Many young and immature entrepreneurs fail. The failures mostly occur at the start up and early running phase. There are a lot of reasons why the failures occur. One of the main reasons why young entrepreneurs fail is because they mistakenly associate cash flow with profit.
Cash Flow is not a profit! I repeat cash flow is not a profit! Cash flow is the indicator of where your money flows over a period of time. The cash that is left is not a profit, it is just cash you have at that time. The cash is the blood of the business. If the cash is used, then the business will not be able to maintain its daily operations as there will be no money left over for future expenses. For this reason, its important that an entrepreneur have an understanding of cash flow and how to read their financial statements to see how it fits into the health of their business.
Profit is cash that you can use or distribute to the business's shareholders. Profit comes from "clean" cash after deducting all the costs that should have been use in the business. For example if a t-shirt costs $5/ piece and you sell it at $8 then your profit is $3 ( you can't use the $5 because its used to for the materials and expenses related to making the t-shirt). If the difference between your cost and profit is small, it's easy to understand why an etreprenuer would be tempted to use the money. However, when millions of dollars are involved the temptation to use the money is also great. Many entrepreneurs suffer from debt because they use $4 instead of $3.
Its better for an entrepreneur to start small that way they can learn the difference between cash flow and profit with minimal risk.
So remember cash flow is not profit! Don't use the money if you don't understand the difference between the two.
Have a Save Journey To Wealth.
Cash Flow VS Profit
Number Is Your Fortune Teller
Unfortunately as we enjoying the comfort offered by technologies, in financial world many were ignorance and refuse to harness the power of numbers, that why there are so many people in this world live in scarcity rather than abundance, they fail to see numbers as a language, yes numbers is a language it simplify our long and complex sentences, that is what number is all about. Everyone can read numbers, the problem is every education institutes all over the world threat numbers as non language subject, that's make us hard to digest math subject.
Billionaire and millionaire knows how to use numbers in they favor, they know numbers always tell them something about wealth and future that is why they are the earliest people who took action when opportunity come. For example, 100 people are hungry the food supply is only enough for 40 people, 60 people is the opportunity and their future, the rich would produced food for this 60 people meanwhile the poor will always think "If the 40 people share the food with the others everyone will get enough food."
When we speak about numbers most people thing it is about funky and complicated math formula and algorithm, no, like i said it is just a language, you can get an "A" in English essay if you write using a nice and simple English. But it is not guarantee you can get the same result if you are using funky and classy English to write an essay. Number is the same you can control your life and fortune just by understanding the simples math. For example, if your numbers tell you this: income = 4678/month, expenses = 8374/month." it is not a rocket science, it is easy to tell that "dude you are f*;k now!", sadly to say when people see this number they will always say "My luck will be better next month, I'll win the lottery."
Stocks, supply and demand, accounting, statistics, economy and every aspect in our life are represented by numbers so does your way to wealth, numbers are always with you as your best friend as your fortune teller, see it you will be one step closer to wealth.
Have a safe journey to wealth.
What Makes You Rich?
In today's world, there are so many ways to become rich, so many until people don't get rich. So what is exactly things that make you rich? These are the list of things that make you rich from top priority to less.
1. Yourself : you are the only one that can make you rich. You are not going to be rich if you just sit around and waiting something happen. Yes something might happen if you just sit and waiting, but is it worthy? Everyday read or learn something useful, just improve bit by bit everyday, 5 minute is enough as long as you move a little. Remember Kaizen!
2. People : There are so many people in this world that make the same mistake; they the put money in the top list as the top priority that is why many poor than the rich, they forgot that the one that give them money are people. People buy product from you, people work for you, you work for people, your boss, your friend and family they are all people. People make you rich not money.
3. Knowledge : What you do today is what you are tomorrow. If today you are a teacher, you are a teacher tomorrow. If today you pack yourself with financial knowledge, education and skill, you are rich tomorrow. If today you only know how to spend money, tomorrow you will spend more. If you do what makes you rich today tomorrow you will be rich.
