FASTer Issue #7

If we don't sort out health(care) we will not sort out wealth. You measure success in wealth. I measure success in mental health. We as a nation are sliding down a slippery slope powered by bad health outcomes borne out of economic tragedy, suffering, inequality, lack of governance and the pursuit of riches by the 1%. Who are the 1%? Those responsible for governance, security & those who sit on land parcels & generational businesses & wealth. All others are not made equal. We are no longer a real country, but a Reality TV contest for the 1% to load up and send abroad the fortunes of their dominance in society. When law makers/enforcers of the law are billionaires they are not working to fix our outcomes.

Outcomes

Today we talk about my favourite kind of outcomes. Un-intended outcomes. Corruption, Greed, Lawlessness these are all outcomes in a not-so-pleasant society that has no rule of law. We got here because we did not take a stand as a people and allowed our core values to be crumpled upon. Now we have a vastly large young population that is paying the dues of the boomers not taking a real stand. The corruption didn't happen over night, the sugar mafias and the wheat mafias and the corrupt bureaucrat or the officers in uniform are not an outcome of a few days or weeks. Human greed has allowed for all this to perpetuate to a point where, those who could have, should have taken a stand when the directionality of the nations outcomes was headed to disaster. Instead of a short history of the things that got us here, let us look at the activities at hand that are messing up outcomes for our future generations and how to spot them.

1)Most if not all businesses that rely on importing parts, products, services, goods, materials etc follow what is known as under invoicing. Meaning declaring the wrong face value of the product, always lower, so that the taxes that get computed on the actual goods/svc is lower. Whats the outcome of this? If you are a straight shooter and don't want to go down this path and do business legitimately by paying full duties/taxes, the entire market you operate in, is under invoicing there-by making your final goods and services more expensive and in the end not able to compete with all the annual umrah doing bayoparis in your market. They have an alternate methodology/reality that they subscribe to, saying paying taxes to a corrupt govt is not ok, so cheating, mis-declaration short taxes, duties etc are ok. A detailed research study here.

2)Sales Tax. One of my top 5 examples. The concept is simple, you sell some thing you collect a sales tax for the govt on that sale. Consumer pays you, you pay the tax man. A sales tax registration number (STRN) (thirteen digits) is issued to every person who is registered for sales tax purpose and only that person is authorised to charge sales tax on his taxable sales. Thats easy enough but there are 1000s of people charging tax, either not registered with the govt, or even if they are not depositing this sales tax back to the govt. Imagine 10 restaurants in a popular area, one person is charging and depositing the tax to the govt from his patrons, one is collecting but depositing partial, and a third is collecting and keeping all of it as he's not registered with the tax authorities. The net economic looser is the person doing the right thing, he has less operating cash compared to every one else, so he will expand less, grow less, compete harder but by doing every thing right, his outcomes are F*d.

4) The elite, educated, professional tax thief that is in the business of a direct to consumer business. In every country, economy there are noble professionals, elite professions, high integrity professions. Those that come with a higher standard than most. Doctors, Surgeons, Lawyers, Architects, Designers, Consultants, Vets, Dentists, Tuition Teachers+ many other professionals are all revered in our society, that reverence is not what we are debating here. These guys run thriving money making practices, mostly operating on cash & virtually no tax, Its you the end user is getting shafted in the end because of their lack of integrity and honesty by paying more indirect taxes on every thing you purchase because you hold them in that high regard, you are ruining your own outcomes by subscribing to, prescribing to or using the services of all these criminals. Thats what they are if there was a justice system in our lands, but instead they are the people who import the 200% duty rated cars and flaunt em. You then applaud their hard work and riches, if we didn't pay taxes we'd all be driving the said exotic cars.

5) The solo-preneur turned businessman cum uncle who is religiously inclined high on zakat, sadqa and other religious outcomes but not registered with the tax man. These guys are pretty enterprising, if there was an equitable tax system, they would still do well and the country would benefit. We have millions of these guys. From the basic pakwan shop guy who does 10 wedding cookouts a year, to the more sophisticated annual vip haj + umrah club of uncles who run large scale catering, supplies , real estate or other businesses with not a single NTN number between them. They are, in the end truly answerable to their maker, so they refuse to pay all taxes, operate in all cash and have more properties in the GCC, FarEast & America than people who live there and worked their entire lives paying taxes.

