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A Bite of Reality: Why New Businesses Fail

by Jason Kanigan
41 replies
Stat to think about: Half of new businesses don't get past the first couple years. Then of the remainder, half of those don't survive through the next two years after that!

People nod and think they understand this statistic. They think something similar to, "Oh, they just couldn't get enough orders." No. That's a SYMPTOM, not the problem. There's more going on. Such as:

> they never stuck with the idea longer than a few days, weeks or months

> they never learned to deliver a product or service competently

> their family & friends weren't supportive and helped pull the rug out from under them

> they didn't realize sales & marketing were vital, and thought building the better mousetrap would get the world beating a path to their door

> increasing(!) cash flow and management requirements killed the business even though it was growing fast.

There is a lot more going on in a business than newbies and outsiders realize. It can be making money and growing, but if that cashflow is not consistent enough, or rapid growth is leading to process problems, even a business that is getting plenty of orders can die or be shut down by choice. A spouse who's tired of inconsistent revenue even though it evens out to keep everything afloat can kill a business.

A huge difference exists between the newbie's "This is going to be a grand adventure!" and the shortly-realized "OMG I'm going to have to get punched in the face for two years to make this at least START to be successful."
#bite #businesses #fail #reality
  • Profile picture of the author DaniMc
    Originally Posted by Jason Kanigan View Post


    A huge difference exists between the newbie's "This is going to be a grand adventure!" and the shortly-realized "OMG I'm going to have to get punched in the face for two years to make this at least START to be successful."
    I love this! It is a bit like repeated punches to the face.
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    Be kind, for everyone you meet is fighting a hard battle.
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  • Profile picture of the author AmericanMuscleTA
    Speaking of business failure...

    I'll never forget what our real estate teacher told us when we were taking our classes to get our real estate licenses. There were 50 of us in the class, and we all thought we were going to be the ones to succeed...

    "Look around at everyone in this room. 80% of you won't be in this business one year from today. For the rest of you 20%... 90% of you won't be in this business two years from today."

    Yikes! Only 2 out of 50 after two years. Funny... it was me and a buddy who made it.
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    • Profile picture of the author kirbymarketingconcierge
      well stated Jason.

      this is leverage for me, because I know most small business need help.

      could really help someone (member) starting out, to know a biz. that's been around for years, is making mistakes that seem so basic!


      wonder how long a good thread like this goes???

      a title like " Jason's WSO- Reality, in 3 easy, no work, no cost steps", would of got more views so far.
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  • Profile picture of the author JosephI
    Basic knowledge of how business works and that you need capitol to start and pay bills and having staying power.
    Having the skills and knowing the trade well and being full of enthusiasm is never enough.
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  • Profile picture of the author iAmNameLess
    Such a good point about cash flow. Huge issue that nobody ever talks about. People think cash flow is simply sales, but that's not the case. There's a difference between healthy sales and healthy cash flow, and they don't necessarily go hand in hand either.

    People always want to talk sales, and how to get more clients. There's more to a successful business than that. I've made the mistake of focusing on sales alone.
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    • Profile picture of the author Oziboomer
      Originally Posted by iAmNameLess View Post

      Such a good point about cash flow. Huge issue that nobody ever talks about. People think cash flow is simply sales, but that's not the case. There's a difference between healthy sales and healthy cash flow, and they don't necessarily go hand in hand either.

      People always want to talk sales, and how to get more clients. There's more to a successful business than that. I've made the mistake of focusing on sales alone.
      From someone who's taken too many punches since going into business in 1991 I'd like to share four simple to use spreadsheets that I still use to this day to manage cash-flow and other key areas.

      Of course there are so many other components to running a business and I'm more than happy to share other tools, forms etc ...but these are the key big ones that have helped me.

      Firstly it is the Annual Budget.

      Most people just stop at this one or don't make a realistic budget.

      Most going into business books, even most accountants would just advise a new business owner to do a budget...but that is where it stops and no-one tells you "HOW to USE" the budget you just created.

      Annual Budget example.


      A couple of keys is to measure the projected annual budget against what is actually going on.

      Secondly...this is how to use the budget.

      From your annual budget I create three documents in excel which are Daily Operations, Monthly purchases budget and Cash Flow Forecast.

      So part two for me is creating the Daily Operations.

      This tool is used to enter daily sales and measure daily profits.

      Set up a spreadsheet for the month where you enter the End of Day sales each day and you monitor daily profits.

      You take the Cost of sales from your annual budget and divide it up into daily amounts so that you have the C.O.S. for each day.

      You do the same with the Other Costs or Expenses. Break up your monthly expenses from your annual budget and spread out to be daily costs.

      I add other columns which you can see in the graphic which are C.O.S.% (daily) and C.O.S. MTD (month to date) and C.O.S.% MTD.

      You then set up a column for Profit ( daily profit) and one for Profit MTD.

      It is a pretty easy set up and you can get more info from the graphic.



      Thirdly set up monthly purchases budget.

      This where you control the C.O.S. and stay ahead of any developing purchasing problems.

      To set it up you take your Monthly cost of sales from the Annual budget and divide up what you anticipate you will spend with each supplier.

      The predicted total of expenditure with each supplier should add up to the total from the monthly budget

      (please note from my examples I'm using bits and pieces from different historical years so don't try to overanalyse my spreadsheets just look at the set up)

      The way you use your Monthly purchasing budget is when you buy something the value of the invoice is recorded under the relevant supplier.

      You keep an eye on the months totals which you are generating as you add each invoice and make sure you stay under budget.

      There are exceptions to this is your sales have increased but the key is to try to beat your estimated C.O.S.% on a monthly basis.

      There is an example of the monthly purchasing budget below.



      The fourth thing is to set up your Cash Flow Forecast.

      This is the secret to staying on top of things because you can predict pretty accurately where you will be from a financial position on any given day in the next few weeks.

      Usually you run about a two week forecast and you can do an annual one or one for any period you like.

      I like to run one for 30 days out.

      What you do is set up another spreadsheet that is basically a mirror of your bank account statement.

      You have a Date, Description, Credit, Debit and Balance Column

      Start out by actually copying your bank account for the last 30 days and entering the details into the document.

      Once you have your actual position recorded up to today's date you can start predicting the future.

      This is how you do it.

      1. Take your monthly predicted income from your annual budget and divide it up into a daily amount.

      2. Drag the date column down and off into the future and paste the daily predicted amount into each day.

      3. Take a close look at your last month or if you have never traded then look at when the actual expenses or debits will be deducted from the account and then paste those amounts into the actual dates in the future when the money will be deducted.