4. Environment : Surround yourself with rich people, the environment make you rich. If you are surrounded by poor people most likely you will be poor too. But this is internet era, everything is possible, if you are surrounded by poor people get to the internet and make friends with the rich.
5. Luck : Well, sometimes luck is a thing that makes you rich. Sometimes there are poor rich people, the only thing that keep them floating is luck. So we can't say anything about luck, that's why people always say to other, "Good luck".
The bottom line is what make you rich is not money but you, people, knowledge, environment, and luck. Do not be slave to money but your are the master of money!
Have a safe journey to wealth.
The World Is Whole : Opporunity Is Vast
Before internet was created human relation was parted very widely, mutual understanding between culture was only understood by small group of people. When mass media was invented and used around the world culture from west seems invaded the east, almost everyone was wanting to be western. But now everything is changed, the creation of internet has bring us to a new era, that is the world without boundaries. Before the world was a whole, to increase the chances to be rich, one must migrate to dense a place where people are dence and developed location, but now is different, the best place to be rich is a place where information is abundance: which is everywhere as long as the place has internet connection. West and east is colliding, new culture emerge the east wanted to be west and the west wanted to be east, the world fill with color and vast business opportunity, more windows of wealth is opening only the smartest win.
There are 6,606,971,659 internet user in the world it is like we live in the island where this 6,606,971,659 live together, business opportunity is vast, the principles of the business is the same the different is the speed and the medium of exchange. The fundamentals of business is sales, sales prospect is 6,606,971,659 people, the speed of the exchange is speed of light and the medium of exchange is just merely a number!
Information Age is the era, the game has been updated, look at the money with our mind not with our eyes, like I say it before the smartest win!
Kaizen
In everyday life survival of the fittest is still applied, in the financial world you need to keep fit to survive, not only physically fit but mentally fit as well.
Japan and China are two of the world economic force, there are a word called "Kaizen" in their vocabulary which mean improve. The idea of kaizen has been a like a flesh in Chinese and Japanese people.
Kaizen is an idea about keep on improving day by day, even a little and small improvement is very important to ensure that one is keep on moving forward everyday. Japan is located in the center of earth quake zone, surrounded by mountain which is not suitable for agriculture and economic activity, in 100% of the land only 30% is flat and in that 30%, 20% for agriculture activity and 10% for economy activity, thrust me that is not the best place to live. With all that hardship, Japanese had emerged as a develop country with class of their own. All thanks to the idea of kaizen.
China too is an example of how kaizen had brought this colorful and turbulence nation forward, from the Qin dynasty, Sung dynasty, Ming, and Ching dynasty and all other dynasies, China didn't stop, it keep on improving little by little despite it socialist ideology had slow them down and now China is coming to take over and lead the financial world by modifying the socialist ideology, it is kaizen .
We as a person should too utilize the idea of kaizen in our life, as specially if you want to be wealthy you should keep on improving little by little until you reach your goal. A slow tortoise will reach it's destination sooner or later if only if it doesn't stop in the midway. If you tired get some rest, after taking all the rest you needed continue and continue until you reach your goal. Remember never give up, if you are stupid or moron, no sweat because we are all born stupid and moron, just keep on moving and trust yourself, at the end of the journey you will eventually realize that we are all bunch of moron we are all the same.
In financial world, you only scared of two things that will stop you from reaching wealth, that things are death and you. Only death and you can stop you, just rammed anything in front of you went dealing with obstacle until your reach you goal, remember, improve, improve,improve do not ever give up. When you reach dead end turn right or left and move forward again!!!
Another thing about kaizen is do not i repeat do not blame others or anything went something bad or misfortune hits you, you are the only one to blame because of your weaknesses and lake of wisdom you make yourself fail, blaming on others or thing only weaken you, take the lesson and move forward, you will grow stronger day by day by practicing kaizen attitude. If your business, marriage, exam or anything fail who to blame? It is all you fault, remember it is all your fault!
Improve yourself by reading books, trail and error, practice, implement and enjoy the pain that's what is all life are about pain and reward! We will never enjoy PS3 if Sony stops at PS2. The bottom line is, kaizen.
