Archives for October 2008

Last time I introduced the concept of Multiple Streams of Income. The idea being that, by not relying on a single source of income, you build a more secure financial base.

I also pointed out that, in order to give you the financial freedom you need, each income stream has to work on auto pilot. You really cannot be involved in all the traditional tasks of business in more than one venture at a time. So how do you achieve this perfection?

Two possible ways – the simple and the relatively more complex. So let’s take the simple first!

1. Agency or Affiliate Programs

Basically this involves selling other people’s goods and services (usually on-line though not necessarily). Look for products and services that match your own interests and that you can be enthusiastic about.

Seek out suppliers that deliver quality products and excellent customer service and who also sell via agents or have a good affiliate program. They will then pay you a commission on everything you sell on their behalf. They are responsible for all production, delivery, customer service, billing & collection, after sales etc. And often they will pay your commission direct into your bank – you don’t even have to take the cheques to the bank!

By going down this road, you relieve yourself of most of the administrative & operational chores of running a business. All you do is recommend great products and services to people and watch your bank account fill up!

Another great advantage to being an affiliate is that you can always add to or even replace your affiliate programs as market conditions change. Not an easy thing to do with a business of your own. 

You can get more information on affiliate marketing from my latest website: 

www.learnaffiliatemarketing.co.uk.

2. Multiple Businesses

This is much harder but ultimately more rewarding if successful. As an affiliate you can build up a very nice income, but you will not build a saleable asset. By building multiple small businesses you get the benefits of multiple income streams plus multiple business assets.

An ideal way to approach this method is to look for niche markets. Niche markets specialise in a specific area of interest, e.g. hobbies sports etc. or are focused on a particular group of people, e.g. accountants or guest house owners or people who want to lose weight….. etc.

On-line you can find these markets by looking to see what people are searching for in search engines such as Google or Ask.com. Two tools you can use for this are:

www.wordtracker.com which gives you the top 500 search terms each month and

www.google.com which has an excellent search term suggestion tool.

Off-line, go to your local newsagents and scan the magazine shelves – they are literally stuffed with special interest magazines. Look at the classifieds in the back for an indication of what others are selling to readers of the publication. Read the articles and letters pages to find out what this group of people are most interested in. This will give you some ideas of things you may be able to sell to them.

The most important thing to remember is – do one thing at a time and really focus on getting it right! Pick one niche. Research it thoroughly, look for products or services that can be easily obtained and sold to that market. Ensure that your business can be set up in such a way as to automate it. Then focus on building that one business until it is running smoothly on auto- pilot and making a good profit.

Once the first business is up and running, you can repeat the process as many times as you want. Just make sure that each business is monitored to ensure that it doesn’t “fall over” when you are not looking. It’s a bit like the “plate spinning” juggler at the circus – all you have to do is keep the plates spinning! 🙂

This is the point at which the two halves of our article stream begin to merge. From here on this section will focus on different business ideas and ways to maximise their chance of success.

Coming up with a viable business idea – especially one that meets the criteria specified in earlier articles, is not always easy. The best place to start is by examining your own interests. Choosing something you are passionate about means you are more likely to give it the time and focus it needs. Doing something you aren’t enthusiastic about, just for the money, is usually a recipe for failure.

Last week I promised to introduce you to the mail order business. This is one of the few areas where the small entrepreneur can still get in without huge capital outlay. It is also one that can be put on autopilot – if you know how. So how do we tie this in with finding your passion?

Well, if you have a passion for something, chances are other people have the same passion. Instead of spending your money buying things that fuel your interest – find the source of the products & do a deal that enables you to sell them to others, at a profit. Simply put, you find a source of supply – find a group of customers and put the two together. Since you already have the interest you probably also know most of the suppliers and quite a few potential customers. You will also know the kind of magazines those customers subscribe to.

If you are really passionate and knowledgeable about your subject, you may even be able to produce a product of your own. Often the best product for special interest groups is an information product. A “how to” book, or even a video, audio tape or CDROM packed with useful information and insights into the subject could be a great seller to the right audience. The beauty of your own product is that no-one else is selling it!

The other advantage of your own information product is that it can be very inexpensive to develop and produce, but at the same time be sufficiently valuable to your customers to command a good price. This is important in mail order as the cost of marketing can be high. Most mail order marketers look for a selling price of 5 to 10 times actual production cost in order to build in a large enough profit margin to cover all costs and make a good profit.

So, armed with this initial information why don’t you spend the next week thinking about what gets you really excited and enthusiastic. Think also about things you know or are skilled at that would be of interest to other people who are excited about the same things you are. You will also need to get some idea of how popular this area of interest is in order to establish the market potential.

Next time I shall tell you what to do with the results of your thinking.

Until then, have a fantastic week!

You cannot achieve true freedom if your focus is constantly on making a living. But, initially, you have to do the work to put the right income generating systems into place.

Now you are on your way to making your budget work & getting rid of any debt burden you are carrying, we can look at ways of generating additional income.

In the session on debt elimination, I asked you to find some spare money in your budget to begin to accelerate your debt repayments. Now, I’m going to ask you to find a little spare time in your busy schedule to put to work making some extra money.

And, what are you going to do with this extra cash? Well, I suggest you allocate one third to speeding up debt repayments, one third to savings and the rest to a little luxury or two for you & your family. After all, by now you probably need a little encouragement & self reward!

So, how are you going to turn a little extra time into future financial freedom? Well, not by stacking shelves at the local supermarket for a start! Nor any other low paid menial task.

It’s time to learn the art of leverage. In other words, use a little time and a little skill to make a bigger income. The true entrepreneur does very little actual work (as we know it), he uses knowledge & skill to apply the techniques we have already begun to cover in the “Going Solo” section of past articles.

If you are already in business, use the extra time to step outside of the business & take a good hard look at how you are presently running it. Are you working hard or are you working smart? The smart business owner works ON the business not IN the business. If you are simply an employee of your own business, you are wasting most of its profit potential.

On the other hand, if you are an employee of someone else, you are probably not yet financially ready to “give up the day job!” But that does not stop you spending a little time on preparing for & building a part-time business.

You may have heard of the principle of “Multiple Streams of Income”. This works on the concept that reliance on one single source of income can be insecure, whereas multiple sources of income give greater security. If something goes wrong with one source, you still have the others.

However, a key requirement for success is focus. It’s no good being a “butterfly” & flitting from one opportunity to the next at random. The way to achieve the security mentioned above is to take your little bit of spare time and build one additonal income stream that can be put onto “autopilot” once it is running smoothly. Only then do you turn your attention to the second stream and do the same again – always keeping an eye on the first to make sure there are no “bugs” in your system.

By working in this way you can multiply the results of your efforts and make the most of your spare time. One day, you could well find that your multiple streams of spare time income exceed the income from the “day job”. If you have set it all up right, you will be well on your way to independence and financial freedom.

So, how do you find these illusive income streams? I shall be going into this in more detail as our journey together progresses.