At the crossroads!

These days we stay in touch with most friends using Social Media or the telephone – people are meeting each other less often. Have you noticed that trend? When was the last time you took a spur-of-the-moment decision to drop in on a friend unannounced?
(Here is another question, out of context, I ask a lot of people: “When was the last time you sent a greeting card to someone?” A sheepish smile is the usual response to that one. )

On Jan 1^st the route I took to get back to town, after meeting a client, went past a friend’s office – I decided to drop in. The visit presented me an excellent opportunity to say “Hello!” in person to at least one friend on New Year’s Day – thankfully this busy man was having a relatively quiet afternoon and could spare a few moments to exchange words with a friend who had wandered into his premises not unlike a cat that had lost its way.

After exchange of greetings and other courtesies the conversation veered towards his business. I was constantly on the lookout for information that could improve my knowledge of the Indian business scenario – and the corollaries thereof would be opportunities for my consulting practice and fodder for my blog! (Sneaky me, eh?)

The business papers were replete with news about a slowdown in automobile sales – post-Diwali the market was showing a downward trend. There usually is a dip in Sales in December because vehicles bought in the last month of the year have lower resale values as compared with those bought in January – so people usually postponed the purchase. Manufacturers countered this trend by offering schemes that could offset the loss or at least the notion. However, the present dip was more than the norm and had to do with the overall economic scenario, which was still recessionary. My friend’s was feeling the pinch too.

When I asked about Expansion Plans my friend said he would like to share some information about a decision he had made a little over a year back. His current lines were doing well and so he and partner decided to add another dealership to their portfolio. They scouted around and soon found a leading vehicle brand that was looking for a 2^nd dealer in town. They had 2-3 rounds of discussions with the local Business Managers of the manufacturer and then tabled their conditions for accepting the dealership. They felt those were fair and essential for them to get a firm footing in a market that already had a well-entrenched competitor.

The brand being considered is a very popular one and their vehicles are in great demand. The Managers knew that finding another Channel Partner who would accept their terms was not difficult. They did not accept the conditions proffered by my friend and soon found another party who was ready to go with their terms.

My friend felt at that time that this was just another opportunity and there would be many others, better ones, which would come their way. But a year later he found that the new player had done well for himself and was on his way to breakeven faster than expected, thanks to the growing demand for the brand.

He analysed their decisions objectively and found that the following mistakes were made while presenting their pitch:

–          Their forecast had been too conservative

–          At that time they did not foresee such growth in the market

–          The impact of the established first dealer was a gross over-estimate

–          Some of the demands made were based with a defensive mindset

My friend says that he does not regret having lost that dealership but he learned a lot from it. It helped him to understand himself – it told him a lot about his decision-making strategies and provided him a fabulous self-assessment.

Have you felt that way? Did you make a decision that you regretted or at least felt later that you could have made differently?

How has the original decision impacted you? Do you feel that your situation would be different today if the decision had been something else?

What are the key drivers that impact your decisions? Are they making you too conservative? Or conversely, are they exposing you to great risk?

My friend was very happy that I had cared enough to greet him in person and I was happy with my spontaneous decision because it gave me a great opportunity to learn something.