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The 'water broker' entrepreneur
Ever heard of a water broker? Lionel Pengilley takes us through his journey as a young entrepreneur in the niche yet vital industry of water broking.

Hi Lionel, can you tell us a bit about yourself?

I got into this industry by working for a competitor and realised that there is a better way to serve my customers and offer them a better deal. You need to have passion, specialised knowledge, good ability combined with doing things differently to do well.

 

What spurned you to take on these competitors?

The ability to set my own goals, do things differently and the opportunity to receive better financial gains. I wasn’t being paid much. I wanted a better lifestyle. At the same time I wanted to run my own business and give customers a better package.

 

How do you make your venture stand out?

I have a low commission and I keep my customers up to date with developments in the water market. There is a lot of useful information on my website and I stay up to date with water market news. For example, I have a price comparison tool which shows my competitors’ prices versus mine, which attracts a lot of attention. You need to offer something different to differentiate yourself from the competition.

I got most of my customers so far through cold calling. Finding who they are and their number is half the challenge, but if you do research, you can find customer lists. Conversion rates are low initially, but they will get better over time as I develop relationships with my customers and better understand their requirements. Cold calling has been the main reason for my success.

I had to work very hard on SEO to get my website ranking in Google. It's not the year 2000 any more and Google doesn't rank new websites quickly. SEO is something with few formal courses on the topic, you have to teach yourself. That said, there are great resources online which teach you how to make a user and search engine friendly website.

 

Did you have a sales background before becoming a water broker?

I am not a natural salesperson, which seems to be who most of my competitors are. To be honest in the past I thought salespeople were not the most reputable group. To outsiders it seems sales is more about personality than skill, whereas once you start being a salesperson you realise there is a lot of time and effort required to hone your sale skills further. When I entered this industry, I started to learn how to sell and improve my sales skills further. Sales is all about doing your research, knowing your customer’s problem, helping and explaining things clearly to them. You've got to know which battles to pick and who to call. Personality matters less than you might think.

 

What was the biggest challenge you faced?

Finding new customers. You spend far more of your time on sales, marketing and customer research than anything else.

You need to have passion, specialised knowledge, good ability combined with doing things differently to do well.

I got most of my customers so far through cold calling. Finding who they are and their number is half the challenge, but if you do research, you can find customer lists. Conversion rates are low initially, but they will get better over time as I develop relationships with my customers and better understand their requirements. Cold calling has been the main reason for my success.

What most people don’t realise about cold calling is that you rarely get rudeness from people, I've never really been sworn at. A lot of the time people don’t mind talking to me on the phone since they enjoy learning new things from someone with industry knowledge.

My customer base has been increasing but I am getting close to the point of diminishing returns since it is harder to reach the less obvious water licence owners. Getting that next set of customers is coming through other channels.

 

What is the Australia water market like compare to overseas market?

Australia’s Southern Murray-Darling Basin is the largest water market in the world and it is one of the pioneering markets. The only other country with developed markets is Chile.

In California a couple of years ago they had a drought but they didn’t have a water market. The irrigators who set up their farms first had the highest priority water rights. The ones with the high priority water were not necessarily those who were using water efficiently.

During the drought, water was going to the high priority users, but that didn't mean it was going to the best use. So water was being used for things like pasture, which can be partially replaced with trucked in hay, whereas almond plantings which took years to grow and were valuable, were left to die. All because the pasture growers couldn't sell their water to the almond growers.

To be honest in the past I thought salespeople were not the most reputable group. To outsiders it seems sales is more about personality than skill, whereas once you start being a salesperson you realise there is a lot of time and effort required to hone your sale skills further.

In Australia if we go through a drought, those who use water for thirsty commodities that aren't permanent plantings, such as cotton, can choose not to grow that year and sell their allocation water to those who have permanent plantings. The other benefit is that by setting a price on water, it encourages irrigators to adopt efficient irrigation techniques.

 

What is your plan for the future?

I would like to see our operations expand, there are good markets in Queensland and there are developing ones overseas. Personally, I want to be known as the expert on the water market. This is why I write a blog to get my name out there and help my business build a good reputation. To gain more knowledge I read a lot of online materials along with networking and reading about related topics, for example, agriculture and weather forecasting.

 

If you could go back in time what advice would you give yourself?

I would have started reaching out to customers earlier. You don't need to have a fully developed product to start selling.

 

For more details about water broking world.  please visit their website at https://www.wbw.net.au/