There are sayings that to succeed you just need to show up. While another saying, ask and you shall receive. In my experience, not only you need to show up but to ask as well. When I say ask, it means asking tactfully.
Lately we have been working on a couple of prospects. The discussion to secure a deal is still on going, but the very least we are given the opportunity to be heard. I do not know these prospects personally nor we were introduced. It just so happens that we got acquainted through a charity event and exchange name cards. These prospects are all well established players in the market while I am still a new kid on the block with limited clientele and cash.
Instead of hard selling my services, I asked about their business, plans and frustrations. I offered some of my thoughts and even promised to introduce somebody that I might know whom might be able to help them. After we have established the relationship, did I immediately sell my services? No. I did not. I offered to catch up over a cup of coffee to discuss the matter further and wanting to know more about they do.
This sets up the opportunity for a second meeting. I would use that time to check out and understand more about this prospects. It can be their business nature or read up about things that they enjoy. If the person is a football fan, I would read up about it. Some of you readers may think this not sincere at all. You are wrong, I am sincere. I genuinely wanted to establish a relationship with this person. The only way is to have a common ground. Not all prospects can become business opportunity, the bright side is that you make a new friend.
In our second meeting, we would have more things to discuss and talk over. Will I spring up the question about my business offerings? The answer is depends. If I notice that there is nothing that we can offer. I will keep my mouth shut about my services. Occasionally I would say something about my company but never in detail unless the person ask. If there is an opportunity, I would offer my company's service but it is never in detail. If the person is keen, I would ask for a formal discussion. Of course, this sets up another meeting which is a formal meeting. Even if there is no opportunity, it is no harm to catch up again.
That's why showing up to meet the person is not only important but knowing how to ask tactfully is vital too. Many would think that "to ask" is means to ask for the business. It is not true, to ask is to understand your prospects and offer a solution to their problems. Is this time consuming? Yes, it is time consuming but we are here to establish a long term relationship. In many business dealings, it is all started from human interactions and relationship.
Showing posts with label business. Show all posts
Showing posts with label business. Show all posts
Tuesday, March 18, 2014
Wednesday, January 1, 2014
Change of Direction
The year of 2013 has ended and a new year has started. This year our business performance is actually way better than the year before. However, the profit margin is rather low.
The board of directors had few meetings and dig deeper into our business performance. We realized that our core strength in our business is actually inventory management and sourcing. No doubt we understand the hospitality business well but we are not getting right customers nor the margin to sustain the company.
We review back our past year projects. Our customers were most impressed by how we set up their restaurant's inventory management system. They are able to track their stock levels and know when to replenish the inventory. As such, one of the directors asked whether the same concept be used in other industries? The answer is actually yes. Maybe some changes but the basic ideas are there.
The existing team is small and we cannot afford hiring employees. As such, the amount of projects that we commit is very little. Managing building/ renovation projects involves long hours. The hours could have been spend on other activities that can generate revenue for the business. This was also one of the main factor that drives our decision to change the business model.
To further push the business ahead we need to generate revenue for the company with the minimal cost but the maximum benefits. Sadly, our 1.5 years old company has not found a constant stream of revenue that will cover the company's annual operation cost. As such, our new trading model will work for us.
Customer has already expressed interests for our products and we were also able to find a reliable supplier. The next phase is to built in the process and get the necessary paper work done to import our goods.
The board of directors had few meetings and dig deeper into our business performance. We realized that our core strength in our business is actually inventory management and sourcing. No doubt we understand the hospitality business well but we are not getting right customers nor the margin to sustain the company.
We review back our past year projects. Our customers were most impressed by how we set up their restaurant's inventory management system. They are able to track their stock levels and know when to replenish the inventory. As such, one of the directors asked whether the same concept be used in other industries? The answer is actually yes. Maybe some changes but the basic ideas are there.
The existing team is small and we cannot afford hiring employees. As such, the amount of projects that we commit is very little. Managing building/ renovation projects involves long hours. The hours could have been spend on other activities that can generate revenue for the business. This was also one of the main factor that drives our decision to change the business model.
To further push the business ahead we need to generate revenue for the company with the minimal cost but the maximum benefits. Sadly, our 1.5 years old company has not found a constant stream of revenue that will cover the company's annual operation cost. As such, our new trading model will work for us.
Customer has already expressed interests for our products and we were also able to find a reliable supplier. The next phase is to built in the process and get the necessary paper work done to import our goods.
Tuesday, November 5, 2013
Do You Know Your Business Partner?
Before you answer the question, re-read the title of the blog again. Your quality of your business is only as good as your supplier. I have already mentioned this in my previous writeup.The quality of your business partner is also important. Some readers might roll their eyes and say this is a no brainer. Yes! It is a no brainer, but the risk of business partner messing up is very real.
Few days ago, I got a call from client whom we worked on a restaurant project. The client asked me to help him to secure a supply of cooking gas for his restaurant. In Malaysia, cooking gas comes in giant canisters. It seems that he could not count on his chef to have the cooking gas delivered to the restaurant! This client was traveling as such he was not able to monitor the delivery.
What I did was straight forward, I called the chef making sure he is in the restaurant to take the delivery, call the supplier to arrange the delivery. I do not make any money out from this incident but there are some lessons can be learned.
The client should have been able to make delivery arrangements with the supplier before he travels. Cooking gas is the lifeline for any restaurant. It is also the single point of failure to the business should the restaurant runs out of cooking gas. Incident such as this is good for my business to built up the relationship with the client and supplier, but it is not healthy for the client when the business lifeline is out of their control.
