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5 Businesses That Do Badly During a Recession

5 Businesses That Do Badly During a Recession

A recession is a global phenomenon that affects every industry in some way. It can be difficult to plan for businesses, eg You must be prepared for everything Your business model and financials. Even if you’re not directly affected by the recession, it’s important to keep track of how it affects other industries and what it means for them (and their customers).

There are many here The way the recession affects small businesses. But some industries see a bigger impact than others. Here are seven businesses that are particularly susceptible to poor performance during a recession.

1. Retail industry

Mistakes happen when a retailer doesn’t know how to pivot changes due to a recession. Pivoting involves focusing more on e-commerce and using smaller influencers instead of larger marketing strategies.

Retailers took a big hit in 2008-2009, causing thousands of locations to close, from luxury to mom-and-pop stores. This eventually led retailers to file for bankruptcy and liquidate their stores. Why retailers can sell Products that do well during a recessionThe retail industry as a whole has suffered during the past two global recessions.

Retailers are notorious for having high fixed costs and high inventory: a retailer must pay rent, utilities and insurance on store locations regardless of how much business they do or whether they have any customers. They also have to carry a lot of inventory because it is difficult to predict which products will sell well during a recession. This means that even if sales drop, retailers still have to pay for the same amount of inventory as before—making it harder for them to cut costs in response to lower demand (or increased revenue).

During economic downturns (when fewer people want new clothes or electronics) retailers also have significant costs associated with customer service due to the large number of employees working retail. It may also let employees go and cut hours to try to stay in business and cut costs.

2. Luxury brands

Luxury brands are often seen as status symbols. They cost more than other products of the same category, so only people with money or those who see themselves as rich can afford them. Luxury brands also rely on high-end marketing, which can be expensive for companies and consumers.

When times are good, and money comes easy, it may seem counterintuitive that luxury goods will struggle through a recession. However, in bad economic times, people tend to focus more on their needs; They become less likely to spend money on frivolous things like designer handbags or expensive watches. Luxury brands often suffer because they have high entry costs—a product may only be worth buying if someone else sees that person use or wear it (this concept is called conspicuous consumption).

3. Restaurants (Non-Fast Food)

When the economy is doing poorly, we tighten our budgets and cut spending. This means eating out becomes less frequent. Restaurants are already expensive businesses because of their high fixed costs, marketing costs, and labor costs, not to mention paying rent.

These things don’t change during a recession, although many people have less money in their wallets and may opt for cheaper options like fast food or home-cooked meals instead of eating out. If you have a large family, it’s easy to choose between cheap or expensive options. The more affordable option will always win.

During the first recession in 2008-2009, 4,000 restaurants closed, according to market research firms. NPD Report. Independent restaurants declined by 2% and fine dining restaurants by 7%.

4. New auto sales

If you’re in the car industry, you may be concerned about a recession. People are not buying new cars because they don’t have money to spend on expensive cars.

In the previous recession (2008-2009), new car sales fell 40%, and employment fell more than 45%.

While this may seem counterintuitive considering auto manufacturers promote their products as “in style” or whatever other buzzword they use these days, there are a few reasons why this happens:

  • People want something cheaper and more practical (like used cars). A car with low miles can save thousands of dollars over time—and even more, if gas prices go up again! With so much uncertainty in our economy, no one wants to waste their money when they could be putting it into savings instead.
  • Credit may not be good enough to buy a new car. If someone’s credit is damaged by the recession, they will have a lower chance of qualifying for a car.
  • New cars lose value over time, so they are no longer an asset.

But oil and gas are in as new car sales decline Top industries that thrive Because of the high price.

5. Hotels and other travel-related businesses

Travel is a discretionary expense, and people cut back on travel during recessions. Both hotels and airlines are hit hard when the economy slows down. Who wants to spend $300 on a hotel room when it could lead to a critical bill? People will probably choose their priorities over fun unless they have a high paying job.

This means that many hotels will struggle to fill their rooms, even if they already have available capacity. If a hotel’s occupancy rate drops, it can lose money—even if it charges its normal rate.

Conclusion

As you can see, businesses that do poorly during a recession are not always what you expect. Retailers and restaurants, airlines and hotels continue to struggle. Automobile dealerships suffer when consumers can’t buy new cars, but oil companies thrive as prices rise.

