Internet Users Hbk - Chapter 8a. Are You Prepared to do Business Online?

Perhaps the greatest contributor to our failure on or offline is our lack of personal preparation to do business. Offline businesses usually start with you, your passion, interest or perhaps a hobby. It is easy to recognize what your need to get started: Money or capital, home or rental/lease location, business cards, signage, etc. Online; it looks so cheap and easy, but soon you find it is not!

Entrepreneurs are not always business minded; most have little or no business experience. Both off and online businesses suffer the same problem with their owners. I believe it is reasonable to say that starting an online scam site is easier than a legitimate site. All you have to sell to get paid is satisfaction to someone’s need, whether you can deliver or not.

All legitimate business off or online, can run into problem with cash flow, management and other business ailments, so just because they fail does not mean that they were a scam.

With that said, this chapter concerns your personal capability to run a business and works fine both off and online businesses. You are given the opportunity to you to assess your strengths and weaknesses, assess your business potential and facilitate a personal plan of action. Your business will not grow, or you will lose most of the potential growth or your business, unless you realize how important your personal preparation is.

Be fair and honest with your assessments! Take notes and develop your personal Plan of Action for starting or growing a Success Business Online

Too many new users (newbies) think that doing business online is easy, and will solve their financial problem. According to the hype It Is! Just look, the start-up costs for doing offline as compared to starting online.

However, if you think you can jump into any business without being personally prepared, without a plan and a without a proper mindset to treat your online experience as a BUSINESS, instead of a HOBBY; then you are destined to join and be one of the 95% +/- failure rate statistics that may be

found for both offline as well as online businesses. The statistics for Forex failures is even higher at 98%.

However, according to a Dr Jeff Cornwall of Belmont University “Ask an average group of people what the survival rate is for entrepreneurial ventures and the figures you usually get are 10-20%. The truth is much rosier than common wisdom assumes.

As reported by the National Dialogue on Entrepreneurship, a new study from the Bureau of Labor Statistics "examines the survival rates of new businesses started between 1998 and 2002. It finds that 66% of new establishments started in 1998 were still operating two years after they started; forty-four percent were still operating in 2002."

The only sector that showed significantly lower rates was the dot.com group, which crashed during this time. Factoring that group out and we are getting closer to the 50% figure that most experts believe to be an accurate estimate. Studies that examine entrepreneurs who have had training and/or education in entrepreneurial skills consistently show a much higher success rate (as high as 80-90%).

While we are here to learn to avoid scams; we are also here to help you succeed. Take your time and see what skills you can improve. Those of you that have joined us, and are already successful online, great, we can use your help. Others, use this section to help determine your needs and to develop your plan of action. With proper planning, learning, mindset and treating your business as a business, you can significantly increase your potential for success. In following sections, we will help you to identify, understand and avoid the Scams. Avoiding Scams will further increase your opportunity for success, but using your resources where they can help you instead of filling the scammer’s pockets.

Business failures are difficult to track because the facts vary with the source and the way the numbers are gathered. For example, we can measure the number of Offline Businesses that start within a year or two and deduct those that do not renew their business license. However, no license is required for an Online Business.

While we can document the change in the number of bankruptcies, but just because a business did not renew their license does not mean the business went bankrupt. All we know is that the business may have closed for some reason; wrong business, wrong or obsolete product, timing, lost motivation, divorce and for that matter any reason will do. Online hobbies can be ceased at any time – no paper trail.

Keep it simple and let us just accept the general numbers of 90% +/- failure rate and accept that that is after 5 years. Of these, the failure rate for online business is 50% within the first 6 months to a year, while offline the percentage is say 50% after 2 years.

Most of us understand that offline businesses require a greater investment to set up the business, licenses, location, furniture and equipment, etc. Offline businesses are lucky if they breakeven in months to a year, while most take longer, if at all.

These entrepreneurs must concern themselves about matters of government regulations, policies and politics, brick and motor location, capitalization, payrolls, risks, etc. Most of the offline business failures are a result of undercapitalization and miss-management., no plan.

