Home Businesses Will Grow During Bad Money Times

I learned something new today. In difficult economic times more home businesses are started than any other time. I found that very interesting.

But then as you think about it, in these tough times most families are looking for ways to make $100.00 to $500.00 extra each month. So I can see why people turn to home based businesses. A home based business is a great move because of the opportunity to make extra money, work part time, and by being in a business you can claim some tax deductions.

If you are thinking of starting a business you should be aware of the start up costs. So many times a person will look at a home based business or a MLM business and believe they can get started with no money and they will be making big money within a month.

That just doesn’t work. All businesses take money to start up and most businesses take longer than a month to pay off for you.

My suggestion in starting any business. Have a business plan with a marketing strategy. Be patient. You should be willing to work hard in your business for 2 to 3 years at least to get your business to start working for you.

My son and I went into business together in an MLM business called the Reverse Funnel System. We both are excited about the business. In the last thirty days he has made $3000.00 in sales. That is pretty cool.

This has been such a great learning experience for him. He found out he had to do some work. However his work is paying off. He is learning how to talk to business people. He has also learned not everyone will say yes and it doesn’t matter.

To tie into this business and in our other business adventures my wife and I started a home based business with SendOutCards. What we like about this company is we are able to build a personal relationship with our customers and clients. We did our due diligence and believe that this is a business that will create big dividends in 2 to 3 years. We got off to a great start as we made $240.00 in our second week of business as we were really just learning how things worked.

So many businesses work so hard at getting new customers and clients and they forget about the customers and clients they already have. That is a mistake. To grow your business you need to build and maintain personal relationships in your business. You will grow your business with referrals from your customers. This is the strength of SendOutCards.

If you are looking for a home based business that you can work part-time either or both of these businesses, the Reverse Funnel and SendOutCards would be great opportunities for you. These are not the only two home based opportunities. Do your due diligence and check out which opportunity is the best fit for you. Then just believe and be willing to build your business for 2 to 3 years.

Developing Your Business Plan

Most individuals who want to open their own retail business or internet business need to approach a lender to secure financing. For your request to be successful, you need to have a very powerful business plan. The more detailed your business plan is, the more it shows the lender that you are dedicated to following through on your project. It also shows you have the skills to work through all the aspects of your business including day to day operations and long term plans.

Don’t make the mistake of simply going in to talk to your lender without a business plan in hand. To make it easy to read, you need to have it divided up into sections. Together, the sections of your marketing plan are going to discuss what your product or service is, who your target market is, how you plan to reach them, and the estimated profits and expenses for the next five years. Simply place it all in a binder or clear cover to make it look more professional.

The first part of the business plan needs to be your introduction. It needs to be short, but also very powerful. If the lender isn’t impressed with the introduction, they may decide not to finish reading what you have to offer. This is the perfect place to include information about your skills, desires, and motivations for operating your own business.

The next part of your business plan needs to discuss your target market. This section needs to be very detailed. Make sure it covers why you think there is a need for your product or service, how you will reach your target market, and discuss each of your marketing strategies in detail. It is very important that you have at least two distinct marketing strategies in your business plan.

In this section you will also discuss the elements of your product or service. It needs to include the cost of making it, how much you plan to sell it for, and how you will distribute it. All of your prices need to be as accurate as possible. This shows the lender that you have been doing your homework and that you have a realistic idea of the profits and expenses involved in the business.

Your lender is going to want to find out how your business is going to be operated, and this information goes next. Include all the information about the internal structure of your business. You also need to include information on the equipment necessary to operate your business in this section.

Think about any consultants, marketing agencies, employees, managers, etc. that you will be incorporating into your business. Try to get as accurate of a dollar amount associated with these operating expenses as you can.

Your financial plan for the business is the next section of your business plan. This needs to include projected income and expenses over a five year period. You will need to provide information on how you came up with the figures used. It is a good idea to use conservative figures in your business plan when it comes to income. If you make more that is wonderful, but don’t overshoot your profits.

I suggest that you include risks that can increase your expenses and lower your profits in this section as well. It is not required, but your lender will already be thinking of the risk factor involved with your business venture. By outlining some of them as well as how you will handle them, you show the lender you are willing to take that risk and that you understand some of the challenges you may face on the road to having a successful business.

The last section is to be a brief summary of everything including in your business plan. Focus on the positive aspects of it in this area of the business plan. This is the last information the lender will read so you need it to be convincing.

Writing a successful business plan is going to take you time, but it will be a very valuable tool for securing funding for your business. Try to include as many details in your business plan as possible. It is a good idea to get a friend or family member to read through it before you see the lender.

They may have questions about particular areas, and this gives you a chance to make any changes to the business plan. Don’t forget to include your personal views in your business plan. This is the best way to allow your passion and motivation for operating your own business to shine through.

The Psychology of Business

On the different aspects of consumer and employee needs that are included within the psychology of business.

