The Easy Way To Start a Profitable Business

To paraphrase Chef Gusteau in Ratatouille, "Anyone can start a business, but only the fearless can be great."  Fear is the great debilitating voice in our heads.  There is no reason to have fear, yet we all do.

Starting a profitable business is very different than starting a business.  Starting a business is simply buying something to sell or getting paid for your services without being an employee.  Starting a profitable business means that you are able to earn your living from your business, and for most people it also means that your "living" from the business is better than it was with your "job".

So is there an easy way to know if your business will be profitable?   Many restaurants go through two or three different variations at a single location before they become profitable.  Most small businesses that offer professional services take years to really make money.  My CPA started a bookkeeping firm.  It isn't making the momentum he had hoped for.

Starting any business that is going to be successful and profitable, requires one simple thing.  Customers who are willing to pay enough that you make money.  While this sounds easy, it is amazing how many people start a business thinking that they had enough customers.

In the retail world, you might make a profit simply based on product and location.  A well placed mall shop or cart with a unique product at the right price might do well.  For a while that is.  Once the copycats show up, the business might be in trouble.

For every other business, the success out of the chute depends on one thing.  The people in your rolodex or contact list.  Keller-Williams has every new agent enrolled in Bold! training call every single person and announce that they are in real estate and ask if they know of anyone who might be in the market to buy, sell or invest in real estate.  My bet is 50% or less actually do it.  The question is why and the answer is a form of fear.

When I added my Real Estate license on Facebook, I got a few sneers about being a Real Estate Agent.  I didn't have any fear about it so I did it.  So what if they make fun of you for starting your new business.  If you can't tell all of your contacts about it, how are you going to sell complete strangers.

The truth is that I buy real estate as my retirement investment.  I like real estate income as much as the dividends from great stocks.  I have a license because agents were reluctant to make the offers I wanted to make.  Why?  Fear.  You might label it other things, like lack of self esteem, or self image or whatever.  It comes down to a fear of being accepted for trying to be different than who you are now.  Step one, get over it, fear is what keeps you down, not "the man".

An interesting conversation a couple of days ago got me thinking about this.  Two men told me they tried "flipping" houses and couldn't make any money.  There just wasn't enough margin to make a profit they said.  The way they buy houses, they were right.  Being an agent, I have better access to "wholesale" deals and occasionally help other people when they ask.  No matter what I said to these two guys, fear was telling them making money in Real Estate can't be done.   My deals are "anomalies" and I am "lucky" were the responses I get.

If you want to start a profitable business, look at your contact list.  How many of those people will buy from you and why?  How many of them won't and why not?  Looking at these guys, they would buy a house, clean it up and try to sell it.  Did they even try to sell to friends as an investment or rental?  Nope.

This little review will be your first clue of how your business might do.

When I started business that became my biggest "lesson" (some would call it a failure), I didn't follow this simple review.  All of my friends bought stuff from the business, but only at a significant discount.  They wouldn't buy at retail, in fact many times I was lucky to cover shipping.  That was my first sign the business was off to a rocky start.  I was lucky to get away from that one.

If you want to start a profitable business make sure your contact list will buy from you, and buy at a big profit so you can pay your bills and grow the business.  If your list will buy from you, chances are your business is off to a good start and your list will start growing as they refer their friends.

Can A Car Change Your Life?

Many of us need a car to get to work or school, and to get places on the weekends to go play, but is a car really that important to our lives and more importantly to our success?  Isn't a new car just a status symbol to tell other people that you got it because you can?  

After reading The Millionaire Next Door, I have been quite content to drive an F-150.  I am on my second one and have logged over 200,000 worry free miles between the two of them.

The human mind is a funny thing.  Henry Ford is reported to have said "It doesn't matter if you think you can or you can't, either way you are right."  

One of the training methods employed by the military is to take everything from you as a civilian, dress you in clothes that don't fit and tell you that you are garbage.  After a couple of days of this and seeing yourself in the mirror, you start to believe that you are garbage.  It worked very well with me since I didn't even have a high school diploma.

Over time you get in better shape, get your uniforms tailored to fit, and you begin to make it through challenges you were failing just weeks before.  Your self image improves quickly, building your self esteem.  The more you succeed, the more you feel like you can do.  The military depends on this phenomenon to take regular people and create heroes every day.  

When I was going to college, I worked at Macy's in mens suits.  As a broke college kid and enlisted military member, $300 for a sport coat was crazy big money.  Because I felt it was too expensive, I couldn't sell the coats either.  I was wearing a Montgomery Wards polyester coat that I paid $19 for on sale.  Finally my boss set aside a very nice sport coat, and waited until it hit the clearance rack and then he made me buy it.  I felt different.  My sales jumped off the charts. 

