TUESDAY, 26 MARCH 2013
It’s always the same: Ask the right questions. Break the problem into smaller parts. You’ll never get where you want to go if you constantly ask the wrong questions, and if you don’t know what you are talking about or what your end goal is.
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Before you can start making money you must ask yourself one question: Do I want to sell something, or do I want to speculate?
To bring together what you need, you also have to consider the concept of probability. You may think that something is not absolutely necessary, but ask yourself if the availability of a particular resource would increase the likelihood of success or not. Or the opposite: How much will the absence of a certain resource reduce the likelihood of your success?
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What do you need in order to make money selling something?
– Seed capital – not always necessary, but consider the likelihood of success without it.
– A market – more specifically, you need to identify a market that already spends money on certain products.
– A product – someone else’s product you can sell, or your own product. A good approach is to think of a product that people need to get to a place where they want to go, or something that will help them get away from a place they don’t want to be, or a product that will help them to hold on to something they don’t want to lose, or simply something that gives them joy, comfort or entertainment.
– Marketing platforms and channels to familiarise your market with the product you believe they would buy if they knew it existed and is available.
– Human resources – can you do all the work that has to be done yourself? Will it increase the likelihood of success if you have one or more partners, or if you employ one or more people to do some of the work for you, or if you outsource some of the work?
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What do you need if you want to make money by speculating on, for example, the financial markets?
– Seed capital – a few thousand rand (or dollars or pounds) you won’t need for anything else and that you are willing to lose.
– Guidance of a trustworthy source that will teach your basic strategies, signals to look for, pitfalls to avoid, and so forth.
– A positive attitude, and patience.
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Is it better to make money selling something or speculating on something?
Of course, people differ in their preferences, and both ways of making money have both pros and cons.
If I had a good product and a hungry market, I would rather sell something. Why? You can later delegate a lot of the work to other people, and depending on the type of product, a large part of your income may eventually be passive – that is, you wouldn’t have to pay attention to it every day to make money from it.
Of course things can go wrong with any product, or with the place where you sell your product, or with a marketing channel, or the market can get lukewarm at first and then turn ice cold.
Because there are risks involved with both ways of earning an income, it is probably best to try both approaches, or if you’re smart enough or willing to work hard, to master both.
Since you are unlikely to generate an income overnight speculating on the markets, the best thing you can do is to become familiar with at least one niche where you can start selling a product or service as soon as possible.
The golden rules: Start small; Start sooner rather than later; Keep it simple; Constantly refine your processes and methods; Repeat what works.