There is a Chinese proverb that states, "Give a man a fish and you feed him for a day, teach a man to fish and you feed him for a lifetime". The central premise of this proverb is the same as the more recent axiom of "each one, teach one". Passing knowledge from one person to another is the surest way of increasing the success of future generations and society in general. Many of the services and products we purchase are the direct result of years of painstaking craftsmenship, which was passed down through generations of people. The end result of this passion was excellence, dedication, and high quality.   

Over the past five years, I have noticed a growing trend among Generation "Y",  that is in the opposite direction. Our young people no longer want to take the time to learn anything, they put instant gratification before the reward of working toward a goal. Evidence of this growing trend is the number of Baby Boomers who now have children between 20 - 25 still in their homes. Many have already graduated from college, but don’t want to deal with the harsh realities of life on the outside and have retreated back to the safety and surety of Mom and Dad’s place. To make matters worse, there are many parents who feel it is okay for them to return, which only compounds the problem.

Unfortunately, it isn’t just Generation "Y" that is having problems, many of the same traits are being exhibited in Generation "X" and Baby Boomers. I am reminded of the last two consults I had with potential clients. One was a team in their mid twenties and the other was a service provider in his late thirties. In each case, they were seeking funding for a start-up business and wanted to know what it would take for me to get them funded. I explained it was a lengthy process, but if they were willing to do the work, it could be done.

As is my standard practice for an initial consultation, I pulled out a marketing form I devised that talks about the five C’s and the four P’s of introducing a product into market. As I began to explain to the twenty year olds, they had the same look on their face, your four year old does when you are trying to explain the importance of eating vegetables. This only got worse as I explained how most of the information that goes on this sheet must be provided by them. It wasn’t that I didn’t know how to complete the form, but I wanted them to understand all that is involved in convincing a financier that they are a worthwhile investment. More importantly, I wanted to teach them the process of determining who their target market was, how to differentiate themselves from the other companies that offer the same services, and all of the intricacies of starting and maintaining a successful business.

The service provider in his late thirties was more receptive to the marketing form and had a fairly good grasp of his target audience. However, he questions were about how long it would take to get the money. When I explained it depended largely on who he was trying to get the funding from he began to look at me as though I had no idea of what I was talking about. I went on to tell him of the various sources of funding and what they require and how I could help him create a business plan or funding proposal to facilitate his needs, but there was no quick way other than loan sharks. Finally, I referred him to my website and told him to get a flavor for who I am and my philosphies and to give me a call if he thought we could work together…………I’m still waiting.

Both of these examples further my postulation of the "just gimme the fish" mentality. They view the detail of obtaining what they want as blah, blah, blah and insist on a faster solution to get them what they want. One of the twenty somethings said to me, "I didn’t know it took all that" and I explained the reason it does is so you fully understand the responsibility your are taking on and have every opportunity to succeed. The older gentleman wanted to know why they just couldn’t give him the money, "he was good for it" and would make repayment in no time.

We as a society need to get back to a few simple truths: No there is no easy way out. Yes, life is hard, and Yes, you have to work for everything you get! The best advice I can give is take the time and let a few good fisherman teach you about bait, tackles and weather conditions and get ready for a lifetime of fresh fish!!

Word to the Wise | No Comments »

Americans are feeling pain at the pump greater than ever before. Politicians are seizing this opportunity to suggest nonsensical solutions such as reducing the gas tax by penalizing the oil industry for benefiting from the very thing they do…sell gas! How ridiculous!!!

If you want long-term relief from rising fuel costs and food costs, tell the government to let you keep more of the money you actually earn! Just imagine how you would feel if you earned $1000 in a week and received a $1000 paycheck? That would certainly help cope with the ever rising cost of filling up.

How is that possible? The Fair Tax. Before your eye glaze over and you begin shaking your head as if to say "here we go again", let me explain a few truths. Our system of taxation has made it impossible for businesses maximize profits and offer competitive wages and benefits. The United States has the highest corporate tax of any industrialized nation at 40% and the affect of that can be seen in the growing trend toward outsourcing.   

Here is an abridged version of the Fair Tax and its benefits:

• Abolish the IRS (Saves over 10 billion per year)
• Removes all embedded taxes (25%)
• Monthly stipends for food expenses
• Adds a national value added tax of 25%
• No inheritance taxes, ad valorum, or capital gains
• Receive every dime of your paycheck
• Bring jobs back to the United States
• The underground economies pays their fair share

Of course there are far more details than I have listed here and you can read them all at www.fairtax.org, but for our purposes I wanted to highlight why the Fair Tax is a better solution.

Of the benefits listed, the most pressing reason for the change is "Brings jobs back to the United States". By removing the corporate taxes, several things happen;

• Companies will be able to invest more money in technology and innovation, which not only produces a better product, but in most cases lowers the price.
• Employers will be able to indentify "best practices" and pay higher wages to employees who embrace those practices.
• Foreign businesses, whose corporate tax average 28%, will relocate to the U.S., create partnership with U.S. firms, or expand into a multinational organization. Either of which means more jobs!!

As you can see, the solution to many of our country’s problem are cured with the implementation of the Fair Tax. So why hasn’t it happened? One word….Power! Making the Fair Tax law would remove all of the leverage of the Washington Lobbyist, who mainly lobby for tax favors, and special interest groups who exchange votes for favorable subsidies and tax breaks.

Secondly, the amount of savings that would be generated from eliminating the IRS and its related expenses, coupled with the increase in empowerment of the American people, would certainly start calls of downsizing the government. While this is welcomed by one political party, the other bases its very existence on dependence and their ability to make decisions for you. Afterall, you aren’t smart enough to figure things out for yourselves….right?

