Feb 3, 2022

La Paz, MEXICO – “There’s no UBER and no DiDi! Can you pick me up?

This was the WhatsApp message I received at 9:45 PM from my daughter. I had dropped her off 90 minutes ago at a gym in town so she could do her workout.

Since the city of La Paz has some quarter of a million residents, one would have thought the independent drivers for UBER and more abundant (here at least) DiDi service, would be in abundance.

Not so. That late. In that neighborhood. With poor streetlights, pot-holed roads and who knows what’s down the side street….

(For those new to this thread, my wife and I have been traveling Mexico and Panama and are currently living and exploring Ecuador. You can find those back issues here.)

Now, unlike the Santa Monica, Malibu copycat city of San Jose del Cabo or the monstrosity that is Cabo San Lucas, La Paz is very much a “working” man’s city. Yes, there are some upscale resort communities and several, very nice marinas with massive yachts. But, overall, the city is quite ordinary.

The downtown is small with the typical open town squares. Traffic is not hectic. The streets are wide, if poorly paved.

What is quite unusual, for a north American, is the feeling that every street is a one way. And where there probably should be a traffic light or none at all, there is a 4 way stop. Even if there is no through traffic on one side.

Out of the blue, where no stop seems warranted, hidden by overhanging branches, is a faded “Alto” stop sign…. Except nobody stops – completely. They use the “rolling stop” method. Can’t tell you how many times it feels like a game of ‘chicken’ at the four-way stop. Who’s going to go first? Stop! No, accelerate!

So why are we in La Paz?

Well, for one thing, we had two friends of ours, one who lives in Cabos and the other who spent time here shopping for houses to buy, recommend it.

It’s much less expensive than Cabos, to the south. For us, coming straight from Ecuador, Cabos felt like we’d arrived in the US! And not the mid-west either. But the most expensive beach areas around Los Angeles.

Everything, from the all-inclusive 5-star beach resorts to the restaurants and shops. It didn’t feel like Mexico.

Secondly, not only are the beaches nicer here, from a swimming perspective, but the access to the sea, is much easier. You can safely go paddleboarding, kayaking, take trips to see and swim with the whale sharks, snorkeling and more. The vibe is less hype. The restaurants less pricey. The feel, more authentic.

Which brings me to this week’s theme.

The lockdowns everywhere – especially in the States and Canada, have hurt this area huge. Charter of excursions – dropped to next to zero. Hotel bookings – maybe sitting at the 30% range. Restaurants are half full at best.

It was easy when we decided to change our accommodation to find another within hours. And the little boutique hotel we found, with just 5 rooms, was empty. We immediately were welcomed warmly.

The very next day, the owner decided she could bring in a plumber to speed up the renovation of one of her rooms and install a new boiler.

That’s how important our little infusion of cash was to her business.

And cash is king. Make no mistake about it.

From the artisan markets to the boat captains. Small coffee shops to hiking tour companies and the local masseuse. No cards please. Just bring cash and pay when you get here.

It does make it inconvenient. Sometimes it’s difficult to get an ATM to spit out more than $200 of cash at a time. With the resultant high transaction and currency conversion fees.

Makes it difficult for the international shopper. More friction – thus some hesitancy to buy.

The more organized companies – take payment in many ways. Including PayPal. Saving the buyer, the inconvenience of meeting in person, in advance, with a cash deposit to secure a charter on the water, for instance.

One thing most of them do well, however, is take money up front. They do not reserve your seat and wait (hope) that you show up and then pay. What happens if you change your mind? Choose a different vendor? Start haggling over the price?

Same should go for you and your business.

Especially if you are selling larger ticket services. Have some kind of a subscription etc. Just like rent – which is paid the beginning of the month, you want a system of pre-payment, whether in the form of a deposit or installments.

You don’t want to be in the business of sending invoices and waiting (hoping) for payment, after the fact. Then you end up being in the “Account Receivable” business. Most of you are too small to be spending resources collecting overdue accounts.
 

No. Get paid. Up front.

To your health and success.

- Hugh
The “Profit Accelerator” Expert
 

P.S. Did you know that even tiny improvements of 1-3%, in just 12 fundamental areas of your business could give you 50% and more improvement to your bottom-line? Test out brand-new Profit Acceleration Simulator^TM  and discover the true impact of a conservative estimate of Profit Acceleration initiatives on your business and see for yourself. Head to: https://hughtafel.com/simulator/

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