Our outcome(s) as a country will not change ever, if you cant understand both the magnitude and implication of the number I am about to share next. As per the FBR's statistics, the total number of people who submitted their tax returns = 2.154 million. We are a country of 200 million people. The only people paying taxes are suckers in the employed class, all others, politicians , so called eminent folks in society, your next door retired chap from the capital, etc all are systematically not in this net. There is a reason why the political elite and feudal elite of this country do not want any thing to change its because they have morons that vote them in to power who they then get to screw over(again). This whole country is running on the tax registration and payment in a lopsided equation powered by Karachi. For any one to counter their argument please submit your tax return by email before you can have an opinion.

One New Thing (That's really old)

"For all practical purposes, the 22 families had become by 1968 both the planning commission and the ministry of finance for the private sector. They preempted most investment permits, import licenses, foreign credits and government patronage because they controlled or influenced most of the decision-making forums handing out such permissions. They had virtually established a stranglehold on the system and were in a position to keep out any new entrepreneurs." There has been this huge hue and cry about the 22 families that ruled Pakistan. The man who classified them as such was one Mahbub ul Haq. He was a Pakistani economist, politician and international development theorist who served as Finance Minister of Pakistan from 10 April 1985 until 28 January 1986, and again from June to December of 1988. So killing entrepreneurship by the so called "elite" is not new in Pakistan. Mabub ul Haq is credited with creating the Human Development Report so clearly he knew what he was talking about. Our present day issues stem from items he highlighted in 1968, 53 years ago. Shame on us for not fixing any thing.

How we get controlled by the same people and why govt is silent?

Boring stuff that scales

Seems almost counter productive once you've read the sections above and feel like this country is in the hands of despots or thugs or both. There is still hope because 200m people aren't immigrating any where soon and they all need food, sustenance, basic services, products, consumables & other things they don't know they need.

You have two choices.

1) You build a product, service, idea, tech company, some thing in PK and sell it overseas and go after the illusive $ dreams.

or

2) You double down and go mass market local. Build some thing that every one needs/wants and go from there.

I'll break it down for you. For path one you can be all digital and be digitally native in what you sell, you have for the first time in our lifetime the ability to beat the despots and the corrupt and all things that have held the average person back and go for the win. But it's not easy, every thing and every one is not cut out for a digital play. For every successful online story you hear there are 99 of failure that you don't. If it was this easy every one would be doing it. The idea is to spot a niche, build a capability and do it cheaper than others initially and then do it better, then scale. Build a business that gives you the life of comfort vs trying to build a unicorn.

For path two, you need a sense of humour, luck, perseverance and an idea, albeit not original that lets your build a product or service that scales that every one wants. My fav example is that of shahi supari. It seems like its a house hold brand but its taken ages for it to get where it's gotten. So identify a product niche that non ones operating on, use other peoples distribution rails and put out product in the market. If it's compelling enough and sells you can double down and build on that. Shampoo Sachets, Masala packets for single use only(no one does it, its not sexy enough yet). Open cooking oil for single use by weight. Think corner store, healthy cooking oil but sold without packaging & its over heads. Soda Stream like machines, installed again in neighbourhoods, with in-expensive flavour packs to make carbonated flavoured drinks at less than a third the price.

There are are paths where the two streams can cross.

Again it's not sexy but it scales if done right. D2C brand built for the Masses but not ours. Take chat masala + fries combo. Our very own combo, just like others capitalised on our amazing Himalayan salt, time for us to take the glass bottle of premium chat masala and sell it at 5$ a bottle in the US/CANADA/Europe as "Pommes Salz" The category already exists, we just need to elevate the game. The things market research will show you, if you only try. So heres a quick go at it, find 20 gourmet food stores in the Benelux region. They love their fries. Find a friend who lives there, ship out 10 kg of your custom blend chat masala, oh no, sorry, "Pommes Salz" feature this at artisanal stores by giving it away for free. Your target markets aren't desi stores. This is one way to build your brand and add an adjacent product that people didn't know they needed. Break free from the tyranny of the boomers. Go online and scale once there is market traction.

You heard it here first ..

