I was talking to a baby boomer over the weekend who clearly disliked his job but clearly had no idea of the sort of business to go for, or more importantly, what constituted an ideal business model versus buying a job so I put this article together as I find this a common theme out there, most people want there own business but don’t know where to turn for the right information.
Paine Webber, a major American financial company defines the ideal business in the following twelve points. If a business has three or more of these points it is considered to be a good investment.
- The Ideal Business sells to the world rather than a single neighbourhood. In other words, it has an unlimited global market.
- The Ideal Business offers a product, which enjoys an Inelastic demand. (Inelastic refers to a product that people need or desire almost at any price.)
- The Ideal Business markets a product that cannot be easily copied. This means that the product is an original or, at least, it is something that can be copyrighted or patented.
- The Ideal Business has minimal labour requirements. The fewer personnel, the better.
- The Ideal Business operates on a low overhead. It does not need an expensive location. It does not need large amounts of electricity, or advertising, or legal advice, or high-priced employees, or a large inventory.
- The Ideal Business does not require big cash outlays or major investments in equipment or product. In other words, it does not tie up your capital.
- The Ideal Business enjoys cash billing. In other words, it does not tie up your capital with lengthy or complex credit terms.
- The Ideal Business is relatively free of all kinds of government regulations or strictures.
- The Ideal Business is portable or easily moveable. This means you can take your business and yourself anywhere you want to.
- The Ideal Business satisfies your intellectual needs. There is nothing like being fascinated with what you do.
- The Ideal Business leaves you with free time. In other words, it doesn’t require your labour and attention 12, 16, or 18 hours a day.
- The Ideal Business is one in which your income is not limited by your personal output (Leverage). In the Ideal-Business, you can have 10,000 customers as easily as you can one.
Author Robert Kiyosaki calls the business model that offers this the “business of the 21st century.
So the question is, what are you waiting for, time waits for no one?