Here are 5 Lessons We Learned
on ABC’s Shark Tank
ABC’s Shark Tank – This is the prime-time business feeding frenzy that invades our television screens every week. The back and forth fighting keeps us all glued to our screens, however what makes some deals close and others fall flat? The sharks have invested over six million dollars of their own money investing in several companies all while giving the american people a peak behind the scenes of how a business can use an infusion of capital to hit the next level.
Mr. Checkout has a front row seat and backstage knowledge about many of these deals as we have either worked with the products before they were on the show or approached with the products by one of the sharks after the deal has closed. We have been able to place many of the shark tank products not only in a portion of our 40,000+ independent retailers that our independent distributors service, but also several major retailers of whom we already have developed a relationship.
Yes, the episodes can be fast and furious. But more-so, they provide a knowledge and insight about what investors are looking for in your business. Here are 5 lessons we’ve learned from ABC’s Shark Tank about what it takes to pitch and investor.
1. Know your numbers.
The make or break factor in all deals is often how well the entrepreneur knows their numbers. Whether you’re interviewing a new distributor or investor, it’s paramount that you understand how much cash is flowing in and out of your business. The distributors on the street care about what percentage goes into their pocket and the quantity that will sell on a weekly / bi-weekly basis.
2. Build relationships.
The most important factor in your business’s success is your personal relationships with your retailers, distributors and wholesale clients. When building relationships it’s important to start slow and give as much as possible to build a base of loyalty. The best way that we’ve found to build these kind of relationships are to over-deliver on all promises. These kinds of relationships give you an edge over any competitors that are trying to enter your market.
3. Understand market timing.
There are good and bad times to ask for investment capital for your business. Many companies find out that they are at too early of a stage in their business to be investable. When seeking investment the investor needs to know that you’ve successfully tested your product in the marketplace and that you can handle scaling up your business to the next level quickly. If a business is not able to scale, it’s not ready for investment.
4. Arm yourself with real data.
After the initial pitch in the Shark Tank, the investors will ask you several more questions pertaining to your sales figures, manufacturing costs and marketing acquisition costs that you better be prepared to answer. Having real data is what will make you stand out from the non-successful pitches. The best data can be found by testing your product in the real world, Mr. Checkout has a program called the Blitz that places products on the counters of independent retailers nationwide to test such factors as cost, placement and point of sale display. This kind of real data can be invaluable to a product’s life as minute changes can dramatically affect it’s lifetime sales.
5. You need to prove that your business is viable.
However you say it, practical, sustainable, viable or worthwhile, you have to have proof that your business works. Go above and beyond to test every way that you can get your product into retailers. You don’t want to be standing in an investment meeting with the Sharks and have them tell you about a new path to market or competitor that you’re currently unaware. In order to be successful on Shark Tank, do your research, be prepared and know the answers to their questions before they ask.