      4. Every day go back and change your predicted balance to your actual balance from your bank statement.

      If you set this up right you can have your negative values showing in red (note in my image there is a little green tab - that is because we are in credit)

      KEY here is to look at dates when the amount of the bank balance may be negative and then you know what you've got to do.

      Either increase income to meet shortfall, obtain finance to cover shortfall ...or drag the expense to another future date to maintain positive balance.

      When dealing with suppliers you can always call them ahead of time to make other payment arrangements, you could pay the phone bill a day late, etc.

      What is important is you won't stress about having the money because you have advanced warning about the impending problem and you can make constructive changes to mitigate the outcome.

      NOTE: in my graphic you will see a column with an "X" in it.- blue dashed line - That means I've reconciled the bank statement up to there and the amounts after that are predictions.

      As you change your prediction to Actual...just put an X.

      Cash Flow forecast image


      These four documents/tools should be set up by everyone who is going into business and everyone who is already in business.

      There maybe software applications that do what I've outlined but there is nothing better than actually doing the process because you then can discover where you can make small improvements for significant results.

      For example...make multiple annual budgets and just see what getting a couple of percent difference in your costs makes...or a few extra sales has etc.

      When I first learned about these methods in 1999 I discover in my business at the time if I just saved 1% on my cost of sales it resulted in another $440 monthly to my bottom line.

      Over the following months and years I reduced my cost of sales from 37% to my best month of 24.2%. You can do the maths for what that did for my income.

      Hope this helps you to fend some of those punches that are always just waiting around the corner.
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      • Profile picture of the author iAmNameLess
        Originally Posted by Oziboomer View Post


        These four documents/tools should be set up by everyone who is going into business and everyone who is already in business.

        There maybe software applications that do what I've outlined but there is nothing better than actually doing the process because you then can discover where you can make small improvements for significant results.

        For example...make multiple annual budgets and just see what getting a couple of percent difference in your costs makes...or a few extra sales has etc.

        When I first learned about these methods in 1999 I discover in my business at the time if I just saved 1% on my cost of sales it resulted in another $440 monthly to my bottom line.

        Over the following months and years I reduced my cost of sales from 37% to my best month of 24.2%. You can do the maths for what that did for my income.

        Hope this helps you to fend some of those punches that are always just waiting around the corner.
        I want to sincerely thank you for the effort. I think you just provided more value than my CPA has in the last few years and I guess I have some homework to do over the next week.

        Funny... the more I learn the more I realize how much I don't know.
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        • Profile picture of the author bizgrower
          Originally Posted by iAmNameLess View Post

          I want to sincerely thank you for the effort. I think you just provided more value than my CPA has in the last few years and I guess I have some homework to do over the next week.

          Funny... the more I learn the more I realize how much I don't know.
          I think many CPAs need more business/marketing knowledge. My hotel owner's CPA
          is just now expressing concerns about the commissions to expedia.com that we have
          been doing for two years. Yes, it's a lot of commission. But, it's directly leading to about 14%
          of our revenues, immeasurable exposure, and repeat/referral business that is direct
          bookings.


          .............

          Knowledge of a business is probably a missing ingredient that causes business failure.

          My hotel owner's bought this business to get out of the laundry business, and because they
          thought a hotel would mean prestige and more money... I don't think that people really care
          what business somebody owns - not to the ooooh, aaaah level, unless it's a household name
          in your neck of the woods.

          Anyway, they almost ran the hotel into the ground because they don't know how to market,
          run this kind of business, and have the desire to serve customers properly. The wife is the
          definition of penny wise and pound foolish, and literally had a second round of cancer from
          trying to run this business. Her doctor advised her to get away and stay away.

          I see that a lot in hotels, Bed and Breakfasts, and restaurants/bars. Professional people,
          or people with high level corporate experience who always dreamed of owning such a business.
          Then find out how much work it really is, and that you really have to like most aspects of the business...

          Generally, one should start a business in something they already know about, then learn the intricacies of marketing and operating a business.

          These days people should also strongly consider if they need retail space, or just go the internet
          marketing route. I had a prospect who opened a nice retail store. Instant $4000/mo overhead,
          plus easily $70,000 in inventory and furnishings. She could have gone straight to the internet.

          She also did not fully consider the environment around her. The owner of her strip mall
          fought tooth and nail with the county over improvements to a feeder road to the mall.
          As a result, the road was closed almost the entire time she was there and traffic
          to her store was much lower than it should have been.
          Signature

          "If you think you're the smartest person in the room, then you're probably in the wrong room."

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          • Profile picture of the author DABK
            It's knowledge of a business. It's expectations. It's understanding that a business is a set of systems, that can be tweaked, changed, dropped, replaced.

            I know a mortgage broker who used to work, in the 90's, for a mortgage brokerage he considers to have been very successful. He's been trying to make his business successful for 2 years and a half now following the business model his boss in the 90's had. With no success.

            Because things changed, in terms of regulations, in terms of people's access to information (think internet) a lot.

            Recently, one of his nieces who had worked as a mortgage processor trainee for him a year or two ago, got a job for some mortgage company.

            She called him to tell him that.

            What he got from the conversation was, those people were closing 20 loans a week while he is closing 6-8 a month.

            I asked him to ask his niece what those people do differently. She told him. There are 2 things that they really do differently. All he has to do is adjust how he does these two things, and he'd be doubling his closings or more.

            He ain't doing it. Because he wants to have his business run like the guy from the 90's did his.

            By the way, the guy from the 90's is still around and a lot less successful that he was in the 90's. Because he's still running his business like it was the 90's.

            The main differences come to 2 points: being more organized and accepting that you can't be a salesman, you need to be a consultant. These translate into different ways of communicating before they sign up for a mortgage application and after.

            In practice, you the mortgage broker just has to change how, what and when information goes out to prospects; how, what and when to communicate with applicants. And it's simple and relatively easy and, besides, signing up to aweber or something like that, cost-free.

            However, impossible in this case due to a mental block: the good ol' times.

            Originally Posted by bizgrower View Post

            I think many CPAs need more business/marketing knowledge. My hotel owner's CPA
            is just now expressing concerns about the commissions to expedia.com that we have
            been doing for two years. Yes, it's a lot of commission. But, it's directly leading to about 14%
            of our revenues, immeasurable exposure, and repeat/referral business that is direct
            bookings.


            .............

            Knowledge of a business is probably a missing ingredient that causes business failure.

