Owning a business required for success?

[newtrader1982]

This thread really interests me because i have seen both sides of the coin. I am 31 and started my business 11 years ago and in this time I have had some great success being able to own my house and a few $$$ in investments. But I have also seen the otherside where my father got into business and lost everything! really hard when you see someone really close to you work hard there whole life and lose everything. I have noticed in the last few years the government doesn't really do much to help people out who own or want to start a small business it sometimes seems more benficial to sit at home and recieve handouts.

 

[waimate01]

Sadly a gross over statement.

There is less than 1% of Australians who are Millionaires (rated as assets over 1 million(US$) readily available for investment.) Principal place of residence not included.

Its pretty elusive

View attachment 52423

Okay, the suburbs aren't literally "full" of them, but when you consider a suburb might consist of 10,000 people, that means there's more than likely 100 people with net investables over a mil, and of those maybe 10 will be above 5m, and maybe 2 will be above 10m. They're around, and it might not be all that obvious if you walked past their house.

(Of course, it's not an even distribution - some suburbs will hardly have any, others will have plenty. But there's a couple of hundred thousand $1m+ people in Oz, so they're not exactly like hen's teeth)

 

[WilkensOne]

Sadly a gross over statement.

There is less than 1% of Australians who are Millionaires (rated as assets over 1 million(US$) readily available for investment.) Principal place of residence not included.

Its pretty elusive

View attachment 52423

Thanks for the statistic, it is interesting as 1% sounds very small but in actuality the number is quite large I think. As always people who work hard and are smart about their decisions with some good timing on their side are those who will achieve what they want.

I've owned two businesses over the years, one was a brief venture into importing and retail with very average results. The other a security biz which was a lot better, I guess having worked in the physical and electronic security world half my life helped. I found that a business that sells needs as opposed to wants can go through varying economic cycles a lot better. For example the security industry didn't even blink during the GFC, which can't be said for a lot of industries.

I think an issue I am coming up against currently is that I don't have twenty years experience any any industry, I have 22 years in experience in life : and I guess I haven't found/investigated a business idea which I am really passionate about, better get my thinking cap on!

But the caveat that most small businesses fail early is absolutely spot-on. The trick is to be one of the ones that don't. The odds are pretty good, though, and you can make them even better by hard work. You'll work damn hard for the first few years and won't see much from it - you'll probably be way less affluent than your friends who stayed in their jobs. But stick with it and the payoff will be worth it. My view is that the best time to do this is before kids and before mortgage, so you can live on the smell of an oily rag for a couple of years if you need to.

Probably comes down to personal appetite for risk. You can live very well working for the man.

Thanks for the info waimate01, I definitely agree that there is a large amount of risk starting your own business and that until established the work required is very high. I think for me success would be having the ability to stop working and spending money living life and experiencing things or spend time working in a community or mentoring people as others have done for me, that is me anyway

I just wanted to thank everyone for their great responses it has definitely given me a lot to think about. I would like to know if people had their time again, what would you do when starting your working career, work for the man, start a business, continue partying?

Wilkens

 

[WilkensOne]

This thread really interests me because i have seen both sides of the coin. I am 31 and started my business 11 years ago and in this time I have had some great success being able to own my house and a few $$$ in investments. But I have also seen the otherside where my father got into business and lost everything! really hard when you see someone really close to you work hard there whole life and lose everything. I have noticed in the last few years the government doesn't really do much to help people out who own or want to start a small business it sometimes seems more benficial to sit at home and recieve handouts.

I think I have had a similar view, maybe not as drastic. My parents have run their business for about 20 years and for many many years it wasn't very profitable and income was low. Then it grew a lot quickly and our lifestyle changed quite a lot and now again it has shrunk and I am not sure if they would be able to sell it at present. I guess a business can be swings and roundabouts..

Life would be so boring if everything was simple..

 

[Vixs]

I just wanted to thank everyone for their great responses it has definitely given me a lot to think about. I would like to know if people had their time again, what would you do when starting your working career, work for the man, start a business, continue partying?
Wilkens

Now that I've found my feet in a business I can start building a career within, my biggest regret is that I wasted so much time in crap businesses/working for crap people.

To a point I'm still doing it now, except that I know given a few years I'll be in a position to step out from under them and build a business for myself. Right now, I don't have the resources or experience to reasonably do so.

 

[WilkensOne]

Now that I've found my feet in a business I can start building a career within, my biggest regret is that I wasted so much time in crap businesses/working for crap people.

