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The power of financial education
Marty
#551 Posted : Thursday, June 05, 2014 3:36:35 PM
Rank: Veteran

Joined: 3/31/2008
Posts: 761
Location: Nairobi
Otieno, the Master Welder

When Mwalimu got his first job, he was living in his ancestral home at the outskirts of the city. You can imagine his shags is just a few minutes from the City. However, where he comes from there are some lazy young men who partake illicit brew and more than willing to harvest where they never planted. It is on this premise that he was invited by his old friend to live with him somewhere in Eastlands. And so he left with a bag of clothes and a big radio to the City in the sun.

While going to his abode in one of those estates with lots of traffic, he could not help but gaze at the amazing works of one particular welder (Otieno). Those Nigerian gates and well-designed windows and doors were a site to behold, amazing work of craftsmanship. In short, Otieno’s artistic work would speak for itself; after all, the compelling products on display were quite appealing to the eye.

Mwalimu eventually got blessed and bought a plot off Thika road before the road was upgraded to a superhighway. He never minded the jam; after all he was used to it. Nothing is as sweet as living in one’s house even if the so called house is a one roomed mabati shelter. You see that landlord I had in Eastlands was just like any other. Every now and then he’d drop that note saying: Due to the current economic situation, we have adjusted upwards our rent…blab la bla…and when I left his house he declined to refund my deposit. In fact he was claiming some cash from me after balancing my account. Funny guy. And he used to come all the way from Muran’ga and camp in Nairobi for two weeks to collect rent. Anyway, let’s leave this landlord alone.

Back to Otieno. When I was doing my residential house, I knew I’d definitely approach Otieno to make my windows and external doors. When I landed at his workshop, it was a beehive of activities and the impression I got is that Otieno was doing quite well. I had a chat with him over a cup of tea (Mwalimu loves tea). The discussion culminated into a quote for the works and I paid the deposit for the works to be done. Otieno went to work and promised to deliver in two weeks. Mwalimu keeps time and he does his best to keep his promises as well. He also expects others to do the same. Two weeks later, I went knocking at Otieno’s door only to be informed that my work is 90% done. I decided to inspect the said works and realized that in all honesty it was 50% done. I felt let down though the fellow promised to deliver in the next 1week. One week later, the work was not complete. The usually quiet and reserved Mwalimu decided to act tough. He really talked tough just to make sure that Otieno does deliver; after all Mwalimu had already given a two months’ notice to his landlord and he expected to finish his house in good time.

To cut the long story short, Otieno delivered the windows and doors to my site 5 weeks later. When the delivery was inspected, it was missing some windows, 1 door and the gate. You can imagine how angry Mwalimu was to the extent to almost slapping Otieno. How was I to move to my new house without doors and windows. How about that perimeter wall and without a gate? That is the day Mwalimu knew that in Jua kali, not all that glitters is gold.

The final delivery was done 15 days before the date I was to move in. And by the way, the gate was still missing. On the eve of my big day (the day when I’d finally kiss the landlord goodbye), I still did not have the gate. I called my good friend and informed him that I was on a small mission to pick a gate along Outering road and requested for his company. When we landed at Otieno’s workshop, I was shown a gate which was halfway done. You can imagine how I felt. Next to my incomplete gate was a very nicely done gate. I actually had assumed that that was my gate. I summoned all courage and informed my friend that we go look for a pick-up and some strong boys. When we came back to the workshop with a pick -up and strong men, Otieno must have sensed danger. We went ahead and loaded the nicely done gate and as we were about to depart, Otieno stood in front of the vehicle and I could see his desperation. You see, that gate I had forcefully picked was for some client from Kitisuru who was to come for it in a few minutes. I could hear none of that and off I went with the gate. That is how Mwalimu got his nice gate. When I look at it, it reminds me of Otieno.

Next, I will analyse Otieno’s biggest weaknesses. Did his business survive???
When I admire the wonder of a sunset or the beauty
of the moon, my soul expands in worship of the Creator.
Lolest!
#552 Posted : Thursday, June 05, 2014 3:51:43 PM
Rank: Elder

Joined: 3/18/2011
Posts: 12,069
Location: Kianjokoma
Applause Applause that's an interesting one @marty. Kumbe you're from Gachie
Laughing out loudly smile Applause d'oh! Sad Drool Liar Shame on you Pray
Angelica _ann
#553 Posted : Thursday, June 05, 2014 4:06:44 PM
Rank: Elder

Joined: 12/7/2012
Posts: 11,935
Lolest! wrote:
Applause Applause that's an interesting one @marty. Kumbe you're from Gachie

formerly @mawinder's neighbour before he hacked it!
In the business world, everyone is paid in two coins - cash and experience. Take the experience first; the cash will come later - H Geneen
XSK
#554 Posted : Thursday, June 05, 2014 4:25:29 PM
Rank: Veteran

Joined: 12/8/2009
Posts: 975
Location: Nairobi
Angelica _ann wrote:
Lolest! wrote:
Applause Applause that's an interesting one @marty. Kumbe you're from Gachie

formerly @mawinder's neighbour before he hacked it!


interesting smile
You will know that you have arrived when money and time are not mutually exclusive "events" in you life!
Mukiri
#555 Posted : Friday, June 06, 2014 1:52:02 AM
Rank: Elder

Joined: 7/11/2012
Posts: 5,222
Laughing out loudly Laughing out loudly Laughing out loudly My (former) tailor is like that

Proverbs 19:21
Rankaz13
#556 Posted : Friday, June 06, 2014 8:53:51 AM
Rank: Elder

Joined: 5/21/2013
Posts: 2,841
Location: Here
Marty wrote:
Otieno, the Master Welder

When Mwalimu got his first job, he was living in his ancestral home at the outskirts of the city. You can imagine his shags is just a few minutes from the City. However, where he comes from there are some lazy young men who partake illicit brew and more than willing to harvest where they never planted. It is on this premise that he was invited by his old friend to live with him somewhere in Eastlands. And so he left with a bag of clothes and a big radio to the City in the sun.

While going to his abode in one of those estates with lots of traffic, he could not help but gaze at the amazing works of one particular welder (Otieno). Those Nigerian gates and well-designed windows and doors were a site to behold, amazing work of craftsmanship. In short, Otieno’s artistic work would speak for itself; after all, the compelling products on display were quite appealing to the eye.

Mwalimu eventually got blessed and bought a plot off Thika road before the road was upgraded to a superhighway. He never minded the jam; after all he was used to it. Nothing is as sweet as living in one’s house even if the so called house is a one roomed mabati shelter. You see that landlord I had in Eastlands was just like any other. Every now and then he’d drop that note saying: Due to the current economic situation, we have adjusted upwards our rent…blab la bla…and when I left his house he declined to refund my deposit. In fact he was claiming some cash from me after balancing my account. Funny guy. And he used to come all the way from Muran’ga and camp in Nairobi for two weeks to collect rent. Anyway, let’s leave this landlord alone.

Back to Otieno. When I was doing my residential house, I knew I’d definitely approach Otieno to make my windows and external doors. When I landed at his workshop, it was a beehive of activities and the impression I got is that Otieno was doing quite well. I had a chat with him over a cup of tea (Mwalimu loves tea). The discussion culminated into a quote for the works and I paid the deposit for the works to be done. Otieno went to work and promised to deliver in two weeks. Mwalimu keeps time and he does his best to keep his promises as well. He also expects others to do the same. Two weeks later, I went knocking at Otieno’s door only to be informed that my work is 90% done. I decided to inspect the said works and realized that in all honesty it was 50% done. I felt let down though the fellow promised to deliver in the next 1week. One week later, the work was not complete. The usually quiet and reserved Mwalimu decided to act tough. He really talked tough just to make sure that Otieno does deliver; after all Mwalimu had already given a two months’ notice to his landlord and he expected to finish his house in good time.

To cut the long story short, Otieno delivered the windows and doors to my site 5 weeks later. When the delivery was inspected, it was missing some windows, 1 door and the gate. You can imagine how angry Mwalimu was to the extent to almost slapping Otieno. How was I to move to my new house without doors and windows. How about that perimeter wall and without a gate? That is the day Mwalimu knew that in Jua kali, not all that glitters is gold.