I find it hard to accept the fact that chef is not capable in reaching out to the supplier. As a chef he should have ultimate control over the kitchen. The chef's conviction towards the restaurant is now being questioned. There is just no excuse for the chef on not following up on important issues such as ensuring the supplier of cooking gas. With a business partner who is not motivated, other business partner has to work harder to fill the deficit. In the long run, the business partnership will ultimately tear itself apart.
Starting a business and sharing the same dream is very easy. The willingness is to wake up from the dream and make things into reality is difficult. Choose your business partners carefully. If it not working out, shut it down.
Few days ago, I got a call from client whom we worked on a restaurant project. The client asked me to help him to secure a supply of cooking gas for his restaurant. In Malaysia, cooking gas comes in giant canisters. It seems that he could not count on his chef to have the cooking gas delivered to the restaurant! This client was traveling as such he was not able to monitor the delivery.
What I did was straight forward, I called the chef making sure he is in the restaurant to take the delivery, call the supplier to arrange the delivery. I do not make any money out from this incident but there are some lessons can be learned.
The client should have been able to make delivery arrangements with the supplier before he travels. Cooking gas is the lifeline for any restaurant. It is also the single point of failure to the business should the restaurant runs out of cooking gas. Incident such as this is good for my business to built up the relationship with the client and supplier, but it is not healthy for the client when the business lifeline is out of their control.
I find it hard to accept the fact that chef is not capable in reaching out to the supplier. As a chef he should have ultimate control over the kitchen. The chef's conviction towards the restaurant is now being questioned. There is just no excuse for the chef on not following up on important issues such as ensuring the supplier of cooking gas. With a business partner who is not motivated, other business partner has to work harder to fill the deficit. In the long run, the business partnership will ultimately tear itself apart.
Starting a business and sharing the same dream is very easy. The willingness is to wake up from the dream and make things into reality is difficult. Choose your business partners carefully. If it not working out, shut it down.
Monday, October 28, 2013
Tile Size and Slipperiness
For those who are observant, they would notice that the tile size used in the bathroom are normally much smaller than the other parts of the house. Besides the surface of the tile, the size of the tile also affects the slipperiness of the surface. Smaller the tiles, the more tiles are required to lay in an area. This increases the number of line gaps within the area. The more lines the more friction it can provide for the feet or shoes. As such, the surface become less slippery. Do note that you would still need rough surface tiles for wet areas.
Sunday, October 13, 2013
All about Tiles
Recently, we have been working on a house project. The dimension of the house is around 4000 square feet. The owner wanted both floor tiles and wall tiles for the property. Wall tiles are only limited to both bathroom and wet kitchen.
During the exploration phase of the project, we learned that the owner is very cost sensitive and insisted on homogeneous tile. What homogeneous tile means the outer layer of the tile is the same color as the inside of the tile. When you chip a homogeneous tile, the damage should not be too obvious. Another term for homogeneous tile is called full bodied tile.
With the current tile making technology, for a normal housing project the decision whether to use a homogeneous tile should not be a main consideration anymore. In the olden days, the tiles used are what we called ceramic tiles. These tiles are easily chip and damaged, thus leaving an ugly uneven color on the tile surface. Thus, many would choose homogeneous tile to avoid such an eye sore. Modern ceramic tiles are a lot tougher and should withstand a lot more knocking before chipping. Any tiles would survive a simple furniture move and day to day living. The choice of homogeneous tile is limited and significantly more expensive. The color of such tile is only limited to light or earth color. Dark surface tiles are only colored on the surface.
Another type of tile that has gain popularity is the porcelain tile. Porcelain tile has a higher density than ceramic tile. It is a lot tougher and able to absorb a lot more knocking than ceramic tiles. In fact, a lot of modern buildings that has heavy foot traffic are using porcelain tiles. Depending on the usage, this type of tile comes in different surface. Rough surface for wet areas to prevent slip. While polish smooth surface for the living room. The price of tiles between surface of the same series is also different. Therefore, any buyers should check with the supplier carefully.
The recommended gap between floor tiles is 3mm. Leaving a good gap between tiles is to prevent it from popping up. Tiles are sensitive to temperature changes. When is cold, the tile shrinks. When is hot, the tile expands. As the tile expands and the gap is too narrow, the tile has no where to go but pops up. While laying tiles, the workers would use separaters of certain size to determine the gap between tiles.
This is what I have learned working from tiles. I am sure there are a lot more that I need to learn. In my next write up, I will talk about managing cost of tiles.
During the exploration phase of the project, we learned that the owner is very cost sensitive and insisted on homogeneous tile. What homogeneous tile means the outer layer of the tile is the same color as the inside of the tile. When you chip a homogeneous tile, the damage should not be too obvious. Another term for homogeneous tile is called full bodied tile.
With the current tile making technology, for a normal housing project the decision whether to use a homogeneous tile should not be a main consideration anymore. In the olden days, the tiles used are what we called ceramic tiles. These tiles are easily chip and damaged, thus leaving an ugly uneven color on the tile surface. Thus, many would choose homogeneous tile to avoid such an eye sore. Modern ceramic tiles are a lot tougher and should withstand a lot more knocking before chipping. Any tiles would survive a simple furniture move and day to day living. The choice of homogeneous tile is limited and significantly more expensive. The color of such tile is only limited to light or earth color. Dark surface tiles are only colored on the surface.
Another type of tile that has gain popularity is the porcelain tile. Porcelain tile has a higher density than ceramic tile. It is a lot tougher and able to absorb a lot more knocking than ceramic tiles. In fact, a lot of modern buildings that has heavy foot traffic are using porcelain tiles. Depending on the usage, this type of tile comes in different surface. Rough surface for wet areas to prevent slip. While polish smooth surface for the living room. The price of tiles between surface of the same series is also different. Therefore, any buyers should check with the supplier carefully.
