“With the right approach, the profitability should be 40-50%.” Mikhail Khristosenko, the founder of the Mikhail Khristosenko Studio of the same name, shared his own experience of creating a business from scratch.
– Mikhail, what does your studio do?
– “Mikhail Khristosenko Studio” is engaged in the development and promotion of Internet sites, the development of corporate identity, consulting. To date, we have more than 200 completed projects, clients in 11 cities of Russia.
How did you come up with the idea to start this particular business? What is the uniqueness of your idea?
I came up with the idea of starting this particular business by accident. After graduating from the institute, I had to earn some money, I didn’t really want to work. I decided to try to make a website for some company. Before that, I had experience in developing a couple of simple sites at the institute. At the beginning, the proposal was no different from the existing ones – I offered the development of the most common sites. Now, of course, there is uniqueness – we have moved from understanding the site as a “technical development” to “solving business problems.” We have simplified everything, discarded the terms, we offer an exclusive, selling design. And if you look at the differences from competitors, in terms of building a business, then we just learned how to sell our services very well. There was no uniqueness of the idea – everything was simple. I believe that uniqueness for the first project is not needed.
How long did it take to implement the idea?
Five years have passed since the first independently created projects. Although the project became a business in the normal sense of the word 3 years ago.
– How did you embody the idea from its idea to the final implementation?
I didn’t know anything in business and didn’t know how, there was nothing. I decided to just call random companies and offer. On the very first day, I agreed on one meeting. It was the first project, I did it completely myself. On the third project, I realized that I would not do it myself, because it takes a long time and is not very professional. Hired an employee, and he was engaged in sales. This was the first key step. We didn’t have an office. I went to meetings on my own. If it was required to meet at “our office”, then we met at the office of an advertising agency, with which we had previously agreed. We also used the legal entity, account and accounting from this company. Then I doubled my productivity and managed to double the number of calls I made. It is easy to guess that this led to a doubling of turnover. The next key step was hiring a sales manager. As a result, I got my own office, several sales managers, full-time programmers and designers, my own column in a business newspaper, publications in leading Russian business magazines, a book, a mailing list, several business seminars held …
– How much did it cost you to start the project?
It didn’t take any money to get started. It was pure business from scratch.
– Many people think about starting their own business, but not everyone ends up opening it: it stops the fear of uncertainty, instability, high risks, etc. Was it easy for you to decide to become an entrepreneur?
I didn’t make the decision to become an entrepreneur as such. I just tried. It was uncomfortable, incomprehensible, but I tried. Happened. There are no risks – if you do not run headlong to buy the first product that comes across, spend money on opening a legal entity, office, employees, advertising, etc. You have to sell first. Himself. And to understand whether someone needs it or not. What difficulties did you face in the initial stages of running a business? All the difficulties are ultimately related to employees – how to find them, how to choose, how to train. Then they “stupid”, fail projects, etc.
– What can you say about the profitability of this business?
– With the right approach, the profitability should be 40-50%. Personally, with less profitability, it would not be interesting for me to do this business. That is why we have exclusive projects, not discount sites. Profitability ultimately depends on the ability to sell high and do well. Complete nonsense – that you need to sell cheaper in order to attract more customers. You need to sell more expensive, and correctly explain this to customers.
– How do you promote your services? Name the main promotion channel. How is your sales network built?
– There are 3 main channels for promoting my company’s services. These are: the city’s electronic business directory, customers from the site, the work of active sales managers. Each of these channels provides approximately the same percentage of orders. We also conduct seminars, have published a business book, and are looking for partners. Some clients come on the recommendations of previous ones. Ultimately, all applications flow to sales managers who advise clients, make sales and conclude contracts.
– Do you do direct sales, offering your services directly to companies, etc.?
Yes. Although this method will soon become obsolete due to its low efficiency. But while it is, we use it. It is imperative to have a clearly defined script for a telephone conversation, then everything will work out.
– What kind of employees does the staff of your company consist of? How did you select key employees? How are they paid for their work?
– The staff consists of sales managers, programmers, designers, layout designer. Key employees were selected from acquaintances. Now I understand that this is a mistake. Firstly, there should not be key employees, and secondly, it is impossible to work with acquaintances, friends and relatives. There are vendors, of course. I took one ready-made, took the second with absolutely no experience and taught it myself. The results are the same. Although I still tend to believe that teaching a person without experience is more correct. The work of sales managers is paid according to the scheme – a small salary plus good interest.
– Obviously, during your work you have tried various ways of advertising. Which advertising media proved to be effective, and which ones did you eventually abandon?
– Any image advertising turned out to be completely ineffective. We use contextual advertising, and advertising in the city electronic directory of companies. That’s all. We never use such advertising, in which it is not possible to measure its effectiveness.
– How do you see the prospects for further development of your business?
– The prospects for development are simple – entering the Russian and foreign markets, increasing the quality and cost of services, working with social networks. Well, the increase in the number of employees, of course.
– What can you say about the competition in your business?
– The competition must be treated soberly. We have more than 50 studios in the city, and an endless number of students offering website development. 48 companies do it cheaper or significantly cheaper than we do. I don’t care. A company will never be able to own most of the market. There will ALWAYS be competitors and someone will always buy from them. No need to waste your energy and time comparing yourself to your competitors. You have to try to be better at something. Even if it’s just “attitude to work” – it will be good.
– What advice would you give to beginners who are just planning to open their own business?
– The advice I want to give is the following:
- Don’t delay. Act right now.
- Don’t waste time coming up with an idea. Make a list of options, cross off all but one of them, and start.
- Don’t rush to buy. Try to sell first. And only then make a buying decision.
- Do not rush to rent an office, buy furniture, appliances, etc. In the beginning, you can agree with any company to use their office if necessary. Money will appear – withdraw yours.
- There is no need to be afraid or complicate things. Try.
- If you don’t know something or don’t know how, try it.