2K10PT1102-015

SSIGNMENT SHEET (The following is to be filled by the participant only)Tire Retail shops OwnerI had a friend, who is a tire retail shops owner in Dalian. He owns 17 shops and earns 40% share of market in tire replacement market in Dalian city. His name is Yunlong Dang. Mr. Dang was an old colleague in Goodyear before I joined Goodyear. He is the richest person among all my colleagues now. He is not only a retail shops owner, but also a tire dealer for several named brand, such as Continental, Hanhook, Triangle, etc.I made an appointment with him on Oct 29th, Saturday morning. I visited him in his office. His office is on the second floor of one tire shop. I climbed into the second floor. He was on the phone to talk about tire mounting equipment with supplier.Me:Sorry to bother you during the weekend. I had a MBA assignment need your help.Dang:Not a problem. I did n’t have any weekend after I started my own business. Even during Chinese New Year, I only have one day off to have dinner with my parents. There are so many things going on every day. At the beginning, I was busy because I felt nervous about business. Now, the business is getting better and my brain just could not stop thinking about business. I think I am used to this kind of life. I feel I am an important person if I can keep myself busy.Insight:a.Entrepreneur is not easy. A successful entrepreneur is even more harder. Theperson must take time and effort in his business. He needs to find solution, make right decision, take time to execute ideas and bear the business result. Ifa person works in a big organization, he either makes decision (seniormanagement) or takes execution (middle managers) and he doesn’t bear the business result in most circumstances. I can feel the workload and pressure to an entrepreneur is much heavier than a professional manager.b.Entrepreneur feels happy because they enjoy the feeling that they areimportant person to family, to the company, to the society. This feeling gives them energy to work hard.c.Entrepreneur likes to watch the business closely. Just like the parent watchestheir baby. Mr. Dong chose his office inside the retail shop because he wants to know how the shop performs every day. He can have a strong business sense when he talks to random customers or business partners.Me: When did you start your business? How you made the decision to do own business?Dang:After Goodyear bought Dalian Rubber Company, I left the company. I was forced to leave because I can’t read English. The people like you, who graduated from university, took over my job in Goodyear. I felt upset when I firstly left Goodyear. Now, I felt lucky because Goodyear pushed me to start my own business and Goodyear also gave me an opportunity to play in tire industry. I knew nothing when I left Goodyear, but tires. So, it only took me 2 days to cool myself down and find my future direction, selling tires.Insight:a.There are two types of entrepreneur, to take advantage of a businessopportunity or because there are no better choices for work. I think Mr. Dang belongs to the second type. I guess the successful rate of the second type entrepreneur should be higher than the first type because this type of entrepreneur can’t bear big loss on business and they will plan everything well and make smart decisions.b.Start a business with something you are familiar can shorten the learning timeand reduce learning cost.c.You can overcome everything if you can overcome yourself. Mr. Dong didn’tgive up his hope when he was dismissed. He even came back as Goodyear’s retailer because he has people relationship in Goodyear.Me: Who is your customer when you firstly start to sell tires?Dang: I didn’t have a shop when I first started selling tires. I did n’t have money to rent a shop. The only property I had was an old bicycle. My business module was a trading bridge for car maintenance center and tire whole sale market. Car maintenance centers don’t keep tires in their shops. They will call tire retail shops to deliver tires ifsome customer in car maintenance center wants to change tires. The difficulties for the car maintenance centers are that the tire shop may not be able to deliver tires on time because they are busy at that time, or they don’t have the inventory in the tire shop, too. I found that it was a good opportunity if I can deliver the right tires on time. So, I bought a BP phone and gave the number to car maintenance centers. I stayed at the tire whole market. Whenever and whatever they called me, I delivered tires to their centers as fast as I can by driving my bike. The car maintenance centers were not intended to earn money from tires and they only wanted to satisfy their customers. So, they paid me all the money that the customer pays them on tires. This gave me an attractive margin. I got more car maintenance customers after I run this business about a year. I asked my brother to join and help me.Insight:a.Opportunity exists anytime, everywhere. The question is that can you find itand seize it or not. Entrepreneur always has the ability to fulfill the demands.b.Don’t complain cash is a problem. Mr. Dang sold his tires in somebody else’sshops. He didn’t own a shop, but he still found a way to sell tires.c.When entrepreneur started his business, he begins with a niche market becausethe competition is not tough.d.When the opportunity growth, the team needs to be larger to supportopportunity. Mr. Dang got the support from his family member. This is the most reliable resources.Me: Where is your first shop? How you gain your shares?Dong: My first shop is in WuYi square, where a lot of car maintenance shops located. It is a small shop and the car can only stop in front of the shop and can’t drive in the shop. The main business of the shop is still deliver tires to car maintenance centers. To speed up the delivery time, I stored some tires in my own shop with 30 days credit from tire dealers. I watched the tire inventory closely. For those slow moving tires, I could exchange the sizes with dealers within 30 days. Little by litter, some customers noticed the shop on their way to the car maintenance centers and came into the shop and asked for tires. Every customer came into the shop, no matter he bought tires ornot, I would always give him a good training about tires. For example, what’s inside the tires, how long people need to exchange tires, how many brand in the markets, how check tire before driving to the high way, etc. All the