The recommended gap between floor tiles is 3mm. Leaving a good gap between tiles is to prevent it from popping up. Tiles are sensitive to temperature changes. When is cold, the tile shrinks. When is hot, the tile expands. As the tile expands and the gap is too narrow, the tile has no where to go but pops up. While laying tiles, the workers would use separaters of certain size to determine the gap between tiles.
This is what I have learned working from tiles. I am sure there are a lot more that I need to learn. In my next write up, I will talk about managing cost of tiles.
Friday, September 13, 2013
Watch Your Suppliers
Recently, my business suffered from a string of complains with one of our cabinets. Through a series of investigation and conversation, we learned that the complains tend to focus on the same company that supplies the cabinet.
We selected this supplier was based upon its willingness to experiment and learn. Our investigation shows that they are only able to do small scale project. As the project scope increases, their resources are stretched to the point where they are not able to maintain consistency with the product qualities.
Being the contractor, we could have taken the easy way out by cutting off this supplier. Rather we have decided to continue working with this supplier with smaller scale project and probably other products. Before taking any drastic actions, we have to ask ourselves why we pick this supplier from the first place. If the supplier are able to hold on to the value where we first selected them, we believe in second chance. Moreover, we all make mistakes. If both of us can learn from it, it only strengthen our working relationship and improve we can offer to our customers.
To many, they may not agree to what we are doing now. Especially in a business environment where perceived to be no loyalties and honor. As for now, we are not willing to cut him lose, unless not yet.
We want to:
The quality of work/ services that you can provide to your customer has a direct correlation with the supplier's quality. Therefore, hang on to your suppliers and treat them with care.
We selected this supplier was based upon its willingness to experiment and learn. Our investigation shows that they are only able to do small scale project. As the project scope increases, their resources are stretched to the point where they are not able to maintain consistency with the product qualities.
Being the contractor, we could have taken the easy way out by cutting off this supplier. Rather we have decided to continue working with this supplier with smaller scale project and probably other products. Before taking any drastic actions, we have to ask ourselves why we pick this supplier from the first place. If the supplier are able to hold on to the value where we first selected them, we believe in second chance. Moreover, we all make mistakes. If both of us can learn from it, it only strengthen our working relationship and improve we can offer to our customers.
To many, they may not agree to what we are doing now. Especially in a business environment where perceived to be no loyalties and honor. As for now, we are not willing to cut him lose, unless not yet.
We want to:
- Grow together with the supplier. Come up with the best product that we can offer, at the most reasonable price.
- Leverage from the supplier's expertise and network.
- Built a portfolio of good suppliers where we are able to quickly gather resources and take action should any good opportunity arises.
The quality of work/ services that you can provide to your customer has a direct correlation with the supplier's quality. Therefore, hang on to your suppliers and treat them with care.
Sunday, August 18, 2013
Entrepreneurship is Enterpreneurshit.
I started this blog is to keep track and share my experience in starting up my company. The journey has not been easy. The blog entry below by Mark Suster says it all well. It is an old entry but says it well.
Yes. Entrepreneurship is Enterpreneurshit.
Yes. Entrepreneurship is Enterpreneurshit.
Monday, August 12, 2013
A Failed Cafe and Cost Management
Over the weekend, I received a sad news. A cousin of mine who opened a cafe in December 2012 has decided to close down the business. He said the business is running out of cash and it is not doing that well. Since Mark Suster talks about failure, I too would like to chip in my 2 cents worth of opinion about it.
I visited cousin's cafe two weeks after its grand opening. My first visit was on a Saturday night and I was surprised to see the place was barely 20% occupied. I followed up with a few more visits and the situation remains the same. The location of the cafe is all right. It has ample of parking but in a location where I will not call it as popular. At night, there are hardly any traffic around the area. There is a famous food joint opposite the cafe. The location is really not that dead. Nonetheless, I still feel the place has the potential.
The operation hours is from 7 am until 3 am daily. Cousin was very tight lip about the operation cost. The following calculation are based on my observation. Each shift, he has around seven staffs and approximately five kitchen staffs. Assuming that he has two shifts with the same number of staffs. Each staffs draw approximately 800 MYR (246 USD) a month, he would need a net profit of 19,200 MYR a month to pay his employees!
The above is only the cost of his employees. The size of the menu is also rather large, especially for a new cafe. The cafe offer close to a hundred types of drinks and dishes. I can imagine the amount of money has gone into food wastage. As I write this blog, I wonder how many dishes that are ordered less than 10 times.
In all honestly, the cafe has a lot of potential. I learned that its lunch business was doing fine. They could have reduce the operation hours and focus on lunch services. No doubt they could be forgoing business opportunities in the evening and night. The very least they can slash their employee and food cost by half. Probably they might be able to keep their head above water for another few more months.
Next is to rework the menu. The menu size can be cut down by half. Focus on the 20/80 rule. Chances are they will have 20% of their menu is taking up 80% of their orders. The business should then focus on that 20% and make it better.
Finally, it is to promote the business. I believe the business owners did some promotion. I shall refrain from commenting as I do not know what they have done. For myself, I would encourage my patrons to check into Foursquare or Facebook. Any form of check in, the customers will get 10% from the bills. In addition, I would partner with any car clubs to visit the cafe. There are ample of parking space around the business, car clubs members will not have any issues finding parking. For car club members, I too would throw in 10% off on drinks. As you can see, I try to refrain from going into expensive advertisement blitz. I am certain advertisement would work, rather I would choose to exhaust all my lost cost options before bringing out the big guns.
