Business Mentor Notes: Dean Pax is currently concluding a Doctor of Philosophy in Organization Development at the Southeast Asia Interdisciplinary Development Institute. With the passion to become an instrument of change for others, the Dean is also a founding mentor together with Butz Bartolome of LEAD MORE Development Center. It is a learning organization created by mentors who design, develop and deliver entrepreneurship frameworks with the purpose of prospering entrepreneurs and professionals on the way to mastery of their craft. He is acclaimed as one of the most celebrated professional speakers and business consultants in the country, Dean Pax Lapid specializes in strategic management, business development, enterprise creation and growth, financial wellness, and family corporation growth. He is the Dean of Entrepreneurship Circle of Bro. Bo Sanchez’s Truly Rich Club and a lead advocate of the Philippine Center for Entrepreneurship Foundation Inc.–Go Negosyo. He is also an adjunct faculty on Entrepreneurship at the Asian Institute of Management. The Dean may be contacted at 0916-6725070 c/o Bennette
Dean Pax Lapid (center) mentors Entrepreneurs in the most practical and innovative methods
While returning from a speaking engagement two weeks ago, a Filipino OFW recognized me as part of the GoNegosyo movement & mentor of Bro Bo’s Truly Rich Club. He asked me a direct question:
“Dean Pax, ano ba ang maganda at madaling Negosyo na maliit ang puhunan.”
Wow- the question is the mother of all questions that I have encountered!
If I were to translate between the lines on what he was really asking –
Maganda = good
Madali = quick
Maliit ang puhunan = cheap
To integrate what is a cheap, quick and good business – allow me to tell you a personal encounter with the concept.
It happened 2 years ago when our parish priest made a call to all parishioners to donate old toys for the annual Christmas Fund Drive. The gift innovation for that year was to include a small toy in the Christmas package (rice, sugar, noodles, sardines) for the residents of the poor community near our New manila subdivision.
Since all my boys (three handsome guys like the Dean) are now professionals- my beloved wife had cleared most of the old stuff in my house long time ago or has donated it already. I wanted to bring some joy/fun to the poor children so, I asked my HR assistant to buy ‘in demand’ toys from a famous mall in Divisoria.
She was able to immediately source (QUICK) four-inch size colorful, metal “Transformer” robots (GOOD). She also was able to bargain to bring down the cost from 80 pesos to 40 pesos because she promised to buy 200 pieces is wholesale (CHEAP)!
Coming back to the office with excitement, my HR assistant called me to say everything was perfect except that ‘Transformer’ robots did not have individual boxes. We agreed to just wrap them in brown paper and stuff it in paper bags. It was a very small problem (not even) until I got the shock of my life opening the paper bags.
I saw that half of the transformer robots were “handicapped” Some were decapitated (heads were missing), some lost their arms and some were like ‘manananggal’ (torsos separated from lower body). Most of them got mangled and/or dismantled while in transit.
Indeed my HR assistant got it quick & cheap but not good. Now I know why the mall is called 1-6-8, either your stuff lasts only one (1) hour (my case), six (6) days or lucky for you eight (8) days. LOL
Admittedly as consumers we want to get the best bargains with the elements of CHEAP (price), QUICK (delivery) & GOOD (quality). Here’s the reality – are you ready? (I’m in the Dean mode)
In my view there are three combinations of the elements CHEAP, QUICK & GOOD.
1st combination is
CHEAP & QUICK is not necessarily GOOD (just the case of the transformer robots)
I can understand the OFW that asked me the question at the airport. Most of them fall into the trap of trying to find a quick business for their relatives were they are willing to put some small investment (minimum risk). Their intentions are noble in wanting to ‘teach their loved ones how to fish” not “give them fish”. It is also a subtle way of cutting the cycle of monthly ‘padala’. (I have confirmed this when I both Bro Butz & myself talked to several OFWs in Rome & Bahrain years back).
Please do not rush a business however small it is. Business is never a 100 m dash. Business is running a marathon were you make the preparation and perspiration before getting the celebration. After all – you run a business not race a business.
If we are so careful with the things we buy, we must be more careful of venturing into business. Business is never easy (little effort). Business is also about bringing in your investment (time & money). I’ve always said, “if you want good business income – you must come in!” The bigger the dream, the bigger is the effort, time & treasure.
It seems so easy to get a franchise business. But please be careful with proposals of a ready business that is CHEAP & QUICK. I’ve cautioned my entrepreneur students that if a business is really good, why the owner (franchisor) will offer its business on a ‘buy one take one ‘basis at bargain prices. More than often cheap franchised business model don’t last six months. (NOT GOOD)
The other advice that I give to my students is to check carefully how many outlets they have for themselves (company owned). The main owner must have equal or more risk that the new franchisee.
2nd Combination is
CHEAP & GOOD is not necessarily QUICK
Setting up a business is like planning for a baby. It does not happen overnight or right after your honeymoon. Using the analogy - a mother must wait nine months before her baby is born. There are preparations & check ups even before the actual delivery.
It is the reason why I always give the advice that ‘Business planning like family planning BUSINESS is a CHOICE’ – Pilitin ang hilig at gusto – Hindi pilitin (Choose your personal preference not force it- on yourself or somebody else)
I remember vividly some funny moments being Dean of an Entrepreneur School for seven years. During freshmen briefings- I’ve always asked incoming enrollees (together with a parent or guardian) why they want to enter an Entrep degree program. Almost always, half of their reasons centered on the wishes of their parents not themselves. Automatically, half of the time I redirect the enrolment form to the parent. I also tell them that I accept freshmen of all ages. LOL
Since most of my former students had little money (CHEAP) to set up their own businesses, we planned their venture set-up over a year (NOT QUICK) plus another year to manage and grow (GOOD). Little money is compensated by time (patience/perseverance) and talent (education, personal experience and mentoring). All my best students undergo a process of TORMENTORING before MENTORING. There is always prestige if you put more effort into a set-up of your own brand!
3rd Combination is
GOOD & QUICK is not necessarily CHEAP
Established brands/franchises protect themselves from non-committed parties by including upfront fees, compliance with regulations and standards to keep the brand ‘holy & solid’. One of the brothers of the Jollibee conglomerate is respected and personal friend. Since I retired from my corporate world 15 years ago, I’ve always had the open option to be a privileged franchisee if only I can shell out 25-30 million pesos (NOT CHEAP) for a very nice Jollibee outlet in a prestigious mall (GOOD) that be can constructed in 6 months (QUICK).
I used to be part of a corporation that owned a five (5) Hectare lettuce farm in Tagaytay. It was a good example of GOOD & QUICK set-up since we had to shell out five (5) million pesos to buy out the previous operators plus bring in an additional two(2) million pesos for upgrade.(NOT CHEAP). It became operational within 6-7 months. (QUICK)It has a production of high valued crops (three kinds of lettuce: Romaine, Falballa & Lolla Bionda) of 1000 kilos/week.(GOOD)
My final advice:
Like it or not, coming into business, you must allocate talent, time and treasure (money) to your dream venture. The less you spend on one, the more you need to compensate with the other two.
Talent and your business model dominate well
Quick is a function of time. How fast you’re able to bring the products and service to the market
Cheap is a function of treasure (money) that you invest in the business.
Start with your personal preferences/competence. Go for businesses that you really like or are good at.
Study formally and informally (learn the business from formal institutions, family, friends and mentors),
Show why people should buy from you. Find a business that will not only deliver a solution to a gap/need but also can give a god & happy feeling to your customer.