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Cover photo | Stills from "Fang Hua"

1

ask：

Uncle Feng, I am a young entrepreneur who has opened a company. I have made some money in the past few years, but I have also suffered some losses and been cheated by unreliable trading parties several times. I would like to ask you, in the business world, how should I judge and identify people and choose reliable partners? How can I avoid "meeting the wrong person"?

Uncle Feng：

If the partner is not suitable, there will be troubles such as arguments and fights.How to choose a good partner? There is a way, which is called choosing a "qualified counterparty".

A few years ago, we had a cooperation with a well-known foreign company. After discussing for a while, the other party still refused to sign anything with us. I was very puzzled. We were clearly having a pleasant discussion, so why didn't they sign?

Finally, one of the people on the other side told me, “We need to weigh whether your company is a qualified counterparty.”

I asked, "What is a qualified counterparty?"

He said, "We will examine you further."

What to inspect?

First, examine whether my motivation for doing this project is pure, or is there something else?For example, in real estate, many people say they are doing it to build houses, but in fact they are doing it to speculate on land, which is called impure motives. So they want to see if there is any problem with my motives.

Second, they want to see whether our company has the ability and strength to cooperate with them.

What’s interesting is that they gave me a lot of strange questions to test me. For example, when they came to China, they suddenly asked me to meet many people, including some very famous entrepreneurs. They only gave me a few days and I had to meet them and have dinner. They thought, “If you can’t do it, it means you are bragging and your company is not strong enough.”

Third, after examining my abilities, they also checked whether I had a bad record in the past, and even checked my personal credit cards.They believe that if a person has a bad credit record in the past, he or she may fail to fulfill his or her obligations in the future and cause losses to others.

They use this method to determine whether I am their "qualified counterparty".

Through my cooperation with them, I found that this is indeed a very good idea. In many cases, you can't easily talk about cooperation with everyone you meet. You have to repeatedly assess whether the other party is a qualified trading counterparty.

If the counterparty is qualified, has the right motives, is honest and has strong capabilities, then all problems can be solved according to the contract without relying on friendship or face. Even if there is a dispute, the problem can be easily resolved by properly adjusting the interests.

2

ask：

When you screen "qualified counterparties", do you also look at motivation, integrity and ability? In addition to these three points, do you pay attention to other aspects?

Uncle Feng：

We have a principle: see whether he is “simple” enough, see whether his company is “simple” enough.

For example, when looking for a new business partner, I met a businessman who was involved in five or six industries. He boasted a lot and said, "I know this person and that person." It was very complicated... After thinking about it, I decided to forget it and not do business with him.

Another person has been doing the same business for thirty or forty years. If you cooperate with him, you can rest assured that the results will be similar.

Remember, from a business perspective, simplicity and focus are the key to longevity. Don't make yourself or your company too complicated.

The so-called "simple" generally means that the company's products and business models are simple; the relationship between government and business is simple; the corporate governance structure is simple; and the identity and role of the entrepreneur are simple.

First of all, the company’s products are simple and can be explained in one sentence.

Everyone knows that Coca-Cola is a good company. Its business model can be clearly described in four words: "selling soda", right?

If your business is very complicated, for example, your business model cannot be clearly explained in one sentence and others cannot understand it at a glance, then you may need to reflect on it.

The second simplicity is the simple relationship between government and business.

The relationship between government and business, including the relationship with state-owned capital, the relationship with leaders, and the relationship with the government, should be simple, not complicated. It should be clear and close. First, it should be clear, and second, it should be close. It should be close to those who should be close, and clear to those who should be clear. It should be simple, not so complicated.

Third, the corporate governance structure should be simple.It’s too complicated. Once a dispute arises, it’s unclear who is right and who is wrong. For example, a company is run by a husband-and-wife team and they are getting a divorce. The husband says he is the chairman, but the wife says he has been fired. “Even a judge cannot judge family affairs.” With such a governance structure, what should the company do next?

There are also the company's equity relations, the relationship between shareholders and the board of directors, managers, and the company's decision-making procedures, etc. The more complicated it is, the more difficult it is to figure out. If the company does not have any problems, it is fine. Once something goes wrong, people often start to argue and the company starts to have problems. Therefore, the company system must also be simple, standardized, and transparent, and the rights and responsibilities must be very clear.

The fourth simplicity is that the identity and role of the entrepreneur should be simple.

Some entrepreneurs pursue a lot of nonsense things that seem to be related to their own business but actually have nothing to do with it.

For example, we are in the real estate business, and I am a real estate developer. This is my main role, even my lifelong role. But if a businessman is not only an entrepreneur, but also has to play very complex roles, such as a moral saint, a professor, an artist, a star... In fact, these complexities indicate many dangers, many contradictions, many uncertainties in the future, and many omissions, which may lead to the eventual collapse of the enterprise.

In short, simple products and business models, simple government-business relations, simple corporate governance, and simple entrepreneurs and bosses. If a company wants to survive well and live long, it doesn’t need to think too much about complicated things. Just examine whether your business is simple enough. The simpler, the better.

Of course, simplicity alone is not enough, the second thing is called focus.

Focus means concentrating your time, energy and resources on your core competitive points, the most important business, and the most vital business.In this way, the more you focus, the more resources you will have and the stronger your ability will be. This is what the saying "a needle can kill a person, but a pillow can't hurt the enemy at all" means.

Focus means being able to keep improving. If you keep improving on a thing, a product, or a project, and make it so impressive, unattainable, and amazing, then your competitiveness will be formed. For example, Tan Mujiang, a company that makes combs, has done one thing to the extreme, and is doing very well today, becoming a very good company.

Nowadays, social and economic changes are very frequent and very fast. If you are not focused and do in-depth research, even if you can achieve simple results, you will be eliminated if others keep improving and you don't.

If you can be simple and focused, and persist in doing so for a long time, then the so-called "compound interest of time" will appear. Your business and what you do will become more valuable over time. Therefore, time is a benefit to you, and the longer the time, the higher the return you will get.