7 MORE Business lessons from 7 years as a CA

Hey there, warriors! Thank you for your kind feedback on Part 1!

Your outreach on Instagram, WhatsApp, Emails is much appreciated.

I may not have been able to properly reply to each one, but thank you! Really.

I promise to make this worth your while :)

Without further ado, here is Part 2 to this series as promised!

There are largely two types of businesses –

-          those who pay their fair share of taxes, and

-          others which use every trick under the sun to avoid paying taxes.

Guess which business generally tends to do better?

It is the first type.

Wait, what?! The second one is saving more money because they pay lesser tax, right?

I know this sounds counter-intuitive.

But I have the perfect case study to back this up.

Two partners were doing business together till about 2015 until they announced a split. It was not very amicable and both of them continued in the same line of business, as competitors.

Both were doing similar turnover when they split.

But one became the market leader and the other one is, well, struggling to survive.

During one meeting with the successful promoter, he proudly told me “Do you know why we have become market leaders, and they have been left behind?”

I was expecting some mindless venom. But he continued.

“It is because we don’t do any hanky phanky with our books. We are 100% compliant and pay taxes properly” he smiled

Seeing my confusion, he continued “To avoid taxes, you have to buy fake purchase bills which generates cash. Cash just sits in your locker. And with Government rules, it is difficult to use cash.”

“Compare that with paying taxes – the initial cost is higher, but the money left over becomes my company’s reserves – and I can use it to invest in new projects and grow my business.”

Gold.

No business school teaches this. No business school can.

Only the real experience of business does.

Traditional old-school businesses do not believe in branding.

They believe (as I have been told) “Do good work, and the brand will come automatically”

While there is some truth in it (i.e. DO GOOD WORK!), but the part of brand building itself is something I disagree on.

We are now in a competitive arena.

For almost any business, there are 100+ competitors in the same space.

And thanks to the Government, we are competing globally.

Think of making any product. And you’ll find a Chinese product already selling on Alibaba at 30% lesser than your landed cost.

Given this tight competition, it becomes more important to invest in branding.

But branding is not just changing your social media theme to rainbow every June.

It is much more subtle way of messaging, without being directly in the face of your customer.

The need for “brand identity” is real. It is not corporate jargon.

I will leave it at that, for today.

This one is directly related to lesson #6 “There is no knight in shining armour”.

But I want to talk about talent here.

Obviously, every business needs good talent to thrive.

But good talent isn’t poached, it is developed and nurtured.

Every successful CEO I work with has personally groomed all their direct reports. It did not happen overnight. It took months, and even years… but the payoff was brilliant.

Just having a HR Department does not release you from the need to invest your time in nurturing talent. HR is not your knight in shining armour.

I get it. The process is tiring.

Interview dozens. Hire one or two. Train them every day.

It is a long process. But the payoff is certainly worth it.

After all, a business is as good as its employees.

“You get what you pay for.” One of my clients told me

She was very happy with the advice we had given and saved her over INR 40 lakh in taxes.

“We were working with «insert online portal name» which was really cheap, but it cost us in the long run”

And this is a business principle applicable across domains.

Be it marketing, legal or even your finances – working with top professionals is worth every single penny.

That obviously does not mean that there are no bad experiences.

But there is a reason why big corporations pay a premium to work with top agencies.

A CFO of a listed company, who is a dear friend too, told me over tea one day “I am so happy since we switched our marketing agency. We are paying 3x but our overall Customer Acquisition Cost has actually reduced by half!”

“What?” I almost choked on the tea

“Ya man. The quality is totally different. They know tips and tricks which only come with experience. You cannot find those on ChatGPT”

If you can afford it, work with a top agency.

If you cannot afford it today, work with a hungry up-and-comer and bet that both of you grow together!

By the time you can afford it, they are a top agency too. 😊

If they are not, you move on.

“Perfection is the enemy of Good”

I will admit, I have been thinking of starting this newsletter since November last year.

Yet somehow, I never got around to it.

I wanted it to be perfect.

The perfect website, the perfect outreach, the perfect content.

Until I realized that wanting to be perfect was just giving me an excuse to procrastinate.

When I told this issue to a client who runs a marketing agency, she said something which I won’t forget.

“Vijay, just get started. No one can put out perfect content on Day 1. It takes months, if not years to get it right. If time is a major factor which determines success, wouldn’t you want to get started earlier?”

Boom, that struck a chord.

Next day, I woke up at 5am and wrote down things which actually matter to get started – a platform, my audience and content. Remaining things will come over time.

Get started at 70% readiness. You can always refine it along the way.

One client is a market leader with >90% market share. Needless to say, he is filthy rich, travels in luxury, lives lavishly – you get the gist.

Yet the one thing I have learnt from him (apart from the fact that I need to get rich!) is how much he invests in relationships.

His product is a high-ticket item. It usually costs upwards of INR 10 crores.

Naturally, his customers usually need bank loans to buy the machine.

Many a times, the customer initially gives the order for the machine. But due to bank issues, he is forced to cancel it.

While technically the customer is supposed to pay a penalty, my client has never charged it.

Instead, when the customer visits him to apologise and cancel the order, he serves them tea and snacks, has a respectful conversation and wishes them all the best for the future.

This, he has told me, has created bigger goodwill in the market than he ever imagined.

He can afford to be money-minded and make Rs 40-50 lakhs as penalty income, just sitting in his factory.

He is an undisputed market leader, after all.

Yet he invests in building relationships.

I cannot even begin to list down the instances when I have seen this lesson play out with my clients and even in my own practice.

So much so, that I have developed a principle -

“Business which only gives me money, and not a long-term relationship, is a WASTE of time.”

I am making a bad habit of making my last points seem philosophical.

But yes, this is another banger lesson I have learnt. And one which no business school teaches you.

For most people, “enjoy” means Netflix & Chill, going to a spa or sleeping for 10 hours straight.

But we do not want to be most people, right?

When I started my practice, I used to be too …. intense.

Or so I thought.

Until I saw how my most successful clients work. Without exception, none of them needed to work.

They built such strong systems in their business that they can easily take vacations 365 days a year.

Yet their discipline continues to floor me to this day.

They are in office at 10 am every single day, and leave late at night.

I once asked such client “Why? You don’t even need to come to office. Yet you come first and leave last.”

 “Yes, because I enjoy my work. I am good at it. I can’t imagine myself doing anything else.”

If you are doing a business “just to buy a BMW”, you will eventually buy that BMW. But you’ll never enjoy driving it.

Enjoy yourself today.

You will never be as young as you are today. You have never been as experienced as you are today.

Today is the present (pun fully intended!).

Enjoy whatever you do, to the fullest.

It is a choice, trust me.

I hope you found this post as useful as I think it is for anyone in business or aspiring to have one. 

I will be really, really obliged if you could tell me how you found this.

I try not to sound preachy and exclusively talk about my own experiences. Your feedback and reviews will only help me curate more relevant content.

Please email me your feedback at [email protected].

Stay tuned - I am now going to dive deep into business finance topics on a weekly basis. All about real practical experiences.

To all those with a mission in life,

VijayBhava!

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