Business Concept 6: Target Market

In every business, you have to know who your customers are. If you don't, you have to make a profile of the customers you want, so you can customise your products and services to suit their needs. The clearer you are about your target market, the better you can cater for them. Take for example the tale of 2 coffee shops located side by side at a highway rest stop pictured below:

You can see that the coffee shop on the left has at least 5 tour vans parked outside and the coffee shop on the right is empty. Why is this so? Here's my interpretation of their business plans:

Lee Chong Cafe (left)

Target Customers: high volume, high revenue customers = tourists

Where to find them: Tour agencies, so need to visit their offices in town to make arrangement for them to send their tourists to dine here.

Decision maker's concerns: Quality of food, cleanliness, tour guides taking tourists elsewhere and making money on the sidelines

How to address their concerns: Create a set lunch comprising of local dishes complete with dessert (which equals to more sales revenue), use table cloth so tables can be cleaned quickly, create cashless payment vouchers and signed by coffee shop owner.

Jia Shing Cafe (Right)

Target Customers: nearby residents, anybody who stops by

Where to find them: Don't need to, just wait for them

Decision maker's concerns: cheap food

How to address their concerns: Create a cheap menu using the cheapest ingredients

Lee Chong Cafe is operating at a higher profit margin and higher volume compared to Jia Shing Cafe even though they are in the same type of business located next to each other. Thinking and planning that little bit extra can make such a big difference to your business.

Best Kueh Chap in Kuching

Kueh chap is another signature dish of Kuching, but less popular than the kolomee and laksa. One reason it is less mainstream is because of the ingredients used i.e. pig internal organs such as stomach, liver, ear, tongue, and intestines, which might not be everyone's cup of tea. Kueh chap is unique because of the large pieces of flat noodles cooked in a thick stewed soup. Other ingredients include hard boiled eggs and boiled chicken feet. You can customise what you put in you kueh chap and if you are not adventurous like I am, you can just tell the seller you don't want any "spare parts", which refer to internal organs, like the one pictured below:

Sometimes it's hard to find kueh chap when you want it and even harder to find a really really good one. My pick is the kueh chap stall at Poh Kwong Park. It's just a small stall located in a vacant open-spaced car park lot. One of Kuching's best kept secret, is hard to find because it is hidden behind the shoplots in Poh Kwong Park, a residential area. For location map, click here.

The stall doesn't have a name, so I refer to it as Poh Kwong Park (PKP) kueh chap. It is a very humble stall with a humble owner (pictured above). What makes this kueh chap better than any others out there is his kick-ass belachan chilli. I always pour the first serving of belachan chilli into my soup and ask for another for the meats. The belachan chilli is really in its own class: strong in taste, not overly spicy, and a perfect addition to the stewed soup. This gives the kueh chap in PKP a very unique taste.

(Mind you, kueh chap already has a very uniquely Sarawakian taste).

Opens after 6pm, PKP kueh chap serves dinner and supper till around 9pm. He rests on Saturday and it might be a bit tricky eating there when it rains.

Think and Grow Rich by Napoleon Hill (Part 1)

This is Part 1 of my book summary of Napoleon Hill's influential success classic, Think and Grow Rich.

Hill was able to personally meet the most powerful and successful people of the 20th century for over 25 years. Through his work, he was able to formulate a philosophy of achievement based on real stories of real people who had used those techniques to create their successes. In a nutshell, his book teaches how we can put ourselves into the same state of mind as those who have created great wealth.

Practice 1: Create a Burning Desire

Every person who wins in any undertaking must be willing to burn his ships and cut all sources of retreat. The example given was a great warrior burning his ships after landing in enemy territory where they were outnumbered, so failure was not an option for their men. Desiring riches with the correct state of mind that becomes an obsession , then planning definite ways and means to acquire riches, and backing those plans with persistence that doesn't recognise failure, will bring riches.

Wanting to be rich and having a burning desire to be rich are 2 different things. To bring yourself into the correct state of mind, you have to be able to see, feel and believe that you have already achieved that goal. This is the same psychological exercise that forms the basis of hypnosis and auto-suggestion

Practice 2: Maintain Unshakable Faith

Faith is a state of mind which can be created by conscious repeated instructions to the subconscious mind. Faith, or belief, is a thought that you can control i.e. you are able to control what thoughts to put in your mind. This is a very important concept because what you put in your own mind, will affect your subconscious mind, which will affect the decisions you make, which will affect the actions that you take, which will affect the results that you get. Having a strong self belief and clearly defining what you plan to achieve will plant the seeds of faith that will influence your conscious attitudes and actions.

This concept was also discussed in my earlier article, The Mindset.