            My hotel owner's bought this business to get out of the laundry business, and because they
            thought a hotel would mean prestige and more money... I don't think that people really care
            what business somebody owns - not to the ooooh, aaaah level, unless it's a household name
            in your neck of the woods.

            Anyway, they almost ran the hotel into the ground because they don't know how to market,
            run this kind of business, and have the desire to serve customers properly. The wife is the
            definition of penny wise and pound foolish, and literally had a second round of cancer from
            trying to run this business. Her doctor advised her to get away and stay away.

            I see that a lot in hotels, Bed and Breakfasts, and restaurants/bars. Professional people,
            or people with high level corporate experience who always dreamed of owning such a business.
            Then find out how much work it really is, and that you really have to like most aspects of the business...

            Generally, one should start a business in something they already know about, then learn the intricacies of marketing and operating a business.

            These days people should also strongly consider if they need retail space, or just go the internet
            marketing route. I had a prospect who opened a nice retail store. Instant $4000/mo overhead,
            plus easily $70,000 in inventory and furnishings. She could have gone straight to the internet.

            She also did not fully consider the environment around her. The owner of her strip mall
            fought tooth and nail with the county over improvements to a feeder road to the mall.
            As a result, the road was closed almost the entire time she was there and traffic
            to her store was much lower than it should have been.
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            • Profile picture of the author bizgrower
              The things that get stuck in people's heads.

              I know a guy who had a blow to his ego by a former employer.
              To get back, he eventually bought and operated from the building
              his former employer used while he worked there.

              We've all seen prospects or clients who will not hesitate to spend $400 (or whatever)
              on newspaper ads that don't work, but hesitate to build a mobile site (or whatever IM
              strategy will be effective for them).

              Sounds like your friend is emulating his former boss too much.

              Does he have access to the software that allows him to generate the professional
              looking forms, good faith estimates, prequal letters ...? I did not when I tried to work from home
              as a mortgage loan originator in the 90's. Huge disadvantage to do things by hand - time wise
              and professional credibility wise.

              Back then, my family used a great loan originator for investment properties. He worked for a portfolio lender (mortgage bank) that has since been absorbed. I think it was Great West or Western. Basically, he was on a pretty good salary and bonus. He had tried to go out on his own a few times and never was able to make it that way.

              Dan




              Originally Posted by DABK View Post

              It's knowledge of a business. It's expectations. It's understanding that a business is a set of systems, that can be tweaked, changed, dropped, replaced.

              I know a mortgage broker who used to work, in the 90's, for a mortgage brokerage he considers to have been very successful. He's been trying to make his business successful for 2 years and a half now following the business model his boss in the 90's had. With no success.

              Because things changed, in terms of regulations, in terms of people's access to information (think internet) a lot.

              Recently, one of his nieces who had worked as a mortgage processor trainee for him a year or two ago, got a job for some mortgage company.

              She called him to tell him that.

              What he got from the conversation was, those people were closing 20 loans a week while he is closing 6-8 a month.

              I asked him to ask his niece what those people do differently. She told him. There are 2 things that they really do differently. All he has to do is adjust how he does these two things, and he'd be doubling his closings or more.

              He ain't doing it. Because he wants to have his business run like the guy from the 90's did his.

              By the way, the guy from the 90's is still around and a lot less successful that he was in the 90's. Because he's still running his business like it was the 90's.

              The main differences come to 2 points: being more organized and accepting that you can't be a salesman, you need to be a consultant. These translate into different ways of communicating before they sign up for a mortgage application and after.

              In practice, you the mortgage broker just has to change how, what and when information goes out to prospects; how, what and when to communicate with applicants. And it's simple and relatively easy and, besides, signing up to aweber or something like that, cost-free.

              However, impossible in this case due to a mental block: the good ol' times.
              Signature

              "If you think you're the smartest person in the room, then you're probably in the wrong room."

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          • Profile picture of the author Oziboomer
            Originally Posted by bizgrower View Post

            Generally, one should start a business in something they already know about, then learn the intricacies of marketing and operating a business.
            Yes...I started a business in something I already Knew about but I also already had a following or tribe that wanted to patronise me with business from day one.

            I'd say learning or at least planning the marketing and operations are really integral to starting any business.

            It is not usually good enough TODAY to just be a good practitioner of your craft today before you go into business and then pick up the marketing and business knowledge later.

            The world is too quick today and if you don't have business smarts from the outset you are gonna get some serious gravel rash.

            If you do have deep pockets or are prepared to finance your education...or have generous parents...I borrowed $35K back in 1990 to fund my start-up, you may survive...

            but...why chance it if you have no marketing or business knowledge??

            Get smart first.

            Test small and fail fast.

            I had incredible "LUCK" when I started.

            Good clientele already prepared to support.

            Family who supported (even my parents would come in and work nights to help me out)

            Took One Year to break even.

            Second Year employed first helper. - Got introduced to some Jay Abraham stuff

            Third Year made a small profit and had to pay TAX

            Fourth year had four employees and then made first income above normal wages for my industry.

            Then from 1995-2000 made good money. - met people who taught me how to save and make more money.

            Invested. then tech crash ...lost money.

            Bought property...

            then 9/11....whoa....

            $75K extra needed to get through that

            And it goes on...

            I have online start-ups that make big sales from day one but Online is a whole other thing.

            Fundamentals don't change so make sure you've got the fundamentals down pat.

            You definitely need bigger and more access to funds (back-up) today than you ever did because unless you are Number 1 online in your niche...and I hesitate to say even if you are NO 1 you can be sure someone is "Chipping" at you with "Tools" and "Techniques" you don't even know about...

            ...YET !
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      • Profile picture of the author DABK
        Budget? What budget? I can barely pay the rent.

        Words I've heard from some business owners.

        I looked into one business owner's sales and revenues and expenses about 1 year ago.

        He is big on bring on the clients (that's his job), thinks if his people just did a better job, everybody'll swim in money.

        I made him some excell sheets. Each month, he can put in the "sales" he brought in and how much he'd make in gross revenue if he ended closing the deals, and he can know how much money he'll make that month and how much he can expect to make the following month.

        He has discounted my prediction worksheet because it's says he's going to make 28% of what he expects in a month and, some of the months he's made 35% (though most months he's between 26 and 29%).

        I also showed how to reduce expenses:

        Don't think everyone's a buyer and start an application; sort them out a the beginning, tell some of them, NO.

        Essentially, I advised him to bring in fewer "sales" in order to make more money.

        I did it by showing him that a lot of the "sales" he brings in don't conclude, so he doesn't make money. I showed him which ones and what they have in common.

