fallout sales.

Measuring online media interactions is important when looking at the impact of the marketing efforts on brand awareness. For Facebook and LinkedIn, the entrepreneurs are able to the “likes” and “connections” at any given point. These factors help measure the awareness of the brand and quantify it through people exposed to the brand. In addition, with each article that the entrepreneur posts on either platform, they are able to gauge the quality and interest of the posted articles based on the number of profiles that “liked” the post. Keeping track of these is important when understanding what the consumer appreciates online, and what to focus their online efforts on.

 

Throughout the engagement, Abuya Consultancy worked with Monde and Arnold to create all these solutions and develop these tactics for their marketing approach. Below is a graph that summarizes the different tactics used to raise awareness, and how they range throughout the segmentation spectrum. Under each of the segments, there are 3 plausible ways to raise awareness of the brand and the services, and in turn this increases the “acceptance” of MPS from potential clients.

SME BSM 5-6

 

SME BSM 7 – M/A Growth

 

Large Business

 

Corporate

 

LinkedIn

 

Facebook

 

Ikasi Network

 

Chamber of Commerce

 

Wall-Mural Adv.

 

Drink-and-Meet

 

Warm/Cold Calling

 

HR Associations

 

Figure 25: Methods of Reach

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.4 Argumentation

• The development of a marketing plan is needed to identify strategies and tactics that reduces waste of resources
• Marketing strategies are needed to raise brand and service awareness, and in turn generate more revenue
• Establishing online presence for MPS is crucial to raise awareness, increase validity of the services, and network with potential clients; this in turn aids in the process of closing the sale and increasing turnover

 

2.5 Implementation

Prior to the consulting engagement, the entrepreneurs had a rough idea of what the market looked like, but did not have defined segments and efforts to reach out to the marker. When implementing the marketing plan and marketing strategies, it is important that they are developed with Monde and Arnold in order for them to understand the reasons why they are done, and how to implement them correctly.

 

Step 1: Because they did not have any market plan efforts in place, Abuya’s first step was to work with the entrepreneurs to understand and define the market. Parameters for the target market were set and the market was segmented. 

SME-BSM 7 –Agg./Man. Growth

 

BUSINESSES IN THE CAPE TOWN AREA LOOKING FOR LOW/MEDIUM SKILLED EMPLOYEES TO FILL POSITIONS FAST, AND HAVE DISPOSABLE INCOME TO PAY FOR THE SERVICE

 

SME BSM 5-6

 

Large Company

 

Corporate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Figure 26: Market Parameters

 

 

Step 2: Once we all had a better grasp of the market, we worked with Monde and Arnold to help them identify their added-value/features of the service and the benefits of using MPS’s services. In order to help the entrepreneurs understand the difference between benefits and features, we created workshops in which we provided examples and then broke down the services and what emotional element each of the services provided.

Figure 27: Feature / Benefit Elements

 

Step 3: The next workshop, we combined the previous two steps and brought them to live. We decided which benefits/added-value services each segment appreciated the most, and reorganized the order in which added value highlights would be presented to each segment.

 

Step 4: Once each segment was aligned with a set of benefits, we worked to go one layer deeper, and identify marketing strategies for each of the segments. Strategies were developed throughout a series of meetings amongst the entrepreneurs and Abuya Consultancy. We studied what each of the segments appreciated, how the connected, how they received news about the industry, and where they spent a majority of their time.

 

Step 5: Abuya and the entrepreneurs took individual strategies and broke them down to plausible and realistic action plans and timelines. This in turn helps the entrepreneurs digest the information and take action upon the plans.

 

Step 6: Working with the entrepreneurs to establish a simple process in which to present the opportunity cost to the potential client. This effort will also be included in the sales process.

 

Step 7: Identified online platforms that would best target the different segments, and would promote the business, and increase the validity of MPS.

 

Step 8: Created online profiles through Facebook for the business, and LinkedIn profile for the entrepreneurs and the business as well.

 

Step 9: Identify resources and potential content for MPS to share with its online network

Figure 28: HR Online Resources

 

Step 10: Made the first Facebook post and LinkedIn post with the entrepreneurs in a meeting. The workshop focused on having an consistent voice and creating relevant content online.

Step 11:  Create a calendar for posting online content through all the platforms. It is important for the online presence to be up-kept in order to gain traction with potential clients and raise awareness of the brand. Creating the calendar in turn increases the likelihood that the established online efforts will be sustainable once the consulting engagement has been terminated.  

 

 

2.6 Next Steps

As a continuation of the implementation process, there are steps that must be followed after the engagement has ended for Mihle Personnel Services to continue to market themselves and grow as a business.

 

Step 12: Speak with web developers and designers to establish a deadline for the project. Because the goal has already been established, it is a matter of acting on it. Setting the deadline is essential, because as more sales calls are made, they need a website to be able to post media to.

 

Step 13: Contact/reach-out to individuals from the Chamber of Commerce and the Ikasi network to build relationships and network

 

Step 14: Launch the website and inform their current customer that the website is now live. When launching the website, the entrepreneurs will need to update their forms of advertising and branding to include the new webpage.

 

Step 15: Re-connect with individuals from the Chamber of Commerce and the Ikasi network to set up dates and topics for speaking events.

 

Step 16: Follow-up and utilize new forms for measuring marketing impact to measure growth and re-asses allocation of resources. This is needed to make sure that the business is indeed serving the market correctly.

 

 

Deliverable 3: Sales Process

 

3.1 Problem Statement

Abuya Consultancy found that Mihle Personnel Services (MPS) does not have any concrete sales processes in place. While Arnold– the company’s co-founder and current primary sales representative– has deep experience in business-to-business sales, he does not have a consistent process and guideline for personal selling in different situations.

MPS’s lack of a process for selling (pre, during, and post) hinders the success of the calls. In addition to this, MPS does not have a set business proposal or a developed sales presentation; two essential steps that will increase the likelihood of closing sales and strengthening the company.

 

3.2 Desired result        

Abuya Consultancy sees it necessary to instill a formal sales process in order to successfully grow the client pool. This sales process must be based on a consistent sales method that is parallel to its core values. Abuya Consultancy would like to see MPS begin to utilize the process within the consulting engagement to attain the first client, and continue to use in the future.

The sales process has been geared to focus on three key engagements with the client through a 9-step process. The seller will be focusing on the pre-sell engagement (research), during-sale (tactics for selling), and post-sale (building relationships). The process is meant to shift the mindset of the seller, encouraging to focus more on building relationships with clients and selling the benefits of a product, rather than its features. This in turn solidifies company values, culture, and vision; increasing awareness of the company through an established referral program.

In addition to this, we would like these guidelines to pave the pathway of growth for MPS. When MPS begins to hire other sales representatives, the goal is that they use the established process to provide consistent branded service when building relationships with new clients. Meeting with Monde and Arnold to build the sales process will:

• Train them in the proper selling process through role-play scenarios
• Develop a sales process unique to Monde and Arnold’s strengths and weaknesses
• Create the proper documents and forms to aid the selling process
• Begin to make sales calls and visits to put the new selling process into practice

 

3.3 Solution

 

The Sales Process

Abuya Consultancy, working alongside Arnold and Monde, created a standard sales process that can be referred to in order to increase the success rate of gaining new clients and bringing in revenue. The sales process focused around raising awareness, creating leads, selling benefits, and following up. These basic stages were broken into 9 more specific steps that help the entrepreneurs navigate the process. Details on each of the steps can be found in Appendix 2: Sales Process.