Jazmin Merriman on Twitter
Jazmin Merriman

Team Writer: Jazmin Merriman is a writer, studying to become a family and marriage therapist. He loves to write about minimalism, business, finance and lifestyle. He likes to inspire people to live a more intentional life by showing what he does as an example. Feel free to connect on Twitter @MinimalFE

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7 Clever Business Ideas for Creative People

7 Clever Business Ideas for Creative People

Selling crafts has grown in popularity, thanks to websites such as Etsy. Technological advancements have made it easier to create and sell products through e-commerce stores. During the pandemic, many people had extra time to learn a new trade, which led to an increase in business as a hobby. Here are seven tricks Business ideas for you Consider whether your craft-making hobby has turned into a passion.

1. Making candles

From Facebook to Pinterest to Instagram, candle businesses are just about everywhere. In the United States, candles are a staple in almost every home, as they are known to bring peace, comfort, and tranquility to our lives—as well as a wonderful scent. Because of this, they also make great, thoughtful gifts.

In addition to learning how to make candles, which you can easily learn through YouTube tutorials or by buying a book on candle making, you need to gather materials. You must have a strong sense of smell. To make candles, you’ll need paraffin or soy wax, wicks, candle molds, a saucepan or double boiler, and essential oils (or fragrance oils). The retail price of candles varies widely. It ranges from 75 cents for simple candles to $100 for luxury ones. The price should depend on the material you are using and whether you want to make a budget or luxury candle.

2. Jewelry designing

There is a huge market for handmade jewelry, which makes it a perfect craft if you enjoy working with beads, metals, gemstones, or even unusual materials such as leather, resin, rope, and special dyes. Jewelry is a form of fashion that allows us to express our personality.

Contact wholesalers who sell materials for jewelry making. Make your jewelry and ask friends and family for their feedback. Experiment with different materials as well as your comfort zone to determine your aesthetic. Decide whether you prefer to sell chunkier jewelry or minimalist pieces. Determine who your target market is and then set your rates accordingly.

3. Knitting or crocheting

Knitting and crocheting are probably the least expensive business ventures on this list. Because the only material it needs is yarn and needle. Find a reliable seller to get high quality yarn in bulk. Once you have that, you may need to take some lessons. If you are a knitting beginner, start by making simple items like small purses and hats. Once you get good at these, you can start making more complicated items like sweaters. However, we recommend that you try selling smaller items first so that you can invest more time and effort as your knitting business begins to grow.

Tip: Along with your knitted products, you can also sell guides that include your instructions along with patterns to create the perfect items.

As long as you know the basics of knitting or crocheting, you can start this business with little investment.

4. Making pottery

It’s preferable if you have a studio where you can focus on your work, but don’t worry — you can still make pottery in a spare room or even a garage. Some cities even have pottery studios that you can rent for an afternoon or for a period of time. If you choose to make high-quality, fired and glazed pottery, be aware of the steep up-front costs and specifications required for the kiln, as they require a unique setup depending on temperature and voltage.

In addition to a kiln, you will need a pottery wheel. You’ll also need some modeling tools, paint, and decorative materials to create the look you want from your pottery. If you can’t afford the fees associated with starting a pottery-based business, consider making small pottery items from modeling clay, such as a ring holder or small bowl for jewelry and small trinkets. This type of clay can be purchased at any craft store and does not require a potter’s wheel or kiln.

5. Gift baskets

Consider putting together themed gift baskets for occasions like back to school, baby showers, summer camps, holidays, anniversaries, bachelor and bachelorette parties, graduations and retirements. Additionally, you can create special baskets for specific foods or drinks, such as a wine-and-cheese lover’s box, an all-chocolate basket, or a basket that uses products from nearby vendors. Start building a portfolio by selecting your best work photographs. Create a website or open an account on a social media platform to start selling.

6. Flower arrangement

Millions of flowers are bought annually for various occasions. This business can be operated from home as it does not require much initial capital. You can collaborate with interior designers to create floral arrangements for large events, from selling flowers to individuals. There are some downsides to this business. The flower market is competitive due to the large number of well-established florists. This task can be especially tedious during the holiday season, such as Mother’s Day and Valentine’s Day, when order volumes are high. If you have a solid understanding of this type of business, you can expand quickly. We recommend you to cooperate with websites that deliver flowers domestically and abroad.

