Manage episode 271048976 series 2342556
Are you keen to start a new business venture but don’t know what to expect? Or perhaps you’re running a business and wanting a helping hand? Join Mark Homer today as he discusses the hidden costs of running a business. Discover the importance of not hiring cheap employees, having enough cash in the bank to survive a recession and being able to adapt to new industry standards.
- Hiring cheap employees can potentially be a huge hidden cost when running your company. When you want 10/10 employees you have got to pay for them, they will be worth three or four times more in revenue than a poor employee. They will also save you a lot of money in losses and costs.
- A hidden cost of running a business is buying unnecessary products to furnish your offices. These can cost a company tens of thousands of pounds when starting a company when they don’t have much cash in the bank. It is much more important and worthwhile to put your money into marketing, sales and growing your business. The material items can come later.
- Not keeping cash can be a huge cost to the business. You do need to keep some cash, as we have seen through this COVID period and the previous recession there are some businesses who did not have cash in the bank. These companies were unable to switch their business model and ended up going bust. Be focused on keeping good chunks of cashback to ensure your business can carry on trading.
- When the market changes, competition comes along. You need to be able to adapt your business, if you’re standing still and staying the same you will no longer be relevant. You won't have adapted to the market as it has changed and you will end up going bust. The competition will come along, your customers will want other things and your competition will respond to that and take your business away from you.
- Diverting time into nonsense. Lockdown has been a great eye-opener for how much nonsense was really going on in daily life. Unnecessary travelling, phone calls and other distractions take place in the office each day which do not serve many purposes to your business. Focus on your income generating tasks so that you are not getting diverted into other issues that are not productive.
“Only hire 10/10’s. Pick the best, surround yourself with great people.”
“The best businesses start in the garage with nothing and grow their revenue stream. That is the most important thing.”
“Businesses do not go bust due to lack of profit, they go bust due to lack of cash.”
ABOUT THE HOST
Mark Homer is an entrepreneur investor. He has worked with investment since he was 15 years old using the laws of wealth! He is a spreadsheet analyst with an impressive following from major publications including BBC Radio, The Wall Street Journal, The Independent, and co-authoring the UK’s best-selling property books. Mark has always looked for the best investment vehicle, and at the end of 2007 with Rob Moore the co-founder of Progressive Property his joint portfolio produced more profit than any of the other investments he’d tried in the last ten years, combined.
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