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Learning lessons from a peanut selling entrepreneur

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Yesterday, while I was returning back home, I came across a man who was selling peanuts over the roadside. Though I had no intention of eating peanuts at that hour of time, I went up to him and asked for the price. With an old grumpy smile on his face, he said “Ek pudi paanch rupiya” (One packet for five rupees). That was quite a good price (nor too cheap neither too expensive) for the quantity of peanuts in one single packet. Within few seconds he said “Agar do pudiya longe toh aath rupiya” (If you go for two packets, you’ll get it for eight rupees). This instantly sounded more interesting for me – and I grabbed the deal.

Over the next few minutes I observed that the guy made a sale of at least 30-40 packets. For me it was a big ‘WoW’ inside my mind; and that was the moment when I made up my mind to stay there a bit longer (no matter if I’d miss my bus) and understand his way of selling peanuts. I sat opposite to his rag, and started counting the customers – and believe me within a span of just one hour there was a sale of nearly hundred packets and few dozens of oranges (yes, he sold oranges too).

I also realized that he had many offers to give to his customers, which made the deals pretty lucrative to buy:

  • 1 packet of peanuts = Rs.5
  • 2 packets of peanuts = Rs.8
  • 2 packets of peanuts + 2 oranges = Rs.12
  • 3 packets of peanuts + 2 oranges = Rs.15
  • 2 packets of peanuts + 1 packet of chana (chickpeas) = Rs.10

Lesson learnt: Give your customers a list of choices to buy your product. You can always add value to your primary product by selling it with another products (e.g. Buy this and also get this).

To my surprise, I saw that few young men (10-15 people) with shattered clothes would run up to the windows of the buses and other vehicles, that halted there for the passengers (do you remember, the man had settled his small business near the bus-stop?). These people (carrying the products in small baskets over their head) would sell the peanut packets and oranges to the passengers with the same deals. On an average, there were about eight to ten buses that would arrive at the bus-stop every ten minutes.

Lesson learnt: Give an opportunity for others to make money – this will not only add to the volume of sales you make but also spread the word about your product(s). And most importantly, it’s always good to hire people on the commission basis rather than monthly pay.

After observing this complete flow of a small peanut business, I was amazed at every single strategy being used. Since it was almost an hour (where I had already missed about six buses), I thought of walking up to him and ask him to be my mentor; plus a request for picture too!

Peanut selling entrepreneur

A good day and a valuable learning experience – worth everything!

Hardcore Entrepreneur | Capricious Writer | Founder Guy at Switch Idea + Exam Juice + Mottled Services + Startcup

  • http://twitter.com/iBeingMe Yogesh

    Interesting.

  • Rajeshwari

    very interesting…a nice article to read 🙂

  • Harleen

    Its the way to view things. Common man wont pay any heed but you being a hardcore entrepreneur looked at things differently. I’m in awe.