Having been online talking about
business and money, I have been asked so many questions that make me go the extra mile in seek of knowledge. Recently, I came across a fascinating question that burst my bubble. What could that question be? Naturally, what should be the next question. Of course, you are right.
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THE QUESTION THAT MATTERS
John Ola (real name was withdrawn) said “I'm 20 and I want to be a millionaire. I have no job, no work experience, and no money. I want to start my own business. How do I start, what business do I need to start?”
I could not hold the question to myself alone; I threw it to a popular international forum to get reactions. You could imagine the reactions, they were mind-blowing and encouraging. I decided to share that of Tom Bergman.
According to him “I was you. I am now 67 and own a business worth around $5mm that I started from scratch from my home with $75 about 15 years ago. We employ around 10 people and we sell hearing protection products.
Here are the principles I would tell you to follow:
First, become a business professional. You can teach yourself, or you can go to school, but you must learn the principles and practices of a business or you will fail at any effort you make, no matter how good your idea is. The basic elements of a business are, roughly, in order of importance:
- Marketing
- Finance
- Operations
You cannot hire marketing. If you want to own the company, you must be a marketing expert in your company. You can easily hire finance and operations professionals, but you must understand these disciplines as well so that you can prevent them from making mistakes or cheating you.
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Second, keep it simple. There are four general kinds of business:
1) Making or manufacturing a product (this is very difficult),
2) Providing an offline traditional service (which is easier to start, but more difficult to grow),
3) Creating a digital product or service (which is nearly impossible unless you are properly positioned as both a programmer and an insider), and
4)Becoming a reseller (this is the easiest to start and to grow)
You can combine these four in various ways, but any time you do that, you will usually make your business less likely to succeed.
The focus will win the day. It almost does not matter what you decide to do in business. Examples of successful people abound in all of these types.
I have tried all four and the only one I have been able to muster success in has been as a reseller. We do not make anything. We buy in bulk from manufacturers (those who make products) or from larger resellers (called distributors or dealers), then we sell in small quantities to end-users or smaller resellers. By using an eCommerce store based on the Yahoo store platform, and focusing on the basics of our business, we make good money in a reliable, solid company, day after day, year after year.
Third, look for the invisible opportunity. A banker once told me that "everyone thinks they can run a restaurant or a boutique clothing store." As a result, these two kinds of business (the restaurant is a service business and the boutique is a reseller business), are always hotly contested and almost always fail. I once met a guy who rebuilt gasoline pump nozzles.
He had four employees and made tons of money. He had no competitors because he was in such an offbeat business. Open your eyes and your mind to look for the unusual business.
We sell earplugs, and we are the only speciality store for earplugs in North America. Look for the problems people and businesses have, to find the hidden opportunities you can turn into a business. Do they need their grease traps cleaned? How can a homeowner get their blinds cleaned? Whom do you call when you need a baby sitter on an instant notice?
I suggest service businesses, especially dirty job businesses start because you can do these immediately.
Just start looking and doing
Don't worry about making money at first. Get the jobs and do them for free if you must. Think of this as training and learn what it is worth to your customers.
Thrill them and ask for referrals. Then as you grow your service business, watch for related reseller opportunities. If you have problems finding enough cleaning rags or special tools you need to do the job, likely so will others. That might indicate a reseller opportunity. You can continue to operate your service business while you try launching a separate reseller business. Do not combine the two or you will risk ruining both.
Whatever you do, continue your education to become a true business professional so that when you find your opportunity, you have the knowledge to manage it.
Good luck. Keep trying and you will succeed". (Tom Bergman)
Thank you for writing and sharing this informative article. You are apparently very knowledgeable in this area and I have found this to be interesting and intelligent reading. Good job. Building a successful and profitable business just got easier. You are just seconds away from the essential training to how to start a business.
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