Starting a business today is as easy as buying a Coca-Cola at 7-11. There are so many opportunities out there; it can drive you crazy and many look good.
However, I want to know the interesting part; It is not the companies that fail.
-No-
There are vital parts to starting a business that are often overlooked because people are so excited to start “making money” off the insights they got from the brochure or website and maybe some testimonials where they heard about the millions who are. . going to do However, it is the “business plan”, not just your enthusiasm that will make them successful.
So again, it is the lack of a successful business plan that will make them fail, but not only that, there is much more.
Interestingly, however, within a typical business plan, a single component that is the number one contributor to failure in business today is omitted and is so simple that you’ll probably shake your head and say, “man, how do I did i lose that?” ?”
So what is the number one reason that any business plan will actually be a plan to fail?
thin capitalization
Yes, that is correct; they run out of money before they are profitable. Also, they only become profitable if they choose the right business in a growing market that will ultimately provide enough money to achieve their goals.
So how do you properly plan to capitalize your business up front and earn the money you need to achieve all your goals? Here are four principles that will help you:
The first principle is to choose a business that financially satisfies your desires:
Well, first of all, I’m going to back up a bit; Even before you decide what business you’re going to do, you want to set your goals (3, 6, 12, 24, 60 month goals) you want to set what you want to achieve by being in business, otherwise you won’t have anything to plan for. Then go out and find a business that can provide that kind of goal achievement.
Now that you know what to measure your business against, if you’re not living up to your goals, find another business to do. Warning: if you decide to lower your goals to reach the maximum amount of money you can earn, you will not be satisfied with what you will do and the result will be failure.
Now that you know what you want and have the business that can produce the results you want to achieve your goals, you understand the first principle; choose a business that financially meets your desires.
If you make your business plan, so Set your goals, chances are you’ll underestimate yourself and end up frustrated soon after starting, or you won’t be motivated enough to work on the business with all your heart and guess what, you’ll fail.
The second principle is to understand all your costs:
Get a clear understanding of ALL start-up costs, your monthly expenses (including your living expenses, advertising, long distance, domain names, heating, rent, hydro, insurance, etc.), and be sure to include the costs of all products that you are going to represent because you can only convey enthusiasm when you talk about something that you have experienced yourself. After all, sales are what make companies money and the last four letters of enthusiasm stand for “I Am Sold Myself”. This will make a clear distinction between you and a competitor who doesn’t have genuine enthusiasm for your product and will make all the difference in your success.
Now that you’ve figured out all of your startup and ongoing costs, make sure you have enough to run your business at 100% for at least six months or up to a year.
Understand that no worthwhile business will be an overnight success. While there are some (if that’s what you’re looking for, buy a lottery ticket), it’s certainly not the norm. For the rest of you, plan for success by having enough money in the bank for 6 months, up to a year of living and operating costs. When you do this, you will ensure your success because money is eliminated as a concern.
Chances are you need to finance your business start-up, most people do and the likely newcomer to the business doesn’t have an extra six figures sitting in the bank burning a hole in their pocket. Many people barely get by and want to start a business because they realize they won’t make it if they do it for someone else.
So where do you get the money to get going? Well, I like to use “other people’s money” to get ahead in life; I don’t risk my money up front and borrowing costs are a business expense.
Here are some ideas: Take out a second mortgage on your home, or a home equity loan, or take out a line of credit, or get a co-signer, or borrow from your assets, or use credit cards with low or no interest interest. , for six months. Whatever it takes to make it happen, make it happen, will be the best peace of mind you’ll ever have if you know all your costs are covered for six months to a year.
Again, being undercapitalized is the number one reason for business failure, if you don’t have access to capital for everything your mind will be focused on finding money or making money in your business too early in the business building process and you will wither and die on the vine.
The Third Principle is to execute your plan.
The only way you should approach life or business is to persist without exception. Andy Andrews, author of “The Travelers Gift” does a great job of explaining the “without exception” part. This will allow you to find a way when there is no way.
Play to win versus play not to lose.
The Fourth Principle is to keep your hours and responsibilities low.
If you want to be smart; spend the least amount of time possible working on your business (20 – 25 hours per week max) and the most time living your life; Starting a business that you can do from home (this is the type that is also most profitable), you can keep startup costs down and be very lean and mean.
Going into a “traditional business” with typical overhead expenses like renting an office, employees, accountants, etc. And guess what, you just bought yourself a job as a professional nanny.
I really challenge you to dispel any thoughts that you need to do a “traditional business” to make a lot of money because I have done it and the 70-80 hour work weeks really bite.
Whatever you choose to do, make sure you have a business that can achieve your goals, one where you can understand everything and all the costs before you get too deep into it, one that will only take you 20-25 hours a week to manage and run. and above all, make sure you are properly capitalized and have a great chance to succeed beyond your expectations.
For the success of your business,
greg nicholls
Copyright 2006 – Nicholls Enterprises