The final delivery was done 15 days before the date I was to move in. And by the way, the gate was still missing. On the eve of my big day (the day when I’d finally kiss the landlord goodbye), I still did not have the gate. I called my good friend and informed him that I was on a small mission to pick a gate along Outering road and requested for his company. When we landed at Otieno’s workshop, I was shown a gate which was halfway done. You can imagine how I felt. Next to my incomplete gate was a very nicely done gate. I actually had assumed that that was my gate. I summoned all courage and informed my friend that we go look for a pick-up and some strong boys. When we came back to the workshop with a pick -up and strong men, Otieno must have sensed danger. We went ahead and loaded the nicely done gate and as we were about to depart, Otieno stood in front of the vehicle and I could see his desperation. You see, that gate I had forcefully picked was for some client from Kitisuru who was to come for it in a few minutes. I could hear none of that and off I went with the gate. That is how Mwalimu got his nice gate. When I look at it, it reminds me of Otieno.

Next, I will analyse Otieno’s biggest weaknesses. Did his business survive???


Laughing out loudly Laughing out loudly Laughing out loudly welcome back Mwalimu. Na kumbe wewe ni mkali eh?Laughing out loudly Laughing out loudly
Life is like playing a violin solo in public and learning the instrument as one goes on.
mawinder
#557 Posted : Friday, June 06, 2014 9:04:37 AM
Rank: Elder

Joined: 4/30/2008
Posts: 6,029
XSK wrote:
Angelica _ann wrote:
Lolest! wrote:
Applause Applause that's an interesting one @marty. Kumbe you're from Gachie

formerly @mawinder's neighbour before he hacked it!


interesting smile

He is not from Gachie but from near there.
Marty
#558 Posted : Monday, June 09, 2014 2:12:48 PM
Rank: Veteran

Joined: 3/31/2008
Posts: 761
Location: Nairobi
mawinder wrote:
XSK wrote:
Angelica _ann wrote:
Lolest! wrote:
Applause Applause that's an interesting one @marty. Kumbe you're from Gachie

formerly @mawinder's neighbour before he hacked it!


interesting smile

He is not from Gachie but from near there.


@Mawinder seems to know. 35mins from CBD could land you anywhere around Gachie, Kikuyu, Kabete, Wangige, Kingéero (the place where they slaughter) etc.
When I admire the wonder of a sunset or the beauty
of the moon, my soul expands in worship of the Creator.
Marty
#559 Posted : Monday, June 09, 2014 2:19:49 PM
Rank: Veteran

Joined: 3/31/2008
Posts: 761
Location: Nairobi
The Donkey in you

Otieno, the master welder set out to run a business. And many of us do that. But how many of us succeed in our ventures; barely 10% within the first 5 years and 5% after five years. The amazing welder was once employed in a welding workshop. He started entertaining the feeling that his employer was really dependent on him, and to an extent he was. How many of us who are technical entertain such thoughts.

I was once employed in a small software company. I did all the donkey work (I will allow you to call me a donkey). I once felt like the boss was doing nothing. I really felt that the company was making money (lots of it) from my personal skills and I never felt adequately rewarded. I had a manager who never understood anything about software. He once gave me some work which he assumed was a one day’s job but in the real sense was a one week’s job. On day two after giving me the work, he reprimanded me and I told him off and walked away. I had the guts to tell him I will never work for him again. Interestingly, I just walked away and without any idea of what I will be doing with myself. Strangely, after 3 days, the fellow called me for a discussion over a cup of coffee and he convinced me to go back to work. I went back and since that time the guy at least could listen to me, after all hata punda anahitaji heshima. I am sure you have seen those sign board that advise we respect donkeys along Naivasha road somewhere around Lari and Kijabe. You need to take good care of the donkey and in return, it will give you good service. On the contrary, if you don’t do that, you can receive the dangerous kick. Where I come from, they say that a donkey will never sleep unless it has a full stomach.

Back to Otieno the master welder. While employed he entertained the kind of thoughts that he was indispensable and his employer could not do without him; after all, all the windows and doors had to be made by him. His boss was just a clueless noisemaker. He assumed that he could definitely succeed in his own business; after all his works were just amazing and he could even run away with some of the clients from his former employer. Mistake No 1: Assuming that the business would just succeed simply because the technical man is around. For Otieno’s case, the technical fellow (donkey) doubled up as the business owner.

