Tag Archives: Business Mentoring

Business in the Wild West

Nick with client Adam Kundi who in grateful thanks for the help provided presented Nick with a dress in PNG national colours hand-made by Adam’s wife for Nick’s “woman” (Adam’s words!).

Lae is an interesting place – 260 inches of rain a year (isn’t that amazing?), either hot and steamy or hot and dusty, as when it does dry out great clouds of dust are thrown up on the dirt track roads, and an hour from the airfield in a van crewed by security guards with metal grills on the windows (as the locals amuse themselves by using passing traffic for target practice) on a road which is about 50 metres wide in some parts because the drivers, trying to avoid the potholes, just make the road wider and wider.

It’s like the Wild West in more ways than one, firstly because of the lawlessness, and secondly, because there’s gold in “them thar hills”. This means boom time, as the local businesses make the most of the opportunities. Meanwhile, back at the hotel, the shower pressure is a trickle, there’s another power cut and the toilet won’t flush as the water pressure is now non-existent.

But despite all that, there are some amazing business success stories to be heard there, such that we could only dream about in NZ or the UK. Like the client I was helping who had started his business with Kina 500 (about NZ $350) whose sales in September were Kina 500,000 and Kina 1 million in October.

Or my client who makes an annual profit of Kina 120,000 after investing just Kina 7,000 4 years ago in a new business. He’s already invested the surplus profits in two new businesses that cost him Kina 200,000 to set up.

Another of my clients recently stood for Parliament (spending a fortune of his own money in the process) in his desire to change things for the better in PNG and to alleviate poverty and unemployment. He’s now moving into no less than 5 new businesses to take advantage of the booming economy and the huge demand for building materials and similar.

Mentors relax for a well-earned beer at the evening de-brief.

And even stranger, the client of my colleague George who has a business out in the bush (where there’s no bank) who has to drive back to Lae armed to the teeth (he’s been shot once already) with Kina 200,000 in his car every month, this representing his surplus takings!

All self-financed, no help from banks or the Government, often no proper education and without the benefit of hundreds of years of Western development. And yet, despite their success, so friendly, humble, and full of gratitude for the help we provided. Truly a rewarding and thought-provoking experience and well worth the sacrifice of missing a week of helping paying clients and the stress of getting back to piles of work.

Business Mentoring in Papua-New-Guinea (part 2)

There was a story on the news the other day about the priciest hotels in the world to buy a club sandwich. Well whoever wrote the story hadn’t been to the Ela Beach Hotel in Port Moresby, Papua New Guinea, where a club sandwich costs 45 Kina, which is about $41 Kiwi! This highlights the huge contrast between the wealthy and poor in Papua New Guinea, and there are plenty of locals in the restaurant in the hotel paying these kinds of prices!

This was our second trip to Port Moresby, and again my colleagues and I were privileged to meet some very switched-on business owner-operators. These are locals, not expats, and I’ve been very impressed with their professionalism and business skills, and what they’ve achieved despite the difficulties they face. In addition, because of the difficultly of obtaining business finance, the businesses are virtually all self-financed from profits – try finding that in NZ or the UK!

The contrast in wealth reflects itself in many ways, with shanty towns and slums alongside luxury hotels and apartments, locals paying 10.5 Kina for a beer when the average wage is 3 Kina an hour, the new cinema which charges 25 Kina entry, thousands of roadside stalls selling limes and betel nuts and not much else, the streets full with expensive looking cars driving by rickety-looking villages built over the sea which is full of rubbish and sewage sludge, stories of Australian pedophiles who buy the local girls and live with them in the villages, the virtual death sentence arising from a serious illness or the huge bride price the men have to pay to find a wife – between 50,000 to 150,000 Kina.

Despite the tales of crime and violence and the Port Moresby police being called out to stop cinema-goers taking in hand-grenades the people are very friendly.

Lloyd and myself hard at workI was lucky enough to be invited to the pub by my client Joe (where I met his client John), and not only did we share a joke over a couple of cold beers (much needed in the hot and sweaty non-air-conditioned local’s pub!) but it was a fantastic opportunity for me to chat informally and find out all about life in PNG. I’ve been sending Joe & John email jokes since my return and I’m sure we will remain firm friends.

