Posts Tagged problems

Why is going to a Franchise (expo) Trade Show likely to be the most costly mistake you will make?

What is a franchise? Buying the right to build a business similar to an existing business in the hope you can get similar results despite being in a different time, different location and with a different personality / skill set to the person that made the business a success. A system is only one of the elements required to move you out of the 95% of business owners that fail within 5 years.

What is an expo(exhibition & sales pitch event) or Trade Show? A Supermarket of 100’s of stalls selling franchises or other things to want to be business owners eg accounting, admin or marketing. Like all supermarkets you are exposed to a range of products in a way designed to get you to buy more than you intended. Each stall will be manned by either employees with no experience of running a business or, even worse by promoters – hired just for the event & on commission for sign ups.
As the cost of a franchise averages 50K or more it represents a substantial part of your life’s savings so there will be a big emotional charge in the room as the 1000’s of visitors make big decisions or gambles about their financial future so you may think “I need to get this now” is your thought when it is mealy a thought transmitted (like tv or radio channels) from others in the room. Marketers know when emotions are high rationality is low – which is why they advertise harmful stuff like gambling, alcohol & smoking during sports. So to avoid committing to something that is not in your best interests step away & visit the local park to get more Oxygen so your brain / heart can make a good decision.

B. = Business
E. = Essentials

S. = System
M. = Marketing
A. = Actual Delivery
R. = Reputation
T. = Timely
E. = Economical
R. = Results
R. = Reliably

Before going to an expo
Ask who benefits if the fees are a lump sum up front
or annually
or a percentage of income eg affiliates
Is there on going support / training
Who controls the marketing?
Where are you in the product & industry life cycle?

Who did I help to get the money I want to invest in a franchise
Can I better serve them by investing a fraction of the money in training to acquiring a skill such as marketing or by buying a business (not creating my own business/ job) or investing in property, stocks, gold etc.

Leave a Comment

How to Build a Sustainable Business – Step 1

What is a Sustainable Business?

A sustainable business is a legal entity that is independent of its owners which can create income on an ongoing basis without damaging its future. The Credit Crunch has shown that traditional businesses are unsustainable, even without taking into account the pollution & climate change the Governments have being subsidising for the past 200 years because they assume plundering a profit is always beneficial despite the evidence.

To make a profit a business traditionally extracts money from customers in-excess of the money it pays to obtain the goods it sells so customers can only remain customers while their money supply is growing faster than prices. A sustainable business will do what it takes to use its resources efficiently to maintain its ability to serve people’s needs now & long term because they know what they do not only effects them but effects their suppliers; their customers and the rest of planet Earth. A sustainable business will treat existing customers with the respect they deserve as essential partners (because they know they are up to 10 times cheaper to sell to than new customers) – trading a nominal token of value called money for a solution to their problem.

1st Step to building a sustainable business is to identify the reasons you want a business.

Do you want to have a business because you do not like to be told what to do?

Well the bad news is – owning a business is not going to be for you unless you are in the 4% of entrepreneurs who plan & structure their business activities in advance.

The 96% of businesses that plan to fail – by failing to plan for

•    success or normal events like

•    the change in regulations,

•    the change in demand with the phases of the economic cycle

•    the reduction of market share when more effective competition enters the market

•    just reacting to crises as they happen

as a result the entrepreneurs are wasting their time; family life & health on enslaving themselves to work for a business (even after they beat the odds and find someone to buy it).

Successful people know a business is only a tool to create an independent income stream when the owner works on the business instead of in the business.

Working on your business is providing the purpose for the business & choosing the strategy to enable the exchange of value with customers.

When the business’s purpose is just to get money to fund the owner’s lifestyle then it will be a struggle to deal with the employees who are only there because they do not know of better ways (like share trading or eBay or blogging) to get an income.

However when the business’s purpose combines the creating the real benefits to users (that the voluntary sector demonstrate) with benefit to business stake holders (owners; workers; suppliers & customers) for a win win win situation, instead of the normal win – lose scenario that created the Credit Crunch, everyone will be prepared to help your business become the sustainable (long lasting) independent income producing center that legally it is already. Having a clearly defined purpose will guide the right workers & customers to you and will enable you to make the right decisions about which changes you should adopt and let everything come together without all the hassles so productivity increases. Having a clear purpose will enable to owner to design the business so he will have the choice to sell up for 10 times the annual profit any time he wants in the future.

Leave a Comment

Have You Learned the Lessons From “The Great Depression” Or Are You Destined to Repeat Them?

