Just wanted to throw an update on my business ventures for anyone interested in starting home based businesses. My approach is to grow from the basement with little investment. Since most businesses fail, I would rather make money from the get go and end up ahead if things die out.
The book I will highlight in this blog actually is a people book. In order to succeed in business, I believe you have to understand people and find out what they need. This is something I have been very interested in and has helped my own personal growth.
First of all, I have a full time job that pays the bills. Last year, I went to the Small Business Development Center (SBDC). This is helpful for getting free advice and support from people who understand the system. They helped me to register my business. I wrote my articles of organization, paid $50 to the state to register an LLC (Limited Liability Company) and had my business. Sounded scary until I went through the process. "The best way to learn business is to start a business." When tax time rolled around, I elected my LLC as an S Corporation by filling out some IRS form. I also filled out some K1s which are like W2s for distributing profits and losses.
I took a $29 course at the SBDC, held by PTAP to learn about how to get a contract. I will get a CRC and DUNNS number. So far, no profit here. This business was registered in Nov, 2010. I did however get a little under $10,000 in part time work, by letting people know I do automated testing.
My next business involves my real estate investments. I covered the numbers in an earlier blog post. Right now, I have a $300.19 mortgage and rent for $750 dollars. This is a potential $5400 in cash flow. However, we were hit hard by Steinborn Property Management with a $1700 in initial fees for cleaning the outside of the house, cleaning the inside of the house, doing maintainence on the swamp cooler and replacing the busted water heater. We also pay 10% which means $80 per month or $960 per year. Already that leaves $2740 for the year (which would be great as an almost 14% return, but I imagine more expenses will pop up). These unexpected expenses are exactly why the numbers need to be really good in the first place! We have $20,000 down on a $80,000 property that rents for $750. The rent to value ratio is .9375%.
The nice thing about the property management is that I don't have to spend my time. However, I am spending my money. My philosophy is that if you want to get rich, you need to learn how to utilize other people's time and money. If I can get a 5-10% return this year, without spending much of my own time, I am happy. The get rich slow method. I would like to find some investors to use their money. Notice, they get the same benefit I do, as far as me using my time to find the investment properties and make regular investment decisions. The more value you can add, the more money you can make.
The final business I will discuss is my wife's soap making business. She started making soaps in the garage and sells them at the local farmer's market. She started in July 2010. Earlier this year, we asked the woman who gives me haircuts to stock our soaps in her store. The original agreement was $20 a month plus $1 for each soap sold. She didn't accept the $20 a month (and hasn't yet, which was very good of her) and we've only sold 4 soaps in the store over about 3 months. We have several ideas about doing larger gift items and setting up web traffic.
Luckily, for my original consulting business, I had a domain registered through IX Web Hosting. This is about $40 per year. You can always host your website for free by downloading Adobe Apache Server software and leaving your home computer as a Server. You will still have to pay $20 or so to register your domain name (ie www.mypage.com) I grabbed some free templates off the web. We will slowly modify the templates to avoid any copyright issues.
So this is the basic layout of a webpage. You have the header, basically a large background image that serves as a background, the right margin, the left margin, and a footer. In between you have the menus and content. I am doing the html myself and will be adding the following: online payment (using Paypal's easy to used Merchant Services) to quickly buy featured items, links to Etsy's online store (costs approximately $.20 per four months for each item posted), a blog allowing customers to follow us, links to facebook/twitter/linkedin/.
As you can see, I am a do it yourself type of guy, but I also like to utilize work from others whenever I can. In one sense, you have to do it yourself to get things cheap and save money. In another sense, you have to use others who can do things better to save time.
This post was reposted from http://sizuservices.blogspot.com/2011/07/tidbits-for-entrepreneurs.html, originally written on July 4th, 2011.
For more information about these three ventures, seehttp://sizusfinlit.blogspot.com/2014/11/early-on-three-businesses-and-lessons.html
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