Your capital investment for an online business is much less; but that does not mean or guarantee that you can or will be an overnight success, as others would have you believe. Unlike offline business, you are not so concerned about matters of government regulations, policies and politics, brick and motor location, capitalization, payrolls, etc.

As said before, those that have some basic business skills or background, training and an entrepreneur sprit have a much greater chance of success and are better suited for business. Add to that, those that have a plan; i.e., business, financial, and marketing plans have a significantly better chance of success.

Offline entrepreneurs may have a Passion, interest or idea, a product or service that they feel can be marketed online. Those that start online may also have an idea, product or service, but the majorities are just looking for extra money. They most likely become an affiliate of someone else’s product or service.

A fulltime commitment is better that a part-time effort for any business. Regardless of the type business, you undertake, you should understand your suitability to go into that business, assess your strengths and weaknesses, what are you needs, and what is your understanding of the risks.

The Scammers will tell you, you do not need money, or not that much, and that they will do everything or most of the work for you. Just sit back and collect your money. If you believe that, then you may as well stop reading further.

In business, we must understand ourselves, what is involved. Some of you want to be your own boss, or you have already started your business, some of you are retired, or work at home moms, whether online or offline. Maybe some you want a change of career or just want to supplement your income.

Look at the following and be honest with yourself. Many items are applicable to the offline business, but some for both. Consider them, i.e. what can you do, what do you know, what are your interests, can you do it online?

This applies to someone who establishes a new entity to offer a new or existing product or service into a new or existing market, whether for a profit or not-for-profit venture. Business entrepreneurs often have strong beliefs about a market opportunity and are willing to accept a high level of personal, professional or financial risk to pursue that opportunity. A Risk Bearer, an Organizer, an Innovator, a Leader

• Entrepreneurs have a Desire to Achieve: The push to conquer problems, and give birth to a successful venture.
• Hard Work: Are mostly workaholics.
• A Nurturing Quality: Willing to take charge of, and watch over a venture until it can stand-alone.
• Acceptance of Responsibility: Are morally, legally, and mentally accountable for their ventures.
• Reward Orientation: Desire to achieve, work hard and take responsibility, but also want to be rewarded handsomely for their efforts; rewards can be in forms other than money, such as recognition and respect.
• Optimism: Live by the philosophy that this is the best of times, and that anything is possible.
• Orientation to Excellence: Often desire to achieve something outstanding of which they can be proud
• Organization: Are good at bringing together the components (including people) of a venture.
• Profit Orientation: Want to make a profit; but the profit serves primarily as a meter to gauge their success and achievement. John G Burch Business Horizons, 1986

A Successful Entrepreneur is one that

• Is motivated and who is able to motivate those around him / her
• Is able to manage time effectively
• Has the ability to leverage off strengths and overcome weaknesses
• Manages resources well
• Considers health as well as wealth
• Is flexible and able to adapt well to change
• Is willing to learn from others, Reads, Reads and Reads
• Uncertainty of Income
• Cash Flow Management
• Risk Of Losing Your Entire Investment
• Long Hours And Hard Work
• Lower Quality Of Life Until The Business Gets Established
• High Levels Of Stress, In-laws (Now Or Future)
• Complete Responsibility
• Are You Easily Discouraged?
• Do you feel personally stressed and feel threatened under pressure
• Constantly stake personal reputation and tend to give guarantees.
• Be hard yet more flexible and more streetwise than a corporate executive.
• Be good at multitasking – able to do everything.
• Intermittent, unpredictable income
• Self-Discipline, Patience, Listening, reading
• Personal technological competence, internet
• The buck stops with you!
• Think of new ideas and deliver them to the market and make a profit.
• Provide leadership to his team against established competition with minimal resources.
• Raise finance without a track record, collateral or internal experts.
• Pay staff first; you get paid when it is prudent to do so.
• Be prepared to lose everything if things go wrong

• Create Your Own Destiny
• Fulfill Your VISION, Ambition And Passion
• Make A Difference
• Reach Your Full Potential
• Reap Unlimited Profits
• Contribute To Society And To Be Recognized For Your Efforts
• Do What You Enjoy Doing And To Have Fun At It