 

Figure 29: The Sales Process

When building the process, we kept in mind Monde and Arnold’s sales techniques, identified gaps within their process, and tailored a formal process that allows easily changing their habits and feel more comfortable when going through it.  

 

In addition, Abuya Consultancy saw a lack of a clear sales pitch, sales proposal objects, and sales presentation. Arnold and Monde have a basic understanding of what the mentioned items entailed, but did not know how to leverage them to increase the likelihood of closing sales. Abuya worked with both of the entrepreneurs through workshops to help them in the process of when to highlight their sales pitch, and the different within the sales pitch that will change according to client. This is highlighted in Step 3: The Call of the sales process.

 

Measuring Sales Success

In order to ensure that the sales process is properly working, success must be measurable. There are three key indicators for Mihle to be aware of to measure if the sales process is successful, or if the sales process should be reevaluated and modified.

1.Growth and Progress. While it may seem like business is not coming in as quickly as possible, growth is a critical measure of success, especially in the beginning. Recording all sales closed is critical so that you can measure growth, and looking at the number of sales closed from month to month will allow the business to see if the sales process is efficiently stimulating growth

2.Sales Cycle Length. The shorter the sales cycle, the more immediately interested a company is in the service you are offering. Therefore, measuring the length of the sales cycle will allow the business to see how quickly deals are being closed. Recording the first point of contact with the business and the date the contract is signed will show the length of the sales cycle.

3.Opportunity-to-Win Ratio. For each opportunity you have to give an in-person sales pitch, how many of those are won over with the client signing a contract? While Mihle might be gaining many leads, it is critical that those sales pitches are leading to sales closure in the end.

 

 

Tools for Sales: Lead Form & Prospect List

Furthermore, we worked together to enhance the process and added guides for building rapport throughout the sales engagement–which were previously lacking. The guide includes thank-you letters to gatekeepers, a system for getting and rewarding referrals, and lead forms.

A prospect database was created in Excel to help in recording when prospecting for future clients, and 50 prospects were found by Abuya Consultancy. The database contains various categories to record basic information about the company and relationships formed to leverage, and can be sorted to help find the best client to pursue at any time. It is a way to help Monde and Arnold stay organized, and to develop relationships with prospects from day one.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The lead evaluation form exists to make the prospecting and lead generating process more streamlined. Using this form during cold calls or warm calls will help to remember key facts about the company, and make future sales calls more personable; making the sales process itself much more about building a relationship with the client. The form was built to be used either electronically (computer or tablet), or to be filled out through paper form. If filled out through paper, the seller would need to input all the information later into the electronic form, which is then transferred to a database. A Google form has been created for this task, to simplify the process for MPS.

 

 

Figure 30: Lead Form

 

 

 

 

 

 

 

Figure 31: Sales Process Form

 

 

Tools for Sales: Sales Presentation

Because Mihle did not have a process for creating and doing a sales presentation, Abuya Consultancy worked with Arnold and Monde through workshops and role-playing to create and implement ideal sales presentations. In addition to this, Abuya created visual aids for the presentation, PowerPoint formats, in order to provide clarity to the client, and increase credibility.

 

 

 

 

• Step 1: Building rapport
  
  • This is the first step of the sales process because it is very important for Arnold and Monde to create a relationship with the potential client. This makes it more personable and the likeliness of the client signing a contract will increase due to the friendly bond that is formed

• Step 2: Ask targeted questions, listen closely
  
  • During this step, Arnold should have a set list of questions that he wants to ask the potential client. These targeted questions will be tailored depending on the client’s business. Listening is also important because it let’s the client give feedback and strengthens the newly formed rapport.

• Step 3: Ask further questions if necessary
  
  • This step will depend on the course of the conversation with the potential client. Arnold and Monde might find the opportunity to ask addition questions for clarity or for more information regarding the job position that needs filling.

• Step 4: Repeat specific issues, needs, and pin points
  
  • This step allows Arnold and Monde to circle back around to the reason why the potential client is there. It gives them clarity and the chance to pin point their exact needs.

• Step 5: Give Pitch
  
  • This is one of the most important steps of the sales process. This is when Arnold and Monde have the chance to really sell why Mihle Personnel Service is exactly what the potential client is looking for.

• Step 6: Give breathing room
  
  • After the pitch has been presented, it is important that Arnold and Monde allow the potential client to fully absorb the pitch. By taking a step back, they will give the client a chance to process the pitch.

• Step 7: Identify specific needs
  
  • By identifying the client’s specific needs, this makes the sales process more personal and relatable. It shows the potential client that Mihle Personnel Services will tailor their services to what they need

• Step 8: Get agreement from prospect

• Step 9: Ask for the sale
  
  • This step is critical because it puts the ball in the prospect’s court. It allows them to either take the offer or walk away. It is important that Arnold and Monde are relaxed and do not push the client. They are there to offer their services, not push a sale.

• Step 10: Handle objections
  
  • If for some reason the client is hesitant or unsure after Arnold and Monde ask for the sale, this gives them the opportunity to ensure that the client is making the best decision

• Step 11: Close the sale
  
  • At this point, the client will agree to signing the contract!

• Step 12: Sign letter of understanding
  
  • Arnold and Monde will present the client with a letter of understanding. This letter provides information and expectations to the client. The client will sign it and then Arnold and Monde will the company to their database and begin looking through their talent pool to fill the needed positions.

 

Tools for Sales: Thank-you Notes

      As mentioned previously, the new sales process is focused on building a relationship with the client, rather than just selling the product. As part of these efforts, Abuya created templates of “Thank you” letters for the gatekeepers and the decision makers. Thank you note templates can be found in the appendix.

 

3.4 Argumentation

To a business-to-business service-based company, there is no tangible product to show the customer before they have received the service to close a sale. The service cannot be sold truly by its merits since the buyer cannot know these without buying. Mihle Personnel Services will benefit in several ways by structuring a proper sales process.

• Sales process will effectively communicate value of services offered
• Builds credibility with clients
• Lighten the load on the salesperson by providing simple steps to walk through sales pitches
• The sales process will help to provide the company for growth

 

3.5 Implementation

In order to implement a sales process for Mihle, we had to make sure that what we were writing went along with how the company’s co-founder and salesperson, Arnold, conducts sales. To do this, we engaged initially with Arnold in both typical and role-reversed role-play sales situations. We gave him objections from both decision makers and gatekeepers. Abuya Consultancy designed much of the sales process around his natural technique. We also tested the technique with Monde, and found the structure helped reduce his apprehension and could empower him to assist in the sales process, should that eventually become necessary for Mihle to develop their customer base.  Once we did this, we made a few necessary tweaks and took the process to where it could be properly tested- actual calls.

 

Step 1: Develop Role-Play Scenarios

Abuya Consultancy came up with some role-play scenarios to use during a client meeting with Arnold and Monde. The first scenarios were meant to gauge the entrepreneurs’ current sale skills, and to be able to identify the gaps within their methodology. A map was drawn out to analyze their holistic process.

