In Don's course he talks repeatedly about 3 factors that are the key to success in business:
Most people that get into business have neither a plan nor goals, they run their enterprise chaotically, don't keep good records and just go from their gut. Then there are people who fail to do enough marketing to keep their pipeline filled with new clients. Sometimes they start with lots of marketing, get a few clients and forget to continue marketing and have to continually restart their business. And finally, the major cause of business failure has to be under-capitalization. Few people realize how much start up money it actually takes to get a business profitable.
Let me review my past businesses in light of this.
- I was involved in Networking Marketing for over 12 years in an Amway Business. Although the initial investment to get involved was minuscule, I realized after a couple of months that this business required real capital to build to a successful level. Although it was still relatively inexpensive, I had to invest thousands of dollars per year for advertising tools, training seminars and tools, gasoline and entertainment expenses. There was an initial negative cash flow after which I started to break even as I gained some success reaching the Direct Distributor level. I also had written goals and a plan. However, the weak link for me was exposure. To make the business grows requires you to really expose the Business Sales plan to about 2o new people a month. And this requires lost of one-on-one talking to strangers to market your business. For me, I dislike talking to people so much that I could not attain the 20 exposures per month. And in a business like Network Marketing, your down line duplicates your effort. So, I got 2 out of 3 aspects of this business right and reached some success, but the real riches were beyond what I was unwilling to do to get out of my comfort zone. By the way, of all the people that quit the Amway business in my group - none were willing to do any of these 3 things.
- My first real estate venture was in West Virginia. I did not do my due diligence when starting to buy properties, had no plan, no exit strategy and no idea how to handle the business. I purchased 12 properties in a 6 month period and was overwhelmed as to what to do. I ran out of cash and could not rehab them, they sat vacant and were an overwhelming cash flow drain. I didn't know how to market the properties. In essence, I failed in all three aspects Don talks about. And I ended up losing close to $100k. An expensive seminar!
- My current real estate venture seems headed on the right track for the moment. I have set goals and made a business plan. We are on track to attain the capital we need ($210k so far), we have been continuing to market using direct mail and are consistently getting leads. We have about 5 houses in our pipeline and seem on track to reach our goal. We will have to fight the tendency to reduce marketing once we have some houses in our possession, but I think we will be able to continue and expand out marketing. I have also created an Operating Manual (not public) which outlines every aspect of our business, so that we stay organized. We have bought QuickBooks and my wife is taking a training course to help us keep our finances organized. So I feel good about this venture. Of course, two weeks does not prove anything, Quarterly and annual reviews of our performance Vs goals will be needed to stay on track
Maybe after some failures I have learned something.