Remember that flowers only last a limited time and require heavy water sprays and refrigeration to keep them fresh. For that, you need to know the basics of flower care. Despite all this, the flowers eventually die, so they need to be sold quickly.

7. Refurbish old furniture

If you enjoy basic carpentry and painting — and have space in your basement or garage to store tools and furniture — then a furniture refurbishing business is ideal for you. Find cheap furniture in dumpsters near furniture stores. You can also ask friends who need help with their furniture. Or, try going to thrift sales or secondhand stores for used furniture. Start by offering services at low prices and work up to higher prices as your work becomes more established You must be familiar with basic carpentry techniques for this trade, such as fixing dents, tightening joints, replacing damaged screws, etc.

The next step is to refinish the furniture. This requires sanding and painting. You can create an Instagram page, post furniture for sale on Craigslist, or open a local store.

Conclusion

If you want to turn your passion into a career, consider selling your craft. Etsy is an option, as well as eBay and maybe even Amazon! However, start small by selling your crafts to family and friends, then invest in a website or open a store as your business becomes more established. Good luck selling your unique crafts.

Peerbhat Haddad on InstagramPirbhat Haddad on Twitter
Peerbhat Haddad

Staff Writer: Peerbhat is a digital content creator and a writer. He started his small venture at the age of 16. Although he had to give it up, he learned a lot about the entrepreneurial lifestyle. His educational background in business administration has given him ample knowledge on various subjects. He now enjoys talking to people about developing productive habits, studying people skills, and applying marketing strategies to succeed.

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How did Oprah get rich?

How did Oprah get rich?

Oprah Winfrey is bound to have an encouraging life story considering her difficult path. Born in Mississippi and raised by her single mother, Oprah’s childhood was one of abuse and poverty. However, that didn’t stop Oprah from graduating magna cum laude from Tennessee State University before going on to broadcast news on Nashville’s WTVF-TV and other news stations.

After hosting talk shows for King World Productions and WLS-TV (Chicago) and co-hosting Good Morning America, two shows that helped put her name on the map—Oprah created one of the most successful talk shows of all time: The Show Oprah Winfrey.

Born in 1954 in Kosciusko, Mississippi, Oprah Winfrey was the first of three daughters and a son. His parents were poor, and his father was a part-time farmer; However, they were very religious and instilled their values ​​in their children. As a result of these values, Oprah became interested in public speaking at an early age, and one of the The greatest entrepreneur of our time.

When Oprah was young, her mother had to work as a domestic worker to support the family as her husband could not find work. Her grandmother then took over raising Oprah while their mother worked and did other odd jobs around town.

Being active with several clubs on campus allowed Oprah to attend college where she studied speech communication as well as performing arts on an endowed scholarship. After graduating from college, he landed an internship with radio station WJZ, announcing news segments before eventually moving to KMBC TV Channel 9, where he began hosting a current affairs program (ACAF).

How Oprah Made Her Money

The Oprah Winfrey Show

The Oprah Winfrey Show ran for 25 seasons and was among the most watched shows of its time. He was paid $315 million annually to host the show, making him one of the highest-paid television personalities in history.

The show began as a half-hour weekly program on local Chicago TV station WLS-TV. As it grew in popularity, it was picked up by CBS and expanded to 90 minutes—then moved to syndication on September 8, 1986, with The Oprah Winfrey Show full-time with her own syndicated channel, WWOR (now WFAN). . Home based. The show airs live Monday through Friday at 10:00 AM EST 1998.

HARPO Studio

Oprah Winfrey is a media mogul, actress and philanthropist. According to Forbes magazine, Oprah Winfrey is the most powerful woman in the world.

Harpo Studios is a media company founded by Oprah Winfrey and her partner Stedman Graham. According to Forbes magazine, Harpo has generated more than $1 billion in revenue since its inception in 1986, with profits reaching $100 million as of 2016 due to various revenue streams, including a licensing agreement with Turner Broadcasting System (TBS) for the use of its content. OWN: The Oprah Winfrey Network; Production costs for shows like “Oprah’s Next Chapter,” which airs on OWN.

advertising sales from magazines such as O magazine or digital properties such as Oprah.com; publishing books through brand extensions such as Hyperion Books; licensing agreements with partners such as Weight Watchers International Inc.; retail stores through the “Oprah’s Book Club” imprint at Hachette Book Group USA Inc.; etc. are also streams of income.