E-commerce discoverability sucks in Pakistan. Try Searching Goldfish pencils. Made by Shahsons in Pakistan. What you will find are dozens of search results for amazon and international market places and pencil blogs(you better believe it) but near crappy results on Daraz and others. Goes to show how as a category, this is under-indexed on google(not a scientific term).

Search "Shahsons Vista" or "Goldfish Vista"

You find listings like this (Sales price for a box of 12 in the US at almost 7$)

Shahsons Goldfish Vista Pencils - 2 1/2 HB - 12 PACK - Quality Drafting Pencils made in Pakistan Shahsons is Pakistan’s first pencil factory which was founded in 1953. The Goldfish Sprinter is the company’s standard school and writing pencil. This pencil is easy to sharpen and it provides a fine

First of all no search results show up in PK for those key words, just for goldfish and then u go through daraz and lucky if you find some thing. Comparable pack of 12 =88 PKR if not less. Do the math. Both as an opportunity to export and as a local store that does on demand deliveries for stationary product, direct to consumer. I wonder why these brands keep missing this outsized opportunity.

Buy Goldfish Sprinter Pencil Pack of 12 Pencils online at Daraz Pakistan with

It simple build your own store, use your existing distributors or retails to fulfil the order, share the margins.

What you should be reading & why

The Millionaire Next Door.

An interesting take away was that most of the truly wealthy in the US don't live in Beverly Hills or on Park Avenue-they live next door to the average American. So how does that help any one? The central message is an unsurprising one - to build wealth you need to spend less than you earn & continuously invest the difference how ever small to incrementally to grow over the long term. Really? But the point is that most of us don’t do it even though it’s within reach of most of us to do so. In much the same way to lose weight we just need to consume less calories than we expend - easy enough? On paper at-least. To be the average guy but not be the average guy is the message. In summary, this book is essentially a long stream of curated data, distilled into a finely tuned narrative that can really give you directionality as you figure out how to life within your means and what that means for your future. A must read.

If you are too lazy to read the book, I still want you to have access to a distilled version. A Youtube summary for you below.

Monetise your time (For Millennials and more)

  1. Remove local news from your list of things to do

  2. Leave Whatsapp groups that add zero value to your life

  3. Add business + growth content to your life

  4. Don't buy in to the "build in public content hype" you don't live in America just yet.

  5. Politics has no end neither does worrying about other peoples "shit". There I said it. Worry about your self only. Dont worry about who met whom to do what. Dont worry about who lives where, does what for a living and what they posted on social media.

  6. Twitter is the fastest way to learn some thing new and to test ideas, use it.

  7. Any time invested in giving free "advice" is money off the table for you.

  8. Make sure you give more favours than you receive and you remember both.

  9. Invest 20% of what ever you make annually into some type of asset.

  10. Quit toxic jobs asap, the money is not worth the future consequences to your health

  11. Have an exit plan always. Be it out of the country, out of the city, out of your town, village, company etc. See issue one of faster for options if you are an entrepreneur.

  12. Invest in real estate slowly, surely, incrementally. Even if its in-expensive agriculture land today so you have a hedge.

  13. Identify some one to mentor you.

  14. Negative company should to be dumped, it adds zero to your growth ambitions.

  15. Try to network with your parents friends and then their friends if you are a young professional it never hurts to be in the company of wiser folks who have greater access than you do today.

  16. Working hard is not waiting for your mom/family/parents clean up after you, own your own space, accountability starts from home. If you cant own your living space you can hardly organise your self to monetise your time.

Made in Pakistan

I came across a pretty comprehensive(likely doesn't have every thing though) list of Pakistani brands and products incase you are curious enough to explore. The List is here for you.

One Last thing

An outsourcing service that does home concierge for well heeled house holds. May sound wacky but people with the means employ hordes of staffers to manage their personal "space & time". Yet there is chaos, there is also no training for globally established professions like:

1)Estate Managers

2)Private Chefs

3)Butlers

4)Personal Valets

And many more. You can see a list here

Part staffing company, but not focused on basic domestic support, instead providing training and elevating the careers of people with specialist skills and charging a premium for a premium service. Done at scale with trained resources this is better than shipping un-skilled labor off to foreign lands namely GCC. We need to up skill every step of the way.

Some details about the lives & careers of butlers for example , in these videos below