The Game of Money
One of the oldest game in the world is the game of money whether you realize or not. Since the creation of money, the game had started. Everyone is the player, no exceptions even the Tibetan monks have to involve with the game without realize it.
The game of money is the game of survival for most people. Before money was created the only thing that people concerned was about the survival; "My kid is sick, is he going to survive?", "Oh my God the tiger is coming!", "Where to find food today?", the mentality was simpled: 'How to survive'. When gold and silver were introduced as the medium of exchange, the game was officially on.
How's the game is played?
Like every sports or games we knew, the game is simple, who has the most money is the winner. The real question is not how much money you have is important but how you play the game is the real thing. They are few ways of playing it according to which class you are. Usually this is the pattern or example how each level of society plays the game:
The poor :
1) Using their labor to generate money, when pay check arrive, the money their earn is theoretically finished. The small fraction of money is saved for the retirement. This process is on and on and on until the retirement day is coming. Some the retirement day is never coming. Sometimes the saved money is 'disappearing' and the lucky one have the saved money increase a bit.
2) The poor's plan B, if anything goes wrong kids will play the game for them. The more children the better. But the problem is, usually the kid is playing the same old style as their parent.
The middle class :
Using their labor to generate money but the different is the income is much more than the poor. The sad thing to say is that they played the game almost the same like the poor. The money is exchanged into something with less value such as cars, boats, and so on.
The Wealthy :
In sports they are like Micheal Jordan, Tiger Woods, Pele, Ronaldo, Lin Dan, Roger Federer and so on. They are the one who make the game fun, thrilled, exiting and colorful; they play the game brilliantly! They work less but money came to them like a river. They manipulate the money to work for them. They buy expensive thing but before that they convert the money into 'money machine' and the machine pays for the expenses.
In conclusion the game is simple: your work for money or money works for you. You choose how do you want to play this game.
Oil Price Hike: Bless Or Curse?
As this article is written the crude oil price on 15 March, Saturday 2008 at 09:55:35 am is $101.15. There is no indication that this number is going to decrease. Crude oil price is no longer cause by politics or events that happened it is the matter of supply and demand. Demand is increasing from all over the world and the supply as we all know will dry up in just the matter of time.
It is a bless or a curse?
1. For the investors who invested in the oil sector, it is a bless, the price goes up, so does the stock. It is a curse for the low paid employees because the inflation is slowly eating them.
2. It is a bless for the oil exporter country for now, but will be curse later if crude oil is still the main country's income because they will become consumer when the oil is not needed anymore.
3. 95% of the people in the world are curse because most of the consumer products are base on crude oil. At the same time it might be a bless for the environment as people are searching for the new free energy.
4. It is a curse for the world economy because the blood of the economy is oil. It is a bless for the world economy because there are a lot of new opportunity will emerge and there might be a shifting wealth from one country to another.
5. Bless for those who have high financial intelligent, wisdom, bravery, visionary, creative, innovative and stay ahead of the big event. Curse for the people who are just sit and catching while the events is moving in light speed.
6. What happen if the the blood of the industry is dried? For the big scale solution there is only one answer: nuclear energy. It is a bless as well as curse because it is a clean as well as destructive energy.
In conclusion, crude oil price hike is effecting everyone financially as well as socially. As a member of the world population the only way to survive and maintain the standard of living is to keep on investing your mind financially. Always remember this: every problem is an opportunity.
How to Start From Zero to Hero
Almost everyone in this world might ask; "I want to be rich but I don't have any money, how to be rich if I'm broke?".
1. Invest You Time Wisely: You don't have the money but you have the time, time is money! Time is your most valuable asset, if you really start to build an empire from zero use your time to equip yourself in financial education, knowledge is the basic foundation of all empire. This step is to ensure that when there is a moment money comes to your grasp, you know how to do with it.
2. Be Passionate : Passion will gives you unlimited amount of energy, do something you like and turn them into asset. Passion will also makes you move forward without hesitation and fear because you know that, once you fall you will stand up again and again. Empire needs a passion to prosper.