And magazines and own television

Oprah Winfrey is the first African American woman to own her own television network, making money in a variety of other ways. The first was through the publication of O Magazine, which was launched in 2000 and is now published by Hearst Magazines.

In 2013, it had a circulation of 3 million copies per issue. Oprah Winfrey also owns an online magazine called Oprahdaily.com that offers advice on topics including spirituality, health and relationships, as well as beauty tips and recipes for cooking healthy meals at home.

In addition to these ventures that generate revenue for her company Harpo Productions Inc., Ms. Winfrey also owns another business, OWN Television, which has been valued at more than $180 million since its founding in 2011. OWN features shows about lifestyle, relationships, health, and fitness, as well as documentaries on social issues affecting people worldwide.

With such a huge platform under her belt, Oprah has the opportunity to continue to grow her fortune. He was involved from start to finish as an executive producer and investor, working with Discovery on the channel’s programming decisions and marketing plans.

Conclusion

Oprah Winfrey is an important force in shaping America’s cultural landscape. His stories and words have helped shape how we think about ourselves, our country and the world at large He gave voice to many people who would otherwise not be heard.

And he somehow manages to do all this while balancing his personal life. Through all of these accomplishments, one thing stands out above all: Oprah Winfrey is a hard-working and creative person with a strong drive.

Jazmin Merriman on Twitter
Jazmin Merriman

Team Writer: Jazmin Merriman is a writer, studying to become a family and marriage therapist. He loves to write about minimalism, business, finance and lifestyle. He likes to inspire people to live a more intentional life by showing what he does as an example. Feel free to connect on Twitter @MinimalFE

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Understand the difference between a business model and a business plan

Understand the difference between a business model and a business plan

Business model and business plan are two terms that are often confused. People assume that both are the same, and their confusion often leads to failure in their business or startup.

Still, they have some significant differences that are important for you to understand before investing time or money in them. In this article, we’ll explore what makes each of them unique so you can choose the one that works best for your situation.

Difference between a business model and a business plan.

A business model is a framework for how a company will operate and should be used in conjunction with a strategic plan. A business plan, however, describes the financial aspects of your venture, including projections of revenue, expenses, and cash flow over time. This includes your marketing plan and any other information that may be helpful when investors decide whether to invest in your company.

The The business plan should be the first thing you write. This will help you organize your thinking and research so that when you start writing your business model, it’s clear how everything fits together.

What is a business model?

A business model represents how a company creates, delivers, and captures value by providing products or services. A good business model will help you understand what your company does, how it operates, its financial needs, and much more.

Business models constantly evolve based on changes in the environment (for example, customer preferences) and changes within the company (new products, services). It is important to remember that no two businesses have the same model.

They are used in a variety of industries, from tech startups to coffee shops, to help entrepreneurs define their competitive advantage and determine the type of investors they need for their business. There is no perfect way to structure your business model; Instead, different techniques can be used depending on your industry and desired results.

Here are some examples Different types of business models:

  • The Freemium Business Model – They offer a free version of their product or service, hoping that the user will want to upgrade in the future.
  • Peer-to-peer business model – The company is a communication between the business and potential customers.
  • Direct selling business model – Employees of the company will be those who directly interact with customers to sell products or services.

There are many other types of business models that are very effective. Check us out List of business models with examples For a more in-depth look.

What is a business plan?

A business plan is a formal document that describes your business and its objectives and how it will operate. It can be used as a roadmap for your company’s future, helping you think through the details of your business. A good one will help you think through how you’ll achieve those goals by outlining both short-term and long-term strategies for growth, including any risks or pitfalls along the way.

