Unusual Ways To Make Money

Choosing A Business

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When considering starting or buying a business, the first question is whether you really want to be your own boss. Early in life, I tried a few small businesses and had dozens of jobs. I realized that there are very real advantages to both. The right job is often less stressful, for example, and the paycheck is regular and a predictable amount.

On the other hand, my wife and I eventually found a business that we not only like, but which in reality is much safer too: internet information distribution. Our income may be up or down by as much as 30% from one month to the next, but it is always there. The best job can be gone tomorrow.

Choosing a business cannot be be broken down into an exact formula, because we are all different. Some will succeed where almost everyone fails, and others will fail at the easiest enterprises. This has to do with not just the nature of the business, but with the nature of the person starting it.

With that in mind, let's look at a series of questions to ask (and answer) before you jump into any new business venture.

Do You Have The Necessary Skills And Knowledge?

If you don't know anything about the business, you can learn. If you need certain skills, you can develop them. But starting before you do these things is not a good idea. One of the best ways to get the knowledge and skills needed is to work in the business you are interested in. Starting at a pizza parlor, for example, you can often work your way up to assistant manager in a few months, and so learn much of what you need to know to start your own pizzeria.

Is It A Great Product Or Service?

High-quality is easier to sell, but this isn't the only thing to consider here. You also want to note whether it is unique enough in some way, so you don't have a dozen other's undercutting your price and driving down margins. Fortunately, even a common product or service can sometimes be sold in a new way. A mobile pet-grooming service that goes to the pet-owners home, for example, can probably charge more than all the other location-based services.

Is The Business Resistant To Employee Problems?

Ideally, you want no employees, which means no employee problems. This isn't possible in all businesses of course, but there are other things to consider as well. Are the positions you'll be offering easy to fill? Can you afford to pay the going rate?

How Much Do You Need To Invest?

Look at the money and time you'll be putting in at the start. Ideal would be fifty dollars and five hours a week invested. There really are businesses like this, and many which can be started part-time for less than a thousand dollars. If you risk more, you should have a good reason too, like higher returns, or a business more in line with your passions.

What Kind Of Return Can You Expect?

Consider the likely profits you'll be able to make, but also how soon they'll come. It's great to generate a decent income at some point, but if it takes three years you have to somehow survive in the meantime.

Is It In Line With Current Trends?

This probably isn't the time to start a business selling typewriters. You want whatever service or product you're going to offer to be saleable for the foreseeable future. Selling solar panels, for example, could be a good bet, since the trend is towards more use of alternative energy sources.

Does Is Create Residual Income?

Residual means income which continues after you stop working in the business. Rental income from an apartment building, for example, comes in even if you don't look at the building for years (if you have a manager). We have advertising revenue from web sites we haven't seen in months. You may have to work hard at first, but will you be able to step aside within a reasonable time (perhaps three years) and still have a stream of income?

Does It Provide Something Needed Regularly?

It is best if people need your product or service every day. Food, for example, fits this ideal. Any necessity which is needed at regular intervals is a safer bet than faddish products. People will stop going to the laser-tag fun center when times are tough, but they'll still eat, clean their homes, and drive their cars.

Does It Get You Excited?

This may be one of the most important questions to ask yourself. It's always going to be more difficult to succeed at a business that doesn't inspire you. It doesn't have to be the thing you've always wanted to do, but I can tell you from experience that it's a lot easier to get up and do the work necessary when it is at least interesting.

The above isn't meant to be a "test." Almost any business you consider starting or buying would fail several of the questions. On the other hand, this list can help you narrow down the options, so you can find a low-risk, high-return venture. Or a high-risk easy and exciting one. Choosing a business will always involve unique personal criteria.

Note: This is part of the "Unusual Ways" Newsletter.
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Unusual Ways To Make Money | Choosing A Business