How to Start a Business With an Unlimited Profit Potential

Unlimited Profit Potential...

Think big... this is a must if you want to achieve success in life, particularly in business. However, we often get scared away of the concept because we believe that in order to go big you need to have an over sized wallet, and nothing can be farther from the truth.

Indeed, most of the greatest business of yesterday and today started from scratch and grew to become industry empires and icons of the entrepreneurial world. Anything is possible, and only you can determine how far you will go.

Yes it is true that out of 10,000 or 20,000 entrepreneurs maybe one achieves that kind of success, but the good news is that you do not have to become Godzilla big or the next Bill Gates to make it happen for you big time.

I mean, being a billionaire must be fun, but I am sure that you would have a full and happy life just by getting to a six figure income every year, and that is big, but not that big, which means that such goal is literally within anyone's reach.

Do you need to have a lot of money to invest or put up front as start up capital in order to achieve this goal?

The answer is certainly no, what you need is brain power and dedication, but above all, you need the will to keep going no matter what.

I would dare say this last component is the only the real engine capable of pushing your forward as an entrepreneur, so before even moving a finger or investing any money, you must first set your mind to challenge mode.

Once you have done that, you will have to think, learn and work, but with your will and determination pushing you forward you will be able to overcome failures and disappointments and see them for what they really are: the foundations of your success.

Therefore, in order to start a business with an unlimited potential for profits all you really need is the will to do it, plus fast and decisive action, because one thing is certain, good fortune will not fall from the sky and hit you in the head.

Reference:
Alex Cadens

Small Business Strategy

Five Key Drivers of Business Profits.

Most small businesses are built on the same business model and hence have the same profit drivers. When thinking about small business strategy, small businesses all have certain key similarities.

• Customers
• Goods/Services
• Cost of Goods/Services

Before thinking about strategy to attract more customers customers we need to understand the two main drivers which leads to a customer.

1. How many people know about your business and the good/services that you provide?
2. How many of them can you attract to become your customers?

Once a small business has acquired a customer, the obvious next step is how much money do we make from this customer. To understand this we need to understand the two drivers of revenue or gross income.

1. How much does the good/services sell for?
2. How many good/services does the customer buy?

Another way of seeing this is:

1. How much value in a basket of good/services?
2. How many times does the customer purchase in a given period?

In short, to find out how much revenue is generated per customer we need to know how much and how many.

Lastly, once a small business finds out how much revenue each customer is bringing for the business they need to understand their cost of acquiring the customer, goods/services. The driver for this is:

Profit Margin

Obviously the higher the better, but businesses in certain industry group or businesses that sell certain type of goods/services will tend to have different margin. auto-manufacturers have lower margins compared to online business selling ebooks.

Summary

The five key drivers to small business profits are:

1. Leads
2. Conversion
3. Revenue per Transaction
4. Number of Transactions
5. Profit Margins

Reference:
Yong Long Lai