According to sba.gov, A well-written business plan includes:

  • Executive summary Explain what you want to do and why, as well as what makes your idea unique. It should only be one page long so it can be scanned by busy people who need an overview of what’s in the document before they start reading more deeply into it (for example, investors).
  • about us – A more thorough introduction explaining who you are, where you are going with this venture and why it is a good time for both the industry or niche market and for someone like you (entrepreneur) to start in this area of ​​expertise. /interest/commitment level, etc.
  • Market analysis – To be successful in your market, you need to understand the industry vision and target market. Look at trends and themes as well as how successful competitors are addressing them—and then find ways to do it better.
  • Organization and Management – Describe your company’s corporate structure and name the key executives.
  • service or product line Explain how your product or service fits into the market and what makes it a compelling choice for consumers. Share relevant patents or copyrights held by your company.
  • Marketing and Sales In this section, you’ll describe how you’ll attract and retain customers—and what that process will look like.
  • Request funds – You should clearly define your financing requirements, including how much money you need for what period. Indicate whether you will accept debt or equity financing and the terms that will apply if this investment is proposed (eg, repayment schedule). Be sure to explain how these funds will be used.
  • Economic projections – Provide a five-year financial forecast. Include a projected income statement, balance sheet and cash flow.
  • appendix Include any supporting documents or other materials expressly requested in your appendix. Common items include credit history, resume, product photos and reference letters.

Conclusion

Your business plan and your business model are two different things. Understanding their differences will help you avoid mistakes and make better decisions as you build.

Jazmin Merriman on Twitter
Jazmin Merriman

Team Writer: Jazmin Merriman is a writer, studying to become a family and marriage therapist. He loves to write about minimalism, business, finance and lifestyle. He likes to inspire people to live a more intentional life by showing what he does as an example. Feel free to connect on Twitter @MinimalFE

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Our story is all we really know

Our story is all we really know

Johnny wrote,

Angel Hair Rows and Floss
And ice cream castle in the air
And canyons of feathers everywhere
I’m looking at the clouds like that

But now they only block the sun
They rain and snow on everyone
So I used to do many things
But the clouds stood in my way

I am now looking at the clouds from two sides
From top to bottom, and still somehow
It’s the cloud illusion I recall
I don’t really know the clouds.”

We want to believe that our experience is consistent with the world.

They can’t be. Everything we encounter is filtered through what we know. And what we know comes from the human culture in which we live.

When someone turns you down for a job, they’re not rejecting you. How could they be? They don’t know you. Instead, they’re rejecting them the story In you, they (all of us) are the best guesses of the complex story we’ve woven ourselves into about our needs, dreams, and fears.

We take these stories and we combine them. We sharpen them, rehearse them, and turn them into an enhanced version of the world as we see it, not the world as it is.

If it doesn’t work for us, all we can do is start working hard to tell a new story, a better story, one that’s more useful.

The clouds are up on us.

5 Ways A Recession Affects Small Business

5 Ways A Recession Affects Small Business

When building your business, it’s easy to look past all the exciting opportunities ahead and dream of the future possibilities that await you. It’s essential to prepare yourself and your business for when the economy isn’t firing on all cylinders, and make sure you have a plan to make it on the other side with your business still intact.

When the word “recession” starts floating around, it’s important to understand what that word means, as well as what it means for your business. A recession refers to when the economy is in recession or, more specifically, when there are two quarters in a row of negative economic growth. Even if you have A recession-proof businessIt is likely that you will still feel some of the negative effects of a recession.

Let’s discuss some of the things you should be prepared for when hard times hit your small business so that your business Surviving a recession.

5 Ways A Recession Affects Small Business

1. Reduction of personnel

Many small businesses treat their employees as family, so when budgets get tight and you don’t have the ability to pay employees like you used to, it can be very frustrating. But part of running a business is being able to work through this process.

There are several options you can look at when it comes to downsizing. If you think it’s just a temporary problem, you can look into furloughing them and if they agree to come back after the leave, you can offer partial compensation. This can save money in the long run, as you won’t need to hire and retrain new employees when the recession passes and business picks up again. Sometimes, a partial leave may not be enough and you may have to lay off employees.

The main factor when working through this process is to keep the integrity of your business and employees as high as possible. Hard times may be inevitable, but how you handle them will determine whether people want to come back and work for you.

2. Credit tightening

Small businesses are already at a disadvantage when it comes to opening and maintaining lines of credit compared to larger competitors, and the recession doesn’t help. Many small businesses get their credit from banks, and when their collateral and ability to repay their balances begin to decline, banks are unlikely to continue to extend loans.

Many small businesses that are already under high levels of debt can quickly crumble in the face of a recession. If you don’t plan for some bumps in the road, your business could run out of credit, quickly putting you out of business.