To a point I'm still doing it now, except that I know given a few years I'll be in a position to step out from under them and build a business for myself. Right now, I don't have the resources or experience to reasonably do so.

Thanks Vixs, so in your situation you are working for someone else until you have the resources to move out on your own? Can I ask what industry you are working in?

 

[FlyingFox]

I come from generations of businessmen (four generations that I know of, probably more). Grew up in my dad's business (previously my grand dads), learnt the ins and outs from a young age. I think I could give simple change before preschool.

I think a business is a great way to achieve financial success but to be successful in business you need a business mindset. It's the X factor, I can't describe it. My dad has relatively little formal education but spending 30 + years in a business, it's amazing to see how he looks at things. Quite different to most people (ASF members aside). This is what I think separates the successful businessman from the unsuccessful ones. I think alot of people assume that if you can do your job well, your business will be successful. I think the ability to run your business well is more important.

If you have the mindset or a great idea and the perseverance to see it through, you will do well. Also timing is quite important. One of the mantras my dad lived by in business. Personally I would not start many types of businesses in the current economic climate.

However business can be quite boring and monotonous for many, depending on what the business. Personally i think this is a bad way to do business, if you can't commit, you will fail. This is one of the reasons my brother nor myself followed my dad into business.

The advantages are that you are your own boss and therefore the effort you put in will be reflected in your results. Also there can be many advantages to owing a business, including tax advantages.

Is it a requirement for "financial" success? No necessarily. It can help though.

 

[WilkensOne]

Thanks FF, interesting that you didn't choose to following step by running a business.

I feel although I have seen the benefits the possible costs are large and that working for someone else may prove less stressful and provide similar financial benefits.. Much to think over.

 

[FlyingFox]

Thanks FF, interesting that you didn't choose to following step by running a business.

I feel although I have seen the benefits the possible costs are large and that working for someone else may prove less stressful and provide similar financial benefits.. Much to think over.

Both my brother and I chose career paths were it is difficult to start your own business even if we wanted to. My dad's main business was overseas and that was another factor in us not taking over.

Might go back into some sort of business one day ... the financial benefits of a relatively successful business can be great.

 

[Vixs]

Thanks Vixs, so in your situation you are working for someone else until you have the resources to move out on your own? Can I ask what industry you are working in?

I'm a financial planner. I work for a senior planner and perform appointment setting and admin duties for them. I'll eventually not need to look after their clients and will advise my own.

I have a good head for business, which came from my own upbringing and early jobs working in a family business which was not particularly well run. Things that are crucial no matter what business you end up in:

• Cash flow management. No matter how good your ideas are, if your bills are past due and your clients aren't paying, your business is finished. Control expenses and don't take on deadbeat clients.
• People management. The consequence of poor people management is that good staff will leave your business, and you will be left with the white ants that undermine it. Dollars aren't always everything, a sincere "Thank you, you are doing an excellent job and I am grateful I have you on my team." is better than a $5k p.a. pay rise for some people. People that have pride in their role will always do a better job.
• Reputation management. The immeasurable value of having a positive reputation as a business that does what they say they will and does it well. It's harder to earn a good reputation than a bad one, and a bad reputation is very hard to make good. A good reputation, however, can be shredded with one bad job/phone call.
• Time management. In business, you miss 100% of the shots you don't take.

I look forward to the day I can branch out on my own, because there is a good living to be made giving people better service and adding more value than the none that most get from lazy planners today. It's an exciting time to be hungry to succeed, regardless of what the markets are doing.

 

[FlyingFox]

Things that are crucial no matter what business you end up in:

• Cash flow management. No matter how good your ideas are, if your bills are past due and your clients aren't paying, your business is finished. Control expenses and don't take on deadbeat clients.
• People management. The consequence of poor people management is that good staff will leave your business, and you will be left with the white ants that undermine it. Dollars aren't always everything, a sincere "Thank you, you are doing an excellent job and I am grateful I have you on my team." is better than a $5k p.a. pay rise for some people. People that have pride in their role will always do a better job.
• Reputation management. The immeasurable value of having a positive reputation as a business that does what they say they will and does it well. It's harder to earn a good reputation than a bad one, and a bad reputation is very hard to make good. A good reputation, however, can be shredded with one bad job/phone call.
• Time management. In business, you miss 100% of the shots you don't take.

Thats really good advice . Covers most of what you will need to have a successful business. Personally, Control expenses bit is quite important in Oz.