Author: Paschal Agonsi
Understanding Producer’s Mentality and the nature of business gives us an advantage to perform better in the market. It is important to note that customer loyalty and brand recognition are key results of a successful business.
Producer’s mentality is the backbone of any successful business. It’s the direct opposite of consumer mentality. Consumer mentality is very easy to understand as over 95% of people are actively involved in it, consciously or unconsciously.
Just 5% or less of the world’s population have Producer’s mentality. It’s reported that 62 people now have a combined wealth that’s equal to the combined wealth of the rest of us in the entire world.
The ability to think and act more on producing rather than consuming is Producer’s mentality simply definedPaschal Agonsi
In other words, if your mindset is focused on consuming, then you lack producer’s mentality.
Another way to describe Producer’s mentality is to understand production in economic terms. Everybody makes profits from the production chain except the final consumer. In economics, production ends when goods and services are consumed by the customer
The production chain starts from the manufacturer to the distributors to the retailers and finally to the customer. This production chain is typical for most industries.
You can see here that goods flow from the manufacturers to the final consumer but everyone else makes a profit except the customer.
The only people who get a share of the market value are those involved with a Producer’s mentality. A good example is Pure water business in Lagos Nigeria. It’s estimated to make billions of naira every month.
The boys running in traffic have their own share in the market. The shop sellers too. They all share in the profits of the billion naira water industry.
For anyone to benefit from pure water business from tomorrow, or any business at all, you need to find a place in the production chain but don’t be the final consumer.
Customers need goods and services. Being able to offer them the right products earns you income. The Producer’s mentality is a prerequisite for understanding the nature of business.
Even in the major and local markets, you can see people who don’t own any businesses but yet make money by hunting customers for those that have shops, products or services. At the end of the day, these hunters (sales people) get a share of the consumer money.
Today entrepreneurs must be aware of having a characteristic way of thinking more about producing solutions for people’s needs than to think about consuming products.
Today entrepreneurs must understand production, how it begins and ends with the customer. Without customers, there’s no business. Our economy today focuses on foreign goods because we lack producer’s mentality.
You can have the biggest shops and factories in the world but without customers there’s no business and failure is almost certain.
China’s is a world power today because they focused on massive industrialization and thus, developed the ability to produce goods at low cost with high efficiency. They understand and have producer’s mentality.
We as the next generation of successful entrepreneurs need to understand this so we can change the fortunes of our economy in due time.
If we lack the technology or if it’s a question of expertise, we can learn from others and/or concentrate on developing ours. Otherwise, we’ll end up as consumers to the rest of the world
It’s important we look at how we can produce goods that can compete favourably with foreign goods and dominate African markets as well as the world at large
It’s not a day’s job or an easy task but it’s a task that must be done. Why must we depend on foreign goods. That’s not the future we want.
Don’t just buy lemons. Make lemonade!
Producer’s mentality reflects the true nature of business. It’s important for we all as entrepreneurs to analyse customer needs and supply them with the right products. This will set the foundation for our business success, boost our brand recognition and customer loyalty.
Written by Paschal Agonsi, a social entrepreneur and business media expert based in Lagos Nigeria. Discover more at paschalagonsi.com