3. Low cash flow

When consumers start feeling the effects of a recession, one of the first things they will start to reign in is their overspending. For many small businesses, this can quickly tighten cash flow. If you try to spend as before and don’t adjust to the economic climate, it could prove more costly to your available cash flow.

With less money coming in, there is less money to invest back into day-to-day business operations. It could be disastrous for your business if you don’t have some urgent refunds to help during this time.

One way to make sure you have some cash coming in is to identify what you can offer the market during a downturn. That’s a lot Products and services that still sell fairly well during a recession. The key is to identify what you can offer and customize it so you’re adding value to the market during a tough economy.

4. Decline in price and profit (due to price war)

A recession can really bring out the competitive side of businesses that are trying to make it another day. Businesses may start lowering prices, even if it means a loss because it’s worth it if more customers walk through their doors.

This means that if you want to make it through a recession, you need to focus on the big picture, not your current situation. Sometimes taking that loss and lowering your price can leave the door open for the long play.

When both consumers and businesses are in their defensive/insufficient mindsets, it can make your business sector a difficult market in which to operate. It is important to remember that your customers are also feeling the effects of the recession in their daily lives and if you are not ready to adapt and adjust to their needs, your next business could be the “Business for Sale” sign hanging in the window.

5. Unprepared businesses usually fail

If you haven’t prepared your business for the possibility of a recession, there’s a high chance yours will Business will fail. Have a plan in place so that your business is prepared for times when money doesn’t usually come in.

There will always be ups and downs in the economy, and there will never be a good time to do business. There are certainly more positive times to start one, but it’s important to be prepared with a backup plan and emergency fund, which will set your business apart from the competition when things seem to be spiraling out of control in the world around you.

Katie Budd on Instagram
Katie Budd

Katie Budd is a full-time 8-5er in the commercial insurance industry and works on building her freelance writing business. He enjoys creating engaging content for people to read. She enjoys working at home programming Street Parking, encouraging her children to pursue what they are interested in, and spending time on the farm with her extended family as much as possible. Follow along with her on her blog and Instagram as she continues to put thoughts into words

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Management with objectives Seth’s Blog

Management with objectives Seth’s Blog

When Frederick Taylor brought the world Scientific management A hundred years ago, it changed the meaning of running a factory. Stopwatches and assembly lines have dramatically outperformed traditional piecework methods.

Henry Ford wrote a four-page article for the Encyclopaedia Britannica on how companies could embrace the new model and his focus on reducing the cost of a car by 80% or more.

I’m sure car companies like Duesenberg and Pierce Arrow felt this new approach was beneath them. They probably made thoughtful arguments about esprit de corps and the magic of a handcrafted auto. But they are gone now.

Video conferencing, epidemiology and knowledge work, and the powerful changes that the Internet have brought about are significant changes, at least in jobs like stopwatches.

And yet the Washington Post sent a memo to its reporters saying they would be fired if they didn’t come to the office three days a week.

Because there an executive decided that “office” and “work” are the same thing. Although journalists usually report, and the reporting is usually done somewhere other than the office.

Was it special to chat over coffee, greet people in the lobby, and gossip at the water cooler every day? Of course. But these were side effects of good work at the office, not the cause.

If a manager says, “The only way I can create a sense of connection, loyalty, and purpose is to get people to walk into an office every day,” they’re being lazy. Surely we can come up with something better than just taking attendance.

If it’s important to have your brilliant designer personally review the work of junior architects, do it objectively. Determine it and make it worth the focus and effort. If you believe that bonding and communication increase when people have regular physical interaction without screens, then build it into the schedule of the work being done, don’t wait for it to happen by accident.

As knowledge work has shifted to a remote-first setting, organizations have generally done a surprisingly poor job of figuring out how to build a culture that they care about. Forcing people to show up so they can hide behind a curtain in the office is lazy.

Yes, the old culture happened organically over the decades. No, it’s unlikely you’ll end up with a new culture you like if you just pretend nothing has changed.

How to Improve Your Chances of Equity Crowdfunding Success

How to Improve Your Chances of Equity Crowdfunding Success

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Equity crowdfunding solves many problems for entrepreneurs seeking funding. Instead of relying on just one or a handful of angel investors or venture capitalists, you can open your idea to the world and attract funding from a wide variety of different people. You can hypothetically raise more money this way and avoid some of the hassles of the messy equity funding system.

