In Cashflow 101, an advanced Monopoly-like board game created by Rich Dad, Poor Dad author Robert Kiyosaki to teach the ins-and-outs of financial independence, there are tiles that say “Opportunity”, wherein when you land there, you have to take an “Opportunity Card”, read it aloud — it describes the opportunity, its cost, and its effect on your cashflow, and decide whether to take it, leave it, or sell it to someone who can afford it.
An opportunity card can only be opened when you land on the opportunity tile; it’s take-it-or-leave-it, meaning you can’t have the same opportunity in the future. If you decide that you can afford it, it usually drastically changes your balance sheet. As a rule of thumb, you take an opportunity card only if it generates a positive cash flow — meaning that the opportunity “pays” for itself. This is in line with Kiyosaki’s simple definition of an asset as anything that generates income.
Well, the other night, life suddenly dealt us an opportunity card.
After giving out cards and contact information for I-NAV Travel at the 18th Philippine Travel Mart last weekend, we were already expecting to be called by hoteliers and resort owners so they could sell us timeshare memberships for their networks.
Come Monday Melynn received a call from Crown Regency’s agents.
We went to their office thinking we’ll just listening. All we were really after was the free 7 nights worth stay at either Crown Regency Mactan or Davao (timeshare marketers usually dangle such perks to entice you to “hear them out”). We came in at around 8 PM, was offered the customary drinks, and sat down thinking how long we would wait for the certificate.
We walked out at around 12:30 AM. Needless to say, we didn’t only have that certificate on our hands.
It was just the usual sales pitch. In fact I found the sales agent assigned to us somewhat inexperienced, and we just let him ramble with the usual sales talk, with matching leading questions. I wasn’t particularly impressed, in the sense that everything he described about their facilities and the perks and terms of the timeshare arrangement were expected. Don’t get me wrong though, the facilities were excellent, to say the least.
It reached the point where all we really wanted to hear was the cost of the whole thing. I had a price in mind. I was getting impatient. But one term made some bulbs in my head go off.
“…accommodations beyond your allocated days per year come at a discount of X%”
X%? I whispered to Melynn: “how much do hotels usually give as travel agent’s commission?”
Melynn answered: “Y%, and it can be lower when it’s peak season.”
X was much greater than Y. More bulbs went off in my head.
When the agent finally got to the end of the presentation, he handed us over to his manager, who gave us the terms and the cost of the product. It wasn’t cheap. It was enough, in fact, to buy a decent 2nd-hand car. And the catch was we had to do decide on the spot, otherwise we won’t get the payment terms, we have to pay in full. He got to the down payment part of the costing, calculator at hand.
“I can’t afford that,” I said. The haggling game began.
After a few more calculator doodling, the manager gave us the cheapest terms he could give us, at a down payment I could afford with our credit card.
I got the calculator from him while my wife asked for the published room rates of the hotel, and the contracted rates for travel agents. We did the math, based on the cheapest rooms available. We figured out how many rooms we need to sell per month in order for the product to become an asset; something that pays for itself.
It came down to Z rooms per month to break even. I turned to Melynn: “could we sell this? Could we sell more than Z rooms per month?”
Melynn said yes.
A few more minutes and we were on a cab on the way home, holding a timeshare policy that probably costs more than the cab devaluated for wear and tear.
It was a crazy feeling; a crazy mix of being scared half-to-death and being overly excited at the possibilities the deal could bring. But I knew it was a sign, an opportunity for I-NAV Travel & Tours, our baby that we nursed through some pretty serious birth pangs, to go up to the next level. We just upped the ante.
It won’t be easy; in fact I’m expecting it would be pretty painful in the next few months. But it’s time to hustle, and just let life bring it on, because when real life deals you an opportunity card, it won’t be coming back.
UPDATE: Peepz, if you know anybody who has regular accommodations/facilities requirements in the Cebu and Davao metro areas, please do tell!
You may comment on this blog or email me at jonlimjap [at] gmail {d0t} c0m or inavtravel [at] yahoo {d0t} c0m.
Thanks! 
UPDATE 2: After a whole year of waiting, we have finally taken another step in our company’s branding and online presence: I-NAV Travel & Tours, hosted by Marvins Web, can now be found at http://www.inavtravel.com
11 responses so far ↓
1 Sam // Sep 13, 2007 at 5:24 pm
Wow the risks…I’m always doubtful when dealing with people who wants my money by pressure…meaning that “on the spot…give me your cash or you got nothing!” scheme. However, you’re dealing with Crown Regency which is a pretty respectable business entity.
Good luck on your business venture tol!
Sam
Flip Brown Guy
http://www.flipbrownguy.com
2 Janette Toral // Sep 14, 2007 at 7:36 am
Congratulations! It is great to read posts like this where you spot an opportunity to a major expense presented. I wish you all the best!
3 Jon Limjap // Sep 14, 2007 at 12:16 pm
Sam,
That strategy is a double-edged sword in sales, actually. It turns off a lot of people, just like you said. But it also has the advantage of filtering out the muck (e.g., the tentative buyers) easily. Following up with clients for a potential sale because “they’re still thinking about it” is a waste of time; you’d rather move on and on and on at a very fast pace until you encounter a client that will buy your product.
I think this is in line with the ABC (Always Be Closing) principle of sales. Always Be Closing means that you have to close the sale always, with a positive or a negative answer. There are no maybe’s — just yeses and nos.
