Robert Burns said it eloquently "The best-laid plans of mice and
men often go awry". Business is more than just being smart but lucky as
well. However skills and planning can definitely help in making the odds more
in your favor. The most important part is that it takes money to make money.
Unless you're independently wealthy, then start-up and working capital is a
must. If you begin a business venture with not enough capital taking a shot
you're doomed from the start.
Where ever you do receive capital from most times they need to be paid
back. Generally that payment is incorporated into your operating costs, which
uses revenues and percentages to show profit. Make sure your estimated monthly
sales are as accurate as possible, and I would suggest reducing them by ten to
twenty percent. This way you'll know in slower times that at least the fixed
expenses will be covered.
Here's a hypothetical example, you open a restaurant
in a great location, and two weeks later the city starts doing road work making
the street none accessible for like a month or two. Very little business comes
in but you're on the hook for expenses regardless. If you don't in advance
ensure enough working capital, and overestimate sales then you be out of
business in a heartbeat. Rule number one in beating the odds, be aware of your
business financials!
I've honestly met the worst business people in the world, unorganized,
not focused, lazy, terrible with numbers, and extremely successful, how does
that happen? Most know inside they're not the sharpest pencils in the box, so
they counter that with hiring exceptional people to make them look good. As a
result through the staff's hard work in spite of the owner's defiance's the
business grows. Rule number two in beating the odds, hire those who might be
more skilled than you in certain areas, and most important let them fly!
Make sure the product or service is competitive within your market
place. In today's world with the economy so poor more people are purchasing on
price than quality. It is vital that you study your demographic, the
competitions pricing prior to making a business investment. Rule number three
in beating the odds, the money is made in the buying not the selling!
Set a budget for marketing and advertising building a loyal customer
base, and make a plan of action that will entice people to check-out your
products or services. In developing a brand one must figure-out what will make
them stick-out with customers feeling they need to be there. Rule number four
in beating the odds, set a better mouse trap!
My final one is never put yourself in personal financial jeopardy when
going into business. Make sure to incorporate your business so you're not
personally liable if things should go south. Going bankrupt with an
incorporation allows you to walk away not in a moral way, but a business one on
clear and free.
If you sign personally have no choice but to go bankrupt
they'll take everything cars, house, any personal asset of value. Rule number five
in beating the odds, always cover your butt!
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