The deal is also good for investors. Investing in equity crowdfunding campaigns A great way to diversify your portfolio and gain exposure to potential high-growth businesses that would otherwise be off the table.

That said, equity crowdfunding is far from a guarantee. Most projects don’t hit their target funding and those that do still have a number of challenges to sort out before building a real business.

How can you improve your chances of equity crowdfunding success?

Know the pros and cons

Before you start creating a campaign or marketing your business idea, you should familiarize yourself with the pros and cons of equity crowdfunding. It is not a perfect system, nor is it an appropriate system for every type of business or every business owner.

You can expand your potential reach this way, and do so relatively conveniently, but you’re going to be subject to a number of restrictions, including laws, regulations and rules set by your chosen platform.

After all, you will have to give up some of your autonomy, since your equity investors will have an ownership stake in your business.

Choose the right platform

Next, select the right platform. There are dozens Equity crowdfunding platform to choose from, and they all offer a slightly different experience. You’re going to find some similarities across the board, including certain rules for orchestrating and managing a proactive campaign. But you’re also going to find different fee structures, different levels of popularity, and different niche benefits. Make sure you choose the platform that best suits your idea and your goals forward.

Hire a lawyer

One of the first things you should do is hire a lawyer so you can start planning your business and your equity crowdfunding campaign legally. Equity crowdfunding is certainly legal, but it is still highly regulated; You need to thoroughly understand the conditions under which you can raise money, how much money you can raise, and how you can use those proceeds in your business. Your lawyer will help you sort everything out.

Put a binding plan together

People aren’t going to invest in your business idea unless you do a great job of presenting it. And if you don’t have a strong foundation you won’t be able to present it well.

If you haven’t already, take the time Write a complete business plan. Pay particular attention to the following:

  • The intellect. What is your business idea and what makes it unique? What is your business going to do and why are people going to buy what you sell? How are you going to work, what are you going to charge and how much profit can you make? It’s also a good idea to think about the business name and how you’re going to position it from a marketing angle.
  • market. Who is your primary demographic? Who are the people who are going to buy your products and services? Do you have objective evidence to prove that people are interested in this type of business?
  • Competition. Even if your idea is completely unique, there are probably still some adjacent competitors to contend with. Who are your top competitors and what are your plans to deal with them?
  • Financial. Of course, you need to create a plan for your finances. How is your business going to make money? How is it going to scale? How are you going to use the money you raised and how much do you need?

Get some early backers

At this point, you’ll be ready to get some early supporters. Over time, your project can spread through word of mouth – but long before that happens, you’ll need to secure some early investors. Consider networking and hitting up some people you know personally to attract your first few supporters.

Start marketing

Equity crowdfunding campaigns work best when supported by active, targeted marketing and advertising campaigns. Get ready to invest some money here.

Even if you follow these tips and plan properly, you are not guaranteed to reach your goals or get the funding you need to start your business. There will always be a risk when starting a new venture.

Still, your chances will be much higher if you’re adequately prepared and you’re willing to make adjustments along the way.

Shadow and light Seth’s Blog

Shadow and light Seth’s Blog

Rhetorical questions, some easy, some particularly difficult, are all worth pondering:

If your house near the sea has a nice view, should the person who bought the land near the shore build a house on it?

If your restaurant needs to empty dirty oil from a deep fryer, is it okay to dump it on the curb, perhaps causing a bicyclist to slip and cause an accident?

If your car painting facility exhausts small drops of red paint during a job and the paint runs off and lands on a nearby white car, are you liable?

Is it okay to make money by selling building toys made from small strong magnets? What happens when children are shot and have internal injuries?

Is it legal to poison the river in any factory?

If you deep fry your holiday turkey, is it OK to pour the used oil down the drain? Or throw it in the river?

Can the architect of a skyscraper specify mirrored glass, even if the glare on surrounding buildings bothers people?

What about building a huge skyscraper that casts shadows all day in the park next door?

And… is it okay to take a private jet to Scotland, even if the exhaust from that jet hurts countless people who didn’t choose it? Does it take long to feel the effects?

There is no easy answer. But we have to ask questions.