The modern world is dominated by global businesses and corporate houses and any large scale enterprise requires a systematic understanding of employee and consumer demands, both material and non-material. The performance of business organizations depends on the performance of employees and the needs and expectations of the consumers, and so the ‘human’ factor is central to the success of any business. In recent years, say from the last part of the 20th century, there have been several changes in our understanding of human nature as it relates to work and performance in organizations and the primary focus in now on communication, leadership skills, and employee satisfaction. All these factors are important in enhancing the overall performance of any business organization.

The psychology of business is thus primarily the psychology of employees and the psychology of consumers and it’s the organization that is responsible for maintaining the balance between consumer demands and employee demands.

The Psychology of Employees - First let us talk about the psychology of employees. Any business house is operated by a number of employees and some of them are part of the higher management and are also considered as partners of business. The major elements that should be part of understanding the psychology of employees would be

1. Communication – Employee communication and understanding of business goals is an integral part of success and it is the duty of the management of an organisation to maintain direct and clear communication procedures through video conferences or seminars and presentations that would clearly state the mission and vision of the company. The communication between management and the other employees is thus a key aspect of employee or personnel psychology

2. Leadership – Any human resource manager or career counselor would focus first on developing leadership skills and leadership is an integral part of business because our inner leadership skills help us to break the mould and do something different and pioneering. Leadership skills in employees are important as team leaders in an organization are required to motivate other employees to attain certain company objectives. Leadership is thus closely related to motivation as a highly motivated individual will also be more likely to show leadership skills

3. Satisfaction – Employee satisfaction is an important aspect of business and we hear of several companies declaring large pay packages and incentives to retain the best talent. Job satisfaction, material satisfaction in terms of salary and bonuses, and social satisfaction with regard to the work ambiance are essential aspects of business and all businesses will have to pay specific attention to employee social, financial and emotional satisfaction. Fulfilling the needs of employees should be the primary focus of companies and this could be in accordance with Maslow’s hierarchy of needs in which it has been suggested that financial security, personal safety would be very important to humans followed by emotional need for social contact and connection and then we have esteem needs for social status and reputation.

Employee psychology is thus based on these three major factors or elements of business and all businesses should pay considerable attention to employee communication, leadership and motivation and employee satisfaction as essential aspects of psychology of business that can in turn enhance performance.

The Psychology of Clients/Consumers - Apart from employees, the consumers or customers are an integral aspect of business and the business management or corporate heads will have to understand the needs of customers as well in order to expand their business potential. Consumer psychology is based on several elements and this has a direct relation to whether businesses will thrive in a competitive global environment. Consumer psychology is shaped by the following related factors.

1. Innovation – Consumers are ever curious and eager to buy new products and services and their own expectations and satisfaction tend to drive business innovation. Innovation is the direct result of consumer necessities and any innovative or novel product immediately gets consumer attention. The apple iPod or iPhone attracted consumer attention with the novelty so innovation as it relates to business has a direct impact on consumer psychology.

2. Branding - Brands indicate social status and many individuals prefer to buy branded products as these products promise quality and enhances social prestige. Women spend thousands on Gucci or Chanel products simply they want to be seen with designer clothes, shoes and accessories. Designer brands apart, regular brands for food products let’s say Kellogs or Nestle are company names which are perceived as brands signifying quality. Consumers are not just interested in innovation and innovative products but they are also interested in familiarity and thus innovative products of renowned/familiar brands or companies are the most successful in the market. Psychologically we are seekers of novelty and we are also seekers of familiarity and a certain amount of routine. Thus both these needs have to be balanced in case of consumer expectations and only then businesses can be successful. Brands are synonymous with company reputation and increase consumer confidence.

3. Performance – Company performance in terms of stock market indications, annual reports, projections of company profits improve consumer confidence and in business performance drives performance. Thus if a company’s prospects are bright and company growth is projected, the business halo effect works immediately and further improves business. When employee psychological factors should be considered to enhance company performance, performance in turn is a factor to meet consumer psychological demands. So business performance is a two way process, it is driven by consumer expectations and drives employee contribution.

Thus consumer psychology which is based on demands and expectations for products and services are guided by these following factors of the extent of innovativeness of a company, the brand or reputation of the company and the performance of the business organization. Employee psychology which in turn is also based on demands and expectations of employees highlights the extent to which they have communication facilities and the extent to which employees are motivated or satisfied in their jobs.

Thus the psychology of business has two distinct branches – that which deals with employee interests and that which deals with consumer interests and although these can at times overlap, the elements are distinct and I have tried to differentiate between the key elements of consumer business psychology and employee business psychology. Thus any composite organizational business psychology will consist of both these aspects of employee personal development through human resource management consisting of elements of motivation/leadership, communication and satisfaction; and expansion of consumer base through organisational goal achievements through performance, innovation and branding.

Apart from the elements discussed here, business psychology involves a whole gamut of psychological aspects considering needs of consumers, employees and the organization in general and this is also closely related with advertising, marketing, and business orientation and objectives of a company. In fact business psychology should also include company strategies as basic elements of an organizational psychology as well. Thus business psychology is comprehensive including consumer needs and employee needs and although these needs may encompass organizational needs, a distinct organizational psychology could well be drawn out from this and I will take this up in a latter discussion of this ongoing series in psychology.