RANDOM THOUGHTS #63
Steve Cole is a big fan of Dave Ramsey, the get out of debt guru, although he takes pains to point out that he paid off his last debt before Dave Ramsey got out of bankruptcy. While Steve only rarely hears Dave say anything he doesn't already know, he always enjoys listening. (Leanna listens to the website all the time, and downloads episodes which they listen to when driving on trips.) Recently, Dave Ramsey did a one-day event of his small business class, and this was simulcast to a lot of places (one of them in Amarillo). Leanna and Stephen took the day off to go see his live performance (on screen) and jotted down a few notes. By the way, the EntreLeadership thing is a combination of Entrepreneur and Leadership.
1. The biggest killer of a small business is debt. Making debt payments can be a huge hurdle for monthly revenue to overcome. Many people who start a business just assume that they have to borrow a few hundred thousand dollars to do so, and that's not only not true, it's very risky to do.
2. Something over 2/3 of new small businesses are started with less than $5000 and no borrowed money. To be sure, these are not the kind of business that is going to employ a dozen people on the first day, but if you plan well and pay attention you can make a living for yourself and grow a small business steadily.
3. It may be annoying to pay $450 every time you need to rent a backhoe for one day, but that's better than making debt payments on a $50,000 backhoe, pulled on a $10,000 trailer by a $30,000 truck and covered by an insurance policy. Borrowed money increases risk and magnifies mistakes.
4. The definition of entrepreneur is risk-taker, but that must be tempered by research and knowledge. Taking stupid risks or doing anything that bets the whole business on one deal is a bad plan.
5. None of your employees are going to be motivated to work as hard as you work if you don't do anything to motivate them. To them, it's just a job. You have to make them feel like a family and reward them with performance bonuses.
6. If you have idiot employees, it's your own fault. You hired them without enough of an interview process, and you did not fire them when you figured out they were idiots.
7. A dream is just a wish. If you can define it, it's a vision. If you have a plan to accomplish it, it's a goal.
8. If you don't balance your business and family time and take care of your health and social life and spirit, you'll fail.
9. Delegate things that are urgent but not important and ignore things that are neither urgent nor important.
10. You need to have your accounting up to date. You need to know things like how much business you do a month, what the average turnover in your inventory is, what profit you are or are not making on any given job or product.
11. You really need to have a written budget and update it every month, if not every two weeks.
1. The biggest killer of a small business is debt. Making debt payments can be a huge hurdle for monthly revenue to overcome. Many people who start a business just assume that they have to borrow a few hundred thousand dollars to do so, and that's not only not true, it's very risky to do.
2. Something over 2/3 of new small businesses are started with less than $5000 and no borrowed money. To be sure, these are not the kind of business that is going to employ a dozen people on the first day, but if you plan well and pay attention you can make a living for yourself and grow a small business steadily.
3. It may be annoying to pay $450 every time you need to rent a backhoe for one day, but that's better than making debt payments on a $50,000 backhoe, pulled on a $10,000 trailer by a $30,000 truck and covered by an insurance policy. Borrowed money increases risk and magnifies mistakes.
4. The definition of entrepreneur is risk-taker, but that must be tempered by research and knowledge. Taking stupid risks or doing anything that bets the whole business on one deal is a bad plan.
5. None of your employees are going to be motivated to work as hard as you work if you don't do anything to motivate them. To them, it's just a job. You have to make them feel like a family and reward them with performance bonuses.
6. If you have idiot employees, it's your own fault. You hired them without enough of an interview process, and you did not fire them when you figured out they were idiots.
7. A dream is just a wish. If you can define it, it's a vision. If you have a plan to accomplish it, it's a goal.
8. If you don't balance your business and family time and take care of your health and social life and spirit, you'll fail.
9. Delegate things that are urgent but not important and ignore things that are neither urgent nor important.
10. You need to have your accounting up to date. You need to know things like how much business you do a month, what the average turnover in your inventory is, what profit you are or are not making on any given job or product.
11. You really need to have a written budget and update it every month, if not every two weeks.
posted by Federation Commander at 8:35 AM
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