Never Underestimate Small Beginnings!
Most of us recognise the MICHELIN brand name. This French multinational tyre manufacturer of Clemont-Ferrand in the Auvergne - Rhone - Alpes Region of France is the second largest world-wide tire manufacturer. But maybe not many know how the company started and the relationship between their tire business and their Michelin Guide, the prestigious handbook of ratings of restaurants. It is an interesting story with lots of wisdom for businesspeople, especially young entrepreneurs, and CEOs.
Two brothers, André, and Edouard Michelin, founded the company in 1889 as a small tire manufacturer. It did not take a lot of business acumen to create a business opportunity between cars and tires. More cars meant more demand for tires and more demand for tires meant good business for the Michelins. The problem was there were only an estimated 3,000 cars in France at the time. So, the real question facing the brothers was how to promote cars?
The brothers decided to publish a free guide of service stations, mechanics, hotels, and restaurants that would invite people to explore France by car. They printed an initial 35,000 copies for distribution. People loved their Michelin Guide, not only for the valuable information, but also, for their ratings on restaurants. The Michelin Guide rated restaurants with 3 stars rating system: One star suggests a very good restaurant in its category. Two stars signifies an excellent restaurant worth a detour, and a three-star rating indicates an exceptional cuisine worth a special journey. Since its launch in 1900, Michelin has sold more than a whopping 30 million guides.
Today, The Michelin Group has annual revenues of Euro 28 billion and employs 130,000 in over 65 facilities in 18 countries. Michelin tires are used in bicycles, motorcycles, autos, aircrafts, and even space shuttles. In addition, it is estimated that Michelin sells over 250,000 guides annually. What a great success story.
Michelin is not an exception. Many other well known large corporations had modest beginnings: AMAZON, GOOGLE, APPLE, MICROSOFT, BIC, DISNEY, to name a few.
My punch line is to never underestimate small beginnings. While most will agree to this fact, how do you translate this insight into practical action when, in today’s world, corporations are driven by size? Business performance depends on large revenues from large clients. Short term focus is priority. I was faced with this challenge at one of the companies I had the privilege of leading. I took a sample of my few large clients and calculated their purchases over several years and BINGO… most had modest first purchases. They did not start large; they started with small purchases and then grew their volumes.
It's a simple message that can make a big difference for your sales and marketing team: If you do not welcome small clients, you will never see them when they are big clients. Welcoming small clients gives you the opportunity to help build such clients into larger ones.
On a side note, Toronto is now on Michelin’s starred map, along side such cities as Paris, New York, London, and Tokyo. On September 13, 2022, Michelin awarded stars to 13 restaurants across the city in its first foray into Canada. FYI, France has 630 restaurants listed and 29 with 3 stars! Canada may have a small share, but hopefully not for long… Just like Toronto’s modest debut, I say to you my reader…. Bon Appétit for small new clients.
(W570)