The Strategy Behind… saving a company

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It’s likely that many motorsport sponsorship-seekers will be targeting micro, small and medium-sized enterprises (SMEs), businesses with an annual turnover not exceeding 50 million Euros and employing less than 250 personnel. So what’s the right recipe for doing that?

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Many SMEs tell me that the majority of sponsorship proposals they receive show that the senders have little idea, or interest, as to what the real business needs of an SME might be. Too many proposals are totally irrelevant.

During my training courses, I look at a typical business day for an SME owner. It is, of course, wildly exaggerated, but usually succeeds in getting my point across. Here’s an example.

Joe Murphy owns a 15 million Euro business manufacturing flat-pack furniture. He and his wife started the business 14 years ago and now employ 25 factory staff, 7 clericals and a UK sales force of 12. From the very start, all profits have been ploughed back into growing the business. Joe and his wife have worked their butts off to make it succeed. No flash cars, expensive holidays or houses. But of late, sales have plummeted.

It’s Monday morning. It’s raining. Joe’s car won’t start so he catches the train, arriving at work soaked through. He looks at the sales-figures report waiting on his desk; down again, for the 4th month in a row. He spots an envelope marked “confidential”. It’s a resignation letter from his PA who has been there for 10 years. She’s leaving the UK due to her husband’s transfer. A pile of bills, some marked FINAL DEMAND, await him. His diary reminds that of a difficult meeting in a couple of hours, at which he will make four factory workers redundant. He feels that the day couldn’t get much worse. Then an e-mail arrives:

“Dear Managing Director, last season I won the British kart championship. I want to move into Formula 4 race cars this year and eventually into Formula 1. I don’t have the £150k budget to do F4. Would you be interested in sponsoring me? In return, you’ll get stickers on the side pods of the car and four tickets for each race. I look forward to hearing from you. Regards, Timothy Hopeful”. Joe Murphy holds his head in his hands and screams.

Don’t laugh! This differs very little from a high percentage of motorsport sponsorship proposals that I see, all based on the same premise: “I want… I can’t afford… you can”. Then a courier arrives with a letter, to be signed for. Joe opens it and reads the first paragraph:

“Dear Mr Murphy, I see from your excellent website that you have a national sales force. Would I be right in thinking that in these tough economic times, you’re constantly looking for innovative ways of motivating your sales personnel to hit and exceed their sales targets? I’ve created what I feel is a powerful, cost-effective programme that uses the proven attraction of motorsport to incentivise sales personnel and improve their performance levels in a measurable, sustainable and yet exciting way.

Would it be possible to arrange a short meeting with you to outline the programme and determine whether or not it might be of some help to your business?”. Joe turns to his PA and hands her the letter. He says he’ll look at anything that might help boost sales…

That concept is how I have acquired nearly £100 million of sponsorship in my career from Formula Ford to Formula 1. Simply by helping a company sell more products or services!

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