Archives for Business
That’s right, business is not complicated. You can literally start a business like this and start making money in a few days.
Now sure, you might be thinking ‘there’s a ton of work to do just to start a company’ … well that’s not how entrepreneurs do things. Successful entrepreneurs jump first and tie the bungie cord to their legs on the way down. The details can wait. The task at hand is to start making money. Now.
Freelance web design is a great business to jump into if you’ve got the skills. There’s no overhead; you work from home. You already have a computer. You know html, css, WordPress, Photoshop, and how to use a digital camera. You need 50 or 100 bucks in startup capital for gas and business cards, and that’s it.
The real trick is getting clients, but there’s a ton of opportunities out there. I’m going to show you how to find them and how to sell your services to them.
This is a 3 step plan you can execute in 3 days. Flat. Just keep in mind that this is about jumping in and making it happen right now. Sort out the details later. Get more professional later. Because worrying about details and a “perfectionist” attitude will only get you killed in the entrepreneurial game.
Thanks to the housing crash and the financial
scam crisis, many businesses have had to downsize their workforce. But many others are prospering. And hiring.
And the difference between them is in how they “purpose” their people. For example; how many people in your business spend money (creating and delivering products and services) vs bring in money (selling products and services)?
And the oddest thing I see are companies that cut their sales and marketing staffs and budgets because sales are down. They do that because they see their sellers as a simple expense on the financial statements. And somehow they’re unable to make the connection that EVERYTHING on the income side of that statement comes from their sales and marketing people.
If you do it smartly, you can hire and/or retain your people in a recession. And doing it smartly, you can make a bundle of cash in the process. Here’s how:
Building strategic partnerships is a very important part of building a strong and enduring business. But these waters are also filled with sharks, and you have to be very careful about who you get involved with. Of course, sometimes you don’t have a choice.
Case in point … last year, my neighbor had a massive problem with a partnership deal that almost ruined his business. All because he failed to isolate the deal process.
And when it comes to playing with billion dollar companies; the market leaders … the rules they play by are pretty simple. Sooner or later, they will own you or kill you. That’s their goal plain and simple, and I saw a lot of that when I was in the water bottling industry.
So let’s look at a really big deal that’s unfolding right now …
The Microsoft-Yahoo Chess Game
When Microsoft first made a bid to buy Yahoo, there was something nagging at me that I just couldn’t put my finger on. As more details surfaced it became abundantly clear; Microsoft is playing an own-it-or-kill-it game.
Emphasis on the kill-it part.
First mover advantage; being the first one in a market or to develop a new technology can be a huge advantage. At the same time, doing all that hard work also lays the foundation for someone else to step in and do it better.
So if you’re a first mover, great. If not, no sweat. All you have to do is find an edge that gets everybody talking about the new kid on the block.
Let’s look at some “second-movers” and see how they did so well …
First there was Apple, then along came Billy G and some new ideas. Big ideas. Where Apple has always developed their operating system and assembled the hardware, Microsoft opened the floodgates to thousands of other compaines by licensing their OS and letting others build and assemble the hardware.
If you can create opportunities for other companies and entrepreneurs to prosper with your product, you can take the lead.
In Getting Paid 101 I talked about how to be pre-emptive and simply run your business in a way that helps (a lot) to make sure you get paid by delinquent clients. In Getting Paid 201 I talked about skip-tracing; or tracking down those fly-by-nighters that skip out on paying you.
Well, sometimes, you don’t get paid but you still have to do business with a company that owes you money.
It might be because they’re a significant portion of your revenue. And if they owe you a significant amount of money and you’re a significant supplier of theirs, it’s usually in your best interest to help them keep the ball rolling, generating revenue … so they can pay you!
This can be a very maddening situation so the first thing to do is get rid of all that emotion. Take a few minutes to yourself and cuss them out.
Good? Alright … moving forward, you have to play it smart and use your advantages. Here they are:
In reference to the great California gold rush of the 1800s it’s really popular to say “Don’t dig for gold, sell shovels”. The logic is sound because rather than investing in high-risk speculation, you can take a much more certain road and sell the tools that these high-risk, high-reward speculators need.
But there’s a limit to how many shovels you can sell. And there’s something bigger that both the gold diggers and the shovel sellers need. And that’s the railway to get to California and back.
When you build a “railway”, you’re building a platform, a gateway. The backbone of it all. You’re building a conduit through which all things must pass.
Good times and bad times start at the top, and then the effects “trickle down” to small businesses and regular people.
Right now, we’re seeing the trickle down effect from a bursting property bubble and mile-high piles of consumer and government debt. So what’s the best way to deal with that?
Well, trickle “up” of course.
First, The Vicious Trickle Down Cycle
Because of the property price implosion, a lot of things are happening:
- Lumber mills are shutting down temporarily or even for good
- Companies like Linens & Things are filing for Chapter 11 bankruptcy protection
- Many large companies are laying off thousands of employees
The idea behind a loss-leader is that you sell something super cheap; in fact it’s such a deal that you lose money on every unit you sell. The idea behind this is to get customers in the door and it’s the other items they buy while they’re there that make you money.
And of course, customers love the idea of flaunting the deal they got at an obvious loss leader price. Loss leaders used to be quite popular. And promoting something like it is one is still really popular. But usually they’re not loss leaders at all …
The Business Landscape Has Changed
The first thing that most businesses have come to understand is that selling loss leaders doesn’t necessarily mean you’ll get any other business from a customer. This is especially true in business-to-business deals. And bringing on a loss leader doesn’t mean you’ll keep a contract you already have or that you won’t get the deal in the first place if you don’t take the hit.
This is partly why most successful businesses don’t sell loss leaders any more. There’s just no money in it.
Some friends of mine are starting a painting business. Initially, they found it difficult to get contracts as most small businesses do. The best way is to just go out and start knocking on doors to introduce yourself. I suggested they hit small businesses where they can talk directly to the owner and just drop off 20 or 30 business cards a day.
It’s pretty much guaranteed in this market that you can line up 2 or 3 jobs just by doing that kind of networking for half a day. But most people, for whatever reason (lack of confidence in their own business), just won’t do it.
The Subcontracting Trap
So, as a lot of entrepreneurs do, they started talking to a contractor to get work. The good thing about being a subcontractor is they go out and get all the sales, do customer service, etc. Which takes that burden off you.
The bad thing is they usually take up to or over 50% of the pie. It can still be good money, but it’s little more than a glorified job. And it doesn’t make your business the killer cash you need to grow your business; it’s more like earning a wage.
Now, subcontracting can be a great way to get started. It’s paid training and experience. But at some point you have to cut the cord and go out on your own.
So you’re sitting there, alone, on one side of the table. And across from you is an army of briefcases. They’re gonna tear you apart, right? Not so fast …
There’s a great advantage to having a negotiating “team”. But there are some huge disadvantages as well.
Building a Negotiating Team
Whether it’s a good-cop, bad-cop “buddy movie” kind of team or it’s a boardroom platoon, there’s just one rule your team has to live by: Nobody says nothin’.
The power of having a good negotiating team is knowledge. Each person on your team is an expert in something. But that knowledge has to be very carefully safeguarded so it can be used strategically. The only time a team member should be engaging the other team at the table is when the team leader specifically asks for their input into the discussion.
There’s 3 reasons for this: