As the experts argue about the definitions of a recession, the reality is that things are definitely not booming. That hasn’t dampened America’s entrepreneurial spirit, but it’s made people more cautious. So should you consider starting a new venture in today’s economic climate?Â
“Many people think that starting a new business in a slowing economy doesn’t make sense, but for many businesses, there are advantages,†says Peter Justen, is president and chief executive officer of MyBizHomepage. Justen says there are definite perks to starting a new business when the economy isn’t great; you can:
Negotiate for a great deal on the lease. Real estate is slowing in most regions of the country which allows for small businesses to get retail, office and warehouse space at reduced costs. “Do your homework,†Justen advises, “and study the past rental rates and current market conditions before you negotiate.â€Â In a tight economy, it’s also easier to negotiate for landlord build-outs, signage, and parking.
Find great used furniture/fixtures, office equipment. Take advantage of the many companies who ramp up too fast and find themselves with offices of new furniture and equipment to sell at a fraction of what they paid. This is a great time to negotiate copiers, fax machines and computer equipment.
 Capitalize on less business competition. When the economy tightens, fewer people are likely to start businesses. This means that you can do a competitive regional analysis and know that your niche is protected, for a while at least. Grand openings, ribbon cuttings and ground breakings are likely to get a lot more media and general attention.
Make the most of less advertising competition and reduced rates. When you spend money to advertise your new company, you’ll have greater visibilitysince there are fewer companies advertising in a slow economy. You should also be able to negotiate advertising rates. Â
Benefit from reduced marketing costs. In a down economy, writers, designers, and agencies are often looking for work and are able to offer reduced rates.
Pursue available media coverage. Local press will be more likely to cover a start-up when it’s one of just a few.  When business slows down, it’s more difficult for reporters to find good stories. Send story ideas and pitches to your local business reporters.
Take advantage of greater loan availability. With fewer start-ups there are fewer companies vying for start-up loans from banks and Small Business Administration grants. While a tighter economy means tighter lending too, less competition should make it easier to get money from lending institutions, assuming you have stellar credit.
Scout out bank rates and services. Shop your local banks for the best rates and services. You can often negotiate lower interest credit cards and corporate accounts.
Profit from an enhanced employment pool. In tough times, businesses lay off good employees who are often willing to accept pay cuts for employment with a company that offers other benefits—improved commute, improved lifestyle, interesting work, etc.
Network harder than ever. All start-ups require hours of long, hard work. A down economy is no exception—quite the opposite.  The advantage though, as one of only a small number of start-ups, use this period of downturn to get out and network with all of the companies and executives who can be mutually beneficial to your business. You have a window to take advantage of the down time and fully maximize your efforts. For instance, in a slow economy, you may find that executives, bank officers, etc. you wouldn’t normally have access to are attending local chamber breakfasts and business receptions. Use this to your full advantage.
Many are facing tough times with the stock market and economy being tumultuous and unpredictable.
To help you through these times we are speaking with Ethan Ewing, President of Bills.com and Kim Kiyosaki, author of Rich Woman and co-founder of The Rich Dad Company.
Ethan is going to show you how to get out of debt and stay out of debt while Kim is going to share some financial advice on how to stay cash flow positive.
Download mp3 – Tough Times Equal Tough People [55:17m, 12.6MB]
See more here:
Tough Times Create Tough People (mp3)
I thought it was funny to read about himself and his wifes accountant and how she (the accountant) reacted when the couple wanted to take 30% of $1000 to invest instead of paying the bills. Even though they owed $1500 to creditors. The accountant became very upset.
This lesson about paying one-self first is something that very few do. They pay themselfs last, but think they pay themselfs first. The thing is that people pay themselfs what is left over. That is not paying yourself first.
It takes a certain kind of guts paying yourself first. Especially 30% of income. Robert Kiyosaki and his wife actually made money through business dealings and paid themselfs 30% before taxes. That takes real guts. Though I would guess the taxman got the first rights to the money on what was left over, before the other creditors
.
But I can’t help it, I like Robert’s crazy way with money. It resonates with me and makes real sense to me. I like his creative financing schemes as well. I really do. Others thinks he is a total moron, I can’t agree at all. He is probably the sanest person out there.
This guy knows that in the end, yourself goes first in line. You only have yourself in the end. I find it (just as the author does) funny that we prioritize others more than ourselfs. People think that this is our responsibility. That is BS, I am responsible for me first. Always. Then I can be responsible for others. But I need to secure my ass first. How can I secure my own ass first when everyone else is entitled to my money before I am entitled to it?
So think about this:
Every time you get $1 in your pocket from business dealings, take 30 cents right of the top and invest it. Pay taxes on what is left and the other creditors. The creditors that are left when there is no more money, need to wait until you earn some more money. This makes you really productive. You have to be..hehe. You have no choice.
Creditors of importance are always:
YOU
The goverment
Banks and financial institutions
Other small time creditors.
If you are dealing with criminals and the Mafia then I would propose for you to stop dealing with those people. It can become a problem if you pay yourself and fall short of paying those guys.
Read the book by all means, you can never get enough of Robert’s refreshing view on finance and business.
I would like Robert to write a whole book on creative financing examples. I think that would have been a slam-dunk. I would have bought it directly.
If there was one question that people would pay a million bucks to have the answer to, it would be – How do I get rich? The answer is really obvious – if you have a million to spare then why waste it on a foolish question.
Invest it and over the years you’ll surely get your millions.
But that’s not the answer they are looking for. Surely there has got to be something more to it — some deep insights, some invaluable pearls of wisdom, some magic!
Not really. It’s often just simple common sense. Like Robert Kiyosaki’s best selling book Rich Dad, Poor Dad that should be made the Bible of the financial world. Here are four points from there on how you can do it:
1. The value of learning
Go back to your earliest memory. When you wanted to ride a bike on your street, the first thing you had to do was learn how to ride. Or when you wanted to pass your Maths exam, you had to learn your tables. Then why is it that when we want to make money, do we not understand that we have to learn good investing?
Instead we tend to just pick up the phone, speak to our stockbroker, buy a stock and start dreaming of becoming rich. That’s exactly what rich investors don’t do.
Instead, they ‘learn’ to ‘invest’. They learn all there is to know about the art of investing in stocks. All about the stocks they wish to buy and only then do they take the plunge. Above all, they keep practicing what they have learnt. They keep sharpening their saw. This single factor of learning before hand separates the rich investors from the poor investors,
2. Shop at a discount
Another bit of common sense — What do you do when your neighborhood super market announces a SALE? You flock into the stores and buy up every little item and build up at home piles of grocery, soaps, etc. But when stock markets reduce the prices of shares and announce a ‘crash’ every investor rushes in to ’sell’ and runs away from the market.
Again, conversely, when Super Markets raise their prices, customers shy away and refrain from buying till the next ’sale’ but when Stock Markets announce rising prices, every investor rushes in to ‘buy’.
This is not the way rich investors behave. They follow the same principle of buying at the super market. They buy stocks only when the stock markets crash. Ask Warren Buffet!
3. Define asset
If you own it, it’s an asset. If you owe it, it’s not. The rich never keep their wealth in the form of liquid money in a bank account. They always keep acquiring assets while the poor acquire liabilities, which they mistakenly believe are their assets.
A house bought on a loan is not an asset, it’s a liability. The same goes for paying for groceries through credit card. So you need to learn the difference.
In life what is important is not how much money you ‘make’ but how much of that money you succeed in ‘keeping’ and ‘multiplying’.
The rich know how to keep it because they know how to invest it. Money well invested is money well kept. Good investing is often more rewarding than good earning.
4. Make real money
Real money is made when you ‘buy’ an asset and not when you sell that asset is yet another gem from the author. Be careful of the price you pay when investing in an asset.
Don’t rush into buying any investment at any price. Wait till the prices come down the way. The ‘price’ of the asset when you buy is the sole determinant of your profit on that asset when sold. If you buy that asset cheap, your profit on sale is obviously larger.
All these four seems rather straightforward now that you think about it. We known all this instinctively and we only have to apply it to the stock markets — it’s really common sense.
The only problem is that common sense isn’t really all that common.
~ Kanu Doshi
Excerpt from:
How to get rich despite bloodbath at markets
1 Indebtness
2. Low wages
3. Financial illitetracy
4. Bad family relationship
5. Lack of sound personal financial management principle
6. Poor habit spending
7. Lack of clear financial goals
8. Credit card dependency
9. Poor knowledge of number game when comes to money
10. Your money working for others
11. Fear of taking investment risk
12. Play safe when comes to money matters
13. No financial budget to follow
14. Bad spending habit, expenes exceed our income
15. Lack of patient in accumulation of money
16. Constantly looking for financial independence short cut
17. Setting financial goals with no time bound
18. No plan to follow
19. Not knowing who to be your influencer when comes to money matters
20. Waiting for tomorrow
See the original post here:
20 Major Challenges to Financial Independent
