Amritsari Desi Ghee

Amritsar is known throughout the country for its delicious food.  If we talk about sweets and Vegetarian food, Desi Ghee is a key constituent of Amritsari Dishes.  Many people have tried to Franchise this category of Amritsari food, and almost all of them have failed. My first client in this category was in the year 2004. He opened a Amritsari Restaurant cum Sweet Shop in a premium locality in a leading city. Desi Ghee Preparation was his Punch-line in all his advertising campaigns. After a year of high pitch advertising, he couldn’t establish himself in the market. I conducted a Market Research for him, and found flaws in his key Punch Line. Chanakya says that no rule is an absolute truth in itself, and it’s the duty of the King to adapt rules as per the requirement of the masses.

There were many other Businesses in the same category running successfully. They could offer quality products at a lesser price as Desi Ghee was not a key ingredient in their preparations. My submission to my client was to keep using Amritsari food as a Punch-line in his campaign, but slowly and steadily get rid of the Desi Ghee Tag. He may offer a few speciality dishes containing Desi Ghee, but in order to rationalize the prices, he needs to convert to normal Ghee. For instance, Chana Bhatura he was offering was almost 1.5 times the price of other key competitors. This is a hot selling dish of Restaurants in such segment. Similarly his sweets were overpriced. Findings of my research indicated that Desi Ghee dishes had only a few takers in that locality, and customers were not willing to pay extra for the same.

My client dismissed my findings, and continued with the same Desi Ghee Punch-line. He ran his Business for one more year, and had to close after suffering heavy losses. Many more clients in food Business have approached me since 2004, and I always quote this case study to them. Learning from this case study is that you need to adapt your product as per the liking of the masses if you are running a Business which requires a Mass Target Segment.

My immediate motivation of sharing this article today is that I saw another Amritsari Dhaba in my locality, opened only this week, positioning his Business on the same Desi Ghee Punch-Line. I wish I had written this article a bit earlier, and the owner of this Desi Ghee Dhaba had read this article before investing his money.

©KUJNISH VASHISHT, Expedient Consultants

www.chanakyaneeti.com, www.sharepundit.com

expedient33@gmail.com, 098789-04347

The Right Franchise

Franchising as a concept has become a popular trend in Indian Business Environment in the last 10-15 years. People are flooded with Franchise proposals of all types of Companies. Which Franchise proposal is the right one? Many clients approach me with this dilemma.

Should one go for a popular Brand, or can one go with lesser known brands also? Both have their own merits and demerits. If one can afford, the decision is easy. One must go with the more popular Brand. Dilemma arises when the funds are limited. Answer lies in Chanakya’s Power equation analysis. If with respect to a particular type of Franchise, the local partner is in a position of strength, he can go with the lesser known Brand. Position of strength may be in the form of strong local goodwill the local partner is having, or it may be in the form of a strategic location (if this parameter matters with respect to that particular Franchise). Important point in such situations is to first define the important parameters related to the Franchise. If the local partner is strong on the desired parameters, he can take franchise of a lesser know Brand. If the local partner is in a position of weakness, and the Brand of Franchisor is also weak, never invest even a single rupee in such a Franchise.

© KUJNISH VASHISHT, Expedient Consultants

www.chanakyaneeti.com, www.sharepundit.com

expedient33@gmail.com, 098789-04347

Machiavellian Tactics

Chanakya is often compared with Machiavelli, an Italian thinker/Politician. “Machiavellian tactics” is a term often used in negative terms. Some people also brand Chanakyaneeti in the same negative shade. I have read the works of Machiavelli in detail, and found many positives in the same. For instance, Machiavelli states that whosoever desires constant success must change his conduct with times.

Isn’t it true that many people waste opportunities in hand just because they think that the opportunity doesn’t conform to their value system? Clare W Graves defines value system as an open set of morals, ethics, standards, preferences, belief systems and world views that come together through self-organizing principles to define an individual, a group or a culture. Aren’t we living in a Dynamic Environment? The answer is a loud yes. If so, then shouldn’t our value system also change with times? And what should be the quantum and pace of change of the Value system?

Quantum and pace of change in our value system needs a special attention in our success plan. We live in a Society where disrespecting our elders is considered a sin. However, can we make a statement that the value system defined by our elders is final? If the society is changing, so should the Value system. However, our elders may not think in the same manner. Many people keep on following the same old value system just because they don’t want to disrespect their elders. Even if they do make a change in their value system, the quantum of change is much lesser than desired.

Our first objective in life should be to identify the correct quantum of change in values. Second objective should be to manage our elders. By this, I mean that the pace of change in our value system should not be abrupt, but changes should be done in a phased manner. Our elders are much wiser than we think. If we can correctly market the need for change in value system to our elders, it will be a great positive in our life. However, the change in value system should be understood in a positive sense. It doesn’t mean justifying immoral conducts.

