Have you ever been invited to a pitch for Agarwood trees investment?
I received a call the other day from a company “Eco Global Network” inviting me for a “Go Green” campaign. It was supposed to be a talk to spread awareness on environmental issues and as an incentive for attending the 1-hr session, I would be given some NTUC vouchers.
At the seminar location, the name of the company was not Eco Global Network but was that of the company that I found earlier. I was bought into a room at the stipulated time to wait for the speaker. I noticed that the room was not arranged in a proper seminar layout. Instead there were many tables with four chairs at each table.
A person T from the company came over to my table to sit with me. T was a rookie who had just joined the company two weeks ago. She explained that the speaker was late and sat down with us at the table to chat with me. The same thing happened at the other tables.
She started to ask personal questions which I was quite uncomfortable with. She was obviously trying to form a connection (one of the sales technique) but I was not in the least interested, knowing she was going to sell me something eventually.
I asked her whether she heard about Eco Global Network. She said she didn’t. She also said that the speaker was usually late but as their company had a existing contract with another company for the speaker, they couldn’t do much about it.
After some time, a manager came over to explain to us that the speaker was unable to come, and whether it was ok for T to brief us instead. I asked why not get one person to brief everyone at the same time. This was shot down with the explanation that a 1-on-1 presentation would be better. I suspected that there were no plans to have any speaker at all based on the way the seats were arranged.
T bought us to a corner to showed us some exhibits of Agarwood, and how expensive it is. A small vial (called a Tola) of oil produced from Agarwood could cost $900.
Finally, T started to talk about an investment opportunity.
A plot of land could grow 100 Agarwood trees. And each tree could produce 4 tola of oil after seven years.
If I bought a plot of land, we could generate 4 x 600 x 100 in revenue after 7 years. This was about $240,000.
Even at a lower projection of $400 per bottle, it still worked out to be $160,000. There was a 15% harvesting cost, so the net revenue would be $136,000.
And the cost of 1 plot of land? Each tree only costs $250, so a plot of land would cost only $25,000. This was a promotion price.
Which means I stand to make more than 5 times a return of my capital after 7 years.
To top it off, the company offered a buy back guarantee after 2 years. They would buy back the trees at $550 – $600 each if I wanted to sell after 2 years.
I think the returns projected by this company would put all the major agriculture companies to shame. 🙂
At the end of it all, came the magic question about how many trees I could afford to buy. I maintained my poker face and asked T straight in the face whether I could buy 1 tree. . Yes, just ONE tree to test out the investment and see whether it worked. The expression on her face was priceless. 😉
A manager came along and tried to sell me 25 trees. She explained that she could try to look for some leftover trees for me. The offer eventually dropped to just 10 tress after I pleaded that I had no money, given the high cost of HDB, etc.
So the final deal was 10 trees with a 5-10% initial deposit and a 5-day cooling day period. I told the manager I had to leave and would think about it. As a last ditch attempt, the manager asked whether I would be willing (as a mark of sincerity) to place my NTUC vouchers on hold with them and they would reserve the 10 tress for me.
I said no, took my vouchers and left.