Get your sales pitch right; your products won’t sell themselves

Although it seems as though there is no true or satisfactory answer to that question (let’s face it we all wanted it to be Johnny Depp!), there is in fact one man who did appear in both films. Kevin McNally was the actor fortunate enough to have played the part of Puquet in Phantom and Joshamee Gibbs in Pirates.

Whether or not Mr McNally was the actor to whom Denise Channing was referring in her pitch to gain an investment in her film company, Goblin Films Ltd, the point to be made here is simply that the mystery actor would have been the only real selling point for her film. And she wasn’t even allowed to name him (though her decision to give clues as to his identity was interesting).

Having a unique and compelling selling point for a product or service is essential to being able to make a convincing pitch. Moreover, the benefits of the product for both the consumer and the investor should be made clear right from the start.

In the Dragon’s Den there is only a short time for the entrepreneur to sell their business. This is the only time during the show in which they are fully able to control how well their product or service is presented, and in doing so create enough interest among the dragons to ensure a more favourable attitude towards them in the following question and answer session. It is vitally important to find all potential negatives in your product and introduce them into your pitch as positives, pre-empting the Dragons’ habit of finding problems and then smugly declaring they are ‘out’.

Make a business plan and stick to it

Let’s take the example of Leon Hamlet and Shakil Mussa and their water-free car washing business, Aquanought.

Their initial pitch seemed polished and they confidently put forward a basic plan for where they saw the company going in the future. Coupled with an effective demonstration, and a list of possible business targets that included some of the Dragons’ own business areas (hotels, casinos and leisure centres) they seemed to be off to a good start.

However, during their presentation did they actually mention the benefits of a water-free car wash for customers or for the environment? Not really - they spoke more about the benefits for expanding the business. And by focusing on the franchise side of the business too heavily, they managed to steer the Dragons’ attentions even further away from being able to see the wider business opportunities.

Instead of insisting that they would use the proposed investment of £150k to take the product back to the US market from where they originally purchased the licence, it would have made more sense to put forward a well researched plan for reaching first the UK market and then the European market before even considering the rest of the world.

An environmentally friendly, water-free product such as Aquanought would have different benefits for each region it was targeted at. For example in the UK, with our hose-pipe bans, floods, and sewerage problems leading to contamination of our seas and beaches, we would welcome a product that saves us water and at the same time is an easier way to wash our cars. Therefore focusing on setting up distribution channels for the product to reach consumers would likely be the most effective route.

Scandinavian countries, on the other hand, which have already been environmentally aware and active for some years, may be better suited to kick-starting the franchise model, enabling the overseas side of the business to flourish more quickly.

Care for the environment and for your profit margins

The Dragons have been known in the past for buying-in to environmentally friendly products, as long as they make economic and business sense, and perhaps this time they would have responded more positively to the idea if there had been a clearer and more realistic business plan.

One friend of the environment who did win investment in the Den was Max McMurdo and his company Reestore. However he did manage to polarise opinion among the Dragons, with three of them adamant that he didn’t have a financially viable business, and the other two seeing his achievements with more vision.

Max’s presentation may have had something to do with this difference in opinion, as he started out with the introduction of a few of his designer household products that, while innovative and easy on the eye, were no real basis for a profitable business.

If he intended that his furniture made from recycled materials should be the unique selling point for the Dragons, he couldn’t have been more wrong. In fact he wasted precious pitch time talking about these items when really he should have been selling the benefits of his only investment-friendly product, Ben the Bin.

As it was, he did a quick demonstration of how the bin worked, and what it was made from but any real benefits of the bin were lost as the Dragons tried to work out how the two sides of the business fitted together and whether it would make any money.

Had Max initially focused on a plan for how Ben the Bin would be making the company profitable, he might have got off on a better footing with the Dragons. He could also have mentioned in advance how, by using supermarket carrier bags in his design, he was simply making the best use of a common problem. Instead Peter Jones brought it up in a negative light, putting him on the back foot. Detailing his sales projections earlier on in the session could also have made a difference to the opinions of the Dragons. Some of them clearly couldn’t find big enough margins in his pricing to see a fast return on their investment.

Fortunately for Max, Deborah Meaden and Theo Paphitis saw gold in both Ben the Bin and in him, and agreed to split the investment equally for a total 30% of the business.

Simple ideas are often the best

Just occasionally in the Den, the Dragons will like a product enough to want to invest despite the possibility of a short shelf-life or copycat designs. Two different products hit the Den in this episode for which the Dragons had such enthusiasm, but only one was deemed to be worth the risk of an investment.

Tipsy Feet from Helen Jones and Sandra Hopkins drew initial enthusiasm but was rejected due to a limited scalability and the ease by which the product could be copied. The product itself – a pair of flat pumps concealed in a purse that turns into a bag for high heels - is actually quite useful and innovative and despite rejection by the Dragons, it could do well with a little time and effort put into the business.

However, Jamie Jenkinson’s product, the Cush ‘n Shade - a sunbathing device that provides a cushion for the head and a sun shade for the face - had not only a useful purpose but also a distribution network in place in the USA in the form of two large retail chains. This fact, presented in the pitch alongside the product benefits, certainly helped the Dragons warm to the business.

Sometimes it is the simplest products that have the most appeal in the Dragon’s Den, especially those that will generate healthy margins throughout the distribution chain. The Cush ‘n Shade is one of those products that a consumer doesn’t really need, but which they’d probably miss if they had one and then lost it! The product’s convenience and packaging make it ideal for all retail channels.

Jamie clearly stated all these selling points in his pitch, as well as the benefits of the product from a customer’s point of view, such as protection from sun damage to the skin without the need for lotions. In the face of such a presentation, three of the Dragons felt compelled to make him an offer.

With three equal offers on the table, and Peter Jones creating pressure by threatening to withdraw his offer, one can understand how Jamie didn’t feel able to press them for a better deal. Not many of the entrepreneurs on the show question the Dragons as to why they think they should be the investor, but this is the only real way to turn the tables in such a bargaining situation. If Jamie had asked each of the Dragons to put forward a case as to why they should be an investor, he could have created more competition between them.

Make the most of every opportunity – no matter the outcome

Overall, the atmosphere in the Den was more positive and jovial than the previous week, and this hopefully meant that all the entrepreneurs who pitched their businesses on the show took away something useful from the experience and some ideas about how to sell themselves more effectively in the future.

Ask anyone whose job involves making pitches for a living – whether they work in advertising or in door-to-door sales, they will all tell you the same thing. Selling is hard. And selling a product or business to a cold prospect in 3 minutes is harder still. However, if you lead your pitch with the product’s financial and physical benefits, you’ll be giving yourself the best possible headstart.

“They may forget what you said, but they will never forget how you made them feel” Carl W Buechner

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