You are very good at what you do at the technical level, but realize that this is just but one element that will be needed for the business to succeed. Being a master baker does not in any way guarantee that the raw materials for the cakes will be sourced in good time. Neither does it guarantee that your cakes will sell. Neither does it guarantee that your cakes will be distributed in time. Alas, it does not even guarantee that you will talk nicely to customers and satisfy all their needs. Again, if you were to bake the same type of cakes with the same raw materials ad infinitum, your clients will get bored…so a bit of creativity and moving with time is needed.

I used to get bored by whiners in the office who always had something bad to say about the boss and how they are unfairly treated. You see, as long as you are in employment, you are just but a slave who sells his time for money. Aren’t you better off thinking of what you can do to get out of the slavery. The boss you keep whining about is just doing his job, and if he is not the business owner, then he is just but an elevated slave. After all he dances to the tune of the CEO. And that CEO who thinks he owns the world dances to the tune of the board.

What is the lesson for today? A business surely needs donkeys (the technical fellows) but it also needs a lot more. By the way, there is nothing wrong with being a donkey, but if you remain as one till retirement age, then I will say you are not that clever. You will at least qualify to be given a wheelbarrow and a spade at 60. Your employer will even give you free transport to your retirement home if you will be lucky to have one.

In the next post we shall look at the other very important thing that Otieno failed to do to succeed in his venture.
When I admire the wonder of a sunset or the beauty
of the moon, my soul expands in worship of the Creator.
simonkabz
#560 Posted : Monday, June 09, 2014 2:34:55 PM
Rank: Elder

Joined: 3/2/2007
Posts: 8,776
Location: Cameroon
murchr wrote:
VALUE INVESTING.

Its an investment approach whereby an investor buys a stock(s) trading at a value that is less than their intrinsic value (moderately undervalued stocks). NOTE not grossly undervalued stocks.

The ‘Actual value’ of the share is found out by certain calculations and the figure you get is compared with the current market trading price. If the particular share is undervalued that signals a good investing opportunity. Stocks undervalued by Mr. Market are what would be referred to as Value Shares.

Value investing was made popular by Benjamin Graham who was later to become Warren Buffet's mentor. Benjamin introduced the concept of "Mr Market" in his book " The Intelligent Investor"

The concept of Mr. Market goes something like this:
Imagine you are partners in a private business with a man named Mr. Market. Each day, he comes to your office or home and offers to buy your interest in the company or sell you his "the choice is yours"

The catch is, Mr. Market is an emotional wreck. At times, he suffers from excessive highs and at others, suicidal lows. When he is on one of his highs, his offering price for the business is high as well, because everything in his world at the time is cheery. {BULL MARKET}

His outlook for the company is wonderful, so he is only willing to sell you his stake in the company at a premium. At other times, though his mood goes south and all he sees is a bleak future for the company. {BEAR} In fact, he is willing to sell you his part of the company for far less than it is worth. All the while, the underlying value of the company may not have changed just Mr. Market's mood. In all this you are free to ignore him if you don't like his price. The next day, he'll show up at your door with a new one.


Value Investors believe that there are two values to a stock. The current market price (which is influenced by market forces and investor sentiments) and the ‘actual’ or ‘fair price’ (called intrinsic value).
A stock may be undervalued because "Mr market" may overreact to good or/and bad news floating around causing movements (up or down) in prices that do not correspond with fundamentals of the company. It is in these movements that opportunities present themselves to buy.

A value investor does not just look at stocks that may appear "cheap" strong fundamentals have to be in place. These fundamentals include earnings, dividends, book value and cash flow. In most cases value investors carry out a SWOT analysis on a stock and individual companies and as such market gyrations and macro-level changes do not matter to them. The ‘margin of safety’ approach ensures that the downside risk to investment is limited. As long as the investor has a strong conviction of what the company is really worth, he should be able to look at "Mr. Market's" offers and reject or accept them.


Applause Applause Applause On point as usual.
TULIA.........UFUNZWE!
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