My Business chats with business owner Sharon Melamed about the impacts of Brexit on her business, the value of government grants and deriving revenue from a free-to-use service.
“The problem is that people go on Google looking for key suppliers for their business; I think something like 95 per cent of companies start with an online search on a search engine when they're looking to buy a particular business service or product. But the problem is that Google returns hundreds and thousands, if not millions, of search results,” explains Matchboard CEO and founder Sharon Melamed.
“So key individuals at companies face the daunting task of wading through all those search engine results, or maybe just going with the ones on page one that have paid the SEO consultants the most, who may not necessarily be the right ones or the good ones.”
Her solution, around which she has built her company, is a business-to-business (B2B) matching platform.
The platform requests a few prompts about the type of service or product required, and the technology platform then narrows the search down to a manageable list of between one and five options that meet all of the specified criteria.
“That's things like budget, timeline, location, industry specialisation [and] type of service,” Sharon says.
For Sharon, the reliance on technology means the business is not staff-intensive, allowing her to retain strong margins from the deals brokered through the site and still provide a cost-effective service to the suppliers using the platform.
Deriving revenue from a free service
Matchboard offers its service to users for free. It instead charges suppliers a success fee once a deal is agreed upon.
As well as making the service a cost-effective tool for clients searching for relevant suppliers, Sharon says a key benefit of this business model is that it can offer independent, unbiased recommendations for users.
“All the suppliers are on the same terms, so we have no vested interest in referring one supplier over another. All we do is recommending what's in the interest of the client, the buying side,” she says.
“In the last four years we've invoiced $28 million in deals [and] our success fees range from 0.75 per cent to 10 per cent, depending on the product or service category and deal size.”
Why SEO is more than tech talk
For many businesses, SEO – which stands for search engine optimisation – is one of those geeky things associated with digital marketing that sound good in theory, but are difficult to implement in practice.
However, Sharon explains that getting your SEO right can make an enormous difference to your business’ bottom line.
“In Australia, about half the business comes through SEO,” Sharon explains.
“Then we've got LinkedIn, just using it in a free way, engaging in discussion forums and groups; I've got about 9,000 followers on LinkedIn for my own personal network, as well as paid LinkedIn sponsored updates and ads.”
Another source of business is direct, regular contact with Matchboard’s existing database of suppliers and clients – demonstrating the importance of building relationships with existing customers, given the ease of generating repeat business compared with attracting new customers.
“We have a monthly newsletter that goes to several thousand people, and every time we send out one of these newsletters to our database, repeat business occurs,” says Sharon.
“You just have to stay front of mind, basically. Once people have tried our service, we find that they're comfortable reusing it when they have a need for a different product or service.”
“It's actually more affordable to expand your business internationally than it is in the home market through [this] grant.”
Government grants: a helping hand
As Sharon points out, the application process for government grants can be arduous, which likely puts off a lot of business owners from applying at all.
However, she says that securing funds under the federal government’s export market development grant (EMDG) has gone a long way in helping her expand her business overseas.
“There are a lot of government grants at state and federal level out there, but the one I went for is the EMDG, which essentially covers 50 per cent of your costs that are sales- and marketing-related when you're entering into a new international market,” says Sharon.
“For me, that was the UK … I've got a general manager over there, and the government covers 50 per cent of his costs, which is really a game-changer for small businesses, that contribution from the government, because it's a lot of money. It's one of the most generous export grants in the world, from what I understand.
“It's actually more affordable to expand your business internationally than it is in the home market through his grant. It made the whole business plan for us feasible to go the UK.”
The Brexit factor
That launch into the UK occurred in July 2016, just weeks after the shock result of the Brexit referendum. My Business was curious to know whether that played any role in Sharon’s decision to continue with the launch, and what she has experienced to date.
“For a business my size, certainly I haven't seen any impact at all,” Sharon says.
“In London, where I was the past week, people are just getting on with it, and are very buoyant. If anything, the feeling I got was that the Brexit thing would actually enhance the Australia-UK relationship.”
In fact, Sharon suggests that now is a good time for Australians to do business in and travel to the UK, given the impact the Brexit vote has had on the British currency.
“For me, actually, it became much cheaper. When I first went, it was like £1 was $2, and now I think it's around $1.50, so to travel there and all those expenses have actually come down quite a bit,” she says.
Location: Sydney and London
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.