Finally, take the time to look at what the real problems are and don’t let politicians tell you how they are going to solve your problems. Choose a path that allows you to make decisions for you and your family. Have the resolve to make tough decisions and take a stand for the freedom our founding fathers and many others fought for…..in other words, its time to Man Up!! 

Word to the Wise, Rants | No Comments »

Going into business for yourself takes a lot of courage, planning and preparation, but the greatest of these is courage. Planning and preparation are the keys to success once your business has been established, but courage is the origin of the initial step.

Unfortunately this very same courage can lead to a belief that if you have to ask for help you will be seen as weak or incapable of handling the rigors of entrepeneurship. Nothing can be farther from the truth!

As I spoke of in a previous post, we must take advantage of the resources we have around to strengthen our business and our chances of success. If you are having a problem with accounting, ask a successful business person you know for a referral of their accountant. Don’t wait until the IRS has served you a notice or your creditors are threatening to cut off your line of credit.

The important thing to remember is to ask people who can help; preferably someone who has already obtained what you are striving for. Simply put, you can’t get sound advice on soaring like eagles by asking chickens. 

What will surprise you most is how willing most successful people are to help; they won’t give you all of their secrets, but they will usually give you guidance on things that did not work and what they did to overcome adversities.

Be diligent in your process analysis and regularly check your achievments, or lack thereof,  against your business plan and if you are at a lost for what to do next, Ask for HELP!

Word to the Wise | No Comments »

As a consutant, I have met many people who have been bitten by the "flipping" bug. They diligently watch all of the shows dealing with finding, restoring and selling distressed  or foreclosed properties. The have saved their money and now are ready to flip a house for huge profit. Unfortuntely, it’s not that simple.What the popular shows don’t tell you is you have to do your "due diligence" concerning a property before you purchase and begin the remodeling.

These steps include:

• Comparative market analysis
• Crime reports 
• School rankings
• Educational background of current residents
• Average income of residents

These are but a few of the factors that determine whether someone will purchase your home after the remodel.

Keypoint: If no one wants to live in the neighborhood where your property is, it doesn’t matter how good the deal is. 

As a real estate investor, I have owned several properties and have looked into "flipping" houses. Amazingly, as many houses as I have researched, I have not found one that has met the standard enough to have me purchase. There have been homes I made offers on, but they were over priced and were taken by investors who still own them to this very day. 

On several properties of interest, I had our team builder come out an assess the condition of the home and what it would take to repair and remodel. During one of the inspections he asked if I had ever considered building a house to sell instead of flipping. The point he made was even though I could remodel a home with new appliances, fixtures and landscaping, it doesn’t change the age of the house. (Eureeka!)

The undeniable fact about new construction is the buyer has the opportunity to be the first to live in the home and depending on which stage of construction they purchase, can choose paint color, carpeting, cabinets, etc. 

Building a new home in an established neighborhood gives you the benefit of an establish price range, stable residency and the ability to offer brand new features for the same price as the current offerings.

What is most amazing is it isn’t as expensive as you may think to build a home. The are companies that offer plans for all types of homes such as www.frankbetz.com. The key is finding a builder that is reputable, honest, insured, and you can see at least five homes of varying types he/she has built.

I have recently purchased property and we are about to break ground on our first "build for sale". I will be posting updates and photos as the process proceeds and we will see what happens.

Finance and Investing, Word to the Wise | No Comments »

Effective advertising is letting your target markets know you have the solution to their needs. In the development of the ad piece you use to make them aware, you must understand the consumer does not care who you are until they need you. When I explain this to business owners, it is met with a raised brow and matching grimace. "What do you mean by that", they typically ask. If you look at the sequence of events involved when a potential customer views an unsolicited piece of advertising it usually goes like this:

1. What is it?
2. What does it do?
3. How much does it cost?
4. How can I reach them?
5. Where are they located?
6. And oh yeah, what was the name of that company?

In our busy society we have very little patience for things that are unexpected, therefore advertising campaigns must utilize as much effective pitch time as the readers patience will allow. I can remember in the 1980’s there was a campaign that had the words Great Sex!! at the top of the page and followed with, "now that I have you attention" and went into the pitch. This was great at the time because it gave the reader a chuckle and many times achieved the goal of them reading at least half of the ad. Unfortunately, pop up adds have ruined the effectiveness of surprise advertising; people are for more likely to think an ad the had the words Great Sex!! was for Viagra or some other sexual aid and throw the piece away.

What I stress most to business owners is the understanding of their target market and designing their campaign around the tendencies of said group. If you are targeting "Soccer Moms" the ad has to be short to the point and relevant to what she needs at that time. She is not going to take the time to read your ad unless it hits upon something she needs now or is aware of needing in the next few days. For those of you who are married, have you ever had your wife ask you about an ad for a service that was on TV or the radio? She describes as much as she can remember and asks if you know who they are. That is what I am talking about. She did not care about who the company was until it fulfilled a need she had.

When you are designing your next ad use the large type for an introduction to what you can do for the consumer and put your company’s name in the same small print as the telephone number at the bottom of the page and see if there is a difference in response. If you have associates who fall within the demographics of your target market, let them see your add and ask them what it is about, not what they think about how it looks. Experiment with different layouts and ways of drawing attention to what you are trying to sell and keep pride of ownership from reducing the efficacy of your campaign.

Marketing, Word to the Wise | No Comments »

This is one of the rudimentary phases of your planning and the realization that these things are needed is half the battle. Going to business for yourself is a long process….and rightfully so! It can be the beginning to the rest of your life or just another hard lesson learned.

Business Development, Word to the Wise | No Comments »