This link would help you reflect on the sales strategy further: Alec Baldwin’s speech on Glengarry Glen Ross
And that’s why it’s very important for buyers (like us) to be always prepared to brainstorm, hustle, and decide very fast. The fast math helps too. It would’ve been foolish for us to take this up without pushing the numbers — that’s suicide. All your decisions must be anchored on numbers.
Now, it’s OUR turn to go out and sell. Thanks for wishing us luck, we need every bit of it!
Janette,
Thanks.
It is fortunate that we already learned on recognizing the potential of what appears to be a liability to be turned into an asset.
We’re working hard on flipping it over that way — we’re really going for broke!
=========
Peepz, if you know anybody who has regular accommodations/facilities requirements in the Cebu and Davao area, please do tell! Thanks
4 siu // Sep 15, 2007 at 11:21 am
A client of mine’s been egging me to play that cash flow game. rEading your post, i might reconsider his invitation.
I already bought a club ultima share more than a year ago - and the price has already tripled. I guess thatt pretty much speak a lot about your investment. Im not so much familiar about crown regency’s promotions, but I hear a buyer needs to buy club ultima shares as well. I’m from cebu, the high-rise crown regency is nearing completion. It’s probably the tallest in Cebu. Right behind it is Club Ultima, the second tallest i think.
5 Jon Limjap // Sep 15, 2007 at 1:42 pm
siu,
Go ahead and play it!
Especially if the session’s for free. Here in Manila AIM has a cash flow “day” where you play the game for a whole afternoon. The price of one slot is PHP800+, includes lunch. That’s how “lucrative” that game is.
Yes I’m aware that the initial offering of Club Utlima was around 1/3 of our investment, at the time that Club Ultima hasn’t been completed yet (and it was only available to Cebuanos then). But at the Philippine Travel Mart I was really really excited about their ongoing Boracay developments: they are putting up not one, not two, but four resort facilities there: 2 on station 1, and one each on stations 2 and 3. Hope the moratorium on building permits doesn’t affect them though.
I’m not aware of the buyer being required to buy Club Ultima shares though.
We’ll be visiting Club Ultima Cebu soon enough, maybe in the 2nd quarter of next year. Hope we could meet you then.
6 reyna elena // Sep 15, 2007 at 8:10 pm
Hey John:
I know this one. Very well, because Chuva (www.chuvachienes.com) and several of my friends took the bait of this (pinoy) marketer who went to Atlantic City bout 2 or 3 years ago selling - TADANG!!! timeshares. Here, they offerred round trip tickets - geez almost everywhere really. Catch is, only if there are available dates. me catch pa, jigzzow puzzle mo na lang.
Needless to say - my friends signed up - and gave my name and phone number.
Dude! Let me tell you! Even when my cellphone was out of battery? It still rings coz they would call like crazy! They left so many messages and they have no clue whenever i say - Please Delete my number from your list - per blah blah blah federal regulations. Di naman naintindihan kung ano yong pinag-da-da-dak-dak ko. Tiniingna pa siguro sa wiki wiki.
In any case, no offense nor pun intended to those who employ these tactis - after all, it’s still creativity kung ano mang klase yan, but personally i always approach it this way - just like probably a good majority:
When it’s too good to be true: premyo mo ay isang onidoro.
Reyna Elena
*eye got balls, no! really!*
7 Jon Limjap // Sep 15, 2007 at 11:06 pm
reyna_elena,
Hah, Atlantic City, ang Las Vegas ng mga East Coasters. Roundtrip tickets? Labo naman nun… kung airline yung nagbebenta sakin pwede pa siguro. Kung third party, malabo.
Yun yung isang factor kung bakit ko kinagat ito, yung may-ari ng hotel yung mismong entity na nagbebenta. Hindi niya masyado binebenta yung mga international time/space bank chenes partners niya na pwede mong iexchange yung 1 week mo for some minimal membership fee — ang binebenta niya sarili talaga nila facilities.
Buti na lang yung isa naming friend lagi sa Cebu, he’s already been to the facilities, nabentahan na rin siya nung timeshare. Naconsult namin siya bago pa kami pumunta dun sa sales pitch, siya nagsabi na it would be a good buy. Hehe, kelangan may mga espiya bago sumabak sa giyera.
Anyway, totoo yan, when it’s too good to be true, it probably is in the inidoro. Anyway if this is all a big mistake, lesson learned, pulubi kami, kay Lolo’t Lola muna si baby, start from scratch ulit kami. Hwek hwek hwek.
8 Sidney // Sep 18, 2007 at 9:37 am
Great news. Good luck! I am sure you know what you are doing.
I for one never close a deal if I can’t sleep it over. I always need a few days to decide so that I can single out my emotions and enthusiasm of the moment. I even do this when I buy a new pair of shoes…
9 Jon Limjap // Sep 18, 2007 at 3:15 pm
Sidney,
Oh my, then I could imagine what you go through every time you need to buy a new DSLR, or a new lens! Haha!
10 siu // Sep 26, 2007 at 5:18 pm
didn’t get the chance to check on the comments, if you get a chance to be here in cebu, email me so we could meet. no probs.
11 Jon Limjap // Sep 26, 2007 at 5:59 pm
Thanks siu, I certainly will. We’ll go there first half of next year.
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