        I showed him that some of his referral sources bring in a lot of the crappy "sales" that don't conclude, the ones that always bring the kind that make him money, and the ones that fall in between.

        A year later, he still accepts the crap. And, of course, his gross revenues have not improved, his cash flow has not improved, his profits have not improved.

        Go figure!

        So, though it's great to have proper budgets and forecasting, really great. You need to act on the information they provide.

        Thanks for the info, Oziboomer. Found ways to improve my spreadsheets.

        Originally Posted by Oziboomer View Post

        Firstly it is the Annual Budget.

        Most people just stop at this one or don't make a realistic budget.

        Most going into business books, even most accountants would just advise a new business owner to do a budget...but that is where it stops and no-one tells you "HOW to USE" the budget you just created.

        A couple of keys is to measure the projected annual budget against what is actually going on.
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        • Profile picture of the author Oziboomer
          Originally Posted by DABK View Post

          A year later, he still accepts the crap. And, of course, his gross revenues have not improved, his cash flow has not improved, his profits have not improved.

          Go figure!
          Maybe give him some of the old school competitor analysis tasks to enlighten them a little.

          From the dark ages...but still can be used and adapted for today's business owner.

          Firstly give them the Competitor List to fill out.



          Then hit them up with multiple forms like the Competitor Profile



          Get them to analyse their competition with multiple Competitor Comparison Profiles derived from their Competitor list.

          Like this...but you modernise to suit...



          After that you get them to do a Site Analysis of each competitor.

          That in the past was a physical visit to the competition's place of business and that is still applicable but today you could include competitor website analysis.

          Finally you get them to do a Competitor Strategy Analysis which is really when they get the awakening moment that they need you to help them beat the competitors and they really should adopt and utilise your skills to help them achieve success.

          These types of competitive analysis methods can be adapted to suit all types of business and should be a routine part of an annual review or more frequently if you are in a rapidly changing marketplace.

          They should be scheduled on the calendar and assigned to someone...ideally the owner in the case of a small business...to complete and discuss with you or anyone else who has an interest in improving the business.

          Often business owners find their own solutions once they are prodded, pushed and, prompted into action.

          As a consultant it is a pre-requisite that you wield the stick and use it wisely to ensure the outcome you know is possible.

          Later they'll thank you.
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      • Profile picture of the author ThePromotionalGuy
        Oz my man,

        Ohh those beautiful spreadsheets. That is the business I know and understand. What a refreshing sight to see.
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      • Profile picture of the author cherrybowl
        Oziboomer, your 4 sheets are awesome.
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  • Profile picture of the author kenmichaels
    we are trained to think that

    if you work hard,
    if you do the right things,
    if you work even harder when things go wrong ,

    then you too can have the elusive "it"

    I don't think that's true

    You have to have certain breaks.
    You have to have certain opportunities.
    You have to have certain environments.

    ... and that becomes the challenge.

    The presumption that we all begin at the same starting line is just wrong.
    The presumption that we all have what it takes is wrong.
    The presumption that we all will eventually win is wrong.
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    Selling Ain't for Sissies!
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    • Profile picture of the author Oziboomer
      Precisely.

      Thinking is bad.

      Planning and executing is good.

      I have a guy working for me who bought a business in the late 1980's from someone who decided it was better to go and make money from drilling holes in people's doors...

      ...let me tell you the story...

      A very successful guy sold his shop ( quite profitable) to new green cashed up purchaser.

      Seller decided he was going to make it big by installing security peep-holes in the front doors of houses.

      He started out in Tower blocks where there was a fear of "Who's that knocking on my door?"

      Within one month he had several guys knocking people's doors with a drill in hand and a small brass door viewer that he imported for like $2.50.

      The guy would knock the door and explain the risk of "Not having a peep-hole installed"

      20 Bucks later and in 5 minutes the device was installed and he'd made a huge profit.

      Within a month he had a team of guys with drills boring holes in doors in every tower block in Sydney.

      He got rich.

      The buyer of his old business did OK selling pictures and other things but was always envious of the success that the

      "Guy with the drill" had.

      It was LUCK.

      After a few years My guy closed his shop in a high traffic (BIG) location because it was getting too hard to manage on his own with the casual staff he employed.

      Decided to go to a new location on a busy high street but didn't do any competitor analysis or any research at all.

      He just made a nice shop and opened his doors.

      Two months later he closed (I bought some stock and equipment cheap)

      Fast forward about 10 years and I was looking for a reliable employee....guess who I employed.

      Now here's the thing...

      after a few months..

      ...I had a big contract come through that I'd been nurturing for about 18 months.

      I'd been taking a holiday at the time the contact was finalised and you know what he said when I got back...

      "It's just luck"

      "Everything I ever achieved was... luck"

      yes.Luck...

      ...It just washed off me like water on a duck's back.

      Ask anyone who has been successful.

      They definitely "HAVE MORE LUCK"

      Luck is the key....NOT

      Yes you can be lucky but really Luck is being

      READY and in the RIGHT PLACE at the RIGHT TIME..

      ...or more scientifically....

      getting a result after years of testing, failing, succeeding, failing, testing and so you go on over and over.

      Success is only ever "NOW"

      Tomorrow you start again

      Successful people get up quicker....

      What's the saying? - The Lion and the Gazelle?

      A lion wakes up each morning thinking, "All I've got to do today is run faster than the slowest gazelle."

      A gazelle wakes up thinking, "All I've got to do today is run faster than the fastest lion."

      A human wakes up thinking, "To hell with who's fastest, I'll outrun the *******s."

      It doesn't matter whether you are a lion or a gazelle:

      When the sun comes up, you'd better be running.

      Maybe that's not it...but it works for me.

      Originally Posted by kenmichaels View Post

      we are trained to think that

      if you work hard,
      if you do the right things,
      if you work even harder when things go wrong ,

      then you too can have the elusive "it"

      I don't think that's true

      You have to have certain breaks.
      You have to have certain opportunities.
      You have to have certain environments.

      ... and that becomes the challenge.

      The presumption that we all begin at the same starting line is just wrong.
      The presumption that we all have what it takes is wrong.
      The presumption that we all will eventually win is wrong.
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  • Profile picture of the author Jason Kanigan
    Bump, because people need to see Oziboomer's sheets and forms.

    There's more pro info in this thread than 100 WSOs.

