WoodMarvels.com - One Year Later
It’s hard to believe but roughly a year ago, WoodMarvels.com launched… here are some important lessons we learned along the way.
http://blog.woodmarvels.com/important-lessons-from-woodmarvelscom
Oct
08
2008
08
2008
Jul
03
2008
03
2008
Greed: The fastest way to kill a business!
From my extensive business experience, if there is any one thing that leads to a slow (sometimes quick) demise of a startup or an established company, more often than not, it can be traced to greed.
The root causes of greed
When you first start a company, the pricing is usually insanely competitive even to the point of undercutting your main competitors. Many people believe that price, and price alone is the way to compete directly against the “big boys”. While this does work for a certain period of time, and can actually be profitable, eventually, overhead such as staff, phones, office space etc. all begin to take their toll leading to you having to raise your prices just to break-even. The root cause of greed for most companies starts-up this way, simply trying to stay afloat… I have yet to meet an entrepreneur who got greedy out of desire. It’s usually caused by something far more urgent, survival!
When greed gets out of hand
Alright, you have a rather new company, you hiked prices and can now afford to pay yourself somewhat of a living wage… great! This should be where things stop but inexperience (myself included) makes you wonder, “hey, that went so well, let’s hike things up a bit more so I can buy xyz”. Your clients grumble but the costs involved with leaving your company for another aren’t large enough to warrant a new fishing expedition. Hey, you got away with it! Hmmm… let’s do it again!
Greed catches-up with you sooner or later
Alright, you are living “large”, move to new offices, hire a bunch of new staff, get a new car, start-up some new (expensive) hobbies and life is amazing! What you fail to realize is that you are slowly pricing yourself out of a market that you helped develop. Sooner or later, the contracts that use to be “guaranteed” begin going to other companies, out of desperation, you match their price but in reality, you cannot. You see, your overhead has taken a toll on how “low” you can go while still breaking even! You have nice new offices, guess what, your clients notice this as well and if “entrepreneur to entrepreneur” you see this, you quickly realize that you, as the client, are the one paying “extra” for these digs. Most entrepreneurs are cheap when it comes to spending money, they have no problem buying a plane and other gadgets but when it comes to business, every penny counts! This is when things begin to go downhill.
Excuses Excuses
First you realize that your sales staff is spending A LOT of time on the road trying to close deals that just aren’t going the way you had hoped or experienced in the past. Your subcontractors, realizing you got a bit of money, begin hiking their prices (making your prices higher) and worse, you begin living project by project. You hear all the excuses but they always seem to come down to price and customer service. You want to hire more people to handle the work flow but your overhead is already too high, you want to fire some people but cannot afford the severance, you need to give your sales staff higher commissions but with lower prices, you are being squeezed from all sides. Throw-in a natural disaster and you are really screwed big time!
What to do?
Well, the above happened to me, it took me years to recover but I wouldn’t have wanted things to happen in any other way. The lessons I learned from my past failures have made me who I am today, far smarter with my money, far more efficient with my time and a miser when it comes to Return On (potential)Investment. Well, how do you avoid a business and the personal failure that comes with it? Here are some tips:
- Only hire staff you absolutely need and not before you have at least a few months salary to cover them in your bank account, in other words, don’t count your eggs before they have hatched.
- Subcontract as much as you can, I have found that you will always PROFIT from subcontractors, when you don’t have a project, they don’t cost you anything and when you do, you will always make a net profit at the end of the day.
- Sales people, unless you can afford otherwise, should have the vast majority of their compensation based on commission, sure you can help with gas and other expenses but it’s up to them to make a living off your product/services, not you.
- Learn from your failures and try to constantly improve not only yourself but how things run in general. I believe in a constant improvement philosophy and it has served me very well in both up and down times.
- Listen to your clients and always try to ask a “lost” client why you aren’t working for them anymore or why a negotiation for a new one didn’t go anywhere. Knowledge is power, especially when it can have a very large impact on your bottom line.
- Accept that chance will play an ENORMOUS role in whether your enterprise succeeds or fails. Entrepreneurs who say they are successful or wealthy because of them and had nothing to do with luck are so full of shit that they can build a mud house out of it. Just about every entrepreneur (successful and otherwise) has been deafly affected by luck.
