|
|
Joined: Sep 2006
Posts: 1,908
Bengal
|
Bengal
Joined: Sep 2006
Posts: 1,908 |
HEY. Perhaps you could take your research and sell it to other Brokerages! There's an idea.  
![[Linked Image from media.lehighvalleylive.com]](http://media.lehighvalleylive.com/tv_impact/photo/birds-of-war-3b1e411c023703c8_custom_120xauto.jpg) Birds of War
|
|
|
|
|
Joined: Mar 2007
Posts: 75
Rookie
|
|
OP
Rookie
Joined: Mar 2007
Posts: 75 |
I think I see what your saying. I don't think what I'm doing here is general enough. It's more less to see if he's marketing properly and see what former customers are thinking. This information may not work for the next guy. But I see what your saying, and wouldn't be a bad idea.
|
|
|
|
|
Joined: Sep 2006
Posts: 1,908
Bengal
|
|
Bengal
Joined: Sep 2006
Posts: 1,908 |
Brokers want to know what they're doing wrong, and what they can do to make it better. If you can't use all the info you're already getting, like you said, make up something more general. You can even ask your friends and stuff, or do an online survey.
Birds of War
|
|
|
|
|
Joined: Jan 2007
Posts: 2,086
Dawg Talker
|
|
Dawg Talker
Joined: Jan 2007
Posts: 2,086 |
Quote:
Realize how much you could actually lose every month (worst case senario) and determine how long you could survive that way.It usually takes a while to get established and with all the hard work and time involved you'll be stressed enough as it is. If you have the financial end of the business understood than your life will be much easier.
That is terrible advice in my opinion. An exercise in futility at it's best.
You will NEVER be able to accurately gauge how much you *might* lose each month (could that be a little more vague) and wasting any time doing this is just that - a waste of time.
If we are going to spend time seeing how much money we might lose, you mind as well see how many millions you might make if this really takes off. Either scenario is useless in the practical business world.
|
|
|
|
|
Joined: Sep 2006
Posts: 28,201
Legend
|
|
Legend
Joined: Sep 2006
Posts: 28,201 |
Losses aren't as dynamic as profits. What you *could* lose is entirely predictable. It's a business, not a craps table in Vegas. They are tied directly to things you buy to run the business..... so if you figure up the costs for real estate, your initial inventory, potential replacement inventory for any perishables, utilities, payroll, insurance, etc, etc... NOW... add to that your personal groceries, your spending money, your house payment, your car payment, your cable and internet bill .... and then assume you have an actual revenue of $0.00....THAT is how much you could lose per month. And no, it is NOT a waste of time or dumb... it's called solid planning because if you start a business full time with no other source of income in your household and you haven't bankrolled enough starting capital to float you through at least 6 months of zero income from that new business, you may as well not even start it unless you have an affinity for Ramen Noodles. 
Browns is the Browns
... there goes Joe Thomas, the best there ever was in this game.
|
|
|
|
|
Joined: Jan 2007
Posts: 2,086
Dawg Talker
|
|
Dawg Talker
Joined: Jan 2007
Posts: 2,086 |
OK, I will perform the analysis here...
The average new biz could lose up to $50k/mo and could make up to $50k/mo.
Analysis done.
There is no way to reliably and consistently predict what your new biz might make or lose. You can speculate and guess all you want, but until you actually get into doing it, it's just a bunch of guesses.
And the reason is very simple - you have NO IDEA what things actually cost until you actually start spending money. You have NO IDEA what kind of business you might generate until you actually start marketing your services.
It's very similar to rehabbing a house. If you watch those house repair shows on TV you very often see people's budgets WAY under their guess at the beginning. Why? B/c they have no clue going into it how to even remotely accurately predict what things might cost. And it's the same thing with any new business - until you've actually done it, you have no clue.
So performing some fluff analysis can easily lead to a false sense of security and moments of panic when your analysis is quickly proven incorrect. If you assume you can lose $3k/mo and survive for 6 mo's, what happens if you lose $20k in one month? You performed your analysis and assumed you knew what you were doing and in the end, you were wrong.
Make no mistake, any new business will need many thousands and thousands of dollars in 'cushion' money to survive. Whatever you think you might need, you better at least double that amount. Again, this is where a qualified professional like a CPA and/or Attny can help tremendously.
![[Linked Image from i45.tinypic.com]](http://i45.tinypic.com/adhq2o.gif)
|
|
|
|
|
Joined: May 2007
Posts: 1,070
Dawg Talker
|
|
Dawg Talker
Joined: May 2007
Posts: 1,070 |
Quote:
Quote:
Realize how much you could actually lose every month (worst case senario) and determine how long you could survive that way.It usually takes a while to get established and with all the hard work and time involved you'll be stressed enough as it is. If you have the financial end of the business understood than your life will be much easier.
That is terrible advice in my opinion. An exercise in futility at it's best.
You will NEVER be able to accurately gauge how much you *might* lose each month (could that be a little more vague) and wasting any time doing this is just that - a waste of time.
If we are going to spend time seeing how much money we might lose, you mind as well see how many millions you might make if this really takes off. Either scenario is useless in the practical business world.
I own a restaurant,so I can only speak for that. Most restaurants fail because they simply run out of money before they are able to establish themselves.
I can tell you this,..if at the end of the month I show a profit,..all is good in my world. If things get slow or the economy takes a dump,I better find a way to weather the storm or I'm in deep doodoo.I pretty much know what my hard costs are every month(barring any major catsrophes) and I better be prepared to cover that.
It's not having a negative outlook,it's called being prepared.
Running a business that consistantly shows a profit is not that difficult.It's how well you fair during those lean times that will make you a long term success,and believe me,those lean times WILL come.
|
|
|
|
|
Joined: Jan 2007
Posts: 2,086
Dawg Talker
|
|
Dawg Talker
Joined: Jan 2007
Posts: 2,086 |
Cal - let me ask this - when you first started or were thinking of starting, could you have consistently and reliably estimated what your outflows and inflows would be? Of course not.
You can probably perform this task now in your sleep with pinpoint accuracy, but I doubt many new potential business owners could do this at the beginning. There's just too many things you do not think about simply b/c you do not know.
|
|
|
|
|
Joined: Sep 2006
Posts: 4,480
Hall of Famer
|
|
Hall of Famer
Joined: Sep 2006
Posts: 4,480 |
I agree - when I started my business, I could not pinpoint with any accuracy what my expenses were going to be. I do software consulting, so I have a very low overhead, but I still had no idea. After doing this for a year, I now know what my expenses are to a pretty accurate degree. I also had a nice contract singed before I quit my previous job which helped to settle some of the anxiety; I did the legwork for months and months while still working for someone else.
To me, if it is possible (and I know most of the time it is not), keep your current job and start the ball rolling while still employed for someone else. You'll have VERY little, if any, free time if you go this route but it can be a littler safer. Again, what I do is a little easier to work odd hours while getting things going - as long as I met delivery dates, everything is fine. Stuff like delivering things would obviously need to be done during the day when you would presumably be working your current job so there is no way that keeping both would likely work.
#gmstrong
|
|
|
|
|
Joined: Sep 2006
Posts: 28,201
Legend
|
|
Legend
Joined: Sep 2006
Posts: 28,201 |
So, to you, doing a budget and knowing your monthly expenditures is a "fluff analisys"? Excellent business sense 
Browns is the Browns
... there goes Joe Thomas, the best there ever was in this game.
|
|
|
|
|
Joined: Sep 2006
Posts: 4,480
Hall of Famer
|
|
Hall of Famer
Joined: Sep 2006
Posts: 4,480 |
I think what he is saying is that when you start out, you don't really know. You might think that you know but it is impossible to predict until you have some basis to make that prediction on such as being in business for 6 months to a year.
I estimated 10K to get my business started. I spent 15K, and have about $600 more per month in expenses that I expected. I've got a good budget now, and a nice cash reserve for the time being, but something I can't plan for may happen.
And there are always unexpected expenses, just as in personal life, but for the most part they are even more expensive when dealing with a business I have found.
#gmstrong
|
|
|
|
|
Joined: May 2007
Posts: 1,070
Dawg Talker
|
|
Dawg Talker
Joined: May 2007
Posts: 1,070 |
Quote:
Cal - let me ask this - when you first started or were thinking of starting, could you have consistently and reliably estimated what your outflows and inflows would be? Of course not.
You can probably perform this task now in your sleep with pinpoint accuracy, but I doubt many new potential business owners could do this at the beginning. There's just too many things you do not think about simply b/c you do not know.
No,I did not know for sure what my total expenses would be for that first month or so,but I had a pretty good idea of what I needed to make in order to break even.
My point is this. When you first start a business you have fresh legs,good attitude,a sound business plan along with some great ideas.As the 80+ hour weeks start to pile up it becomes more and more challenging as you start to feel the mental and physical fatigue (which is inevitable). If you're struggling more than you thought you would(not uncommon), stress starts to build up almost to unmanageable levels.At this point it becomes more and more difficult to maintain a proper focus and many people lose motivation.
The more you can do to prepare yourself for those difficult times the better chance you'll have to survive.You don't need to really prepare for the good times,they take care of themselves.
There's a reason why most small businesses have a better chance to fail than succeed.
|
|
|
DawgTalkers.net
Forums DawgTalk Tailgate Forum Starting a business
|
|