 

Step 2: Gain Feedback from Mihle

After the first session we provided feedback to both Arnold and Monde. Abuya Consultancy created a new process that was tailored to the entrepreneurs’ preferred methodology, and we took it to another meeting for another role-play session with different scenarios.

 

Step 3: Adjust Process

We identified gaps once again within the new process, took it back to the office, refined the process to make it more personable and customer-relation focused. Focusing on a new customer-relation sales process cultivates relationships and makes the potential client more vulnerable to sign and buy the services. A new role play scenario was played out, this time the consultants and the entrepreneurs switched roles, and each had the opportunity to experience the role of the gate keeper, the seller, and the decision maker.

 

 

Step Four: Workshop

 When meeting with Monde and Arnold, Abuya Consultancy conducted sales presentation and proposal workshops. Conducting the workshops allowed us to gain insight into what they wanted for the presentations, and we took this, developed a presentation template and merged it with “best-practices” for sales from the industry.

 

Step Five: Make the Call and Make Sales Trips

The next step was conducting an actual sales call. This gave us the opportunity to ensure that MPS’s process were going to be sustainable and successful. The reaction from the potential client was good, and Arnold was able to make his first contact with the gate-keeper and decision maker of the business. Abuya Consultancy also wanted to also implement the sales process in the retail field. During a half-day trip to the Khayelitsha Mall, Arnold was able to talk to 5 gatekeepers, make future appointments with 2 decision makers, and sit down for 2 full calls with decision makers

 

3.6 Next Steps

            Because the growth of the business is completely dependent on the sales process, practicing and implementing this process will be critical once the engagement has ended. In order to master the sales process, Arnold and Monde must continue to review the role-playing situations practiced, and should continue to make cold and warm calls to put this practice into action. By adding to the prospect list and updating as calls are made, they will be able to establish a concrete sales process and be introduced to the community by closing sales.

 

 

 

 

Deliverable 4: Forms and Processes

4.1 Problem Statement

Mihle is still in the startup stage where processes, especially the basic functions, are not in place. They currently have no systematic interviewing process for job seekers and an engagement of agreement with the client. For Mihle to be able to move forward and have consistent service provision, they need a system to follow in activities like a check list when interviewing. There are also other basic forms, such as an invoice and contract, which must be created to ensure that the sales process can be smooth and all paperwork is available when necessary.

When consulting with Mihle, Abuya Consultancy realized that no system is followed and thus no organized flow of processes. This mostly occurs before interviewing. This process is time consuming but also needs a lot of attention to details. No system is followed to enable the interviewee on what the interviewer has to offer. This can create confusion and can be time consuming if one has to repeat the process again. There is also no contract that enables them to gain some control on what they offer and expected of them as well as the client they are servicing. This places them at a risk where client can change their mind and they lose out of revenue for service. They cannot be hold the client accountable or demand payment for their services. Without an organized process and check list Mihle cannot know what information is relayed. In the process inconsistencies can occur especially when dealing with clients. As a results of this when new employees join they will not know how Monde and Arthur do business and thus introduce their own systems, messing up the already placed plans.

 

4.2 Desired Result

In creating templates of the processes that need to be followed, Mihle will be able to have an operating model that will offer consistent service delivery smooth flow of information. The ease in the flow of information occurs when interviewees’ information is organized in a systematic manner easily found and interpreted. This is created when a checklist is in place when job seekers are interviewed and jobs are matched easily to suitable candidates. This will enable Mihle to have a built in culture that can be transferred to new employees who join in when they expand when they will be interviewing candidates.  

The training of new employees will be easier as a template of what Mihle’s interviewing process will be followed by the book. In addition Mihle will be in a position where clients will take them seriously as they are able to know what skills they can supply and through their use of a contract as both parties will know what is expected of them when they do business.

 

4.3 Solution

In order to create an interview process for the pool of hirees, a form for evaluating applicants and a checklist to follow have been created. This form will be a hard copy, enabling them to see the process they follow when evaluating an applicant and understand the importance of knowing which factors the applicant was judged on. These templates will become even more important as the business grows, and the interviewing process is delegated to other employees. Monde and Arnold will be able to train employees and ensure that the employees can follow procedures for what is required of them. The checklist will ease the process of interviewing and interpret capabilities and skills of the interviewee.

 

Below is a checklist to ensure all necessary documents have been received from the applicant and interview can be arranged. This document will help Mihle to make sure they have all documents from the job seekers before they arrange for an interview with them. This will assist them to make sure Mihle has all information of the job seeker, so that when they are finally placed they can forward these documents to the necessary employer. In addition Mihle will be able to screen the job seekers efficiently and see what they have to offer. It will also enable them to judge among the many candidates the most suitable one for the job that is to be filled.

 

 

 

 

 

Interviewer:	Date:
Name
ID no.
Qualification Certificates
Interview Date
Applied job position

 

 

Figure 32: Interview Checklist

Figure 33: Applicant Ranking Form

The interviewing process will be filled in a form that will later be transferred into a database. By using Google Drive, Mihle will be able to type up details that are recorded on the hard copy. The form is used by Mihle during the interview, by either Monde or Arthur at the start of the interview avoiding reading the CV in detail. This will go into details as they present different scenarios to judge the answers from the job seeker and later rate them. A snapshot of the way applicants are ranked on soft-skills can be seen below, and the full form can be found in the appendix.

Figure 34: Job Seeker Database

Finally, an Excel database was created to keep track of these forms digitally. The database can be sorted by any category, so people will specific strengths can be found and called for an interview if they seem like they would fit the job.

 

A contract was also created for when Mihle Personnel Services signs an agreement to hire employees from a company. This contract was created with Arnold and Monde, gaining information about the pricing structure and terms for payment due. The contract can be found in the appendix.

 

 

Figure 35: Mihle Personnel Services Invoice Form

 

An invoice statement was created, in order to properly invoice clients for Monde’s HR consultation services. The basic invoice statement will record the hours worked, rate, and due dates on payment, and can be seen below.

 

 

With the full functional database, Mihle Personnel Services will be in a position to know the skills sets in their job seekers offer when they go meet potential clients. With a new client. they will need to understand what it is they need and what they have to offer. The negotiation stage will also include use of contract of agreement from both parties. This will ensure abiding of the agreement and also awareness of what the parties have to offer. Establishing basic forms such as the ones above will help to simplify the process of working with a client for Mihle.

4.4 Argumentation

The database will enable Mihle to sort through a lot of information and be able to quickly match suitable candidates with what the client is looking for. The following points will come from an organized database:

• Mihle will be able to know the skills levels they have for potential candidates
• Training of new interviewers is made much easier
• Culture of the company is created implemented and maintained: this is the procedures to be followed and abided, to have quality candidates that will build the relation with clients in the future.
• Mihle is taken seriously as a professional recruitment agent
• Mihle is able to reduce risk for non-payment and compliant through the use of the contract

Other forms, such as the contract and invoice, exist to aid in the sales process, and make sure that Mihle Personnel Services is fully prepared to make a sale on any day.