3 Types of Vertical Integration to Understand for Business Growth

3 Types of Vertical Integration to Understand for Business Growth

Vertical integration is a strategy that businesses can use to help them achieve their goals (see others here) It involves buying other companies to increase sales, reduce costs or improve efficiency. The main goal of vertical integration is to create a more efficient supply chain with intermediaries (such as wholesalers) adding no value and combining activities that require fewer resources from each (such as outsourcing). There are three types of vertical integration: forward vertical integration, backward vertical integration, and balanced vertical integration.

What is vertical integration

Vertical integration is the acquisition, establishment and merger of companies involved in the same or related stages of the production process. A company can vertically integrate to reduce the number of suppliers needed to produce a product and to increase its control over the production process. In addition, vertical integration can allow for economies of scale in production and distribution processes and the sharing of management skills across businesses (eg, marketing).

Vertical integration can be beneficial to businesses in many ways, including:

1. It can reduce costs. Integrating your business reduces the number of steps required to get a product from concept to a finished product. This means lower labor costs and fewer resources spent on transportation and logistics—and it means your customers get their products faster.

2. It can improve customer service. When you are vertically integrated, you can provide better service because there are fewer people between you and your customers

3. It can help you innovate faster because you have access to more resources internally than if you just buy from outside vendors.

Forward vertical integration

Forward vertical integration is when a company buys a supplier. It’s a way to control the supply chain and reach other markets, which can be good for both parties involved. If you’ve ever bought something from Amazon and seen it shipped by one of their warehouses, that was vertical integration at work.

Forward vertical integration helps control the market because it allows you to dictate who gets your products. Without it, anyone who decides to sell your products can set their price for them (and even if they don’t set a price, they can still charge more than you wanted). Forward vertical integration gives companies more control over distribution channels. This means that there is no competition between retailers and sellers unless they want to cut off contact with each other, which is unlikely because they would lose all revenue from sales together!

Examples include:

  • PepsiCo owns several beverage brands sold under different names: Gatorade and Aquafina
  • Tropicana is owned by Coca-Cola, the parent company of PepsiCo
  • Lipton Iced Tea was discontinued as a standalone brand after being acquired by Unilever in 2015.
  • Quaker Oats Company now produces Life Cereal under Kraft Heinz Co., which owns Oscar Mayer meat and Capri Sun juice pouches.

Vertical integration behind

Backward vertical integration is when a company buys its supplier or distributor. For example, if Apple Inc. A similar website wants to buy, but it can set its prices for all its products and decide when and how much to pay for each product sold on the site. In 2010 it began buying back its stock from investors. This prevents them from controlling their stock and outside investors interfering with their plans.

Backward vertical integration is beneficial because it gives companies control over their supply chain and allows them to maintain quality control of their products. They maintain control through better management of distributors or suppliers that are not directly related to production but still provide essential services during distribution (such as delivery).

Another example Amazon is; They use this method to control their supply chain, so they can set prices and dictate contract terms.

Balanced vertical integration

Balanced vertical integration is when a company owns its supply chain and customer relationships. In this type of vertical integration, the business is involved in all aspects of the supply chain and customer relationships.

An excellent example of balanced vertical integration is Amazon: the company owns the warehouses where they stock their products; They sell these products directly to consumers through their website and app. The business owns its suppliers, meaning it buys supplies from them. It sells to customers on its terms. When you buy something from Amazon Prime or subscribe to Amazon Music Unlimited, you’re buying directly from them instead of an outside supplier.

In addition to owning their physical assets such as warehouses and trucks, companies must invest time and money in building relationships with vendors that provide raw materials or services needed for their business. For example, accounting firms that help manage taxes or software developers that develop security software for bank ATMs generate high-profit margins that justify going through all this trouble to increase revenue quickly rather than risking bankruptcy for lack of it alone!

Conclusion

Vertical integration is a very broad concept that can take many forms. Three types of vertical integration were discussed: forward, backward, and balanced. Each type has its advantages and disadvantages, which make them ideal for certain industries or situations But not others.

Jazmin Merriman on Twitter
Jazmin Merriman

Team Writer: Jazmin Merriman is a writer, studying to become a family and marriage therapist. He loves to write about minimalism, business, finance and lifestyle. He likes to inspire people to live a more intentional life by showing what he does as an example. Feel free to connect on Twitter @MinimalFE

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