    And this, too:
    http://www.warriorforum.com/offline-...1-2-years.html
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    • Profile picture of the author sandalwood
      Jason,

      I've picked only this point:

      they didn't realize sales & marketing were vital, and thought building the better mousetrap would get the world beating a path to their door

      to talk about. The better mousetrap idea seems to be the generator for far too many "I'm gonna go into business" types. They actually believe that their toy, trinket, software, hardware, etc. will be immediately recognized, accepted and purchased by those of us in the unwashed masses. Never mind the fact we don't know it exists.

      They don't have a clue, for example, that the material Ozziboomer presented even exists. Heck, they can't even spell spreadsheets. These spreadsheets fall into the same category as nuclear physics.

      They recognize that the terms sales and marketing exist but that is for the other guy. My product will sell itself. All I have to do is open my business.

      Wow, if only it was that easy, right? We'd all be in business and never have to do any marketing at all. And, sales would be spinning the cash register software into oblivion.

      I like all the posts but most are too deep for the average I'm gonna go into business folks. There's too many trees to see the forest.

      I hope your post at least gets the thinking machine up and running.
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      • Profile picture of the author veheme
        Oziboomer, your information and spreadsheets are a huge, huge help. As a businessman myself, I highly appreciate it and much more since my business had just reached its second year but that doesn't mean my business is safe already. I need to learn and improve so that my business can thrive and improve as well.
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      • Profile picture of the author DABK
        Don't you know they're the best at what they do, they're the fastest and they care about their customers?

        By the way, you forgot this one:
        marketing is for losers; only companies that don't know what they're doing need to advertise; if, like me, you know what you're doing, you're going to get all the sales you need through word of mouth.

        That is being said 3, 4, 8 years after they opened their doors for business. That is being said even as they re-asses and conclude they're far from their goal.

        Why?

        Because they think they somehow failed at delivering the quality product or service or didn't deliver it fast enough or the pink bow they tied around it was not pink enough.

        It's so strange and sad how accurate thinking goes leaves town every time someone's talking about their own business.

        Originally Posted by sandalwood View Post

        Jason,
        They actually believe that their toy, trinket, software, hardware, etc. will be immediately recognized, accepted and purchased by those of us in the unwashed masses.


        ... My product will sell itself. All I have to do is open my business.
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        • Profile picture of the author iInvent
          Great thread! Bookmarked too!

          In my experience, every business is different but often times the person opening up a business isn't a business person at all. Its a baker who dreamed of having his own bakery. Its the renovator who was tired of working for someone else and wanted the freedom.

          Most of them are people who will work "in" their business and not on the business.
          They get busy doing what they love, which is the actual work but they lose sight of the big picture.
          And as a consultant, this is where I often come in to help.

          Every time I see a business closing up, I always wonder would could've been done to save it.
          Often times, they don't need much to turn things around.

          Thats my perception from my experience!
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          "Before you try to satisfy the client, understand and satisfy the person."

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  • Profile picture of the author jmferret
    I would also add that often people don't do enough home work before they start a business to research the market.

    Very often I hear people complain their business didn't go well. And in almost every case it was something they thought should sell. They imposed their wishful thinking onto reality. No good. Reality cares less about your wishes.

    In my experience, unless we are Apple or someone else who can create the niche, we should follow the existing market. In other words, find someone who wants something, find out what exactly, what it should be like to be bought and for what price. Then all you have to do is give it to them! Hard to beat that model!

    I use it nearly every time I expand my business, last time did it last week. Believe me, it works.
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    • Profile picture of the author Oziboomer
      Originally Posted by jmferret View Post

      I would also add that often people don't do enough home work before they start a business to research the market.
      I had someone recently grill me via email repeatedly about one part of my industry and ask what training material was available.

      The area I would consider...like most...skills probably takes 2-3 years to become proficient at and then at about 4-5 years you become really good and then after maybe 10 years you become an expert.

      I enquired about the level of experience that the person had in relation to my industry and they indicated "None"

      I suggested getting some work for a similar business in their locale...even voluntary...to gain experience...

      ...but no...

      they wanted what I had to get them skilled "NOW"

      I sent them a basic training course that was around 4 hours long and a supplementary 2 hour training on the area of interest.

      I also reluctantly allowed them into one of my more advanced membership programs where they could access some archived training...maybe about 75 hours of additional training that someone would usually do over a course of a year coupled with "on the job" training.

      They paid a token amount for this content as I'm pretty generous with what is already created as opposed to what my live contact time is worth...

      ...now...

      last weekend just before I was going live with a premium training session I got an email complaining that I didn't show "Everything" in the training I had previously "GIFTED" to the said individual....

      ...so maybe 10 day earlier they had access to over 83 hours training BUT I didn't show them what takes 25 YEARS to learn...!!!

      They asked in the same complaining email if I could give them a list of suppliers because they already had purchased equipment and registered a business name and were going to open their doors for business next month.

      In a month or so someone's going to pick up some cheap secondhand equipment don't you think?
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      • Profile picture of the author kenmichaels
        Originally Posted by Oziboomer View Post

        In a month or so someone's going to pick up some cheap secondhand equipment don't you think?
        Some lessons in life, just have to be learned the hard way.
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        • Profile picture of the author bizgrower
          Originally Posted by kenmichaels View Post

          Some lessons in life, just have to be learned the hard way.
          If someone who knows the restaurant business wants to open a new restaurant,
          it can be a good thing to be the second owner of a newly refurbished restaurant.

          I know of a chef who bought a very nice place for about half what the previous dreamer
          owner (who failed in less than a year) put into the building.
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          • Profile picture of the author kenmichaels
            Originally Posted by bizgrower View Post

            If someone who knows the restaurant business wants to open a new restaurant,
            it can be a good thing to be the second owner of a newly refurbished restaurant.

            I know of a chef who bought a very nice place for about half what the previous dreamer
            owner (who failed in less than a year) put into the building.
            I hear ya. Just today I picked up two more large format printers for my shop
            at less then half price .... because of someone else's failed dream
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            • Profile picture of the author savidge4
              Originally Posted by kenmichaels View Post

              I hear ya. Just today I picked up two more large format printers for my shop
              at less then half price .... because of someone else's failed dream

              I LOVE IT when that happens! I scored a BOSS Laser cutter not to long ago for less than 20% what they cost... and I am not sure they ever used it to begin with!
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      • Profile picture of the author jmferret
        Originally Posted by Oziboomer View Post


        In a month or so someone's going to pick up some cheap secondhand equipment don't you think?
        More people better study basic physics. Conservation of energy for example. Otherwise too many think they should get something for almost nothing and that world owes them something.