- Don’t give up! If there is one thing you remember from this blog posting it is that you should NEVER GIVE UP on your dreams. Hope, no matter how small, is still hope. The minute you give-up the only guarantee you will have is failure! Sometimes it is good to refocus your energies elsewhere, learn from your mistakes and move on… but never loose hope on the bigger picture to improve the lives of you, your family and those you care about.
The Bottom Line
Greed is one of those dragons that every entrepreneur has to learn how to slay.
Jun
21
2008
21
2008
Trolls and other losers
Throughout my entrepreneurial journey, I have come to the realization of a number of facts, some of which I will share with you today. Instead of seeing these things negatively, people saying bad things about you or your products/services actually represents a fantastic opportunity!
Jealousy
When ever something “new” come onto the main consciousness of many people, the first thing they do is reject it even when this act completely defies logic. For example, if you start a new business and you all of a sudden have a number of people calling you a loser, that you will never amount to anything or worse, try everything in their limited powers of persuasion to convince you that everything will fail. What they are really telling you is “Geez… I wish I thought of that” followed by “Well, I’ll be damned if you succeed at something I -could- have but chose not to. In other words, the people out there with the greatest angst about you are the very people who are extremely jealous of your ambition and willingness to succeed where others haven’t.
YOU WANT LOSERS!
If you are developing something that sparks no emotion even in those who wish for your spiraling downfall it means one of two things, these losers either have no clue what you are doing or worse, you haven’t hit their “jealousy” buttons. Why is this bad? Well, it means that the general public, those who have a neutral stance on your success or or failure may also have the same blahze reaction to this idea as well. The quickest death of a company is indifference, you can succeed with huge negative and positive reaction but neutral sparks a quick death. Essentially, you WANT to receive a reaction - at both extremes, otherwise, you may be going down a dead-end.
YOU WANT TROLLS
The difference between a loser and a troll is quite simple, one usually uses their reputation and contacts to bring you down publicly while the other hides behind the anonymity of the internet to speed-up your failure. Losers are easy to deal with, if you have logic on your site, stand-up for yourself, present the facts (and only the facts) without any negative emotion or “talking-down” type behavior and generally losers will slowly fade into the background. Of course, you have to thank these losers because usually they bring-up a lot of attention to your cause which you may not have had otherwise. A troll on the other hand, well, you need to deal with them in a respectful manner now matter what they have said or done as, let’s be honest, you don’t know who they are or the possible influence they may have on you. I have found the easiest way to get rid of them is with a quick message acknowledging their “grief”, saying how you don’t agree with them and essentially telling them you will no longer participate in their games once you have summed-up a reply. Trolls need a reaction to succeed, don’t give them this pleasure and usually they will fade into the background as well.
Summarize
I know it’s tough to hold back your emotions and especially your tongue when attacked, but from my experience, if you handle it in a very civil manner and always maintain a certain state of decorum, others will come to realize that you where wronged and you will WIN! Every actions has a reaction, by blunting your reaction, there is nothing left to react against, as such, a developing negative situation can quickly be dissolved with little grief.
The Bottom Line
Trolls and losers are an indication of success, NOT FAILURE!
Jun
05
2006
05
2006
Illegal Immigration is caused by Exploitation
The link between Illegal Immigration and Global Exploitation must be broken! Each week, like clockwork, there is some national crisis in the USA that must be fixed. A few weeks ago it was the “Gasoline Crisis” followed by the “Darfur Crisis”� and for the past few weeks now, the needle has been stuck on the “Immigration Crisis”�. Like many others, these where a long time coming but due to the impotence of our leaders to make decisions, what was once a hot pot that could be managed has turned into an overflowing mess. As usual, everybody is to blame except those who could have helped blunt the crisis..
Immigration is too broad a label
I think the entire term immigrant or immigration makes absolutely no sense to begin with, every living thing on this earth is an immigrant�, some say from Mars, others from comets but as Moby said in one of his songs “We are all made of Stars”�.
The piece of land you sit on is no more yours then anybody elses. I don’t think the dinosaurs had borders to allow good ones in and bad ones out… why should we?
Countries CHANGE!