For a positive change, even if you need to use Machiavellian tactics with your elders, go ahead. Success is waiting for you.

© KUJNISH VASHISHT, Expedient Consultants

expedient333@gmail.com, 098789-04347

www.chanakyaneeti.com,www.sharepundit.com

Sell on a High

Among all my Strategic Marketing assignments, the most challenging have been the one involving Business Takeovers. Many entrepreneurs approach me for selling their existing Businesses. And what’s the common factor? Almost all of them have approached me when their Business is on the downside curve. Any Business Takeover aspirant (one who plans to sell his running Business) aims to get some revenues on account of Brand Equity (Goodwill) over and above the asset value. But why would someone pay Goodwill when the Business Curve is on the downside?

Chanakya says that a wise man should not reveal his loss of wealth, and the disgrace that has befallen him. When we approach a potential client with a takeover proposal, forget about the goodwill, we will not even get the right value for the physical assets if we present the Business in bad shape. In the modern day Business Environment, one can’t bluff. Gone are the days when one could fudge the balance sheet and befool clients. My take on all Business Takeovers is, bring the Business back to shape, and then advertise for a takeover. The only way one can create a good Business takeover proposal is to genuinely spend money on decent Marketing activities as well as on requisite Business restructuring. Once we show a healthy balance sheet, healthy bank statement, and a healthy Marketing function, Business Takeover proposal becomes attractive.   

©Kujnish Vashisht, Expedient Consultants

www.chanakyaneeti.com, www.sharepundit.com

expedient33@gmail.com

Announce your Success, Not your Resolutions

An interesting gentleman (aged 33) approached me last year. His problem was that he was never able to complete his tasks/ Goals in life. He planned big, but was never able to implement most of his plans. I found him reasonably intelligent, well educated, and his family atmosphere was also cordial. He was happily married with an understanding wife and one little kid. He worked for a private bank as Branch Manager. After two meetings with him I couldn’t figure out the real problem with him. In my second meeting with him, I found him browsing his Facebook profile on his mobile. He seemed to be quiet active on Facebook. After the second meeting I told him to come after two days for a third meeting.

I was now aware about his Facebook profile. I browsed through his profile and found something interesting. He was too open with his Goals. He used to share each and every Goal of his on Facebook.  Chanakya says that “Do not reveal what you have thought upon doing, but by wise counsel keep it secret, being determined to carry it into execution.”  I also analyzed comments by his friends on his posts revealing his Goals. I immediately had a solution in mind.

On our third meeting, I asked him about his religious orientation. He was a great follower of Lord Hanuman. I asked him to create a folder in his Lap top with the name Lord Hanuman. Then I asked him to list his three most important Goals in Life, and further asked him to create three separate files under Lord Hanuman folder. I advised him to refrain from posting about these Goals on Facebook, and further told him to share his thought process about these Goals with only Lord Hanuman by writing on the blank files created in the folder.

After three months, he approached me again with a box of sweets. He was now more oriented towards his Goals. I again warned him not to share his Goals, neither on Facebook, nor with anyone else. When he met me after six months, he had achieved one of his three Goals. I told him to immediately share his achievement on Facebook, but again warned him not to share his remaining two Goals. He asked me the reason for the same.

Then I explained him his problem. I told him that I found the root cause of his problem from his Facebook account. When I saw his Facebook account (after that second meeting), I found that he was too open with his Goals. On analyzing the comments of his friends on his posts, and his subsequent replies, I found that this Gentleman was wasting his energy on justifying his Goals to his friends rather than utilizing his energy on achieving his Goals. By giving a religious angle to his Goals (by creating a folder in the name of Lord Hanuman), I could ensure that he keeps his Goals to himself. Then why did I ask him to share his success on Facebook? The reason was that this post would command positive comments from his friends, and these comments would act as a motivator for achieving his remaining Goals.

Lesson we learn from Chanakya is that never disclose your Plans/ Goals to anyone, as their comments/ suggestions may distract you, and can create self doubt in your mind Once you achieve your Goals, and share your success, your image/ self-confidence will receive an immediate boost, which will motivate you to do even better.

© Kujnish Vashisht, Expedient Consultants

www.chanakyaneeti.com, www.sharepundit.com

Increase your Luck

Chanakya says that Fate makes a beggar a King and a King a Beggar. Fate can make a rich man poor, and a poor man rich.

I analyze fate in a different fashion. What’s the difference between Lucky and Unlucky people? Lucky people are the ones who get more opportunities in life. By a simple law of probability, even if they grab a few of the plenty of opportunities available to them, they become successful. But are only lucky people successful?

