Articles

Time for Caribbean Entrepreneurs to Begin to
Add Distribution Value to their Products and Services.

We are all admirers of that great country - the United States of America in one way or another. We may not always agree with the politics of its leadership, but when it all boils down to the methods applied by its citizens in business, we have to conclude that it is truly a land of opportunities.

President Bush may not be the most loved politician but the polls give the impression that he is right on target and is more likely to get another term in the White House than any one of his contenders. It must be recognized that he has taken every step to re energize the economy of his country. He instituted several initiatives to boost economic activity. Tax rebate, higher level of employment within the public sector, opportunities for contract manufacturing, including the bail out of the airlines after 911, saving jobs and keeping essential services in place. Energizing the economy means putting money into the economy, reducing interest rates and making available special windows of financing.

Instruments to allow businesses to develop and prosper, even sometimes a hands off approach are the cornerstones of any constructive platform for economic expansion. We have seen the internet driven businesses evolve without any form of control by the US government. Then at a certain point the issue of fair trading arose and that was dealt with in the courts and settled.

We have in our Caribbean countries a trade distribution pattern which evolved and expanded and has reached a point where the system has to be re visited. Fortunately, there are a few new kids on the block who are prepared to enter the world of business in spite of the doom and gloom being preached by most long standing entrepreneurs, especially those who fail to grapple with the new realities and continue to do business the old fashion way. Many businesses need to be re-engineered. However, in many cases failure is not always due to their fault, as some well intentioned Entrepreneurs have been caught up with the sudden change in economic fortunes being experienced in certain sectors of the economy such as the fall out in Agriculture, until recently, the main export crop and tourism either by market forces or disaster.

On reflection, has it dawned on you, what it would have been like, had it not been for the Sandals Group, not only for the airlift but also for hotel occupancy and promoting St. Lucia as a preferred vacation destination. The Sandals Group demonstrates the added distribution value in services. A Sandals Holiday is not cheap but the added distribution value is worthy of recognition, the several spokes in the wheel.

The spin off of a well priced product or service is tremendous and it is in this direction that I wish to draw my readers attention. Too often, we feel that we must compete on price without giving thought the added distribution value. For example a US magazine producer targeting a particular audience and sells his magazine for EC$20.00. A local publisher of good quality magazine targeting the same audience sells his for EC$5.00. Taking all things into consideration, I feel the local magazine could be marketed at EC$10.00, utilizing the direct sales approach and paying the Sales Representatives 50% of sale price. This approach can also increase circulation and ultimately profits. We must agree that if we can begin to position our product or service and add distribution value, we can put our people to work to support themselves. Many companies in our midst have the potential to apply direct marketing to their sales approach and expand employment opportunities.

A few years ago, I made the point that Article 56 needed to be re introduced. The agreement was implemented before its time. Premature interventions sometimes do not work in our best interest and cause us to miss opportunities. It would have taken political will to re introduce Article 56 which would have regulated Industry by country allocation. I put forward the position at a meeting in Kitts in 1998, that in the case Pasta Production all that was needed was one plant in St. Lucia to supply the Windward Islands, and another in St. Kitts to supply the Leewards. The other small states need not have similar plants but rather seek to get one of the two locations to provide their requirement under the company’s regional Brand or under their own private label. The better approach was to negotiate country representation by existing manufactures in the proposed non plant states. At the end of the day, it is not about plant ownership, it is about economy of scale and seeking to be certified as world class. This proposition still holds good.

I was a MLM junky and thought that by following, I would have been a part of the fortune getters, not seekers. In the MLM business you have to be the promoter and surround yourself with a few good friends with whom you will share the fortune derived from the participation of many. The American way is simple, once you offer a product or service, it is a legitimate transaction. However, the offer must not have any similarity to a pyramid. This is much different from our African brothers and sisters who seek to share their fortune obtained through all types of illegal means (whether real or imagined) with us, just for our involvement. It never works that way. My first encounter with the programme caused me to ask myself one question- why me, don’t these people have relatives, friends and business acquaintances to share their fortune with? I am not surprised that they continue to send these letter of invitation month after month, year after year, they are hoping to catch you at your most vulnerable moment. The frequency of these letters are increasing. Don’t be fooled by them.

After the years of my participating in legitimate American schemes even if after some time after their establishment the US government deemed them to be pyramids and close them down – one such case was SkyBizz, I am convinved that many of them were genuine until greed entered the hearts of the promoters. It is interesting that the liquidator returned my cheque in the case of SkyBizz. But all of the MLM programmes are based on added distribution value. We can easily refer to this type of system as sharing the wealth. We need to begin to do some of this. In the meantime, those of us who have ideas, we should start to reverse the strategy. We have products and services that can be franchised. I am now ready to launch a franchise to the world. The answer to our business problems is to reverse the winning services offered through MLM and franchises – packaged with a Caribbean flavour. We must introduce our Brand to the world. It will take the collaboration of some players such as webmasters, lawyers, accountants, economists marketers and salesmen. If we are going to be successful in reaching the world with our products and services it will take mastermind groups to put the pieces together to guarantee success. Let us plan to do it together and share the legitimate fortunes not necessarily as our counterparts in America, as I believe we can even do it better. At least when we say Free, we will mean FREE!!

Keep the faith!!!