The Success Formula of a Dynamic Entrepreneur Revealed & Exposed!

Alot of people ask me, Ken, how does one make Massive Profit in business? Well, one thing sure, there are many ways of doing so, legally, morally and ethnically. However If someone tell you that theirs is the only way (and they usually claim it the fastest way too) to create financial freedom, please be cautious and stay clear.

In this blog, I will show you a real case study as part of my own creation of “Common Businesses & Uncommon Profits” Series (Copy is strictly prohibited without my permission). Please watch the clip below,

Ok ok, I can hear some of you start saying this: Nothing sexy, nothing advance. In fact, it is a dead boring business but let me assure you that their business & marketing strategy is superby! As some of you might know, I spend about 40-50% of my time overseas as my marketing and advertising business started to grow. And near to the place that I stay in Malaysia (PJ area), there is a nice duck rice stall called “Sunrise”. My partner bought me there a year ago and I frequent the place often to make the following observations:

1. They have only 2 type of dishes: Roast Duck and Cabbage

2. They have only 2 type of drinks: Sour plum soup and Herbal Tea

3. No renovation done. Very likely that the same deco are seen by 2 generations

4. No air-conditioning and hence very warm environment even when they install fans (KL weather can be quite punishing)

5. All clients are expected to share table

6. All ducks are freshly roasted on “Just In Time” basis

7. The business start opening at 11.30 am and close when all ducks “sold out” on daily basis. Usually, they close at 1.30 pm during weekday (Yup, you hear me right) and Monday is a rest day. I was there at 11.40 am to take the video and by 12 pm, long queue has formed already

8. They do not announce how many ducks left over or how much they sell each day. This is a well guarded secret but if you observant enough, one could make an estimation.

9. I estimated that one whole duck is chopped and sold within 1-2 mins interval. Hence, based on rough estimation: there are at least 100 ducks sold in any single afternoon if not more (weekend is more). Each duck is selling for RM40.

10. The secret receipt of roasting the duck is passed only to the boys of the family (I can hear the feminists are screaming now). Girls are incharge of chopping and serving. Total 6 staffs. Only 1 outlet.

Why is this business so powerful and what can we learn from it? Take a look below,

1. RM40 x 100 ducks x 6 days x 52 weeks = RM1,248,000 cash a year (without including cabbage and drinks). Let say the turnover for the drinks and cabbage is enough to pay for the cost of duck, rental and staff cost. Let me assure you, Banker love this business because there is no drama. Just plain boring RM40 per minute day in day out.

2. Because business are only run 3 hours operationally, staff can be paid half wage instead of full. Lower cost

3. Business is extremely efficient in utilising raw materials. No leftover and little wastage. Lower cost.

4. The speed of turning raw materials into cash. Inventories is not an asset. Your inventories will be your major blood clot if cannot generate into cash or other valuable resources fast enough. Alot of business died of blood clot. This include manspower for the service industry. Too many people “walking here and there”.

5. Keep it simple. 2 dishes, 2 drinks. Less operational and inventories keeping issues. Most importantly, the cost of good sold is kept consistently with minimium cost movement. Thus, this business become highly predicable if you run it long enough. Predictability is the key in long term business planning. You can plan exactly how much cashflow that your business need in a month/quarterly/yearly.

6. By following the “we will close once sold out” policy and the keeping the number of ducks avaliability mum, it creates a scarcity mentality in customer better take action fast and arrive there early and will lead to point 3 & 4. Interestingly, 75% of the customers would order half of a duck even when 2 persons dinning. This is called pyschological selling. The hot button is “There is not enough to go around”

7. Now come to the air conditioning part, it is intentional that the owner want to make the place warm so that you can eat quickly and leave your butt for the next guest! Thus, this lead to a faster table turnover and gel to point 3 & 4

8. Lastly, nothing work if your product/service quality is not the top. This is the key ingredient in a business before we can talk about branding and marketing.

Roast duck anyone? Look forward to your comment.

P/S: Please forward this url link to anyone you think might benefit from my post. Thanks!