Those who get lesser opportunities in life can increase their chances of success by applying their mind to generate more opportunities.  An aspiring MBA once approached me in the year 2006. He was intelligent, but was not getting the desired success in his career. I told him only one thing, “Increase your Luck.” Increase Luck? He was stunned. Then I explained him the ways to increase his Luck. I made a Chanakyaneeti Plan for him with an eye on creating contacts with senior Business Executives. I analyzed his profile and found that he had good writing and analytical skills. I advised him to write critiques on Marketing campaigns of leading Brands, and start mailing them to senior Marketing executives of the concerned Brands. I also explained him that it was an ongoing process, and success may take six months to two years. The plan clicked in the very first year. He worked hard on further increasing his luck in the following years, and today, he is a senior executive in a blue chip Company.

Thus, unlucky people can manage their Luck by increasing the opportunities in life. If you create 10 more opportunities in life in the coming year, you may fail to take benefit from 9, but only one successful opportunity can make you Lucky.

 

Wealth Begets Wealth

Chanakya says that a Man without Wealth doesn’t get it even after a hundred attempts. Just as Elephants are needed to catch Elephants, Wealth is needed to capture more Wealth. In this article, I have made an attempt to analyze the above statement of Chanakya in terms of the way people invest/trade in Stock Market.

Stock Market is a sea of opportunities for creating Wealth. However, to sail through this financial Sea successfully, you need to invest in a robust Ship, and need to follow certain navigation rules. We are often fascinated by the stories that a financial wizard created his fortune by investing a penny and created a million pounds. In reality, there is no such free Lunch in Stock Market. You need Wealth to create Wealth.

A Stock is worth Rs 100 today. A man has a capacity to invest Rs 1 Lakh. The Stock is strong, and has the potential to increase by 25% in the next few months. He invests the whole amount at Rs 100. Another man with the same investment capacity invests only Rs 25000. Now consider two scenarios. In the first scenario, the Stock increases by 25% in the next two months. First investor makes Rs 25000, and the second investor makes only Rs 6250 (as he had invested only Rs 25000). Who is the smarter investor of the two? Answer this question after reading about the second scenario. In the second scenario, the Stock decreases by 10% next month. Investor A watches silently (with no more investment capacity), and Investor B invests another Rs 30000 (at Rs 90). Stock further decreases to Rs 80. Investor A again waits for the Stock to go up, while Investor B invests another Rs 20,000. Stock again reaches Rs 100 in fourth month from Initial investment. Investor A is still waiting for the Stock to go up to make some money (sitting at Par), while Investor B Sells his Stock purchased at Rs 80 and 90 at Rs 100. Investor B makes a profit of Rs 7000 (21% p.a. on the total investment capacity), while Investor A is yet to make profits. Investor B is likely to repeat the same investment pattern in case of repeat in scenario 2. Investor A tried to extract the maximum from his Wealth by committing the whole investment at once. He can succeed only in one scenario, i.e. the Stock going up from his purchase price. Investor B is likely to make money in all the scenarios. He could still make money from Situation 2 because he had Wealth available at suitable opportunities. If investor A wants to earn more money, and in all situations, he should increase his Investment capacity. Considering the dynamic nature of Stock Market, a smart investor is the one who has wealth available at all given opportunities.

With every passing day, more and more traders are getting attracted towards Options segment of Stock Market. It constitutes about 75% of the daily turnover. I have been teaching/ advising on this segment for the last 6 years, and have interacted with number of traders. Smart traders make decent amount of money by employing optimum wealth in this segment, whereas those making the mistake of trying to extract more and more gains by investing smaller capital often end up losing money. And those who go only long in this segment (to avoid paying higher margins involved in Shorting) often end up losing 100% of their capital. There are many safe hedging strategies available in Options segment like Calendar Spreads, Ratio Spreads, Covered Call, Bull Call/ Bear Put spreads. By prudently investing in these strategies, one can easily make 24 to 40% in a year in a safe manner. And I am stating this on the basis of research conducted by my team at Expedient Consultants (published in leading international Journals).

Summing up the above, you need Wealth to create Wealth. If you try to sail through the sea of financial opportunities with limited wealth, no one can save your financial Ship from Sinking.