 

 

4.5 Implementation

 

Step One: Determine and Create Forms Necessary

When discussing the business with Monde and Arnold, developing a sales process helped to identify which forms and templates would be necessary for the business to be prepared for clients. It was determined that these forms would be an invoice, a contract, and forms for ranking and recording the job-seekers that come to Mihle for placement. These forms and templates were created based on industry standards and Arnold and Monde’s specifications.

 

Step Three: Implement with Monde and Arnold

After creating the forms, they were brought to Monde and Arnold to be implemented. Because Monde and Arnold both have prior Excel experience, the database was easily picked up on, ensuring that it will be sustainable in the long-run. It was explained that the idea is to have all information about the business in their fingertips, and that the system will assist them to know who they can target to increase the skills that are lacking in their database. Monde and Arnold brought CVs that they have from the past, and one was inputted into the Excel system to walk through the process. In order to score a job-seeker during an interview and enter them into the database, the following process should be followed:

 

Figure 36: Interview Process with Forms

                             

 

 

 

Step Four: Adjust where necessary

            When meeting with Monde and Arnold, changes were made to the form to make it easier for them and appropriate for the current interview process they have. While before, there were just boxes for “weak”, “average”, and “strong” soft skills, a scale was implemented to make the system simpler and easier to refer to in the future. Also, layout changes were made with the Excel database to make it read more easily for the entrepreneurs.

 

 

4.6 Next steps

During the implementation Mihle mentioned their desire to simplify their data input.  In future, when Monde and Arnold have their own location and have consistent internet access, Google Docs will be a media that will be beneficial. At the moment they are not always online and they need to first and foremost get acquainted with the new systems that have been introduced. A system using Google docs is not practical now, because with their unsteady access to the internet, it may not be sustainable. However, when Mihle Personnel Services opens their own location, this will simplify the process and be the best option for Monde and Arnold to pursue.

 

 

Deliverable 5: Develop and Implement Short and Long Term Goals for the Company

 

5.1 Problem Statement

 

      Because Mihle Personnel Services is such a brand new business, Arnold and Monde have yet to identify short and long term goals for their company. It is very important to do this because it helps to prioritize what they need to do in order to grow the business. Without setting goals, it is nearly impossible to identify what needs to be done and what is expected of the business for the future.

Arnold and Monde have high hopes for Mihle Personnel Services. They are very ambitious and know what they want to their business to look like once it’s well established. At this point in time, they must reel in their attention and focus on the short-term intentions. In order to place their company where they want it and to establish it, they must pinpoint realistic goals and a timeline. As of right now, there are no specific objectives. It will be extremely hard to move the business forward until a plan is set in place.

Once the short-term goals are developed and implemented within the business, Arnold and Monde can then begin to focus more of their attention on the long-term goals.

 

5.2 Desired results

 

      As a consultancy group, we want Arnold and Monde to succeed and grow their business as structured and soundly as possible. In order to do so, they will need to figure out exactly where they want to take Mihle Personnel Services. By developing short and long term goals, it will give them a structured outline of what they will need to do in order to achieve their potential growth.

      We believe that they need to determine monthly sales goals and create timelines for the growth of Mihle. In doing this, it will ground the company and provide parameters for the owners. If Arnold and Monde take the time to pinpoint these goals, it will give the company an outline and purpose. In turn, this will help them lay down a strong foundation for Mihle and to better serve their future clients.

 

5.3 Solution

 

      First we had Mihle set short-term goals. Because they are still establishing the company, we allowed this window of time to be two months. We believe that if Arnold and Monde make the right calculated decisions, they will be able to finish setting up the business and begin working with clients in a timely manner.

 

 

The timeline for Mihle’s short-term goals is listed below in chronological order:

Figure 37: Recent Goal Timeline

     

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 This is just a brief overview of the short-term goals in order to get Mihle up and running. In reality, the process of gaining clients will be more in depth, which has been understood by Monde and Arnold through the sales process.

 

Week 1:

• Day 1: Finalize a list of potential clients
  
  • Gather their contact information and locations
• Day 2: Launch website and begin printing brochures/business cards
• Day 3: Begin to fill in employee placement database
  
  • Contact Silulo for graduates looking for employment
  • Categorize by skill level, experience, desired job position, ect.
• Day 4-7: Start process of cold calling and warm calling to potential clients

Week 2:

• Day 1: Continue to call potential clients and grow employee database
• Day 2: Make necessary revisions to client contracts
  
  • Have several copies printed and ready to sign
• Day 3: Try to have at least one in person meeting with a potential client
• Day 4-7: Look at timeline that is set up to make sure Mihle is following its guidelines

Week 3-4:

• At this point, Arnold and Monde will have a grasp on calling potential clients and setting up meetings with them during these two weeks
• They should also continue to develop their employee database
• By this point, it would be ideal that Mihle secures their first client

Week 5-6:

• Walk through the contract with new client
  
  • File the signed copy accordingly
• Receive deposit from the client
  
  • Deposit this money into their new business account
• Open a business banking account to use for client deposits

Week 7-8:

• Continue to call potential clients and set up meetings with them
• Secure another one to two new clients
  
  • Collect deposits accordingly
• Build up brand awareness in the surround community and pipeline for future clients and employees

 

Once the short-term goals are established, Arnold and Monde will be able to focus on some long-term goals they would like to achieve within the next twelve months.

They can be found below in 4-month increments:

Figure 38: Long Term Goal Layout

 

      These long-term goals for Mihle are attainable, but will need to be planned out. In order for Arnold and Monde to achieve what they want, they must focus on gaining their first clients within the first four months. This client will most likely be from a smaller, local business in the heart of Khayelitsha. This is where they need to begin. Once they begin to grow their company and become established, they will be able to start looking for office space to rent. Before they rent an office space, Monde suggested that they look at using Hubspace, Jumpstart Entertainment, or Lingelethu Training Center as possible premises to use. These are very good suggestions because it will give more credibility to the business and these locations are well known so they are easily accessible to others. Because both owners have other jobs, they may need to look at hiring additional help whether it is a part-time worker or an intern.

 

Monthly Sales Goals

      Because Mihle Personnel Services is such a new company, there are hardly any costs to Arnold and Monde as of right now. They do not pay themselves, there are no other employees, and they plan to operate their business out of their homes until further notice. The monthly sales goals will start off as relatively small as well. They will be able to cover their costs (i.e. petrol, printing costs, ect.) as soon as they sign their first client.

      Once the company picks up in the coming months, the sales goals should also increase. Arnold and Monde will accumulate more costs at this point and it is important that they are generating enough of a turnover to cover everything. It should not be difficult for them to breakeven and gain profits relatively quickly.

5.4 Argumentation

 

• Arnold and Monde will have a clear understanding of where their company is currently
• It will outline feasible steps in order for the owners to get Mihle where they want it
• It will establish parameters for the owners so they can keep Mihle on track
• It will allow the business to run smoothly
• The owners will know exactly what they will need to do in order to progress with their services
• By setting monthly sales goals, Arnold and Monde will know how much turnover they will need to breakeven and generate a profit
• The timeline will provide a clear understanding for the business, where it is and what the next steps are

5.5 Implementation 

 

      When we had our first initial meeting with Arnold and Monde, we asked them what they wanted their short-term and long-term goals to be for Mihle Personnel Services. Once they listed them, this gave us a good look at what their visions were and if they were attainable. It was important that we lay out a proper timeline so that they could achieve these goals.

