Choose the Troublesome Problems: Where There Is Trouble, There Is Opportunity

Liu Run: ‘Profit is compensation for prejudice.’ People used to view Latin America as ‘chaotic,’ ‘far away,’ and ‘poor.’ They therefore hesitated to go there or treated it merely as a stepping stone to the United States. But: What others see as ‘chaos’ is not actually an absence of laws, but high compliance costs. What others see as ‘distance’ is an uncontested market not yet caught in cutthroat competition. What others see as ‘poverty’ is a huge gap between supply and demand. There is no perfect market. Europe and the United States are mature markets, but competition is too intense. Southeast Asia is close, but too crowded. So-called blue oceans are often the places that look a little ‘troublesome.’ If a market had lots of people, lots of money, and were especially easy to operate in, the opportunity would already have been filled. It would not be waiting for us. Then there are tariffs. If you calculate only the ‘visible costs’—how much tariffs have risen or how much margins have shrunk—the picture can look frightening. Smart businesses, however, calculate ‘total costs’: add tariffs, logistics, labor, supply-chain costs, and the cost of time. Which route has the lowest overall cost? When you focus only on tariffs, you may feel there is no way forward. But put them back into the entire cost structure and recalculate, and you will find there are still many possible routes. When one route is blocked, you can do more than look for a detour. You can redefine what a ‘route’ means. #LiuRunBusinessReportCommentary ----- Robin: ‘In entrepreneurship, choose the troublesome problems. Where there is trouble, there is opportunity. If something looks easy—including choosing a market—there is basically no opening left for you. More than a decade ago, everyone wanted to go to China. Seven or eight years ago, everyone wanted to go to Southeast Asia. Today, everyone is talking about Japan. But Japan is not as far behind as people imagine. Someone there is already doing the things you can think of—and even the things you have not thought of yet.’