3. Be Happy : Happiness is the key to success, happiness is a money magnet. Who would you stick longer friends that give you smile and joy or friends that make you sad? Let say you are happy person and you have a lot of friends, your friend is a good prospect for business. The wider your network the chances you for you to be rich is higher. Build your empire with smile and laughter.
4. Cash flow is king! : Make sure you threat the "king" wisely, if you offended the "king" there are only two conclusion for you, die or stand still, either you fail or you can't move forward. Cash flow is like a river, if you managed the flow wisely entire nearby land will prosper and opportunity is abundance. In your empire, cash flow is king!
5. Leverage is Queen! : Leverage is a double age sword, just like a queen. It can destroy you or reward you. Leverage is a tools to make you move faster,the most common leverage in financial world is loan, business, stock market and you yourself, you are the most important leverage. Cash flow is the king, your are the queen.
6. Money is Everywhere : If you don't have money, money is everywhere. Money is abundance, change your perspective about money, now let's try this, close your eyes and move your vision from the sky, you see a lot of people, everyone is bringing money with them, now think how you can have their money legally.
7. Foundation : Every empire has a foundation, what is your foundation and how would you build it? The stronger foundation you have the stronger the empire is. Business is the foundation of all strong nation, you should build your empire base on business because business is a money machine.
8. Believe In Yourself : Trust yourself, you can do it. Human kind started naked, now we had achieved many seems impossible things but some how we succeeded. business is not a new thing, it had been here along with our journey, just have faith and you will succeed. Remember, it is just a game.
Everyone can be rich
1. Know The Value of Money : Spend some time to learn the value of money. Most people live poorly is because their don't understand the value of money. For example, this is the spending pattern of a rich person and a poor person, with $3,000 a rich person would have invested his/her money on education, starting small business at his/her back yard or invest it into something that will generate more money, if he/she fails, he/she will try again. On the other hand a poor person mostly will spend the money just like an air coming out from a puncture type.
2. Plan : Most people planed to be a middle class or poor. Rich people planed to be rich from the beginning of the plan. This is how the poor or the middle class thinks when comes to planning. "After finish college i want to search for steady and secure job. I'll support my family with the paycheck, my salary will increased if i work hard enough, after I retired my pension plan will support me." On the other hand, rich people will think like this "I'll search for a job that can provide me the essential learning skill that i need for my future plan, my asset will support me when i retired."
3. Patient : The most important key to become rich. Most people have a good plan to become rich, but unfortunately they keep changing the plan. "I'll save $500 each month and I'm not going to buy a new car, after five year I'll invest the saved money and profit from it." The different between the poor and the rich is that the rich sticks to the plan and the poor and the middle class don't.
4. Entrepreneur Spirit : This is the fine line that apart the poor and the rich. The rich uses what they got to make a lot of people around them become rich, this is why the rich become richer. Mean while the poor uses what they got for only them self, that's why the poor getting poorer.
5. Moving Forward : The rich moves forward no matter what had happened. The middle class or poor stays in their comfort zone. "I made $200,000 each year steadily, next year I'll make $5 million." this is how rich people thinks. On the other hand middle class or poor people probably will think like this "$200,000 is enough to support my life, I'm happy with it."
6. Asking the Right Question : Asking the right question will make you rich. The rich, middle class and poor using the same words to ask but using the different phrases to use, for example words like "why", "when", "how", "what" and so on is used differently by both people such as the rich might ask: "Why should i buy this investment?", "How to make money." , "When to invest at the right time?", "What venture should i start?". The poor or middle class would probably asking "Why don't i search for a second job to increase my income?", "How to become a good employee?", "When should i ask for a raise?".
The bottom line is not how much money you have that make your rich, it is how you think and act that make you rich and wealthy. Africa and Singapore are an example on how two different thinking pattern effecting the well being of a nation, Africa is rich with natural resources especially diamond but ironically Africa is a third world country, on the other hand Singapore was 'naked' when parted with Malaysia in 1963 and now one of the rich country in Asia.