 

Step One: Discuss Short and Long Term Goals

      In order to implement goals, we first had to discuss what the short and long term goals were that Arnold and Monde had for the company. In our first client meeting, we asked them about their vision for Mihle, and what their short and long term goals were. We recorded these goals, and took into consideration what short-term goals we could achieve in our three week engagement with them.

 

Step Two: Present Realistic Timeline

      After compiling Arnold and Monde’s goals, we presented them with a timeline of these objectives, and got their feedback. Working together, we developed specific goals over a 3 month, 6 month, and one year period, and detailed steps on how to actually achieve those goals. We focused on not only goals that could be achieved together, but goals that would be prioritized once the engagement was over.

 

Step Three: End of Engagement Evaluation

      Towards the end of the engagement, we sat together with Monde and Arnold to evaluate the goals that we had already accomplished working together, such as building a Facebook page, practicing sales calls and making a first sales call, and developing database systems. Many of these goals were accomplished, and those that were not were scheduled as a short-term future goal. We then set guidelines for the short and long term goals that would be accomplished at the commencement of the engagement, and what these goals would require to be completed. The goals are as follows:

 

 

 

Deliverable 6: Bookkeeping System

 

6.1 Problem Statement

      Because Mihle is a new company, and has not had any sales, they have not developed a bookkeeping system to date. However, when sales begin to occur, a bookkeeping system is critical in order to keep track of cash and of receivables. Mihle has a desire for future growth and expansion, and this will not be able to occur without being financially organized from the start.

 

6.2 Desired Results

      A bookkeeping system will allow Monde and Arnold to keep track of the revenues and expenses that the company is accruing, and see how profitable the company is. Specifically, recording each job will allow Mihle to keep track of receivables, and make sure that they are received on time.  Because of the nature of the business, payments are not made until after the service is completed, and therefore receivables are a critical aspect of the bookkeeping system.

      Along with basic bookkeeping, the system will provide for scenario analysis, allowing Monde and Arnold to play around with the commission they are charging to see how much revenue it will produce. This will help Monde and Arnold to make thoughtful, informed decisions on the compensation that they are taking from each individual job.

 

6.3 Solution

      A bookkeeping system was created in Excel, which will allow Mihle to track any business that comes in. The bookkeeping system records:

• Cash flows in and out of the business
• Accounts receivable, and their collection
• A history of all jobs, for both personnel services and HR services, and full detail for every job Mihle Personnel Services contracts
• Scenario analysis to establish what revenues will come from charging various commissions

The bookkeeping system will most importantly record and identify the process of a payment from being a receivable to the day it is paid and comes in as a revenue. This will ensure that payments are received on time, and that they are not recorded as a revenue until they are actually received as cash. Monde and Arnold are very familiar with Excel, so the system will be easy for them to pick up on, and will be adhered to in the future.

 

Figure 39: Personnel and HR Contract Sheets

Contracts Sheets

 

In order to record the contracts that Mihle signs and the clients that they have, the contracts tabs exist to record all of the relevant and critical information about an engagement. This is a record of the money owed by the client and when it is due, and also will show when they have paid in full. It can also be used as a reference in the future, to look at past contracts and compare % commission taken for various contracts. Two different tabs exist separating Personnel contracts and HR Services contracts, mainly because the information recorded is different for the two. Because of this, job #s end in “P” for personnel, and “HR” for HR services. This distinction will be maintained in the receivables tracker and cash flow system.

 

Figure 40: Receivables Tracker

Receivables Tracker

 

The receivables tracker allows Mihle to record receivables when a contract is signed, and also to record when payment is received to zero out the receivable account. Two examples are shown above to represent an entry for personnel services and for HR. This receivable tracker is important to ensure that payment is received, and that the account gets paid off by the time it is due. When a payment is recorded in the receivable tracker, it should then be recorded in the cash flow system as cash coming in.

 

 

 

Figure 41: Cash Flow System

Cash Flow System

 

     

While the receivables tracker records money that is owed to the business, the cash flow system records actual cash coming in and out of the business. Whenever a payment is recorded in the receivables tracker, it is then transferred to the cash flow system as a revenue coming in. On the right hand side, the profit is totaled to date.

      It is important to recognize that currently, there are very few expenses in the company, so there are very few cash flows out. A majority of the variable expenses are simply time dedicated by Monde and Arnold. However, in the future, when a location is established and employees are hired, this cash flow tracker will have many more cash flows going out.

 

 

 

 

 

 

 

 

 

Figure 42: End of Month Tracker

End of Month

     

 

 

The end of month recording tab allows for comparative tracking of growth. At the end of each month, revenues and costs are added up from that month, and this will produce the profits created for the business. It is important to also record receivables still outstanding at the end of the month, to acknowledge work that has been done that has not yet been paid for. This monthly system will allow growth to be seen, because if more business is coming in, the profits will increase monthly. It will also allow Mihle to see the receivables outstanding at the time, and allow them to take action to collect on receivables that are overdue.

 

 

 

 

 

 

 

 

Scenario Analysis

Figure 43: Scenario Analysis

 

 

 

This scenario analysis will allow Mihle to quickly calculate how much varying commission will increase or decrease the revenue they receive from a job. Because Mihle’s pricing is variable, depending on many factors, they may adjust the commission % received. This tool will allow them to see how much of an impact that commission will play on the revenue they receive.

This is particularly valuable when adjusting commission based on time and effort put in by Mihle. For example, if the job that they are filling is very skill specific, and will take a lot of effort to develop a pool, the commission that they take may be higher to reward this increased effort. This tool will let them manipulate the various factors in a personnel hiring job.

 

 

Monthly Fixed Costs

Recording monthly fixed costs will help Mihle to understand how much money they should be bringing in to cover costs and make a profit. Because there are no variable costs, besides simply the time commitment to a job, the revenue that needs to be made per month to turn a profit can be based solely on the monthly fixed costs. While it is difficult to establish exactly how many people should be placed per month, because it is dependent on the commission taken and annual salary, ensuring that these total monthly costs are covered each month will allow Mihle to ensure that they are breaking even and making a profit.

Figure 44: Monthly Fixed Costs

 

 

 

 

6.4 Argumentation

Bookkeeping is a necessary practice for any business to understand their profitability and track orders to ensure that receivables are being paid on time. In order for the business to expand, sustainable bookkeeping procedures must be implemented to avoid lost cash through receivables that are lost track of and never collected.

      The bookkeeping system created will allow Arnold and Monde to record information about each contract signed and keep track of payment dates and amounts. The system is appropriate for them because it is simple to keep up with, and Arnold and Monde have past experience using Excel. In the future, if Mihle is interested in any financing from a financial institution, well-kept books are critical to show their profitability and their understanding of basic business concepts.

 

6.5 Implementation

      In order to teach the bookkeeping system to Monde and Arnold, and ensure that it resonates, it is important to go through the recording process step-by-step with an example client to practice with them. Monde and Arnold understand the value in a bookkeeping system, but in order to make sure that this system is used to its full potential, it must be ensured that they fully understand the process for recording a client contract from start to finish. If steps are skipped because they are confusing or need to be simplified, this will decrease the benefits that the bookkeeping system can provide to Mihle Personnel Services.

