Hard times in business

Motivation is often given by reciting good stories, experiences and nice moments. I find it quite encouraging to motivate entrepreneurs by also sharing difficulties, the times when most of us felt like quitting. Yes, I say this because it comes a time when quitting seems to be the only and the only option.  I have been is such situations many times as business person. When we share stories of difficulties, it helps people to build resilience by being aware of and preparing for hard times.

If we only share good stories, many people, especially those venturing into business for the first time tend to think everything is easy. Such people tend to give up after a few real challenges. In my opinion, we need to help people in developing the ability to fight by telling the ‘war stories’. This reminds me of my time as a very small boy. My grandparents used to tell us stories about cattle rustling, raiding the maasai community and taking away cattle. They used to tell the stories so well that I looked forward to growing up and taking part in a cattle rustling expedition. We even had hero stories whereby a small boy would go, raid and come back with hundreds of cattle using supernatural powers. You can imagine what went into my mind every time such stories were told. In such stories, we learnt mostly how to manage crisis along the way; including how to report and account for the dead raiders! We were prepared to know that not all of us would come back alive after a cattle rustling expedition. What about enterprise stories? We surely need to tell the stories the same way. Business schools need to do the same. I occasionally remind people that fresh university graduate from a business school cannot sell boiled eggs or sweets in the street or their neighborhoods. Yes, the business schools do not prepare them for the battle!

For over 20 years, I have found wonderful products that cannot sell; especially products that tend to be ahead of their time. As an industrial designer, I tend to come into conduct with products that provide solutions to the public at a time when people are not ready to deal with the challenges. For instance, I once sold revolutionary low cost washing machines from Hungary. Another time I introduced mosquito traps into the market but they did not sell well. People would see how effectively the gadgets worked but only a few people bought. Then, one time everyone I knew started asking me for mosquito traps following a disease outbreak.  I also came across and started selling LED lights ten years before their time. I remember someone used to assemble them in Nairobi, some 500 km away and send them to me to sell. He bought the tiny LED bulbs in kilograms, assembled them on a circuit board and I designed how the lights would look like. Again, that did not work but ten years later, LED lighting became popular. These are just a few examples and I have done a lot of projects that closed down. Whenever I talk about them as an enterprise trainer, people always ask me ‘how come it fails and you are the teacher?” My usual answer is that the storm affects everyone and no one is immune to enterprise challenges. At times, closing a project is a good decision and that is part of the duty of business leaders.

At one time, during an election year 2017 in Kenya all small enterprises were struggling. Those with 3-5 employees went back to ‘owner operator’ status. In a lot of cases, businesses closed and those who provided services like trainers started operating from their houses in towns and in the villages. For those large enterprises, the challenge of taking care of large workforce became a real burden. In our case, we had three departments dealing with fresh fruit juice, commercial equipment rentals and trainings. The fruit juice unit was a nice juice parlour at a good location where we also provided mobile money transfers and agency banking services. Actually, we started agency banking as pioneer when people didn’t know what it was all about.

A few months to the election year, the rains started beating us. Distribution for mobile money service and agency banking was reaching its peak and the graph was going down. Almost every other shop became an outlet for such services but none of them was doing well.  Our performance dipped from over 100 customers to barely 20 in a day and we could barely pay staff so we had to exit that industry. We had lost 60% of our income and therefore we did not have a choice. One of our cashiers also took off with about 50% of our operation cash. The fresh juice unit suffered a real beating due to the reduced flow of customers. Within a short time, it became a ‘single staff’ business. What a scenario? Some of you can relate to this and even worse situations.  

Now, this is interesting! The trend in equipment rental business had a different story. Initially, we used to put men and women on the ground as sales persons. That traditional method of marketing was not very productive and the staff mainly spent time serving existing customers instead of winning new business. In short, they were not fighting the battle they were employed to fight simply because they were not ready to do so. On a pilot basis, we developed advertising content and published regularly on online platforms. Within weeks, the pilot experiment worked. From that time onwards, we went digital, fully online and even reduced prices by 20% because marketing expenses came down. We only needed one staff working from home as an independed delivery person. We never looked back and surprisingly, the bad year became our best time ever. Our income grew by more than 3 times and we kept on increasing capacity. What changed here? It is just the deliberate effort and choice to fight the battle in a different way. We always promise we can deliver in 20 minutes and we have achieved that many, many times. Actually, we are like a rescue service. Most people call us when in a crisis and thereafter become repeat customers.