Sales Force for Small Entrepreneurs

The biggest problem which small entrepreneurs face is marketing. And among various components of Marketing, attracting, retaining and handling sales force is the problem almost every small entrepreneur faces. Whenever I suggest small entrepreneurs to employ quality sales force, their standard answer is “Let’s appoint sales persons/sales agents who can sell our product on commission basis or on small salary plus commission basis”. And my counter question to them is “Which came first, egg or hen”?
Sales is the only function of an organisation which generates revenues. Rest all the functions are expense heads. Then why be frugal while appointing sales persons? Chanakya says that if the treasury (funds) is inadequate, salary may be paid in kind like forest produce, cattle or land, supplemented by a little money. However in case of virgin lands, all salaries shall be paid in cash until the affairs of the village are fully stabilised. All small enterprises are like virgin lands, and it is the duty of the entrepreneur to develop such virgin land. You can grow and taste the fruit if and only if such land is ready to grow fruits.
Promoting the products of a small enterprise with a lesser know brand is the most difficult job for a salesperson. We at Expedient Consultants conducted a comprehensive research on this subject. Most of the sales persons preferred to join leading organisations where lesser push/effort is required to sell the product. Sales people who normally are available to join a smaller organisation are the ones who either don’t have the capability to join a bigger organisation, or the ones who join the smaller organisation as a stop gap arrangement. People in the second category are often found missing from their allotted sales territories on Wednesdays, when new jobs are advertised in Job Columns. One of the other main reasons for their joining the leading organisations is financial stability. This aspect as per the sales persons is missing in smaller organisations.
When a small organisation starts looking for sales persons, their job should be to market their organisation to capable sales persons rather than to choose among the lesser capable / cheap salespersons. And the only way they can do so is by offering attractive fixed salaries, better then the leading organisations. When a capable sales person joins a small organisation, he brings along with him his selling skills/ experience as well as contacts. Effort of the smaller organisation should be to establish their product on the basis of previous goodwill of the salesperson. I have experimented this with many of my clients in small scale, and the results have been excellent.
Thus, my advice to all the entrepreneurs in small scale is to keep a spare budget for sales force. Attract and employ quality sales force. Spend on them for the first two/three years even if the output is less. Pay them good fixed salaries, and try to use their goodwill to the maximum. Once a name has been established for the organisation, only then start the trend of paying them with a mix of fixed salary and incentives. Till then it will be almost impossible to retain them.
© Kujnish Vashisht, Expedient Consultants
www.sharepundit.com, www.chanakyaneeti.com

Seeking help from a Strong King

A Businessman from UP once approached me for consultancy to set up an educational academy for his son. He had own commercial place in a category A city, and his son was a fresh Engineer from a prestigious Institute. He wanted help in establishing his own Brand of coaching centre for +2 level entrance courses. Finances were extremely comfortable.
Education is a lucrative Business these days, but also a Business with cut throat Competition. There are two types of people successful in this Business. One category is professors in individual subjects who already have an established brand name. Other category is pure commercial academies with huge advertisement budgets, and specialized faculty for each subject. The category which suited my client was the second one.
Chanakya says that If a King is unable to ruin the enemy’s undertaking, and is also unable to protect his own from enemy’s attack, he shall seek the help of a stronger king. Now consider this in terms of the case mentioned above. Education Business has reached maturity stage of Product Life Cycle, and the only way you get students is by creating your own share in the same pie. Client’s Son was extremely intelligent, but a fresher. He couldn’t take on the already established professor’s. Thus, heavy advertisements and attracting students in good numbers was the only option.
We had two options. One to set up own brand, and another to set up some strong Brand’s Franchise. We considered a few Franchise options. Three strong National level Brands were already there in the city, and the Brand which we were considering was at best at par with the other three National Brands. Thus, in Chanakya’s terms this Brand could have failed to attract the competitor’s students just on the value of its Brand name. Also, in case of similar such Brands establishing the Business in the city, this Brand could have possibly failed to create a Brand loyalty for itself, and would have been just another shareholder in a limited pie.
Thus, the only option left to us was to establish the institute in own Brand. Chanakya had clearly said that key to success in such a situation lies in seeking help from a strong King. I did the site analysis and found his place fit for opening up a good eating joint. The Building had three floors. I advised my client to take up a strong franchise for opening eating joint for youngsters at the ground level, and to set up the institute at 1st and 2nd floors. This eating brand should be strong enough to attract the desired target segment. Second issue was to decide the target segment. I advised him to attract students who are not toppers but are average students. Apart from studies, these students have other issues on their mind while choosing an institute. One such issue was the eating place. We listed other such issues pertinent to that location and target segment, and designed a Marketing strategy.
Franchise with a leading Brand was finalised for that eating place, thus satisfying Chanakya’s condition of a strong King. In a few months, in the month of January (the right month for targeting students for entrance level courses), the institute was launched. First year was average, as expected, but second year gave a strong base to this institute. Now they are planning to establish their own franchise network.
© Kujnish Vashisht, Expedient Consultants
www.sharepundit.com , www.chanakyaneeti.com