Thursday, January 28, 2010

My third adventure in business, CARS CARS CARS

After my computer business, I kept thinking about what I had learned in my past experiences and searched for something new to try. Still keeping in mind that profits are better than wages and working for yourself has a higher potential that working for someone else. I can't remember exactly how it happened, but at some point, it occurred to me that the margin between the cost of a vehicle to a car dealer and the price it is actually sold for can be significant. This started me on my path to researching what it would take to be a car dealer.

I want to point out a prevailing theme that seems to exist for all aspects of life and especially business. It is something that has become a philosophy for me over time. Always follow the "why" and the "how". This will come up again, I am sure, in future blog entries, but basicly, it stems from a familiar phrase you may have heard about from Einstein. "Always as why". Many times, a person will give up and their brain will shut off because that person has stopped asking why and stopped trying to figure out how. This could be anything in life, but lets stay on the topic of business. If you think to yourself that you want to be successful in business, but you hit a wall along your way. The person that doesn't ask "why" or "how" begins to believe that it is just not possible. From that point, the brain stops and never tries to overcome that obstacle. However, for the person that does ask "why" and "how", they will think about why the obstacle is there and how it can be overcome. I have found this to work every single time without fail. When I hit a wall. I figure out how to get over that wall. If something keeps me from getting over that wall, I then figure out what it takes to overcome that as well. This process repeats until the ultimate solution is found. I don't think I have ever hit a situation that I could not go over, around, under, or through. There always seems to be a way, if you let your mind think and not shut off.

So, back to the car dealer story. I did my research and discovered that there were a specific set of rules that had to be adhered to in order to be come a legal car dealer. It was a bit of a tiring process, but I got all the ducks lined up and met all the requirements and became a car dealer. I was very excited about this opportunity. It was great while it lasted. I went to some car auctions, which was an adventure in itself.

I am talking real auctions where the auctioneers are making the classic auctioneer noises with their mouths that almost seems like a different language. When I first heard it, I couldn't even understand what they were saying or where the bid was at. Something magical happens after you listen for a short bit though. The jibberish fades away and you suddenly can hear the bids. These guys are real sharp too. You have to be very careful when at a serious auction. Quite literally, the blink of your eye or any small gesture can be considered the acknowledgement of a bid. I do recommend going to one though if you ever have the chance. It is a very exciting experience.

Eventually, I saved up enough money to purchase a car. I was once again working with a shoe-string budget, so everything I did, I had to save up for. fortunately, as a car dealer, you can get cars cheap. So, I bought a car and didn't have it too long before I found someone who wanted it. It was a sister of a friend who bought the car from me. Now, the plan I had was to take my earnings and invest in another car or two if I could manage it. I made a good profit from my first sale and was well set to keep the ball rolling.

Here is where the hard lesson learned comes in. I made the mistake of letting a close friend of mine make the final transaction of the car and money. My friend was supposed to take the car to the purchaser and bring the money back to me. We had handled the paperwork before hand since the person buying the car was in the process of moving and we could not synchronize our schedules. The car and money changed hands, but on the way back to me, my friend ran into a situation that caused him a personal financial problem. With "my company's" money in hand, he made the decision to borrow some of the money with the intention of paying me back. I was a bit upset at this since his situation cost my company more than half the money made from the sale of the car. Not only was it wrong, but now I was actually a step back and had to save up a little more money just to get one car. I only ever got back a small portion of the total amount due back to me. It was bad timing for me that this happened. I don't mind helping my friends, but in this particular instance, it hit me at just the right time where I ended up closing down my car dealer business. Timing seems to matter whether it is good or bad timing. I did end up purchasing another car before the doors to my business closed, however; it was too late and I could not stay above water. I did take away some good things though. I got a good view about how business works within regulations of the state. Nothing too significant, but it was more notches on my business belt. I was certainly not going to let this defeat stand in my way. With my mind, heart, and soul still vigilant, I stepped forward to find what I would do next.

Until next time... keep your mind alive.

Friday, January 8, 2010

My second business adventure, custom computers.

After my two partners and I put to rest the T-shirt business I spoke about in an earlier post, I was able to add to what I had already learned. My mental gears never stopped spinning. In fact, they were spinning even more because I could see the potential. I could see how it could have been done better and had learned from mistakes that had been made.

I have noticed over time that a couple of key things happen in a person's growth process. One will learn from their mistakes and also self evaluate to determine what things need to stay the same and what things need to change. In my case, I had added to my bag of business knowledge and also realized that the T-shirt business wasn't quite right for me. It was obvious that there were very successful people and companies making great money in the T-shirt business. For me, it just wasn't quite my cup of tea. It was exciting to go through it and learn from it, but I would not have been happy trying to make a successful business out of T-shirts.

One thing to keep in mind, regardless of working for the man or if you are the man, try to be sure that what you are doing is fullfilling. If you are not enjoying what you are doing, it will generally not be worth the trouble in the end. You could be making tons of money, but if it is from doing something you hate, eventually the money become less important.

So, with my bigger bag of tricks and my sights set on new horizons, I found myself starting a computer business with a friend and my mother again. At the time, my friend and I were working in the same software company. In our tinkering and exposure to computers, we realized that we could put these things together with ease and had a pretty good understanding of how the components worked together. Starting a business building custom computers seemed like a good opportunity. I love computers. So, for me, this seemed like a really good fit. This was in the late 90's if I remember correctly. This was a time when there were not a lot of people with computers skills. The internet was really taking off, but people were still fairly new to using them much less putting them together. This meant that we possessed a key component to success. We could do something that only a small number of people could do.

This business worked pretty well for a while. Once again, it was a situation where we had to work with a very small budget and we had limited time to work on the hardware. It worked though. It really worked. We spread the word about what we could do and we started getting orders from friends and associates at first for full custom builds to minor fixes and maintenance. Our profits weren't very big, but we did actually make profit. Now some might see small profit as no big deal. In actuality, any profit is pretty amazing considering most businesses operate at a loss for a year or more before they start to show profit and those businesses are considered successful. So, eventhough it was small scale, we had done some things right. I was personally proud of this because it was a sign of moving in the right direction. I had taken the things I had learned and got to taste success because of it.

Despite our small success, we still had to eventually close shop. The interenet really started to take of in terms of business. A number of companies popped up that did the same thing that we did, only they were able to do it on a larger scale. We had a chance to talk to some of these companies and discovered that they really only made pennies on the dollar for their profits. The key though was that their volume was far bigger than ours so a lot more dollars were coming in for them, so their pennies really added up. On top of that, because they could operate at a larger scale, they were able to offer more services and hardware for less than we could if we were to remain profitable. Our options at this point were either to try to get the loans and backing needed to compete with the big boys or close shop. I didn't feel comfortable yet competing with other businesses at that level. I had not yet learned enough and felt that it was a great risk to take.

This is not all a bad thing though. I learned even more about business and got to taste a little bit of success even more so that with the T-shirt business. Another added little bonus was that we got to be on the radio one time. It was a spot of time on the radio where a regular host would take calls about general computer problems and information. Through an acquaintence of ours, we were offered a chance to sit in on this show and talk to the host and respond to listeners and depate on computer related topics of the time. If I remember correctly, we got to plug our little business too. So overall, more knowledge, success, and some worthwhile experience more than made this a rewarding opportunity.

More to come...