I know as a business person, your challenges are not limited only to those highlighted in our experience as described here. At times of hardship, best thinking and ideas tend to come up. Those who work harder, putting more effort tend to find it easy when the storm is over. It is worthy trying harder and thinking harder when faced with hard times. You must ask yourself “is there something I can do online or is there new ideas for new business?” Most people I know, including my supplier for mosquito traps operate from home and they use online platforms like social media to market their businesses. Today, online public is a huge opportunity for every business person. It is very universal and non-discriminatory in nature. If you do not have an online presence, then you have no business in saying you are in business.

We have had our own troubles. A few times, a landlord would threaten to kick us out of a business premises. As if by a miracle, money would come in and save the situation. More than twice, a bank threatened to auction our equipment and household items because of loan repayment. Again, just a day before in every case, we found our way out of the problem. I learnt never to panic as hard times come and go.  We keep on looking for a business of the moment. Yes, an idea that can do well using current opportunities in the market. Our first attempt to sell mosquito traps failed because people seemed not to be keen on preventing malaria. At one time, there was an outbreak of Dengu fever, a terrible disease caused by mosquito bites. Then, it was the time to sell mosquito traps because the disease had no cure and people were now keen on prevention. Customers were coming even when we had nothing to sell. Some people preferred to prepay using our cashless payment platform and then call us to say why they had sent money.

Again, it is never over until it is over! Therefore, there is no need to quit when hard times come. Those who quit tend to quit too early. I have seen a lot of new shops opening and closing on their fourth month, especially where the premises are in a new building. In such cases, the first lots of businesses fail and close. The second generation comes and some survive. Most of the time, rent is usually high and a new place tends to attract among others, persons without business experience especially persons in full time employment who would like to do some business as a side hustle. Remember, if you really want to do business, you cannot do it entirely part time. Business is a fully time engagement, otherwise you are better off planting trees because they will still grow as you work for your boss. This is not to say tree planting cannot be a business. I have seen people growing fruit and trees and making good money. A friend of mine grows tomatoes and he calls them tree! He also grows green grams on a large scale. Apparently, he has a full time job that requires him to travel out of the country many times in a year. How does he do it? He has a team of people on the ground who knows what needs to be done at every stage of the way. He doesn’t employ any of these people and they are paid based on what they have done.

Do you have a team that you can rely on? You need to have one. Even one trustworthy person can make a lot of difference. When we promised we could deliver equipment in 20 minutes, we meant it. We needed delivery guys who knew they were doing more than ordinary work. In almost all cases, a customer would look for us when in distress. For instance, while in the middle of a presentation during a conference, a laptop or projector would malfunction. In such a case, a customer would quickly go online, search and hopefully find us and call us immediately. And within 20 minutes, a guy from our rapid response team would appear and sort out the problem. What a team! It requires dedication to do this sort of work. Everyone in our team knew and believed in the purpose and therefore worked with the same dedication as emergency service personnel.

When we started making a selling fresh fruit juice many years ago, fruits used to be very cheap. A kilo of passion fruit was Ksh 25 only compared to the current price of Ksh 100 and sometimes rises to Ksh 180 per kilo. Sugar was Ksh. 35 per kilo compared to the current price of Ksh 120. One mango used to be Ksh 8 compared to the current price of Ksh 30 per piece. Therefore, our price was Ksh 20 and we targeted the whole public when we started.  Along the way, we had to target customers who could buy juice at Ksh 100 per glass. How did we manage that? We realized that juice shops were dying away as times became hard in our economy. Customers who could afford juice at Ksh 100 bought is even when it rained. They also could afford to buy throughout the month while income patterns for low income spenders tend to show high purchasing power around the end of the month as they received salaries. We kept on making innovations in product development and there was something new every other time.