people looked me as a tire expert. I think that may be the reason I have more and more customers. Later on, I opened more shops. All the VIP customers can get 24h-service by calling the shop. That may be another reason why I have royalty customers.Insight:a.Location is important for retail business. Choose location doesn’t mean choosethe best, expensive location. It means choose the right location at the right time.b.Credit from suppliers is an important capital resource to run business.c.Add low cost service into the product can make your product more premiumthan others.Me: Did you make any mistake or face any hard time in the past?Dang: There were a lot of mistakes that I made in the past 15 years. Mostly, I already forgot. One big mistake I made is that I didn’t buy the property of the shops. It is hard to image that the property price increase almost 10 times compared to 10 years ago. I spent all money to open new shops. Now, the rental cost is getting higher and higher. The problem that I don’t own the house is not only from cost, I was kicked out from the buildings also because the landlord wanted to change the building into other usage. It really hurt my business. I am struggling if I should buy the property now. The property price is really high in China. I am not a good investor in real estate. Insight:a. A successful entrepreneur is still human beings. He is good at some areas andhe may feel less confident in other areas.b.Mistakes make people more strong. If you realized you made a mistake, youwill avoid the same mistake take place next time.c.There is no right or wrong to run a business. If Mr. Dang spent his money tobuy property and he may lose opportunity to develop his tire business.Me: Anything make you feel proud recently?Dang: I am a self-confidence person. I am always proud of what I did. No matter how others look at me. Recently, I gained the Creative Retailer reward from Michelin. This makes me more boosted. I did a presentation in the Michelin retail conference to share my practice. The reason that this reward is impressive to me is not because of the reward name and it is because that a lot of retailers are interested in my business module. They keep talk to me and ask my advice during the conference. I was like a famous consultant.Insight:a.Mr. Dong is the first retailer to provide free service for tire testing. And he alsois the first mover for providing tire emergency rescue service. Entrepreneurs need to lead change if they are to be successful in growing their business.b.Entrepreneurial can learn from other entrepreneurs.Me: How is the return in tire retail business?Dang: I invested 20million RMB in my business and yearly earning is no more than 1million. The return rate is less than government bond. The return for me to run the shops is not only money. It is a feel of social respect. I have 200 employees. I like to see their growth. Their parents rely on me to training them and develop them. Most of my employee came from country side. They were not confidence when they talked to city people. I told them how to talk and how to response to customers. I always say” everyone is equal if I didn’t own your money” “Nobody look down you if you didn’t own his money”Insight:a.When you own 10million money, the return to an entrepreneur is more on hissocial satisfaction than money. Mr. Dong enjoys providing jobs to others.b.Entrepreneurial has a self-motivated attitude.Me: Do you want to grow your business faster? Did you ever think about Franchise to speed up business growth?Dang: Everyone wants to see business growth. But how? I never borrowed money from banks or somebody else. I don’t like the feeling that I own somebody. The ca sh to open new stores are all from operational profit. As for Franchise, some friends wantto invest in tire store and give me Franchise fee every year if I can help them to monitor the operation. I didn’t accept the offer because I didn’t have a system to run Franchise yet. I am thinking about it now. Recently, I changed my shops signage from “Michelin”,” Contine n tal” to “NanPao”. “NanPao” is my own brand. To start Franchise business, a named brand is very important.Insight:a.Mr. Dong has loan –reverse attitude to run his business. He feels morecomfortable to grow business step by step.b.Franchise is another to growth business faster without heavy investmentc.Branding is very important for Franchise.Me: Any challenge you are currently facing?Dang: The most challenge stuff is people retention. Tire repair job is a dirty, boring and low skill job. Most kids from city are not interested in the job. So, most workers come from north of China, country side. They are not stable labor resources. You may see they are in the shop today and you can’t find them tomorrow. Also, my shop managers always want to start their own business after 3 years working experience, regardless how much salary you pay them.Insight:a.Among opportunity, resource and team, the most difficult thing is teambecause team is dynamic. It is not something you can buy it from the market quickly.b.Entrepreneurial are always good at managing a small organization. They havesome constraint to manage a large organization because every penny they spend they would like to see the return immediately. People development is something they always talk and it is hard for them to spend money on it. Me: Any new plan for your business?Dang: I am working on developing a tire selling website. There are some tire selling transactions through internet already today, such as “TaoBao”. But, these websites are only selling tires and don’t provide service. This is not convenience for customers. I am trying to find partners in different cities can provide service to customers ifcustomers buy tires through internet. For example, if the customer is located in Beijing and he buys my tires from internet, I will give him an authorized retailer list. He can go to these retail shops for free mounting and I pay the bill. The bill is only small money because the retail shop would like to have “walk-in customers” and retailers can earn money from selling other stuff to these “walk-in” customers. Insight:a.Firm must continually seek new customers in new markets. Mr. Dang isdeveloping new customers in new geography.b.Understand customer habit and anticipate future is important to make the rightchoice.c.Growing company should have an energetic entrepreneur, who can learn newtechnology and smell the trend of Macro economy changes.。