I do not know whether my strategy would work, but that's how I wold manage the cafe business. In any business, managing cost and cash flow is important. If the owner let any of it gets out of control, chances of failure increases exponentially. Still I hope cousin and his business partners can learn from this incident. A business can fail, but this does not mean they are a failure.
I visited cousin's cafe two weeks after its grand opening. My first visit was on a Saturday night and I was surprised to see the place was barely 20% occupied. I followed up with a few more visits and the situation remains the same. The location of the cafe is all right. It has ample of parking but in a location where I will not call it as popular. At night, there are hardly any traffic around the area. There is a famous food joint opposite the cafe. The location is really not that dead. Nonetheless, I still feel the place has the potential.
The operation hours is from 7 am until 3 am daily. Cousin was very tight lip about the operation cost. The following calculation are based on my observation. Each shift, he has around seven staffs and approximately five kitchen staffs. Assuming that he has two shifts with the same number of staffs. Each staffs draw approximately 800 MYR (246 USD) a month, he would need a net profit of 19,200 MYR a month to pay his employees!
The above is only the cost of his employees. The size of the menu is also rather large, especially for a new cafe. The cafe offer close to a hundred types of drinks and dishes. I can imagine the amount of money has gone into food wastage. As I write this blog, I wonder how many dishes that are ordered less than 10 times.
In all honestly, the cafe has a lot of potential. I learned that its lunch business was doing fine. They could have reduce the operation hours and focus on lunch services. No doubt they could be forgoing business opportunities in the evening and night. The very least they can slash their employee and food cost by half. Probably they might be able to keep their head above water for another few more months.
Next is to rework the menu. The menu size can be cut down by half. Focus on the 20/80 rule. Chances are they will have 20% of their menu is taking up 80% of their orders. The business should then focus on that 20% and make it better.
Finally, it is to promote the business. I believe the business owners did some promotion. I shall refrain from commenting as I do not know what they have done. For myself, I would encourage my patrons to check into Foursquare or Facebook. Any form of check in, the customers will get 10% from the bills. In addition, I would partner with any car clubs to visit the cafe. There are ample of parking space around the business, car clubs members will not have any issues finding parking. For car club members, I too would throw in 10% off on drinks. As you can see, I try to refrain from going into expensive advertisement blitz. I am certain advertisement would work, rather I would choose to exhaust all my lost cost options before bringing out the big guns.
I do not know whether my strategy would work, but that's how I wold manage the cafe business. In any business, managing cost and cash flow is important. If the owner let any of it gets out of control, chances of failure increases exponentially. Still I hope cousin and his business partners can learn from this incident. A business can fail, but this does not mean they are a failure.
Monday, December 24, 2012
Planning, Adjusting and Mistakes
Last Saturday I visited a cousin's newly opened cafe. It was one week old. He told me that he is not getting the crowd or the desired revenue. Curious, so I decided to pay him a visit.
I asked for the shop's actual address. He said he is not sure and asked me to check out the Facebook page. Instead of registering as a local business, the cafe was registered as an individual. The address was not even there, good news was there is a location map. Maybe a map would be clearer? Wrong! The map contains two marks, one mark for his house, the other for his shop. I have to guess which was which. The page only has a picture of the cafe and did not show what was offered on the menu.
It is obvious that him and the partners did a poor job in planning. In any business, the first impression matters a lot. Even though the cafe is only one week old, I wonder how many customers had turned away.
At the cafe, I wanted to know the cafe's maximum capacity. He was not sure either. In any food retail outlet, the owner has to know how much each customer must spent and how many turnarounds per table in order to make a profit. On average, there should be at least three turnarounds in one business session.
As I spend more time with him, the more issues I noticed. Besides just poor planning, he has thrown himself into the deep end by dealing with customers and adjusting the operation issues. It would have been better to if he had a dry run with family and friends instead of enraging the wrath of the customers. In my opinion, he has 7 more weeks to get his act right. All the issues and mistakes are costing the business money. The business would have run out of money if the mistakes still remains.
I am a strong believer in making mistakes and taking risk. However, going into anything without proper planning is pure suicide. Thus far, he has adjusted his Facebook page. Hopefully he can sort out his operation kinks soon.
I asked for the shop's actual address. He said he is not sure and asked me to check out the Facebook page. Instead of registering as a local business, the cafe was registered as an individual. The address was not even there, good news was there is a location map. Maybe a map would be clearer? Wrong! The map contains two marks, one mark for his house, the other for his shop. I have to guess which was which. The page only has a picture of the cafe and did not show what was offered on the menu.
It is obvious that him and the partners did a poor job in planning. In any business, the first impression matters a lot. Even though the cafe is only one week old, I wonder how many customers had turned away.
At the cafe, I wanted to know the cafe's maximum capacity. He was not sure either. In any food retail outlet, the owner has to know how much each customer must spent and how many turnarounds per table in order to make a profit. On average, there should be at least three turnarounds in one business session.
As I spend more time with him, the more issues I noticed. Besides just poor planning, he has thrown himself into the deep end by dealing with customers and adjusting the operation issues. It would have been better to if he had a dry run with family and friends instead of enraging the wrath of the customers. In my opinion, he has 7 more weeks to get his act right. All the issues and mistakes are costing the business money. The business would have run out of money if the mistakes still remains.
I am a strong believer in making mistakes and taking risk. However, going into anything without proper planning is pure suicide. Thus far, he has adjusted his Facebook page. Hopefully he can sort out his operation kinks soon.
Monday, December 10, 2012
A Thought About Employee Empowerment
Over the weekend, I took my family to visit a newly opened theme park. One of the rides that we were waiting had a problem and has to be shut down. At that point of time, we have already waited for at least 40 minutes in the line.