I think Kiwi business owners (me included) could learn a lot from my new friends in Port Moresby, so complacency and any sense of superiority are most definitely out of place. We’ve got it very easy in comparison!

Business Advice Papau-New-Guinea Style

I have just come back from a week assisting local business owners in Port Moresby in Papua New Guinea.

It is a place of huge contrast with luxury, very expensive hotels and apartments alongside falling down shanty-towns, slums, filth and poverty, relentless sun (it was the dry season), with everyone sweating profusely in the heat. There is rubbish strewn everywhere, mangy dogs rummaging through everything. Graffiti is rife, thousands of people sitting in the dirt on the roadsides trying to sell small piles of fruit or nuts, naked kids coated in dust running and rolling in the dirt, and walking along the street you have to dodge locals spitting out great mouthfuls of red betel nut juice (out of vehicle windows too) which they chew to make themselves high. Not only does this juice stain the roads and pavements everywhere but also it makes their mouths bright red. The beach is covered in rubbish and filth too.

Contrast that with the luxury hotels and apartments. Because of the booming economy (GDP growth is 9% due to oil, gas & minerals) our rooms cost $600 per night. Apartments cost $5,000 per week – yes, that’s per week! The cost of employing the expats is huge. The minimum wage here is $2 per hour whilst food is more expensive than at home.

Whilst there are some very friendly people in PNG it a very dangerous place. Many you speak to, both locals and expats, have been robbed or car-jacked at gun or knifepoint more than once. Shops have signs saying “No Guns or Knives” which is comforting to a degree I suppose! Whilst we encountered no problems ourselves, we were careful. We had a couple of drivers taking us around and if we walked anywhere, we tended to go with at least one other or made sure it was busy and not dark. I did go, against advice, for a couple of runs as it was getting dark along the seafront but it was very busy with locals so I felt safer with so many people around but I was told off later for doing so by the NZ High Commissioner and the expats!

One of our drivers (a local obviously) say crime is not due to poverty, but laziness, as the criminals come from the Highlands where they all have ancestral lands to farm but can’t be bothered. There are thousands of security guards and all businesses, hotels and restaurants etc have them standing around en masse. In addition to the security guards, high fences surround all houses and business premises together with roll after roll of barbed or razor wire or electric fences. Upon arrival in the car, they beep their horns, the gates are opened and immediately shut and locked with you on the inside! You can’t even move around the hotel without using a card which activates the lift, opens the doors in and out of the stairwell or the doors in the mostly glass walls which divide off the sections of the hotel on the same floor.

When assisting a business its best to see the business in action. In PNG this means leaving the safety of the hotel and venturing out into the suburbs or outlying districts. The two most exciting trips for me were out to business owner’s homes and business premises, the first in a shabby part of town a long way out and secondly, to a village built on stilts out over the sea.

On the way to the former, the car I was being driven in (by my new local client) broke down, just alongside a really shabby-looking shanty town. Watching the interest shown by the hundreds of locals upon finding a European in their midst, locking the car doors was not that comforting but luckily, just in time, the car chugged into life again allowing our journey to continue. Not wanting to risk that car again, I asked my new client to telephone one of our drivers to bring me back into the city but he couldn’t find where I was, so after driving around for a while gave up and went back into the city! By then it was getting dark and I was beginning to wonder what to do, as the local taxi drivers are untrustworthy and walking out where I was (a very rough suburb) would be crazy. Luckily, the driver returned following my requests for help and eventually found and rescued me. 

As for the village on stilts, the house/business we had to visit was about 400 metres out on a long slim planked wharf with huts on either side. The surface of the wharf consisted of slats of wood but what was alarming was to be told to walk in the middle because the ends were not safe! Even worse, many of the slats were missing so there are huge gaps to step over as the wharf swayed alarmingly from side-to-side! Tripping and plunging into the sea would have been one thing but not into the soup of rubbish, sewage and sludge that collects underneath the houses, as needless to say, not only do the villagers use the sea as their toilet but their animals too, mainly pigs that are trapped in tiny wire cages with corrugated iron floors. And then, horror of horrors, smiling kids wading waist deep in the sewage sludge – yuk! Apparently, the huts do blow down now again but there’s never been a tsunami, just high tides that bring the water level over the floors! The locals sit listlessly watching as you pass whilst one or two wash themselves or their clothes in big tin buckets.

