In an earlier post on Wisdom Nuggets, I have shown going against predictably irrational behavior of the majority fueled by covetousness, one may ironically get the very results of what everyone is pursuing.
A disciple of Christ is a radical disciple. He refuses to conform to the world. Even encountering storms in life, he will continue to trust in the promises of God.
Likewise an entrepreneur is a non conformist. In his earnest pursuit of the best value or solution for a given problem, he may go against conventional wisdom of the day. He strongly believe in his cause and persevere till he proves the effectiveness of the value or solution he has discovered.
Allow me to share some personal examples.
Once I was trying to introduce a new digital read-out into a market where the German brand was the most established. Most of the technicians were trained using the German brand of digital read-out in schools or training institutes. Conventional wisdom was that nobody would change to buy another brand regardless of the price. The German digital readout was sold for $ 3500 and the cost of installing it onto the machine was separate and cost another $ 1000 for the brackets and installment labor. Buyers could only take a hire purchase loan of 90% of the cost of the digital readout and not the brackets and labor cost. I decided to offer through the largest distributor of the machines in consignment a total package price of $ 2500 including brackets and labor. That would be a saving of $ 2000 and the buyer only needed to pay deposit of 10% of the total package cost which would be $ 250 and the rest could be covered by the hire purchase loan. But for the German brand, the buyer would need to fork out $ 1350. Within 2 years, the digital readout I promoted overtook the German brand to become No 1 seller in the market.
Once, I even made semiconductor chips with my brand name ANK (Anthony And Kenny). Conventional wisdom was that factories around the world would never buy such a high tech product from unknown brand names and unheard-of manufacturers. Creative Technologies and Aztech were 2 local companies which supplied 90% of the world’s demand for telephony cards – sound card and 56k modem rolled into one. They produced 1.4 million and 0.3 million cards per month respectively. Once there was a shortage of 4 semiconductors chips and one signal relay and Creative got most of the allocation from the suppliers leaving Aztech without any allocation. I was approached and I managed to turn on a relatively unknown factory in Europe to make these components for me and labeled ANK. At that time, the whole production in China for the signal relay was only 10,000 units a month and I needed 300,000 a month. I went to turn on the factories in Ningbo to get me this volume production. I had no knowledge of the manufacturing technology but that did not deter me to work out with the Chinese factories to produce such a relay which was manufactured in Japan at that time only.
Once when I was trying to introduce a new brand of washing machines into the crowded market here. All the distributors refused to promote seeing no particular advantage against the more superior Japanese and European brands. And I could not afford any advertising budget for these distributors as well. Conventional wisdom was to sell new entry brands at extremely low cost. I went to look for a large direct retail shop bypassing the big distributors. At that time, most brands retailed for $ 600 to 700 so I positioned my brand at $ 650 instead of selling really cheap though my cost to the retail shop was $ 250. That gave the retailer a cool $ 400 profit unlike the established brands which the retailer would get only $ 50 and the promoter at the shop would only get $ 5 for each machine sold. I ensured that the shop gave $ 50 as commission to the promoter and the machine had to be sold with gifts costing another $ 150. To the consumers, they would perceive a very good deal when they saw the gifts of Philips appliances costing $ 300. The promoter was so motivated to promote my brand because she would get 10 times more commission than selling other brands. We moved so many washing machines more against one European brand who had advertised over TV at that time.
Once I took over a failed food court from Kopitiam, a local chain of food courts at Lucky Plaza in Orchard Road. I turned it around offering SGD 2 for all meals from the stalls I owned while renting cheaply to other stallholders selling less popular food items. I got a different crowd of office workers from other food courts serving mainly tourists. It was a hybrid model of owning some stalls and renting out the rest. This gave economy of scale for the self owned stalls for labor and purchasing. Such hybrid model also kept all stalls running. Soon we had the big Filipino weekend patronage.