 

When a contract is signed with a client, the following process occurs:

1. The details of the contract are recorded in the proper Contract List – either personnel or HR. The contract is assigned
2. The information from the Contract List should be transferred to the Receivables Tracker with the customer information, due date (30 days from the contract being signed), initial amount, and balance.
   
   1. The initial amount and balance should be the same, because no money has been paid thus far

When a cash flow comes in on that specific contract…

1. Record the cash that was received on the Receivables Tracker as a payment. Record the balance as the initial amount minus the payment. If the payment was the entire initial amount, the balance should be zero.
2. Record the payment onto the Cash Flow System as a revenue
   
   1. Make sure to transfer the job id consistently on all sheets

If the contract has now been paid in full…

1. Return to the Contracts form and update the “Paid?” column to say “YES”, the job has been paid for in full.

 

The following checks and balances exist in the system:

• Whenever a contract is signed, it should be recorded in:
  
  • The appropriate contract tab
  • The receivables tracker tab
• Whenever a cash payment on a contract comes in, it should be recorded in:
  
  • The receivables tracker tab
  • The cash flow system, as a revenue
• Whenever a contract has been paid in full, it should be recorded in:
  
  • The receivables tracker tab, to ensure that the balance on that job is zero
  • The cash flow system, to mark the cash coming into the business
  • The appropriate contract tab, to signify that the contract has been paid in full

The system was fully explained to Monde and Arnold, and reviewed for understanding. After looking at the system together, the tab for monthly fixed costs was added to help Monde and Arnold see what kind of revenues they need to be bringing in monthly to cover their costs in the future.

 

 

6.6 Next Steps

      The bookkeeping system can be used with the sales process to ensure that sales goals are being reached. It is important to analyze end-of-month revenues, expenses, and profits to see if there is growth in the business, and have a unit of measurement to understand this growth.

While this bookkeeping system is good for Monde and Arnold to keep track of their accounts receivable and cash flow, it does not create income statements or balance sheets. These will be important in the future, especially if Mihle Personnel Services desires to receive funding from a bank or private institution. Therefore, in the future, when revenues are coming in, money should be spent to hire an accountant to annually create financial statements for the business. Relationships can be developed with local accounting firms to reduce the cost of this.

Letter of Appreciation

 

Letter of Appreciation to Mihle Personnel Services

 

Dear Arnold Ndindwa and Monde Foli,

 

We appreciate you for opening up your business to us. We admire your passion for your business and your community. We believe you will accomplish your goals because of the drive and determination you have. We are very impressed with the work we did together in the short time we had, and are grateful for your dedication to the engagement. We can’t wait to see how much your business will progress in the future.

 

We hope the implementation of these deliverables will allow you to grow your business and take your business to where you want it. We have enjoyed ourselves tremendously these past six weeks and we have learned so much from you. Thank you for your kindness and patience.

 

Warm regards,

 

Abuya Consultancy

 

Esteban Arturo

Alexis Illyinsky

Susanna Marrero

Ian Mitchell

Elaine Wairimu

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Appendix

 

APPENDIX 1: COLLEGE FLYER

 

Figure 45: Flyer for local colleges

APPENDIX 2: MARKETING PLAN FOR MIHLE PERONNEL SERVICES

NICHE STRATEGY: DO SOMETHING THAT YOUR COMPETITORS CAN’T DO

 

 

Situation Analysis

Mihle Personnel Services (MPS) is just starting operations in the month of July 2014. The Cape Town and surrounding areas are in need of a job placement company that focuses on recruiting potential employees with low-skill and medium-skills from the townships.

 

Market Analysis

Need more information on the size of the industries that are hiring low-skill and medium-skill individuals.

 

Market Needs

At the moment, the market in Cape Town lacks a job placement/recruiting company that focuses on low-skill and medium-skill jobs. MPS is providing business in Cape Town and its surrounding Townships with pools of talent that comes straight from the Townships itself.

 

• Low/Medium-Skill employee pools
• Quick fulfillment of low/medium-skill positions

 

Target Market

SME’s, Large Companies, and Corporations who employee low/medium-skilled talent and are in need of fast services to fill the position required.

 

Market Segmentation

The market was segmented into four primary targets, the SME’s who qualify under BSM 5-6 status, SME’s who qualify BSM 7 and Managed/Aggressive Growth Firm, Large Businesses, and Corporates.  Seen in the next page

 

	SME BSM 5-6	SME BSM 7- Managed/ Aggressive Growth Firm	Large Business	Corporate
Primary Benefit Sought	-Cost effective - Availability -Locality	-Talent Development -Hassel Free -Cost effective	-1-Stop Shop -Talent development -Video Interviews -Employee Skills and culture match	-Employee culture match -Township talent pools -MPS References -Success rate
Business Characteristics	-Small -Privately owned -Operate from home -Average turnover of $47,039 R -1-2 employees	-Small/Medium & ready to grow -Privately Owned, multiple shareholders -Operate from home or small office -Average turnover of $100,000 R -2-10 of employees	-Large business -Privately owned or multiple shareholders -Operate from office complex -Average turnover of $577,000 R -10-30 employees	Large companies 3+ branches Multiple levels of management -Average turnover of $757 mil. R - Average of 14,944 of employees
Decision Makers	-Owner	-Owner/Partners	-CEO -Owner -Head of HR	-HR top management
Hiring Habits/ Frequency of Usage	-Referrals -1 time/year	-Job Posts -Referrals -1-2 times/ year	-Job Posts -Referrals -2+ times/year	-On-going database -Hiring services -Multiple times/year
Services/ Products Purchased	-Job placement	-Job placement -HR Mediation	-Job Placement -Team-Building workshops -HR Mediation	Job Placement
Education Level for Jobs	-Some high school -Matric	-Matric -Post-Matric -Specialized training	-Matric -Post-Matric -Specialized training	-All education levels
What are they shopping for?	-Office support jobs -Specialized Skills	-Office Support -Computerized skills -Specialized skills	-Office Support -Technology Assistants -Specialized Skills	-Cashiers/tellers -Call Center Specialized Skills
Typical length of sales process	-Weeks	-Weeks/Months	-Months	-Months/Years
Exposure to hiring services	-None	-Little to none	-Limited	-Very

 

Competition

While there are no direct competitors that offer the same services that MPS offers, there are indirect competitors that are just independent individuals who also have access to talent pools in the Townships and are able to make recommendations to companies for potential hires. In addition, Cape Town has about 12-15 job placement companies that focus on providing the market place with medium/high-skilled talent pools; however, MPS is  the only one of these based out of Khayelitsha that offers access to low/medium-skill talent pools.

 

Placement

High Cost

 

Low Cost

 

High Skilled

 

Low Skilled

 

MPS

 

Comp

Mihle Personnel Services works with companies in the Western Cape. They focus their efforts in recruiting potential employees from Khayelitsha (and other townships) for low-skilled or medium-skilled jobs.

 

 

 

 

 

 

Product

MPS provides job placement for individuals based on the townships. They seek to fulfill positions that are mostly low-skilled/medium-skilled positions. In order to develop the product that they provide to the client, in this case the potential employee, MPS provides them with workshops in which they can develop and learn about essential etiquette for the workplace.