That was then, this is now, I know how all of this mind stuff works so it won't work on me.

Last week I picked up a 2013 Chevy Volt.  Initially I got the car because it made great economic sense given my work life and travel requirements.  Chevy was offering a lease deal that was about half of what I was spending in fuel for my F-150.  In a pure monthly cash flow sense the Volt wouldn't cost me a penny.  In fact it might save me money by cutting my overall monthly expenses.  

I did get a little specific with the color and options since I do spend a lot of time in my car.  If you think about it, a 3 year 36000 mile lease says I will be in that car for 36000 miles if I use every mile they give me, and you can bet I plan on it.  Even on a good day in SoCal, if I average 60 miles per hour, that is 600 hours in that seat and I bet the reality will be closer to 1800 or maybe 2400 hours with LA traffic.

I started thinking about the car like a mattress.  Realizing how much time I would be in it, I decided I wouldn't go for the cheap seats.  I ended up getting the fully loaded Chevy Volt to get the good seats.  Lucky for me, it was the last day of the month so the dealer made a great offer, giving me a discount that covered all the extras.  I got the newspaper deal and the loaded car. 

Anyone who has ever bought a new car knows that it isn't as easy as sign here, and go away with your new car.  It took several hours for the bank approvals and all the paperwork to get finished.  Driving home, I was glad the leasing process was over, it was nearly 10 at night and I had to been up since 4 am and yet I felt good driving home.  

My wife pointed out that the Volt is the first new car I have brought home for myself since 2003.  Hers is a 2008 and much nicer than my truck.  My truck was looking good for it's age but it has seen better days.   

From the time that I was 16, I got a different car almost every year.  Sometimes it was because I made a bad purchase decision and the car fell apart, other times because I found something I liked better.  In two cases, I totaled my cars and in one case somebody wanted my car more than me.  Some 30 cars had passed through my garage until 2003, and then for some reason I stopped buying cars.  I don't have kids, I don't know why, I just stopped getting new cars.

I have been driving the same F-150 with an occasional weekend outing in my old Mercedes SL since 2003.  Given the economy, I would think this is normal to keep cars this long, but kbb.com says the average ownership of a new car is at an all time high of 71 months.  I am clearly past that at 123 months for the F-150, so I guess it was time.

Is It OK To Enjoy an Economy Car?

After driving a four door F-150 for over 10 years, the Volt is a funny little electric car with a range extending gasoline engine.  I don't know why it makes me smile.  It just does.  It isn't sexy like my 1966 Mercedes SL is, it won't carry my dogs or paddle board like my truck does, and so far I can only go 48 miles on a full charge of electricity and charging is painfully slow if I don't want to use gas, which I don't.  That is part of the challenge and maybe a little of the fun.  

The smile I had every time I drove my big F-150 in 2003 was now back as I unplugged the Volt in the morning and headed to work.  It was still there when I logged 46 miles on battery when the car started the morning with 38 miles on the range estimator.  The smile was still there when I got home and burned 1.1 gallons of gas driving the 48 miles back home.  Yes I know the Volt only gets 38mpg on gas, but I am just telling you what the car is telling me.

I bought the car for purely practical purposes, and yet I am enjoying it.  According to the other Volt owners I have already talked to, this part is normal.  One traded in a Mercedes C class, another a Chrysler 300, and another a Prius.  

In five days my Volt tells me I have driven 204 miles, and used just 1.4 gallons of gas.  Actually the ap on my iPhone that is talking to the car right now is giving me the information.  The car is in California and I am in Washington D.C.  It also says I still have enough battery to make it back home from the airport without plugging in.

There is something that makes me feel good about it.  I can't put my finger on it, I just know it is there.  Maybe just driving something new and shiny is improving my self image and bolstering my self esteem.    I sure hope my mind isn't that easy, but it really does look that way.

Much like my experience joining the military, already one good thing has lead to another.  My wife pointed out my wardrobe was about the same age as my truck and maybe it was time to upgrade from the three button suits since I have a new car, so I did.  We took the Chevy Volt to the local mens store and she found a salesman to gang up on me and bring my wardrobe up to date.  

One new Chevy Volt, four new suits, and in five days, already I have new work I didn't expect and have met some cool people I might not have met.  This is the kind of change I like - Positive Change.

Picking Up The Chevy Volt At Simpson Chevrolet