        Rude awakening is just around the corner, but what is sad, few learn those lessons. Most prefer to blame someone/something.
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  • Profile picture of the author manishsqrt
    I think the most important factor is that they don't stuck up with an idea for a long, lack of patience causes it, value is crated over year, and if you keep changing your model everytime people will not able to get it or they will lack trust on you, plus the lack of finances according to budget requirement is also a factor but this must be decided before starting up with anything.
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  • Profile picture of the author TrumpiaTim
    Owning and running your own business is not easy, all of the above points are valid and prove that managing a successful business and longevity are definitely not things to take for granted.
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    • Profile picture of the author Oziboomer
      Originally Posted by TrumpiaTim View Post

      Owning and running your own business is not easy, all of the above points are valid and prove that managing a successful business and longevity are definitely not things to take for granted.
      Case in Point...

      Back a few months ago my wife took a 50 day holiday/business trip to China and left me to look after two young boys under four....

      A few days after she left, a key sales staff member suffered a stroke and ended up in hospital and is yet to return to meaningful work.

      Another staff member was also on annual leave at the time which put added pressure on the rest of the team to cover their regular tasks along with the additional workload.

      Add in a falling currency that affects material costs of something like 8% increase to materials and increased energy costs largely due to policies out of our control and you sort of have a perfect storm brewing to challenge any business.

      Despite some recovery there are serious challenges faced by all long term businesses and as they say "When the going gets tough...The tough get going"

      Most people can see the magic growth drivers of

      "Increased Traffic" + "Increase prices" + "increased frequency"

      producing an exponential effect on profits...

      but many fail to see what the effects of the small percentages of

      "Decreased traffic" + "Falling Prices (or margin)" + "Decreased frequency"

      have on survivability.
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      • Profile picture of the author ewenmack
        Originally Posted by Oziboomer View Post

        Case in Point...

        Add in a falling currency that affects material costs of something like 8% increase to material costs
        .
        I got out of importing because of falling local currency.

        Sure is frustrating when things you can't control
        affects your business.

        Now I look very closely what I can control
        so the business isn't put at risk.

        Best,
        Doctor E. Vile
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        • Profile picture of the author Oziboomer
          Originally Posted by ewenmack View Post

          I got out of importing because of falling local currency.

          Sure is frustrating when things you can't control
          affects your business.

          Now I look very closely what I can control
          so the business isn't put at risk.

          Best,
          Doctor E. Vile
          Thanks Ewen,

          The experience of managing what one can control is something all business owners need to learn in one way or another.

          There is always the flip side with the products some of my businesses sell in USD but I have noticed the pressure on some even quite low dollar memberships in countries that were reasonably supportive when times were good for them.

          In many cases I've suspended their payments and maintained service and support because I value the long term relationship and goodwill.

          The biggest threat is not so much the things you can't control but the things you "MUST" control to keep moving in a positive direction.

          Things like the move from offline to online.....not that we don't still get our fair share of offline clients but all the pre-shopping and information gathering is done online and increasingly more on mobile.

          We've spent a large amount of time and resources upgrading websites to become responsive.

          We always had "mobile redirect" type sites that still function extremely well but because a number of products I sell have area or volumetric calculations we originally coded specific calculations into our databases and now we need to look to "modular" solutions....much like wordpress has plugins.

          That is now sorted and the painful task of testing is complete so here we go...

          Upgrade time !

          Over the years I've always had different "Irons in the fire" so to speak and even when the coals are dim we still manage to cook dinner.

          Today is no different as staff get trained to meet new demands and they adapt along with me.

          The best advice I can give anyone and Ewen's comment relates strongly to this...and that is...

          "Control what you can within the four walls of your business"

          You will never change what goes on outside despite who you vote for...how much you bitch and whine,,,nor how much money you earn...

          Get on...adapt....

          ....manage.

          Find the markets you can serve and do a bloody good job identifying their pain and then be the number one paramedic administering pain relief within coo-ee.
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        • Profile picture of the author savidge4
          This is an interesting topic for me... this is REAL business at its best. Over the last few years I have made some pretty radical shifts not so much in the way I do business but where I do business. An technically I am not even talking about the location of my clients..I am literally talking about the location I do business from.

          I live in a small town... Commercial rent is actually pretty cheap for the most part. I was paying $900 a month before for 1800 sqft. But the Gas and electric was killing me.

          I ended up buying a decent chunk of land outside of city limits and built a house and an office. The house is a modest 1800 sq ft 3 beds 2 baths and an office.. nothing overly spectacular.. the office on the other hand is 3000 sq ft not including the attached double garage with 10 ft door and a lift.

          There is a Supervisor for one of the Satellite Brands I work for that says "Control the Controlables" I always get a kick when he says it..it is usually in reference to something that is out of most anyones control.

          However, I took those words to heart when designing and building the 2 structures. The house is primarily heated and cooled using geo thermal. A bunch of deep ditches basically with a ton of pipe in them. The Office is a combination of Solar Electric / water heating and Geo. The water heating is the temperature control for the facility. An in floor maze of 1/2 inch pipe. we actually reverse the process in the summer and it actually works as a cooling effect.

          I cant control many things in the industries I work with The price of Vinyl is only going up the price of Rolled Paper and Ink for my Larger Format Business is only going up. The price of gas for my Satellite business is only going up ( tho we are in a slight dip right now ) The price of insurance only goes up. The price of employees can only go up - You get good help you have to keep them right?

          But power... 2 years ago in January for my house and Office my gas and electric bill combined was $1400.. this last January..$63 The actual expense of "owning" my Office vs renting is about a 50% savings. Doing my own oil changes on my vehicles. 6 company vehicles and 3 personal saves me about $400 a month. I just recently got the equipment needed that I can now buy my vehicle tires at wholesale and mount and balance my own tires. This will save about $5000 a year.

          Making those investments in things you CAN control is KEY. Just the numbers above... I'm adding something like $25,000 a year to my bottom line. Is there investment needed to do these things? sure there is. But The return on much of this is lightening fast.

          The lift so I can do oil changes in house paid for itself in the first year. The Tire mount and balancer equipment will pay for itself in about 6 months. All the expense for the Solar and geo stuff.. takes a bit longer I am looking at about 3.5 to 4 years on that... but seriously a small price to pay for the stability in the budget!

          And these are all things that over time just don't break even... they just keep giving and giving.

          BTW.. moving out of city limits... saved me from a 5% tax a year as well!


          Originally Posted by ewenmack View Post

          I got out of importing because of falling local currency.
          Sure is frustrating when things you can't control
          affects your business.
          Now I look very closely what I can control
          so the business isn't put at risk.
          Best,
          Doctor E. Vile
          Signature
          Success is an ACT not an idea
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          • Profile picture of the author bizgrower
            Your post reminded me of several things.

