Cost of Marketing

[Newby100]

Can anyone give me some advice on this. I have been quoted for sales & marketing for my new small company. I don't have much budget as I haven't sold anything yet, but I have been quoted £100 for a day a week plus 33% of my profit. Can anyone suggest a way that I can negotiate a cost with this company? I am still working full time so the daily rate will have to come from my wages, and 33% of my profit seems really high.
Any advice would be welcomed.
Thanks

 

[S-Marketing]

I offer marketing on results based fee's. I wouldn't have a clue if the deal was a good one or not with the info provided though. You need to give us more to go on.

 

[Newby100]

Hi Stretchy
It's a new business that I want to pitch to major retail as well as the tourism trade. I really want to pitch at the spring fair NEC. What info do you need?

 

[directmarketingadvice]

As Stretchy said, it's hard to know whether this is a good deal.

What is this person going to be doing for you?

Who else could do it (equally well for less money, or do it better)?

What happens if they don't perform? Do they still get 1/3 of the business?

If their role is to bring in big clients, then it's reasonable for them to get expenses (£100 a day isn't much) and a big reward if they succeed. But I wouldn't give them the big reward before they bring in a single client.

Hope this helps,

Steve

 

[Newby100]

Thanks directmarketingadvice

I think what it may be best to do is discuss the cost to enter the spring trade fair at the NEC and then after that guage the interest in the business before agreeing ongoing costs. Is this sensible do you reckon?

 

[Peter Bowen]

£100 a day doesn't sound like a very much it's around £8-£10 an hour. By the time you have taken out all of the expenses and unbillable time the person is probably earning less than minimum wage. Can you really get great marketing at that rate?

 

[Newby100]

Understood, but this was a reduced rate in favour of a 33% profit share. What would you assume a really good daily rate for marketing? Taking into consideration expenses/unbillable time etc. I would rather pay a better daily rate and a smaller % of the profits.

I appreciate your advice:redface:

 

[directmarketingadvice]

Thanks directmarketingadvice

I think what it may be best to do is discuss the cost to enter the spring trade fair at the NEC and then after that guage the interest in the business before agreeing ongoing costs. Is this sensible do you reckon?

I don't think there's anything inherently wrong with the deal as you stated it, as long as (a) it's a fair return for both parties, and (b) you're not giving up a % of the business for nothing.

Frankly, if I were a salesman and it was a new company dependent on me selling to big businesses, I'd want a big piece of the action from any such client I brought in.

Steve

 

[goodguy]

£8-£10 isn't much, but more than most Small Business owners make, and also if he has 10 clients, that £80 per hour, £800 per day around £200,000 a year, plus a 3rd of 10 companies.
Where do I sign up

 

[marklouis]

What all they(company) have quoted in sales and marketing as in are they providing email marketing, seo of your website(if you have one) or they will be making one for your business?

 

[Newby100]

Hi MarkLouis

I have done a bit of asking around about the company and the general opinion is that they over promise and vastly under deliver. Apparantly they come up with lots of contact names but as far as sales are concerned they are not very successful. So I think it's back to the drawing board for me. I probably need to try and market it myself to get some capital behind me to then bring in someone to market for me. Has anyone any tips on finding out who the buyers are for retailers such as John Lewis, Boots, Antler luggage etc? I have tried Linked In but draw a blank.
Thanks for your good advice.:redface:

 

[garyk]

As Stretchy said, it's hard to know whether this is a good deal.

What is this person going to be doing for you?

Who else could do it (equally well for less money, or do it better)?

What happens if they don't perform? Do they still get 1/3 of the business?

If their role is to bring in big clients, then it's reasonable for them to get expenses (£100 a day isn't much) and a big reward if they succeed. But I wouldn't give them the big reward before they bring in a single client.

Hope this helps,

Steve

Ahhh there you are! Profile name change...or have you actually changed your name by deed poll to Mr D. M. Advice too?

Gary

 

[kezi2cool]

I believe that is just too much to start with unless u haev seen some results with his promises and marketing becuase spending time or money are vice versa.....so think which is the one u can afford or even if u could try geting somewhere cheaper that what he quoted

 

[marklouis]

Marketing out the product can be a good start up but for that you actually need to have a clear understanding of how seo and social media marketing is done.Start with a facebook page about your business and market your product there.If you have a website then you need to go through Seo basics otherwise not.Study the basics of Fb page like how to get likes, target audience etc. Try it and let me know the results.Mind you, traffic gradually increases so patience is the key.

 

[angrystone]

Best thing is to give it a trial and see if you get a return. Also keep in mind that the amount of promotion that should be done for anything is way underestimated by most people. You should be setting aside and spending at least 14% of each weeks income on promotion.

 

[babblemouth]

I really want to pitch at the spring fair NEC.

You do realise that this starts on 2nd February!

 

[DDAFIRE]

Has anyone any tips on finding out who the buyers are for retailers such as John Lewis?

Silly question, but have you tried ringing their head office and asking them?

 

[XanderMarketing]

In answer to your original question any marketing you do should be an investment. You need to start with your targets...I need to make £x sales this year or get this many new customers, then work out how much of that it's worth spending on marketing.

That will then determine what marketing you do and the type of company you do it with.

So what do you want to achieve with your marketing?

 

[mattleescott]

Budget/cost..

Marketing is an investment and the single most leveragable activity for generating more profit in a business.

What can they guarantee you'll get back from your investment?

Matt

 

[Scott-Copywriter]

There has been no mention of exactly what the marketing company has projected to return based on this setup.

You can't just chuck £100 per day at someone without any idea of what they're going to do with their time. What if it takes weeks or even months before their work starts to produce sales?

PS: The only way we can know if the percentage is high or low is if we know your expected average order value.

 

[ChcClassifieds]

There are two ways -
One - individual item. Look at cost and market for each item and take the lower of the amounts. then add 3 to get inventory
Two - find the totals of the costs and the totals of the markets and find the lower of those two.

chclassifieds[dot]com