Have You Learned the Lessons From “The Great Depression” Or Are You Destined to Repeat Them?

The Great Depression in which 25% of people in America were unemployed had their homes reprocessed and faced starvation started when 7 things combined together

1.    The economy went into a slower phase in the economic cycle.

2.    The Wall Street stock exchange crashed in 1929 as a result of an Insider Dealer Scam (which was small compared to Maxwell or the Enron scams) still wiped out the investment of thousands of people & several banks who had not done due diligence & just hoped that share prices would continue to go up at the same rate indefinitely. Although the stock market only charts the emotional value of a stock it must sooner or later adjust the prices of stocks back to the real value based on the firm’s actual performance (it took over 2 years for the dot com bubble to burst in 2000). Other people seeing a fall in the stock market prices feared they would have a loss so rushed to sell their stock in a falling market, thus creating an excess of supply forcing prices down more to ensure they lost money.

3.    The banks made things worse by demanding repayment in full of mortgages & loans at short notice in an attempt to save their business. Banks, like other businesses without Government support, will go out of business because their reduced cash flow can not keep up with their liabilities which naturally increased as the economy slowed. By removing money from economy the banks made the slow down spiral down into economic depression

4.    The belief that the Government should not intervene because markets would automatically adjust to benefit a changing society because the economic system always gives people what they are worth & new jobs will appear despite the evidence.

5.    The Isolation culture of thinking “if something benefits an individual than society must benefit” regardless of what harm results from that action despite the Indian’s knowing we are all part of one interconnected web of life on our only planet. The Economic system is incapable of serving the public as long as polluters do not have to compensate those who suffer from their actions because governments do not use true accounting.

6.    The lack of Understanding of Fundamental Economic Cycle (still not taught in schools) leads businesses facing hard times to downsize to cut costs to hope to wait until better times return instead of looking to increase their income by switching to more profitable products. Downsizing reduces the money flowing in the economy and signals that the business has poor management & may not be trusted to be here for long.

7.    The uncertain times and the untrustworthiness of the financial sector led most people to withdraw their money from the banks which the banks could not fund as only 1% of money is held as cash by banks. So more banks collapsed so creating a domino effect run on the banks.

Although FD Roosevelt did manage to halt the downward economic spiral in 1933 by ending the hysteria & restoring hope with the “New Deal” – The Great Depression did not end until full employment was created as a byproduct of the Governments policy of creating world war two with appeasement in Europe & Isolationism (ignoring the consequences of my actions in the USA)

By 1929 the down sides of technology were beginning to become apparent. E.G. the mass production lines that Henry Ford introduced to enable the greater output by braking a process down into steps performed over & over by specialists was dehumanizing people’s work and turning it into a job (just our bodies) so had strikes despite the violent oppression from their owners.

Farm technology was also having a damaging effect on wider society.

Tractors (which developed out of the world war 1 tanks) had got cheaper due to mass production so were replacing farm workers and increasing yields initially and causing an excess of supply at harvest time thereby reducing the income of the smaller farmers who then could not keep up with their mortgages.

Tractors are best for long straight fields without ditches or hedges to provide a home for natural pest controllers like ladybirds, frogs, hedgehogs etc so hedges were removed although they protect crops from the wind and supply the crops with water from deep down where they can not reach. The larger fields of monoculture naturally attracted the pests like aphids to them & with fewer predators to eat the aphids they increased in numbers every year. A couple of dry summers combined with ploughing thin soils & the removal of hedgerows & the abundance of pests led to large areas of the mid west being turned into dust bowls collapsing the income of the area & the rural banks that depended on farmers. Thus triggering the domino effect in the banking sector.

The technological fix to the problem of falling farm production caused by technology was to apply ever larger doses of poisons like DDT until they get banded because of the harm do as they get concentrated up the food chain. The chemical industry needs to constantly come up with new products to sell to farmers like fertilizers (that contaminate our water supply disrupting the reproduction of fish & humans) so they can grow the same crop in the same field year after year; new pesticides because the old ones do not work as spaying is not ever 100% effective as does not go evenly under the leaves (where the pests live) so the pests develop resistance to the poison.

In order to survive the lack of official money circulating during the great depression over 3000 other currencies (LETS) were created to enable the local exchange of transferable skills for mutual benefit to occur.

As Einstein said “Doing the same thing over & over again yet expecting different results is the definition of insanity”

So if you have a problem you need to change your thoughts to find the solution. Why do you believe the lies you are told like “Buy this and you will have women falling for you” when Happiness is an emotion so comes from with in you?

Leave a Comment