I started to notice problems when other park visitors are walking against the line leaving the ride area. The family have to hear the news about the breakdown of the ride through other park visitors. At that time, no announcement was made nor any park attendants were to be seen. By the time, an announcement was made. The announcement was made over the blaring Christmas music where I can hardly make out what was being said.
At the moment of that crisis, the theme park does not have any leadership at the local level to take charge of the situation. In any business and organization, empowering employee to take charge in an usual situation is very important. Imagine, if the situation is not a breakdown but a small fire. It would have caused a stampede. In a production line, if there is any problem employees are expected to resolve the problem while making reports or suggestions to the local leadership.
The management should be able to nurture employees to show initiative and willing to take charge. One of the main root cause of the unwillingness is the fear of failure and getting into trouble. Problems are not like wine, it does not get any better through time. Employees are expected to take charge and solve the problem as soon as possible. Whether the initiative is success or not, employees should be given the credit for trying.
As organizations are getting flatter and less hierarchy. It is important for employees to have a sense of belonging and understand the amount of influence they have towards the company. Gone are the days of lets wait for instruction. If it is the right thing to do, employee should go ahead and do it.
I started to notice problems when other park visitors are walking against the line leaving the ride area. The family have to hear the news about the breakdown of the ride through other park visitors. At that time, no announcement was made nor any park attendants were to be seen. By the time, an announcement was made. The announcement was made over the blaring Christmas music where I can hardly make out what was being said.
At the moment of that crisis, the theme park does not have any leadership at the local level to take charge of the situation. In any business and organization, empowering employee to take charge in an usual situation is very important. Imagine, if the situation is not a breakdown but a small fire. It would have caused a stampede. In a production line, if there is any problem employees are expected to resolve the problem while making reports or suggestions to the local leadership.
The management should be able to nurture employees to show initiative and willing to take charge. One of the main root cause of the unwillingness is the fear of failure and getting into trouble. Problems are not like wine, it does not get any better through time. Employees are expected to take charge and solve the problem as soon as possible. Whether the initiative is success or not, employees should be given the credit for trying.
As organizations are getting flatter and less hierarchy. It is important for employees to have a sense of belonging and understand the amount of influence they have towards the company. Gone are the days of lets wait for instruction. If it is the right thing to do, employee should go ahead and do it.
Sunday, December 2, 2012
A Thought: American Airline's CEO THomas W Horton
Recently I came across a Time magazine article titled as The Worst Job in America. It is a three pages article on how Tom Horton the current CEO of American Airlines trying to save the company.
If you think you got a difficult job, Horton has it worst. This airline has lost 10 billion dollars in the last 10 years and filed for Chapter 11 bankruptcy in November of 2011.
I don't really know whether Horton would actually succeed in breathing life into the company. Nonetheless, I admire his resilience towards in making the company successful again. No doubt he would be going to bed thinking about his organization's problem; waking up each morning muster enough courage to get back to work. He will not be doing all these unless he knows he is going to be successful.
Nobody wants to bet on a losing horse. Yet, I was truly inspired by his actions. He chooses to take the difficult path. Many times, I would complain both about my job and my business. Nothing that I faced is as complex and uncertain as American's problem. Horton action has breath a new life into my perspective towards surroundings. Things are just not as dire as I have thought so.
I know only Thomas W. Horton through a magazine article. It is actually enough for me wanting to work or spent time with this individual. He may not have succeeded in turning around the company yet, but I hope many of those who are struggling can learn something from him. I for sure I know I did.
If you think you got a difficult job, Horton has it worst. This airline has lost 10 billion dollars in the last 10 years and filed for Chapter 11 bankruptcy in November of 2011.
American hasn't hire a flight attendant in 12 years. It has too many of them because too few of them worked a full schedule. yet all claimed full benefit..Many CEOs would have resigned and leaved for greener pastures. Not Horton who joined the company in 1985. He wants to tough it out and bring the airline soaring back into the skies again.
I don't really know whether Horton would actually succeed in breathing life into the company. Nonetheless, I admire his resilience towards in making the company successful again. No doubt he would be going to bed thinking about his organization's problem; waking up each morning muster enough courage to get back to work. He will not be doing all these unless he knows he is going to be successful.
Nobody wants to bet on a losing horse. Yet, I was truly inspired by his actions. He chooses to take the difficult path. Many times, I would complain both about my job and my business. Nothing that I faced is as complex and uncertain as American's problem. Horton action has breath a new life into my perspective towards surroundings. Things are just not as dire as I have thought so.
I know only Thomas W. Horton through a magazine article. It is actually enough for me wanting to work or spent time with this individual. He may not have succeeded in turning around the company yet, but I hope many of those who are struggling can learn something from him. I for sure I know I did.
Monday, November 26, 2012
Make Your Fans Feel Special
On the 21st November 2012, TGIF Malaysia celebrated its 50th anniversary. All the restaurant chain that falls under the company umbrella are offering 50% discount off the menu price.
The beauty stroke about this promotion was that it was only advertized on their facebook fan page and their corporate site. In fact, restaurants did not even put up any form of banner or printed materials regarding the promotion. Some might think that why not promote the occasion through main stream media? This no doubt would attract more customers.
What the company did was that they have made the fans who followed TGIF feel special and exclusive. This only cements customer loyalty and attracts more followers so that they will not miss out for any future events. Furthermore, good deals such as this one would no doubt travel far through word and mouth.
I visited TGIF at 6pm and I was told that I have to wait for 10 minutes for a table. Yes! The night was that busy. By 7 pm, the waiting line has swelled to at least 30 people. I dare to say, that night was a roaring success for TGIF with minimal marketing expenditure.
