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Highlighting the best Kuching has to offer...
“Tell the world what you intend to do, but first show it”
Practice 6: Practise Organised Planning
Planning is the transition between ideas from the imagination into tangible products or services. Align yourself with people who can review and contribute to various aspects to your plans and if your first plan fails, try another till you succeed. Being one of the longest chapters in the book, I feel that this chapter in a way sways from it's main topic into discussing topics such as:
Continued from Part 2
To be continued... Part 4
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.
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
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:
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.
I would recommend to head to Pandan Beach first arriving at around 3pm, then head to Sematan Beach at around 5pm for a sunset dinner.
Sematan Beach location map (click here)
Pandan Beach location map (click here)
So even when a massage centre has zero customers, income derived from his own staff can offset some of the fixed charges he has to pay. The massage centre boss is basically creating an environment for the employees to work and make money, while charging "rental" as an income stream. Once again, the concept of helping others make money applies here.
If you put this in the context of a typical foodcourt, the masseurs are renting the place like renting a stall which requires them to pay a rental to the foodcourt owner. The foodcourt owner sells drinks and the volume of drinks he can sell is dependent on the quantity of customers who patronise the foodcourt. The quantity of customers is dependent on the pulling power of the stalls collectively. This foodcourt drinks business is like the royalty the boss earns from every massage service carried out by the masseurs. The boss has to ensure the quality of massage remains at a high standard to pull in crowds because this will not only increase the amount of money he receives from the royalties ("drinks" business), but also the chargable services ("rental" business) he earns from the masseurs. When masseurs can make money, they will recommend friends or family members to come work for the boss, which increases the income derived from his "rental" business. 1 action can grow 2 streams of income. You can consider it unethical or inhumane the way some of the bosses run their businesses, but as an income-generating business model, it is simply brilliant...
Pick your pasta, then pick your sauce, and have it cooked on the spot by the restaurant chef. I thought all bolognaise sauces were the same until I tried theirs which was surprisingly different...
Other than visiting the caves in Bau, going kayaking along the rainforest rivers is a very good way to soak up the Sarawak experience. The waters are calm so it soothes the mind when you want to get away from your hectic work lifestyle.
You get magnificent views along the river journey such as rock formations, untouched greenery and scenic landscapes. This activity takes almost a full day and it's well worth doing if you have a day to spare in Kuching. It is a safe activity for all because it is supervised by experienced guides and the waters are not rough and wild. You need to have the tour pre-planned with the company that runs it. For more information and contact details, visit the owner's blog at:
If you asked the accounts department to bill a customer based on his previous invoice, how can you make sure it is not billed based on a promotional price? When a mistake is made who do you blame - The person or the system? There is a difference and it is important for a business owner to understand the difference. The lazy, easy and common way is to give the accounts clerk a good scolding and hope that the mistake doesn't repeat itself. But what happens if the clerk is on leave and another person has to take over the job and makes that mistake?
The alternative to a good scolding, provide intensive training, multi-level checking, etc is to try to improve the system so that we close the loophole to prevent another repeat incident. How about creating a special code for all non standard items? This can be a form of a promotion invoice tag or promotion product code, so when the account clerk is about to price an item, promotional items are clearly marked. This will lead to less confusion, therefore less mistakes in the future.
Do you improve man to compensate for a weak system, or do you improve the system to compensate for the unpredictable man? I believe that humans are too variable and unpredictable to be depended on. Humans are emotional beings and performance can be affected by many outside influences. I also believe than systems should be set up to be run by people rather than people running the system. In order for a business owner to go on a long holiday and not worry about things going wrong while he is away, he will need to set up a foolproof business system. Remember: a self running business is the difference between a self-employed and a business owner as defined in the earlier article, "How to Make Money". If the business system is not foolproof to be run by employees, the owner can never take himself out of the business and his income will be proportionate to the time he puts in the business.
I do not need to elaborate on sales skills because it's quite self explanatory. Most companies only spend money to hire the best salesman that can push their products but think of the marketing team as an expense with no clear return on investment. Business works well when there are push and pull strategies akin to yin and yang. Sales is a push strategy and Marketing is a pull strategy. Understanding the difference will give you an edge in your business because once you start asking yourself "how do I create demand for my products / services" you will have a different viewpoint on the way business is conducted similar to the shoe salesman in the story above.
Let's make up a scenario for an example: You have a new brand of fishing rod to sell to the market. Most businesses would get a salesman to drive around town for all shops that sell fishing equipment and try to convince the boss of that business to try out your new product. This is a straightforward sales strategy (without marketing), and needless to say, you can imagine the results of this plan - Unpredictable, and basically praying for good results
How about this as a different approach: Before I even approach a fishing equipment retailer, I approach the local fishing association and ask if I can take up an advertisement in their monthly flyer / newsletter. I would prepare an advertisement complete with testimonials from satisfied users from overseas. Before they publish the advertisement, I would send out my salesmen to all fishing equipment retailers (where most would happen to be members of the fishing association) and tell them that I would insert their business in the advertisement as so interested buyers who see the advertisement could contact them to buy my product. Wouldn't you agree that this would make it easier for the salesman to push the product because you have in a way created demand on behalf of the retailer? This is an example of how an army general (marketing team) can create an advantage for the soldiers (salesmen) on the battlefield (market) just by applying marketing intelligence (push and pull strategies working together). This example also illustrates how thinking of helping others make money first, will help you make money down the line as discussed in my earlier article, Helping Others Make Money First.
Another gem I accidentally found at this restaurant is the Wrapped Ham with Mayonnaise Sauce. I came across it when eating the 4-dish appetiser during a function at this restaurant. It's not on the menu, so you will have to request it from the waitress captain.
Just as tasty as the Butter Prawns, and just as fattening, but sinfully good. This air-conditioned restaurant is a good place to have lunch and dinner
The 20/80 rule: Business schools teach this, applies in real life – The 20% of your top sellers contribute to 80% of your business revenue. This is the bread and butter of your business. Track your 20% top sellers on a monthly basis in terms of:
Your 20% top sellers are your ricebowl and do whatever you can to defend your territory. Ensure they maintain a competitive advantage (see earlier article here). The 20/80 rules also applies in business effieciency i.e. you should be spending 80% of your time and money in the top 20% to ensure the biggest return. Delegate the other 80% to others for maximum effectiveness.
If your competitor launches an attack on your ricebowl a.k.a your 20% top sellers, take urgent action, but be rational about it. For example if they offer a competing product at a discount for a limited period and the market has already been saturated, don't jump in and st on the same item asart a price war when not many left will be buying. Think rationally and take alternative steps such as launching a discount on a diffferent product that happen's to be the competitors' ricebowl.
Inventory Forecast– This is a very simple concept I never eveb thought of until the sales manager showed me. To decide on which products to push for inventory clearance, do the following:
Now you have a list of items you need to find ways to clear ranked by urgency. An example of this would be a product that has sold 3 units in the past 6 months.
3 units / 6 months = 0.5 units per month
If we have 5 units left in stock, it would take us:
5 units / 0.5 = 10 months to clear
Simple math, simple concept, almost common sense, but seeing 5 units left in your store room does not give you the same urgency as knowing it will sit there for 10 months before it's sold out. It's just a different, but very useful way of looking at things. This method of inventory management also helps you plan sales and financials as you know that you would not need to place an order for this item for, say, another 8 months.