 

Price

      Prices for MPS will vary depending on the segmentation and the requested services. The fee that MPS charges is based on a percentage of the amount of the placed employee’s year salary.

The fee is based on the firm ability to pay for the services. The prices are competitive in the industry. Competitors charge minimum of 8% for all their services, but their services are geared towards more high-skilled industry.

SME BSM 5-6	SME BSM 7- Managed/ Aggressive Growth Firm	Large Business	Corporate
4.5%	4.5%-6%	6%-7.5%	7%-8%

 

 

Marketing Strategies:

Promotion

      80% of the business promotional efforts will be focused on Personal Selling. The business revolves around sales and at the moment the business has zero traction with potential clients. The other 20% of the promotional efforts and resources will be geared 10% towards advertising and 10% towards public relations. As MPS starts to gain traction from clients, they will also need to continue to grow their talent pool (which they already have traction with from Silulo), therefore advertising to this sector will be important. As for public relations, the company’s validity and rapport will come from these, and will in turn aid in the closing of sales with potential clients

      POINTS OF CONTACT WITH POTENTIAL CLIENTS THAT RAISE AWARENESS

SME BSM 5-6

 

SME BSM 7 – M/A Growth

 

Large Business

 

Corporate

 

LinkedIn

 

Facebook

 

Ikasi Network

 

Chamber of Commerce

 

Wall-Mural Adv.

 

Drink-and-Meet*

 

Warm/Cold Calling

 

HR Associations

 

 

 

 

 

 

 

 

 

 

*Drink-and-meet: Going with managers or decision makers to get a drink. This is part of building relations, raising awareness, and informing on services

 

MARKETING TACTICS FOR SPECIFIC SEGMENTS

The chart below lists specific tactics that can be used for the specific segments to increase sales and revenue

 

Identify Business SME-BSM 5-6 SME-BSM 7-Growth Large Business Corporate

 

Monetary Costs What percentage of the budget goes to hiring How much business are they potentially losing due to an unfilled position

 

Added Value Services Khayelitsha Talent 1-stop-shop Convenience Reliability Talent Development

 

Opportunity Costs Compare time and monetary costs to the MPS services Present opportunity cost

 

Time Costs How much time does it take from time of posting job, conducting interviews, to signing contracts

QUANTIFYING VALUE FOR THE POTENTIAL CUSTOMER

 

 

APPENDIX 3: RESOURCES FOR ONLINE MEDIA CONTENT

 

Resources for Online Media Content:

• Forbes Africa
  http://www.forbesafrica.com/

 

• Business Insider
  http://www.businessinsider.com/

 

• Quora (specific subjects especially useful):
  http://www.quora.com/

 

• Cape Town Chamber of Commerce
  http://capetownchamber.com/
   

 

 

 

 

APPENDIX 4: FEEDBACK FORM

Feedback Form

 

 

 

 

How did you first hear about us?

 

________________________________________________________________________

 

 

What made you chose MPS?

 

________________________________________________________________________

 

________________________________________________________________________

 

 

What was your favorite part about working with us?

 

 

________________________________________________________________________

 

 

 

 

Thank you for choosing us. We believe in working together for a brighter future

APPENDIX 5: SALES PROCESS

 

 

 

 APPENDIX 6: SALES TEMPLATES

1.  Thank You Note Templates

1. Thank You – Gatekeeper

Dear _____,
Thank you for directing my call. I appreciate your assistance. If you have any questions, comments, or if there is any way I can assist you in the future, please let me know.
Sincerely,
-xxxx

1. Thank You – Non-Signing Prospect

Dear _____,
I understand that your time is valuable, and would like to formally thank you for your time. While you may not need Mihle’s services currently, please do not hesitate to contact me at (083) 531 1753 should your needs change. If you or someone you refer find an employee through Mihle Personnel Services, please contact me for a *FREE* teambuilding workshop on us.
Thank you,
-xxxx

1. Thank You – New Client

Dear ______,

It is my personal pleasure to begin our relationship on behalf of Mihle Personnel Services. I want to personally ensure that your experience exceeds your highest expectations, and welcome you to call me personally, should you have any questions or concerns during our engagement.

I look forward to working with you.

Sincerely,

- xxxx

These thank you notes serve as a template for how to interact with a business after approaching them for a sale. They benefit the business by continuing lines of communication after the in-person sale has been made.

1. Sales Points – Gatekeeper

When talking to the gatekeeper, especially when cold calling, there are certain selling points to discuss with them that can be helpful to develop a relationship and differentiate yourself.

Problems Mihle can Solve for the Business-

• Resume influx / backlog issues
• Failure of personal network recruiting
• Turnover / expense of temps
• Inconsistency of employees hired from outside Khayelitsha/Cape Flats

 

Benefits that Mihle’s Services Provide-

• More family time, by saving time going through endless resumes
• Deeper employee relationships / pool for promotion, because employees are trained, screened, and rooted in the community
• Peace of mind, because Mihle will do just about everything for you
• Saving money for the business by saving your time and efforts.

 

Loaded Questions for the Company-

• What’s the biggest issue you’ve had in hiring in Khayelitsha>
• What do you look for in an HR agency?
• How much excess time do you currently spend on HR?
• What is your HR department’s time worth?
• How much more would you pay for a perfect employee?

 

 

1. Quick Sales Scripts – Cold Calls

When cold calling, it can be difficult to strike up conversation, especially with the gate keeper. These quick scripts can inspire you and spur conversation to get to the right person and set up a meeting from the call.

1. Initiating the Call

This is Arnold (introduce self)

I’m sorry to bother you (if you feel someone is frustrated), but I would like your help with something, do you have a minute?

We have this great service where we are matching people with X skills, and we are having X success. I was hoping that you could help me identify someone who I could sit down with at your company who would be in a position to make a decision about hiring practices?

 

1. Passing the Gatekeeper – Reference is everything

“X recommended that I talk to you, did I catch you at a right time?”

If he says no, “Ok would it be ok if I call you tomorrow at X time”

“Hi X, this is Y, I spoke to [day] and you told me to call you back at [time] and I wanted to make good on that”

 

 

APPENDIX 7: LEAD FORMS

Lead Forms

 

Name of the Business:

 

 

Segment:

 

 

People spoken to (order from first to last) with short fact about each person:

 

 

 

 

 

 

 

 

Decision Makers Name and Contact Info:

 

 

 

 

 

 

 

 

 

 

 

Sales Process Form

 

Business Name:

How discovered:

Quick facts:

 

Likely needs:

 

People spoken to (order from first to last) with short fact about each person:

 

 

 

 

 

 

 

 

Decision Makers Name and Contact Info:

 

Appointment scheduled:

Needs identified:

 

 

Sale Closed:

Followed up (week):

Followed up (month):

Followed up (quarter):

Referral(s) given:

 

Notes:

 

 

APPENDIX 8: STAFFING CONTRACT

 

General Staffing Agreement

 

_______________________, with its principal office located at _______________________ (“STAFFING FIRM”), and _____________________, with its principal office located at _______________________ (“CLIENT”) agree to the terms and conditions set forth in this Staffing Agreement (the “Agreement”).