The beauty stroke about this promotion was that it was only advertized on their facebook fan page and their corporate site. In fact, restaurants did not even put up any form of banner or printed materials regarding the promotion. Some might think that why not promote the occasion through main stream media? This no doubt would attract more customers.
What the company did was that they have made the fans who followed TGIF feel special and exclusive. This only cements customer loyalty and attracts more followers so that they will not miss out for any future events. Furthermore, good deals such as this one would no doubt travel far through word and mouth.
I visited TGIF at 6pm and I was told that I have to wait for 10 minutes for a table. Yes! The night was that busy. By 7 pm, the waiting line has swelled to at least 30 people. I dare to say, that night was a roaring success for TGIF with minimal marketing expenditure.
Thursday, October 25, 2012
Lance Armstrong: A Lesson
On 22nd October, Lance Armstrong has been stripped for his seven Tour de France titles and banned from the sport for life. I personally find his story inspiring especially his fight against cancer. With his doping scandal, will it change my opinion towards him? Probably not. As I will always see him as a cancer fighter.
I personally condone his action in doping. However, is he solely to be blamed for his action? I do not think so. We now live in an environment of hero worship. We all look up to someone who is an underdog and beat all odds to achieve fame and glory. We always look for someone can win and inspire us. In the current world of sports, achievements means a lot of money and rewards. As such, the temptation to cheat is as great as ever. Some may not necessary cheat but interpret the rules to their favor.
The same applies to the world of business. The reward of a successful product or increase sales is always an initiative to take short cuts or illegal activities. In business, these stakes are a lot higher. A good example is the melamine tainted baby food in China.
Whether as a sportsperson, a businessperson or an employee, possessing the quality of integrity is most important. Lance Armstrong may have gotten away for many years before he got caught for doping, now he faces a lifetime of shame. Many of us may feel that life is un-fair especially on people who got away cheating or doing things that is outright illegal. The temptation to get even is always strong. I feel that too.
To me, the way that I keep myself in check is by asking myself the following question.
"Whatever that I am going to do now, will I have the courage to explain it to my kids?"
If I answer "yes", I know that what I am doing is right. If I answer "no", chances are it is something that is not correct.
There could be other ways, but I want my kids to grow up right. I may not be able to predict the future but I know that living with integrity is timeless quality. My kids will always be my moral compass.
I personally condone his action in doping. However, is he solely to be blamed for his action? I do not think so. We now live in an environment of hero worship. We all look up to someone who is an underdog and beat all odds to achieve fame and glory. We always look for someone can win and inspire us. In the current world of sports, achievements means a lot of money and rewards. As such, the temptation to cheat is as great as ever. Some may not necessary cheat but interpret the rules to their favor.
The same applies to the world of business. The reward of a successful product or increase sales is always an initiative to take short cuts or illegal activities. In business, these stakes are a lot higher. A good example is the melamine tainted baby food in China.
Whether as a sportsperson, a businessperson or an employee, possessing the quality of integrity is most important. Lance Armstrong may have gotten away for many years before he got caught for doping, now he faces a lifetime of shame. Many of us may feel that life is un-fair especially on people who got away cheating or doing things that is outright illegal. The temptation to get even is always strong. I feel that too.
To me, the way that I keep myself in check is by asking myself the following question.
"Whatever that I am going to do now, will I have the courage to explain it to my kids?"
If I answer "yes", I know that what I am doing is right. If I answer "no", chances are it is something that is not correct.
There could be other ways, but I want my kids to grow up right. I may not be able to predict the future but I know that living with integrity is timeless quality. My kids will always be my moral compass.
Saturday, October 13, 2012
The 23 million USD Hotel Deal
Last week, someone told me a deal where someone is selling his three stars hotel for 72 million Malaysian Ringgit (Approximately 23 million US dollars). The hotel is located in downtown prime area. It has around 150 rooms. Getting at least 80% occupancy is definitely not a problem.
Unfortunately, the deal does not many any sense. Assuming that the hotel is paid in cash without loan and the occupancy rate is 100% throughout the year. An average room rates of 200 Malaysian Ringgit (65 US dollars) a night. The annual sales would be around 12 million Malaysian Ringgit (4 million US dollars).
If the cost of operation takes about 30% of the sales. That is a profit of 8.4 million Malaysian Ringgit (2.8 million US dollars). The buyer would still need 8.4 years to break even.
That is a very big if, as such deals normally involve certain amount of loans and hotels are normally required to be refurbished every three to four years. As such, the value of the property has far exceeded the value of the business.
My gut feeling tells me that the current owner was never keen in developing the hotel business. Rather they are using the property as a form of investment and sell the property when the price is right.
In my future blog entry, I will try to explain how to evaluate a project.
Unfortunately, the deal does not many any sense. Assuming that the hotel is paid in cash without loan and the occupancy rate is 100% throughout the year. An average room rates of 200 Malaysian Ringgit (65 US dollars) a night. The annual sales would be around 12 million Malaysian Ringgit (4 million US dollars).
If the cost of operation takes about 30% of the sales. That is a profit of 8.4 million Malaysian Ringgit (2.8 million US dollars). The buyer would still need 8.4 years to break even.
That is a very big if, as such deals normally involve certain amount of loans and hotels are normally required to be refurbished every three to four years. As such, the value of the property has far exceeded the value of the business.
My gut feeling tells me that the current owner was never keen in developing the hotel business. Rather they are using the property as a form of investment and sell the property when the price is right.
In my future blog entry, I will try to explain how to evaluate a project.
Saturday, October 6, 2012
Holding Your Ground and Looking for Customers
My business has been up since April 2014. Until today, we made multiple bids for hotel projects and have also received some import/ export queries. So far, our success rate is zero.