            I know of a business that needed to invest in more marketing.
            They found the money by purchasing a small office building after their
            lease expired. The savings was very substantial - about half what their
            rent was.


            A Wal-Mart that was only open for about two years shut down to move across
            the county line for the tax incentives. (Fascinating bean counting to me.)




            I'm sure you run and maintain your vehicles much better than my old boss. I
            used to drive for an auto parts store. The owner was a semi-good mechanic,
            who did his own repairs and maintenance. Semi-good. He had his warehouse
            manager do our oil changes when he could. Floor jack, no lift, no time. Vehicles
            went way too long between oil changes.

            He relied on us drivers to inspect our vehicles. One of the vehicles that our oldest
            driver used almost all the time got so bad that the brakes and suspension were
            about to fail.

            Although he could get tires at wholesale, he still bought the cheapest. Cheap all
            season tires for Colorado winter driving in the mountains?

            There's probably a savings on auto insurance if you show documented safety and PM
            behaviors.




            Originally Posted by savidge4 View Post

            This is an interesting topic for me... this is REAL business at its best. Over the last few years I have made some pretty radical shifts not so much in the way I do business but where I do business. An technically I am not even talking about the location of my clients..I am literally talking about the location I do business from.

            I live in a small town... Commercial rent is actually pretty cheap for the most part. I was paying $900 a month before for 1800 sqft. But the Gas and electric was killing me.

            I ended up buying a decent chunk of land outside of city limits and built a house and an office. The house is a modest 1800 sq ft 3 beds 2 baths and an office.. nothing overly spectacular.. the office on the other hand is 3000 sq ft not including the attached double garage with 10 ft door and a lift.

            There is a Supervisor for one of the Satellite Brands I work for that says "Control the Controlables" I always get a kick when he says it..it is usually in reference to something that is out of most anyones control.

            However, I took those words to heart when designing and building the 2 structures. The house is primarily heated and cooled using geo thermal. A bunch of deep ditches basically with a ton of pipe in them. The Office is a combination of Solar Electric / water heating and Geo. The water heating is the temperature control for the facility. An in floor maze of 1/2 inch pipe. we actually reverse the process in the summer and it actually works as a cooling effect.

            I cant control many things in the industries I work with The price of Vinyl is only going up the price of Rolled Paper and Ink for my Larger Format Business is only going up. The price of gas for my Satellite business is only going up ( tho we are in a slight dip right now ) The price of insurance only goes up. The price of employees can only go up - You get good help you have to keep them right?

            But power... 2 years ago in January for my house and Office my gas and electric bill combined was $1400.. this last January..$63 The actual expense of "owning" my Office vs renting is about a 50% savings. Doing my own oil changes on my vehicles. 6 company vehicles and 3 personal saves me about $400 a month. I just recently got the equipment needed that I can now buy my vehicle tires at wholesale and mount and balance my own tires. This will save about $5000 a year.

            Making those investments in things you CAN control is KEY. Just the numbers above... I'm adding something like $25,000 a year to my bottom line. Is there investment needed to do these things? sure there is. But The return on much of this is lightening fast.

            The lift so I can do oil changes in house paid for itself in the first year. The Tire mount and balancer equipment will pay for itself in about 6 months. All the expense for the Solar and geo stuff.. takes a bit longer I am looking at about 3.5 to 4 years on that... but seriously a small price to pay for the stability in the budget!

            And these are all things that over time just don't break even... they just keep giving and giving.

            BTW.. moving out of city limits... saved me from a 5% tax a year as well!
            Signature

            "If you think you're the smartest person in the room, then you're probably in the wrong room."

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            • Profile picture of the author savidge4
              On the work Vehicles I use $800 a set of mild Mud and snow in the spring, summer, and fall and then switch over to $1200 a set aggressive snow and mud tires in the winter. Oil changes.. geeze.. November 1st to March 31st every three weeks. and April to October the 1st and 15th of every month.

              I keep trucks in service for 3 years total usually. they get about 60K miles a year. At the end of their life cycle I order new interiors ( Roof Liners, Carpets, seats and steering wheel ) and they are given to whoever in my organization needs a vehicle.. or has the oldest one.

              And the moving for the tax break.. yeah a must move! LOL

              Originally Posted by bizgrower View Post

              Your post reminded me of several things.

              I know of a business that needed to invest in more marketing.
              They found the money by purchasing a small office building after their
              lease expired. The savings was very substantial - about half what their
              rent was.

              A Wal-Mart that was only open for about two years shut down to move across
              the county line for the tax incentives. (Fascinating bean counting to me.)

              I'm sure you run and maintain your vehicles much better than my old boss. I
              used to drive for an auto parts store. The owner was a semi-good mechanic,
              who did his own repairs and maintenance. Semi-good. He had his warehouse
              manager do our oil changes when he could. Floor jack, no lift, no time. Vehicles
              went way too long between oil changes.

              He relied on us drivers to inspect our vehicles. One of the vehicles that our oldest
              driver used almost all the time got so bad that the brakes and suspension were
              about to fail.

              Although he could get tires at wholesale, he still bought the cheapest. Cheap all
              season tires for Colorado winter driving in the mountains?

              There's probably a savings on auto insurance if you show documented safety and PM
              behaviors.
              Signature
              Success is an ACT not an idea
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  • Profile picture of the author Oziboomer
    Wow... I didn't expect that the thread would turn to "DIY" options for saving money in the business.

    There are a couple of thoughts I've got on this and I've got nothing against bringing some tasks under your own control but there is a lot to be said for outsourcing also.

    I suspect the controls that Ewen may have been talking about were constraints he chooses to use to run a tight ship and to leverage his time to extract maximum value.

    There is much to be said to designing systems to manage your business in all areas.

    The true entrepreneurs do tend to surround themselves with people who are better than them and leverage those people's skills to produce a positive outcome for their businesses.

    I understand many aspects of things that could be brought into a "do it yourself" solution but I also understand acutely the value of my time and how to best leverage that to maximise results.

    I've always look for ways to get rid of tasks that take me away from my primary purpose which is "Business Growth"

    I do understand the ideas of cost savings and the frugal application of funds to hand but I also know

    "You can't shrink yourself to greatness"

    When times are tough you have to look at savings but be careful to not start becoming the employee or "slave to your business" when you should be the leader and deal maker.

    If your time can be better spent closing one sale that generates profits for the business I'd say do that over changing oil or tyres or some other task that you could have done for you.

