Full Speed Ahead?

Are You Ready?

Before you seize the day, you must ask yourself two critical questions: Do you have the infrastructure, equipment, resources and personnel to handle a surge in business? And even if you have all those things, does that mean you should definitely put the pedal to the metal? The answer, again, is a resounding "maybe."

"Rapid change is an opportunity," says Joseph R. Mancuso, president of the Center for Entrepreneurial Management, a nonprofit organization in New York City that serves small-business owners. "But is the reward worth the expense? Nine times out of 10, the experts are right when they say you shouldn't do it. But that tenth time could make up for the other nine. You have to look at each crisis on a case-by-case basis."

Global Datalink Inc., an Internet service provider in Orlando, Florida, looked at the crisis that whacked AOL in December 1996 and decided it provided an opportunity the company couldn't pass up. AOL made national news when it began offering unlimited access to its subscribers--and made news again when the move caused such a jam on its phone lines and with its customer service representatives that many of the company's infuriated customers began fleeing to alternative firms like Global Datalink, which serves the central and east coast areas of Florida.

"That special circumstance allowed us to obtain a lot of customers from AOL," says Ramzi Nassar, 33, president of the 4-year-old company, which generated $3 million in sales last year. Nassar estimates he scooped up 500 disgruntled AOL customers in less than three weeks, which translates to about $100,000 per year in sales. He says his company--in effect a mom and pop shop on the information highway--was able to offer frustrated AOL subscribers faster online connections and easier access to customer service.

Perhaps more important for Global Datalink, however, was that Nassar had a customer-generation plan in place before the AOL log jam. While it's hard to predict the type of crisis that could drop thousands of customers in your lap, Nassar advises having an "expansibility plan" ready for any sudden increase in customers.

Nassar developed his plan during the company's first year in operation. Anticipating that the demand for Internet services would grow by leaps and bounds, he made sure he'd be able to acquire the necessary infrastructure when needed. That meant having a strong enough working relationship with the local phone company to allow him to quickly add more lines. Nassar was already in the process of adding 24 lines when the overload hit AOL. He just picked up the phone and ordered more.

"It wasn't a problem," Nassar says. "We had established a relationship with the phone company to add more lines anyway, so it was easy for them to give us what we needed when we needed it. It would've been a lot harder for us to pick up the extra customers if we hadn't had an upgrade schedule in place."

Another plus for Nassar was that he was able to capture the additional market share without spending much money on marketing. "Seventy percent of our new accounts come through word-of-mouth," he says. "We had very few marketing campaigns in place, so we didn't have to spend a whole lot of money trying to get the new business."

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This article was originally published in the April 1999 print edition of Entrepreneur with the headline: Full Speed Ahead?.

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