If I tell you that I am not nervous and desperate, I would be lying to you. Every month, the cash burning rate is around 1000 MYR/ 300 USD. The longer time I have no business, the bigger hole that myself and other business partners would be in.
For those who aspires owning a business and wanted to quit the current job. It is vital to plan ahead.
Good luck in getting the first customer.
If I tell you that I am not nervous and desperate, I would be lying to you. Every month, the cash burning rate is around 1000 MYR/ 300 USD. The longer time I have no business, the bigger hole that myself and other business partners would be in.
For those who aspires owning a business and wanted to quit the current job. It is vital to plan ahead.
- Keep your job until your side business starts to make money.
- Save up! Forget about the movies, or eating out. Before you spent the next dollar, think whether it can contribute to your business funds or savings.
- Calculate your personal monthly expenditure and the business's. From the calculation, you would know how much your business needs to make in order to sustain yourself and itself.
- Be careful of cost! I am lucky that my business partner own the property, thus we do not have pay the rental now. Due to our small operations, the services that we use are either the cheapest or free. For example, we are only using Google Drive's free 5GB storage for our work.
- Plan to call or bid for business on a regular basis. There are not many hotel projects out there in the market. The partners make sure to have weekly discussions on who and where to look for customers.
Good luck in getting the first customer.
Sunday, January 15, 2012
It is Your Problem
I have met many friends who aspire to become a business person. Many have tried and failed. While some did not even started. One of the biggest difference between running your own business and working are the magnitude of the problems that you would face.
If you are running your own business, the survival of the organization is your problem. This may ranges from employee engagement to the cleanliness of the toilet. In work, you only need to worry about issues that revolve around your area of job.
Therefore, besides only having passion. Are you willing to handle whatever issues that are thrown at you, regardless of its sizes and magnitude? In your own business, there is no such thing as a small problem. If is not resolve, it will come back and may get bigger. Even if you have a team to support your business, you would still need to direct resources and have the right vision to solve the problem.
If you are already in business. Ask yourself, what are the problems that business is facing? How can you solve it? You better start to think about it now, as it will not go away and you will have to solve it. It is your problem. You have to own it.
If you are running your own business, the survival of the organization is your problem. This may ranges from employee engagement to the cleanliness of the toilet. In work, you only need to worry about issues that revolve around your area of job.
Therefore, besides only having passion. Are you willing to handle whatever issues that are thrown at you, regardless of its sizes and magnitude? In your own business, there is no such thing as a small problem. If is not resolve, it will come back and may get bigger. Even if you have a team to support your business, you would still need to direct resources and have the right vision to solve the problem.
If you are already in business. Ask yourself, what are the problems that business is facing? How can you solve it? You better start to think about it now, as it will not go away and you will have to solve it. It is your problem. You have to own it.
Saturday, December 3, 2011
You Need Passion Rather Than Money
Many people told me that they do not have the money to start something. This is partly true. The same time, I am also seeing this as lack of passion and interest to make the idea into reality.
No doubt certain business requires high capital expenditure. You can always start small. When I created the Better Dining site, I just have a three years old Ubuntu Linux machine. All the application that I used are part of the Linux bundle. Except for the hardware, the software that I used are free! The most expensive part of the setup is actually signing up with sitesell for web hosting and Search Engine Optimization. That cost 299 USD. The only running cost that I have is the internet connection.
Yes! I have not been making a lot of money through the site. Yet, I had a great time working on the site. I have learned a lot about web publishing writing up on topics that I like. Creating and researching content for the site is not work for me. Rather it is just something that I do outside of my regular work hours. Working on the site has become such a habit that I will uncomfortable if I miss a day.
Starting today, ask yourself. What is your passion? With passion comes creativity. That passion may someday help you to put food on the table.
No doubt certain business requires high capital expenditure. You can always start small. When I created the Better Dining site, I just have a three years old Ubuntu Linux machine. All the application that I used are part of the Linux bundle. Except for the hardware, the software that I used are free! The most expensive part of the setup is actually signing up with sitesell for web hosting and Search Engine Optimization. That cost 299 USD. The only running cost that I have is the internet connection.
Yes! I have not been making a lot of money through the site. Yet, I had a great time working on the site. I have learned a lot about web publishing writing up on topics that I like. Creating and researching content for the site is not work for me. Rather it is just something that I do outside of my regular work hours. Working on the site has become such a habit that I will uncomfortable if I miss a day.
Starting today, ask yourself. What is your passion? With passion comes creativity. That passion may someday help you to put food on the table.
Wednesday, November 30, 2011
Never Say No Onbehalf of the Other Person
Have you ever experienced this? Whenever you wanted to approach someone asking for something, you would always say "No" on the person's behalf? I bet many of you did that. I do that too. Whenever I wanted to ask for help, I would think of a million things that would have that person to say "No" to me.
Now, what I want to tell you is to stop doing that. You have already defeated yourself before you even start. The rights of saying "No" belongs to the other person. It has nothing to do with you. If you already know that the person would reject your approach, you have think further on the true reason behind the rejection. This helps you to plan and make your approach.
This is especially relevant to many things in life from closing the sales to getting a date. There was a time that I worked in a project that requires a whole new set of equipment for a short term training. However, the company was under going a series of cost cutting initiative. Asking for new expenditure is like asking for the moon. Worst, a career suicide move. I have no choice, and I was worried that the financial controller would tear me into pieces. I prepared my case carefully and consider all possible options. I spend 10 minutes explaining it to him. When I finish, all I heard was a grunt. The controller broke into a smile and tell me that he will approve the expenditure. The reason is that many of the existing machines are reaching the end of its life cycle. No matter what it has to be changed. With the training around the corner, there are more reasons to buy the equipment. Once the training is over, the machines will be transferred for other use.