    It doesn't hurt to know how to do those things but it can hurt business when you focus on the small stuff when a few big deals can change your situation.

    As for rent, I'd love to pay $900 a month for 1800sq ft...the same in my area would cost over $6K for commercial space and between 15-20K monthly for prime retail.

    I currently pay a reasonable $7K monthly for my space in a homemaker type "big box" retailer type location. - I'd love to own my space but until the whole business is online ad we don't need foot traffic I'll grumble but that is the cost in my market.

    It doesn't really matter what your business structure and costs are.

    What really matters is only a few simple things.

    WHY you do what you DO?

    When you know the REAL why, then you have purpose in your life.

    The other thing is to manage what goes on.

    The way you manage is by learning the methods or

    ....financial control

    ...how to leverage the profit drivers

    ...how to manage risk

    ...how to market and sell

    ...how to measure where you are

    ...how to grow through leverage

    ...how to love your family

    ....how to relax under pressure

    Anyone got any more?
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    • Profile picture of the author savidge4
      I really do agree with what you are saying. For me its those low times that open up the best clarity of a situation for me. Where my trucks are parked every day and the closest oil change place is 20 miles away. There and back in the Morning or mid to late afternoon can be an hour total both ways. then it can take an hour to get the oil changed. That's 2 guys and 2 hours x 4 trucks x 2 times a month.

      That alone is 1 weeks salary per month ( give or take ) just to get the oil changed.. and that doesn't include the actual cost of the service. Between that and tyres ( just for you Ozi ) I was spending the equivalent of 1 years salary in the time it took to get that done, and the expense. Buying a proper lift, and having my guys do it in house turned out to be leveraging THEIR time, that I pay for!

      I have cut my non productive costs in every way I could think of. I have a truck with a 200 Gallon fuel cell that gets filled every other day or so. So my guys don't have to drive out of the way to get gas. I am basically leveraging the time spent by a $12.00 an hour delivery boy against the guys out producing mid 3 figures an install.

      Fleets tho are kinda a given spot for savings when you really start breaking it down. but I really don't stop there. Im always looking at ways to keep my high end help on task and away from things that could be done by lessor payed individuals, and often by me personally.

      I think my primary job as a business owner is to keep things as smooth as possible. I ask my self all the time.. what can I do to make my employees work more efficient? I actually spend a good amount of time and money developing systems that reduce time spent on certain tasks.

      I have developed a CRO back end as an example. brought in a programmer for what turned out to be a month to as close as possible automate the process. Imagine Opening a clients site back end, their Analytics account, the testing software, locating testing variables etc 60 times a day. It worked out to about 6 hours a day was spent on this stuff. What took 5 minutes each, now takes about 20 seconds. PLUS I now have an accurate time stamp of how much time is spent on each client.

      In my book / experience efficiency drives profits. If you look at it this way.. yes you can shrink your way to success! Efficiency means more work can be done, and done smoothly. reduce the stress friction from your everyday work and you as a business owner can start doing what it is you do best.

      Originally Posted by Oziboomer View Post

      Wow... I didn't expect that the thread would turn to "DIY" options for saving money in the business.

      There are a couple of thoughts I've got on this and I've got nothing against bringing some tasks under your own control but there is a lot to be said for outsourcing also.

      I suspect the controls that Ewen may have been talking about were constraints he chooses to use to run a tight ship and to leverage his time to extract maximum value.

      There is much to be said to designing systems to manage your business in all areas.

      The true entrepreneurs do tend to surround themselves with people who are better than them and leverage those people's skills to produce a positive outcome for their businesses.

      I understand many aspects of things that could be brought into a "do it yourself" solution but I also understand acutely the value of my time and how to best leverage that to maximise results.

      I've always look for ways to get rid of tasks that take me away from my primary purpose which is "Business Growth"

      I do understand the ideas of cost savings and the frugal application of funds to hand but I also know

      "You can't shrink yourself to greatness"

      When times are tough you have to look at savings but be careful to not start becoming the employee or "slave to your business" when you should be the leader and deal maker.

      If your time can be better spent closing one sale that generates profits for the business I'd say do that over changing oil or tyres or some other task that you could have done for you.

      It doesn't hurt to know how to do those things but it can hurt business when you focus on the small stuff when a few big deals can change your situation.

      As for rent, I'd love to pay $900 a month for 1800sq ft...the same in my area would cost over $6K for commercial space and between 15-20K monthly for prime retail.

      I currently pay a reasonable $7K monthly for my space in a homemaker type "big box" retailer type location. - I'd love to own my space but until the whole business is online ad we don't need foot traffic I'll grumble but that is the cost in my market.

      It doesn't really matter what your business structure and costs are.

      What really matters is only a few simple things.

      WHY you do what you DO?

      When you know the REAL why, then you have purpose in your life.

      The other thing is to manage what goes on.

      The way you manage is by learning the methods or

      ....financial control

      ...how to leverage the profit drivers

      ...how to manage risk

      ...how to market and sell

      ...how to measure where you are

      ...how to grow through leverage

      ...how to love your family

      ....how to relax under pressure

      Anyone got any more?
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  • Profile picture of the author bizgrower
    Savidge4,

    Sounds like you could license or sell the non-competitive
    aspects of the behind the scenes software you've developed?

    Dan

    PS - I did assume you'd handle vehicle maintenance better than my ex-boss.
    We were four miles from a one of our customer' shops and he should have
    worked out a deal for oil changes and inspections. They charge $20 retail for that.
    It's a Firestone.
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    "If you think you're the smartest person in the room, then you're probably in the wrong room."

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    • Profile picture of the author savidge4
      Originally Posted by bizgrower View Post

      Savidge4,

      Sounds like you could license or sell the non-competitive
      aspects of the behind the scenes software you've developed?

      Dan

      PS - I did assume you'd handle vehicle maintenance better than my ex-boss.
      We were four miles from a one of our customer' shops and he should have
      worked out a deal for oil changes and inspections. They charge $20 retail for that.
      It's a Firestone.
      the trucks are $50 a crack around here... rent is cheap, but oil changes are not. There are 1000's of oil and gas pickups.. so there is a pick up surcharge! LOL

      The software I look at as a business asset. My last buy out was in part due to the back end software I had developed. At some point this will be the same thing. Without any assets your business is only worth so much. Clients come and go, so they really have no value. its in the business' assets that "create" value. And to have a service based business such as I do, that has a very tangible asset.. well makes it worth a kick ton more than all the rest. I know I could license it out... but it does make life rather simple.. and I think its is a very competitive edge!
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