500 years ago, if I told somebody that my nationality was Canadian, they would probably be executed or at the very least, promptly tared and feathered. Who is to say that 500 years from now the Canada (or any other country) will even exist. Just in recent history countries where born such as Israel, countries where destroyed like USSR (mostly satellite states) and others where renamed like the Congo (formerly Zaire). Our worlds geography is an ever evolving tapestry of political, cultural and ethnic desires not a static one as many lead you to believe.
Right now I am a Canadian but I hold no more patriotism to that name then any other, I consider myself a human first and foremost. I think it’s very limiting to classify our species based off where we where born and only helps to marginalized the vast majority of our populations.
So who has the right to keep people from going where they want to go? NOBODY!
Globalization and Economic Prosperity
If you go back as little as 100 years ago, populations where pretty free flowing around the globe where the major barrier to travel was geographical. This has now changed dramatically, in less then 24 hours you can go from one point on the planet to the other. This is only going to get worse as transportation methods get faster and cheaper and our immigration� laws will simply cease to become relevant as a result. If somebody wants to come to a country, they will always be a way for them to achieve their goals, legal or otherwise.
I totally understand why people want to keep some undesirables� out of a country, namely the poor, uneducated and dis-enfranchised. There are more poor people in this world then rich, we got to protect what was “given”� to us. This is the problem facing the industrialized world right now and is at the heart of the issues presented BUT NOT TALKED ABOUT.
Wealth generated off the backs of the poor
Go to your local Walmart, I bet you 95% of the cloths or items you want to buy come from ANOTHER COUNTRY. Cloths is probably Bangladesh, India, Pakistan�, Electronics notably China�. That stereo you purchased for 200$ I would be surprised if the laborer who built it got even a dollar, this is exploitation, pure and simple that is what all us rich� people are doing to the poor ones.
The wealth we live in the western world is absolutely mind blowing, much of the world dies from starvation while in the industrialized world, we die of overconsumption. To us, it is a right to be educated, get credit cards, own a car, house, boat… you name it. Back in Darfur, their only right is a life of lifelong misery. What do we do about this? Nothing, we exploit them even more hey, while they are down, why don’t we kick them one more time and extract a little more labor out of them?
Putting the pieces together
Lets sum things up, countries change, economies are getting global and travel is getting easier… what does that leave us with? A free flow of people from poor� countries to rich� ones, how do we stop it? Simple, according to rich� people (which is all of us), build a wall around us. We don’t mind exploiting you in your own country but no way in hell will your sweat and tears be used to experience any part of the wealth we created off your backs. This is a stupid approach preached by too many people in this world. The fundamental problem with this approach is it simply DOES NOT WORK, poor people are just as resourceful as the rest of us.
Now, what does illegal immigration have to do with global exploitation?
A lot more then you may realize, although there is little that can be done to stop illegal aliens from entering any country they wish there is a lot we can do to step the flow remember, illegal immigration is caused because of the lack of opportunity in their mother country brought on by exploitation in the country they usually want to migrate into. For instance, Mexicans want to enter the United States for a better life, not to pick fruit and be forced into sweat shops… but BECAUSE they are illegal, businesses and individuals exploit them for their cheap labor. This is a mind set that only leads to more exploitation both within and outside of a host country.
So what is the solution?
I do not think all is doom and gloom but I have an extremely simple solution to the problems caused by exploitation of the poor in this world.
Every item purchased should have three prices.
a) environmental price (1 out of 10)
b) production price (this is the actual cost to produce the item you are purchasing)
c) purchase price (what you pay at the cash register)
If every item you bought, whether a box of kleenex or a food item had this, we consumers could modify our purchasing habits to follow our consciousness, if you saw your shoes had a environmental price of 8, cost 1 dollar to produce and where on sale for 150$ - I sure as hell wouldn’t buy them… would you?
This will help stem the flow of illegal immigration because now people will be able to make a LIVING WAGE in their own country, no longer being exploited (as much). It will also put out of business the profiteers, smugglers and many more of what I call undesirables�.
Will this ever happen, sadly, I doubt it, there is too much money to be made in exploitation and keeping things as they are (which is the real problem).
The Bottom Line
Marching, screaming and crying about a problem without offering a solution does nothing but cause you to be ignored. You cannot stop illegal immigration but you can stop creating the environment that creates it in the first place, which is an environment of exploitation.