To be Continued... Part 2

What I Learnt from a Self-Made Multi-Millionaire

I got the honour of spending 4 days with a self-made multi-millionaire from Taiwan. With over 95 countries under his distribution network, it is no surprise that he is one of the smartest businessmen I've ever met. What makes him stand out from the crowd is his knowledge in marketing. He is also a voluntary invited speaker to MBA courses in Taiwan universities. The following are some business concepts that I learnt from him during my brief encounter with him:

1) Find the right customers

There are some hotels that charge $100 a night and others that charge $1,000 a night. There is no point arguing which rate is reasonable because the value is determined by the guest. Guests that stay at the $100 hotel value a no-frills hotel, whereas guests at the $1,000 hotel value comfort, service, security, class, hygiene, etc. Instead of spending time, money and energy into converting one type of guest into another (sales skills involved), it is more efficient to use those resources into finding more guests of that same type (marketing skills involved).

Commentary: I wrote an article earlier explaining sales vs. marketing. As an analogy to the paragraph above, sales is like trying to convert a person from one religion to another, whereas marketing is finding a location where the people are free-thinkers and trying to convert them. Directing your resources into marketing, followed up by sales, will make your business more efficient.

2) Have a strategy - and maintain it

You have to acknowledge that you cannot satisfy everyone. If 80% of your current customers share the same characteristics, you must be aware that your current business strategy is catering to their needs. There will be criticisms coming from the remaining 20% and you will be tempted to change your strategy for them but bear in mind how it will affect the 80% majority. If you will lose customers from your majority to cater for the minority, then it is not worth doing. Keep doing what you are doing right.

3) Capturing the city

When asked why he picked Chile in South America as the first country when expanding overseas, he replied,

"The biggest market is the USA, but as in the art of war, you do not attack a main city head on because it is the most heavily fortified. To capture the main city, you first take on the weaker surrounding villages. After you have captured the surrounding villages, it is easier to take on the main city."

4) Show concern to your customers

Showing that you care for your customers will add value to your product, especially important for a product that is competing in the premium range. This is why his company's motto is "Care about your products, and show concern to your customers". The company encourages their distributors to find a low cost way to show customers you care even though there is no transaction, using the example of an optometrist cleaning your glasses for no charge even though you do not buy from them.

5) Have a strong competitive advantage

Being the only brand from Asia of his category in one of America's largest distributor is not an easy feat to achieve. These are his competitive advantages to stay ahead of the game:

• One stop shop - His brand has the biggest range of products so his customers do not need to look for other brands to find what they are looking for (example of doing thing better)
• Ahead of the game and continuous improvement - His products are always the trendsetter and continuously improved in quality because the company invests heavily into research and development (example of doing things faster and better)
• Great quality products at a reasonable price - Because of continuous improvement and strategically located, his products are cheaper (not cheapest) than comparative products in the same quality (example of doing things cheaper)
• Unrivalled marketing knowledge - With 30 years of experience and a wide global distribution channel, the company can provide advice and recommendations to new distributors on how to increase their sales volume (example of doing things better and faster)

6) Get a "lost leader"

This is a marketing concept which supermarkets use a lot. They advertise one product at 30% off to draw you to their shop with the idea that a shopper will end up buying more than just that 1 product on sale. When trying to widen his distribution network, the businessman made it a point to sell at least ONE product when the distributor has no interest in any of his products. Even having only 1 product on his shelf has a chance, however small it may be, for a re-order. If you leave empty handed, you get ZERO chance for future business. That 1 product on his shelf may open doors that might otherwise be impossible.

Best Tomato Mee in Kuching

The tomato mee is another signature dish of Kuching and Sarawak because it almost exclusively available only in Sarawak. I like to call it the local version of spaghetti bolognaise. The outstanding features of this dish is the fried crispy noodles and the tomato sauce gravy that is used to pour over the noodles. Newly opened in 2009, Cafe De Margherita serves the best tomato mee I've tasted so far. What makes it the best is the thick tomato sauce gravy. Many noodle sellers skimp on the tomato puree used to cook the sauce so it ends up tasting quite bland, but not the one at Cafe De Margherita though. You can literally see the chef taking a big scoop of tomato puree and cook it over such a fierce fire, that you would think they would go through a barrel of cooking gas every night. With that said, it is worth paying the above-market price of rm 5.The chef and staff never fail to greet me with a smile every time I dine there. Good food, friendly staff and a clean place to dine for dinner and supper. Cafe de Margherita is located on Green Hill Road, just opposite the more established Ah Ka Su Seafood Restaurant. For the location map, click here.

Check it out and leave a comment after you've tried it.