Business there is done a little differently, with corruption a huge problem, as is the large network of family and friends they call “wantocks” which is both a blessing and a burden. A blessing because that’s the way they get business, but a burden because they don’t know how to get business the normal way! In addition, they feel obligated to either employ their wantocks or support them with money or gifts, which can place real pressure on the business owners in terms of affordability, as everyone thinks the business owners are rich.

Business objectives are different too, as they are not bothered about profitability but want to employ more people and feel obligated to expand their businesses to support their wantocks. Despite that, we were surprised by the successful and profitable businesses we saw which, overall, are financed out of cash flow, as they lack the security for borrowing which is hard to get anyway. We could do with more of that in NZ.

So a fabulous experience all round, and even better, we’re going back next April. By the way, my business Facebook site under the name Nick Roberts (not Nicholas Roberts) includes some photos, so take a look if you’re interested. Unfortunately, as always, photos cannot really capture the whole experience…

Which Business Consultant is Right for You?

There are a plethora of business advisers, consultants, coaches and mentors out there all offering to transform your business into a money-making machine. How then, do you choose one that’s right for you?

  • Background. It never ceases to amaze me about the background of some of the business coaches out there. There are so-called life coaches who’ve never had kids, been married or been through separation or divorce and business coaches who, until they set themselves up in business or bought a franchise, were working in mundane jobs for others, who’ve never been an employer, never owned or managed a business let alone been exposed to a wide range of business types, industries and seen what makes them tick, or seen business success and failure. Come on now!
  • Business Experience. To advise others in business it seems obvious that you need to have a wide variety of business experience. Have they worked for good employers, bad employers, in the back-stabbing dog-eat-dog corporate world, seen the undercurrents of partnership at first hand, dealt with difficult employees, hired and fired, been the boss, worked on the shop floor, wrestled with tricky ethical dilemmas, walked the fine-line as a managing partner, bought businesses, sold businesses and struggled to manage and attract customers and clients as well as having been through several recessions?
  • Relationships. As in all walks of life, it’s important that you choose an adviser that you can get on with. Do they make you feel at ease and are they welcoming? Are they stuffy and old fashioned or informal and modern in outlook? Are they able to chase you up to get the tasks done you agreed to do in a firm but polite way without causing offence? Can they deal with difficult issues and draw out of you the key issues you’d rather not face?
  • Finance Experience. It’s essential that any adviser in business has a good grasp of business finances – budgeting, cash management, profit and loss accounts and balance sheets to name just a few. Appointing a practicing accountant as your business consultant isn’t necessarily the right thing to do (and not all practicing accountants are experienced enough anyway) but they do often make the best advisers, not only because of their unequaled finance experience but also because of the huge variety of business types and industries they’ve worked with.
  • SME Experience. Small and medium owner-managed businesses are very different from bigger businesses managed by those who are not shareholders and they present many unique challenges and difficult issues. An adviser who’s been high-up in the Corporate World will not find many similarities in the world of small business!
  • Systems experience. Here’s where many business advisers stumble at the first hurdle. To get a business to function effectively good systems are an absolute necessity, especially on the financial side, and unfortunately the great majority of business advisers lack the necessary skills and experience on systems. To make matters worse, they are often reluctant to call in a systems specialist to help as they fear being sidelined or a reduction in their fees!
  • Contacts. Being successful in business requires you to draw upon the skills and experience of others in different fields. An experienced business adviser will be able to open doors for you and refer you to a wide range of trusted advisers in other disciplines who will always try harder for someone who has been referred by a respected adviser who is likely to refer more later.

Choosing someone to work with to grow your business is a vitally important process, so make sure you choose wisely. If you need a good business adviser to make your business thrive contact Nick on 0800 ASK NICK or email nick@abac.co.nz