Honestly, I never thought that the request would be approved so easily. Why? I was too busy thinking about how I will get rejected. If I have done my homework more carefully, I would have found out about the soon to-be expire machines.
Your take away? Never say no other behalf of the other person.
Now, what I want to tell you is to stop doing that. You have already defeated yourself before you even start. The rights of saying "No" belongs to the other person. It has nothing to do with you. If you already know that the person would reject your approach, you have think further on the true reason behind the rejection. This helps you to plan and make your approach.
This is especially relevant to many things in life from closing the sales to getting a date. There was a time that I worked in a project that requires a whole new set of equipment for a short term training. However, the company was under going a series of cost cutting initiative. Asking for new expenditure is like asking for the moon. Worst, a career suicide move. I have no choice, and I was worried that the financial controller would tear me into pieces. I prepared my case carefully and consider all possible options. I spend 10 minutes explaining it to him. When I finish, all I heard was a grunt. The controller broke into a smile and tell me that he will approve the expenditure. The reason is that many of the existing machines are reaching the end of its life cycle. No matter what it has to be changed. With the training around the corner, there are more reasons to buy the equipment. Once the training is over, the machines will be transferred for other use.
Honestly, I never thought that the request would be approved so easily. Why? I was too busy thinking about how I will get rejected. If I have done my homework more carefully, I would have found out about the soon to-be expire machines.
Your take away? Never say no other behalf of the other person.
Friday, November 25, 2011
Do You Know Your Cost of Making Money?
Everything has a cost. We read a lot about the need of making sacrifice to start a business and making money. Before you nod your head saying that you already know that. Ask yourself this question, how much are you willing to spent on making money? When will it reach a level where you think it just cost too much to make money?
The cost itself may not only be time, health but also your social well being. Being busy making a business work, your family life, health condition may take certain amount of beating. So you must know where is your limit. If you go beyond your limit, the money that you made may not necessary be worth your while.
For example, you have an important contract to negotiate but it is also your kid's school performance. Do you try to re-schedule the negotiation and risk the deal or you miss the performance and take the deal? Both comes at a price. Whatever decision that you made, there should be no regrets on your part.
Know your limits. It actually cost you something to make money. Be sure to know how much you are willing to "spent" on making money.
The cost itself may not only be time, health but also your social well being. Being busy making a business work, your family life, health condition may take certain amount of beating. So you must know where is your limit. If you go beyond your limit, the money that you made may not necessary be worth your while.
For example, you have an important contract to negotiate but it is also your kid's school performance. Do you try to re-schedule the negotiation and risk the deal or you miss the performance and take the deal? Both comes at a price. Whatever decision that you made, there should be no regrets on your part.
Know your limits. It actually cost you something to make money. Be sure to know how much you are willing to "spent" on making money.
Sunday, November 20, 2011
The 110% Percent
I am a racing F1 fan. I do not have a specific team that I support but many times I would watch out for certain drivers, especially from the mid field teams and the bottom teams. In those teams, I see passion in some of these drivers. They may be driving a car which is not as good as the front runners but they tend to get certain recognition. Why? They are able to push the car beyond its design capabilities and able to finish the race! Many times these kind of drivers, would go and do great things such as the two times world champion -- Fernando Alonso.
The same principles should applies to life, especially in business. All of us wish that our tools is the latest and greatest in helping to get the task at hand done. In reality, not many of us has the privilege to have the best tools. This does not mean we cannot get the work done! With some creativity and passion, I am certain we can get many things done.
This PC that I am using now is four years old. It may not be the latest model nor has the latest graphic engine. Nonetheless, it has help me to create my websites, host my pictures and even to write this blog. Instead of keep upgrading the hardware to chase after the latest technology trend, I try to stay with proven technology. The very least, I have saved on technology cost over the last four years.
No doubt, faster machines and more user friendly OS has been released in the last few years. But I must think about the money spend and the benefit that I can extract from it. In this case, whatever that I am doing now is more than suffice than to upgrade my machines.
I am not asking you to get stingy and not upgrade. Rather, by pushing your existing equipment for that 10% more, it means you get more bang for your investment and run your operations as efficient as possible. Just being efficient, you would be ahead of your competitor in terms of price and quality.
Before you spent money on upgrades. Think about efficiency and cost savings. If you can push your existing equipments further, maybe you should hold back your investment a little longer. After all, the cost of technology will only come down. Good luck with that 10%.
The same principles should applies to life, especially in business. All of us wish that our tools is the latest and greatest in helping to get the task at hand done. In reality, not many of us has the privilege to have the best tools. This does not mean we cannot get the work done! With some creativity and passion, I am certain we can get many things done.
This PC that I am using now is four years old. It may not be the latest model nor has the latest graphic engine. Nonetheless, it has help me to create my websites, host my pictures and even to write this blog. Instead of keep upgrading the hardware to chase after the latest technology trend, I try to stay with proven technology. The very least, I have saved on technology cost over the last four years.
No doubt, faster machines and more user friendly OS has been released in the last few years. But I must think about the money spend and the benefit that I can extract from it. In this case, whatever that I am doing now is more than suffice than to upgrade my machines.
I am not asking you to get stingy and not upgrade. Rather, by pushing your existing equipment for that 10% more, it means you get more bang for your investment and run your operations as efficient as possible. Just being efficient, you would be ahead of your competitor in terms of price and quality.
Before you spent money on upgrades. Think about efficiency and cost savings. If you can push your existing equipments further, maybe you should hold back your investment a little longer. After all, the cost of technology will only come down. Good luck with that 10%.
Subscribe to:
Posts (Atom)