 

 

 

1. STAFFING FIRM’s Duties and Responsibilities

1.1 ​STAFFING FIRM will

a.​Recruit, screen, interview, and assign its employees (“Assigned Employees”) to perform the type of work described by CLIENT

 

b. Properly train Assigned Employees for the job at hand

 

c.​Require Assigned Employees to sign a contract agreeing that they will hold a job with CLIENT and are agreeing to work as a permanent employee

 

2. CLIENT’s Duties and Responsibilities

2.1 ​CLIENT will

a.​Properly supervise Assigned Employees performing its work and be responsible for its business operations, products, services, and intellectual property;

 

b.​Properly supervise, control, and safeguard its premises, processes, or systems, and not permit Assigned Employees to operate any vehicle or mobile equipment, or entrust them with unattended premises, cash, checks, keys, credit cards, merchandise, confidential or trade secret information, negotiable instruments, or other valuables outside of the job description provided to Mihle Personnel Services

 

c.​Provide Assigned Employees with a safework site and provide appropriate information, training, and safety equipment with respect to any hazardous substances or conditions to which they may be exposed at the work site;

 

d.​Not change Assigned Employees’ job duties without the knowledge of the Assigned Employee or the knowledge of Mihle Personnel services

 

3. Assigned Employees Guarantee

3.1. Mihle Personnel Services offers a three month period of time in which the Assigned Employee may be removed from the job if performance is not appropriate according to job description, and a partial refund may be provided

 

3.2 Mihle Personnel Services requires weekly and monthly updates about the Assigned Employee, and reserves the right to refuse a partial refund if the Assigned Employee appeared to be serving CLIENT according to the job description provided

 

3.3 After the first three months, semi-annual check-ins are still required by Mihle Personnel Services, to assure that the Assigned Employee is still meeting the needs of CLIENT

 

3.4 In the case that the Assigned Employee quits within the first three months, a partial refund will be received by CLIENT, depending on circumstances. For this clause to be applicable, the Assigned Employee must have been provided with a safe work site and not be required to do additional work outside of the initial job description. Therefore, a refund may not be received if the Assigned Employee was put into a dangerous situation by CLIENT

 

4. Payment Terms, Bill Rates, and Fees

4.1 CLIENT will pay Mihle Personnel Services for its performance at the rates set forth between the two parties, and will pay any additional costs or fees if they were set forth in this Agreement. Mihle Personnel Services will invoice CLIENT for services provided under this Agreement at the time of Assigned Employee placement. Payment is due on receipt of invoice. Invoices have a net30 payment schedule, and must be paid after the first completed month of work by the Assigned Employee.

 

4.2 In the case that they employee is not meeting the terms of the job description, CLIENT may put in a request to not pay or a request for a new Assigned Employee. Mihle Personnel Services retains the right to deny this request depending on the situation.

 

4.3 Placement Fees are calculated at ___% of the employees commencing annual package (includes commissions and all other benefits) and become due for payment when the introduced candidate commences employment. Placement Fees must not be taken out of employee salary.

 

5. Confidential Information

5.1 ​Both parties may receive information that is proprietary to or confidential to the other party or its affiliated companies and their clients. Both parties agree to hold such information in strict confidence and not to disclose such information to third parties or to use such information for any purpose whatsoever other than performing underthis Agreement or as required by law. No knowledge, possession, or use of CLIENT’s confidential information will be imputed to Mihle Personnel Services as a result of Assigned Employees’ access to such information.

 

6. Cooperation

6.1​ The parties agree to cooperate fully and to provide assistance to the other party in the investigation and resolution of any complaints, claims, actions, or proceedings that may be brought by or that may involve Assigned Employees.

 

7. Indemnification and Limitation of Liability

7.1​ To the extent permitted by law, CLIENT will defend, indemnify, and hold STAFFING FIRM and its parent, subsidiaries, directors, officers, agents, representatives, and employees harmless from all claims, losses, and liabilities (including reasonable attorneys’ fees) to the extent caused by CLIENT’s breach of this Agreement; its failure to discharge its duties and responsibilities set forth in paragraph 2; or the negligence, gross negligence, or willful misconduct of CLIENT or CLIENT’s officers, employees, or authorized agents in the discharge of those duties and responsibilities.

 

7.2 Neither party shall be liable for or be required to indemnify the other party for any incidental, consequential, exemplary, special, punitive, or lost profit damages that arise in connection with this Agreement, regardless of the form of action (whether in contract, tort, negligence, strict liability, or otherwise) and regardless of how characterized, even if such party has been advised of the possibility of such damages.

 

7.3 As a condition precedent to indemnification, the party seeking indemnification will inform the other party within ______ business days after it receives notice of any claim, loss, liability, or demand for which it seeks indemnification from the other party; and the party seeking indemnification will cooperate in the investigation and defense of any such matter.

 

 

8. Miscellaneous

8.1 ​Provisions of this Agreement, which by their terms extend beyond the termination or nonrenewal of this Agreement, will remain effective after termination or nonrenewal.

 

8.2 No provision of this Agreement may be amended or waived unless agreed to in a writing signed by the parties.

 

8.3 Each provision of this Agreement will be considered severable, such that if any one provision or clause conflicts with existing or future applicable law or may not be given full effect because of such law, no other provision that can operate without the conflicting provision or clause will be affected.

 

8.4 This Agreement and the exhibits attached to it contain the entire understanding between the parties and supersede all prior agreements and understandings relating to the subject matter of the Agreement.

 

8.5 The provisions of this Agreement will inure to the benefit of and be binding on the parties and their respective representatives, successors, and assigns.

 

8.6 The failure of a party to enforce the provisions of this Agreement will not be a waiver of any provision or the right of such party thereafter to enforce each and every provision of this Agreement.

 

8.7 CLIENT will not transfer or assign this Agreement without Mihle Personnel Services’ written consent.

 

 

9. Term of Agreement

9.1 The terms and conditions stated above are between Mihle Personnel Services and CLIENT. Acceptance of Mihle Personnel Services’ services deems client acceptance of these terms and conditions. The engagement of an applicant introduced by Mihle Personnel Services in any capacity will signify your acceptance of these conditions.

 

 

 

 

 

 

 

I, ______________________________________________, being duly authorized, have red and understand the terms and conitions of this agreement and I agree hereto.

 

 

 

Signature ______________________________________________________

 

Signed at _______________ on this __________ day of 20_____ 

 

Company/ Client Name ____________________________

 

Co. Registration No _______________________________

 

 

APPENDIX 9: INTERVIEW FORM

 

Applicant Name:                       Applying for:                                         Date:

Education level:

Current position:

Period on the job:

Reasons for leaving:

Skills attained:

Previous job:

Period in the last job:

Describe a situation, applied reaction and rate below

 

 

	1 2 3 4 5 6 7 8 9 10
	Weak	Moderate	Strong
INITIATIVE
Comments
STRESS TOLERANCE
Comments
PLANNING AND ORGANIZING
Comments
TECHNICAL AND/OR POSITION SPECIFIC
Comments
WORK STANDARD
Comments
TEAMWORK
Comments
COMMUNICATION SKILLS
Comments
LEADERSHIP
Comments
JOB MOTIVATION
Comments

 

Suitable for the job : Yes           NO        .

Comments: