Just Good Business or a Scam?
A business is designed to make money for the owner through the selling of products or services.
A scam is designed to make money from the exploitation of ignorance – tricking someone into thinking what they are doing is the right way to behave.
The secret to good business is to know your business, and not be ignorant.
When starting a business, you need to learn as much as you can to plan properly.
If buying a business, you also need to judge if the price is fair? But more particularly, do you actually want what you are being sold?
A franchise business should come with tried and tested products or services and systems. Good franchises will give you training on how to use these efficiently to make your business a success too. But you will have work to do to complement this so still need to learn about the business.
Learning your business
- Is it a good enough product/service? For you to boast about and hence be able to sell?
- Are enough people willing to pay the price? If no one will buy, then there is no business
- What/Who/Where/Why/When? – you need to know these to find your customers.
- What are the product costs, including delivery? You need to sell at more than cost to make money
- What are the expenses? – You need to cover expenses and leave something for your efforts.
- Are you getting value for money on all your expenses?
- What are the rules & regulations?
- What are the taxes?
Scams to avoid – Deals too good to be true?
- Buying stock that you can-not sell at a profit – do your research first
- Overstocking such that it goes out of date/fashion before you can sell it – Do your calculations first
- Buying unseen, untried, untested, uncertified – assess the risks
- Big profit margins on recommended sales prices – but are they achievable, and how much to YOU get?
- Large commissions – what are they doing for their share of your money?
- Random bills chased for payment – check the product or service was received and has not already been paid
- Change of bank details – double check that they are legitimate
- Advertising – test/check it is happening and working
- Advice from social media or the Pub – check it out with a professional
- Know the real regulations, fees and penalties – don’t be scared into paying extra
Ignorance is bliss – until you get scammed!