This is the second part of our 10 ways to cope with stress article. Entrepreneur Philippines interviewed Brian Quebengco of the industrial design firm Inovent Inc., Dondon Atayde of the events company Wishcraft, Richard Cruz of the real-estate consulting company INSPIRE, and Jonathan Dee of Alliance Tuna International Inc., on advice how the Filipino entrepreneur can cope with stress.
6. Spend wisely
A recession, according to Atayde, may tempt business owners to sit on their capital, but to fear spending is to essentially grab the wrong end of the stick. This is because bad times often offer opportunities that don’t exist in bullish markets, such as cheap stocks or a good business for sale. Indeed, says Atayde, a recession is a good time for capital-rich companies to buy another business cheap.
[related|post]Atayde cites how they grew Wishcraft: “The capital we had put back into our business helped us expand from being simply an events company into a holding company, with businesses in manpower promo activations, staging, rigging and displays, and logistics and vehicle rentals. We are able to keep our costs down because when you own related businesses, you can share resources. In any case, we are cautious about sharing the dividends even until now and would rather invest our capital in new businesses.”
7. Go beyond cost-cutting and strengthen YOUR brand
Atayde says that cost-cutting is always a healthy practice both in good and bad times. “The old adage, ‘Cut costs to maximize profits,’ still holds true,” he says, “Every year, therefore, we always make it a point to examine where we can cut costs.”
For his part, Cruz emphasizes that spending wisely goes beyond simply cutting costs: “Instead of simply cutting down on advertising, it may be good to study your brand and find a way to make your clients or your customers feel that you care about their situation. In this manner, you can market or advertise your product more effectively to your customers.”
He advises businesses should focus on revenue generation, whether maintaining them at present levels or increasing it. He says this approach forces business owners to strengthen their brand and market it better. “Companies that respond to how the market is changing will do better than others,” he adds.
8. Don’t dwell on negatives
Quebengco emphasizes the importance of having a positive belief system. “What holds you back or propels you forward is your belief,” he says.
Atayde agrees with this view and advises his fellow entrepreneurs not to plug into the negative predictions of the media and other sources. “Business is all about opportunity,” he says. “When you’re on the lookout for opportunities, they will present themselves. Dwelling on the negatives will blind you to the good things coming your way.”
9. Look within and make the hard decisions
Cruz says that although business failures can be attributed to such factors as luck and circumstance, most of them are actually caused by internal failures. He explains: “An internal failure can be a character flaw like laziness or greed, a loss of drive or passion, depression, or simply doing too much too soon. The ability to honestly assess one’s self at all times can alert one to an internal failure before it becomes detrimental to the business.”
Dee says he knows this lesson only too well. His First Dominion Group had borrowed heavily in US dollars so it could expand and acquire other companies. This exposed the company to a foreign exchange loss of up to P1 billion when the currency exchange rate went up from P26 to P43 to the dollar, and then to over P50 to the dollar.
When interest rates then rose to 30 percent, Dee’s company—at the time considered the second largest exporter of canned tuna in Asia—got starved of badly needed working capital. He says there were no shortcuts to surviving the crisis, which lasted about six years. “We had to make hard decisions and swallow our pride,” he says. “From a work force of 6,000 in 1996, we shrank to 600 in 2002. From five operating factories, we retained only one.”
10. Pick yourself up
The entrepreneur needs resilience and perseverance to survive hard times. “If you know your business and are committed to it, you will no doubt find a way to bounce back,” says Dee. “You need to pick yourself up every time you hit the pavement.”
In 2003, Dee re-established his tuna canning and export business as Alliance Tuna. Today, the company has a strong balance sheet, zero long-term debt, and is listed as the most profitable tuna packer in the country, with plans to expand operations not only in the Philippines buy also to Indonesia and New Zealand.