| "But Everybody's Doing It"
| |
| | harvest.Rule number two: Ask yourself how
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| Are you familiar with that plea some
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| | you are going to pay back what you
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| children make in an attempt to get what
| |
| | borrow-collateralize your own loan if at
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| they want based on the behavior of their
| |
| | all possible. Be willing to sell
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| peers: "But everybody's doing it"?
| |
| | something such as a nicer car that you
|
| Should you, as a business founder or one
| |
| | own for a more modest one, for instance.
|
| who wants to be, use credit cards, just
| |
| | Be willing to sell all of your "stuff,"
|
| because a majority of your peers are
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| | to the extent that is necessary to raise
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| using them? Ironically, the answer may
| |
| | funds (preferably up front, prior to
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| lie in the same type of parental analysis
| |
| | starting your business; if you sell when
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| that might be applied to a child's
| |
| | you are desperate and strapped for cash,
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| situation. Are you mature enough to
| |
| | you will be at a unique psychological
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| handle the freedoms and responsibilities
| |
| | disadvantage).Rule number three: Consider
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| that are associated with the behavior?
| |
| | whether or not you absolutely must have
|
| Do you know what you are getting
| |
| | whatever you are purchasing on a credit
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| into?Have you checked your credit card
| |
| | card. If you are charging expenses such
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| statements and account terms lately, and
| |
| | as payroll, ask yourself other questions,
|
| read the fine print? What those
| |
| | such as "do I need these employees?" What
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| disclosures say, once they are translated
| |
| | alternatives have you considered in lieu
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| into non-legalese, is that if you use the
| |
| | of paying cash for their services? Maybe
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| credit card account, you both understand
| |
| | you should make them partners to the
|
| and agree to the terms. Have you noticed
| |
| | business and arrange for them to invest
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| default interest rates (if you miss
| |
| | with their own "sweat equity"
|
| making even a single payment on time) in
| |
| | contributions to the enterprise. Have
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| excess of 30 percent? These default
| |
| | you considered temporaries, interns,
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| rates are not all that dissimilar to
| |
| | freelancers, outsourcing, or virtual
|
| those of loan sharks, especially in light
| |
| | assistants? Have you fully automated
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| of the fact that they have emerged during
| |
| | your business, for example, with Internet
|
| a period of record lows relative to
| |
| | enabled ordering systems?Rule number
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| interest rates set by the Fed and
| |
| | four: Manage your credit card debt with a
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| corresponding prime interest rates (the
| |
| | vengeance. Pay your credit card bills on
|
| most favorable rates granted to
| |
| | time and protect your credit in every way
|
| financially substantial commercial
| |
| | possible. Use an automatic payment
|
| borrowers). Are you aware that
| |
| | service through your checking account
|
| bankruptcy laws have radically changed,
| |
| | provider, an online service, or the
|
| and that it is not nearly as easy to walk
| |
| | credit card companies themselves-don't
|
| away from credit card debt as it used to
| |
| | ever be late. Send two payments just to
|
| be?Do you realize that complaints about
| |
| | increase the odds that one will arrive by
|
| credit cards have been ranked among the
| |
| | the due date. Send payments by certified
|
| top four consumer complaint categories
| |
| | mail, if need be. Do not accumulate
|
| based on data from state and local
| |
| | balances if they can be avoided.
|
| consumer protection agencies (just behind
| |
| | Remember that just about every letter
|
| automobile repairs and home improvement)?
| |
| | from a bank that starts by stating, "We
|
| Have you used your favorite search
| |
| | value your business," probably includes a
|
| engine and combined various words and
| |
| | change in terms; a change of terms is
|
| phrases such as "credit cards," "consumer
| |
| | just about always in the bank's best
|
| complaints," and "hate"? (Be prepared to
| |
| | interest and not yours, with few
|
| wade through millions of hits.) It does
| |
| | exceptions, such as when it is the result
|
| not take much perusing to come across
| |
| | of a legal settlement against the
|
| stories of woe written by consumers who
| |
| | bank.Rule number five: Watch your own
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| have been tricked and trapped by credit
| |
| | margins. Credit cards started out as a
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| card companies. You need to understand
| |
| | convenience, such that one did not have
|
| that some banks are engaging in predatory
| |
| | to carry cash; they were used as a
|
| lending practices.There are stories being
| |
| | short-term pledge against cash that one
|
| told by people who signed up for a low
| |
| | had, and would pay back at the end of a
|
| rate for the "life of the balance" only
| |
| | billing period (e.g., monthly). They
|
| to later receive a notice that in the
| |
| | were not designed as a long-term source
|
| fine print it was disclosed that the bank
| |
| | of capital. Because they are unsecured
|
| could change this rate based on factors
| |
| | (although even this is changing), as a
|
| such as credit ratings (and other
| |
| | vehicle for financing they usually come
|
| criteria, at the sole whim of the
| |
| | with higher rates. By using credit cards
|
| institution). Many banks have sent these
| |
| | unwisely, you are doing the exact
|
| notices although their customers have not
| |
| | opposite of what entrepreneurs must do:
|
| even missed a payment, which is clearly
| |
| | you are, in effect, buying (capital) at
|
| egregious. You'll note that these are
| |
| | high prices, and selling your good or
|
| not "shady, off-the-wall" banks relative
| |
| | service under circumstances that reduce
|
| to the names that you will see
| |
| | your own margins. That's not a formula
|
| mentioned-these are brand name banks
| |
| | for being competitive in the long or
|
| engaging in shady business practices.The
| |
| | short run. If you can't raise the price,
|
| banking industry constitutes a powerful
| |
| | consider ways to add value so that
|
| lobbying force, which exercises
| |
| | customers would be willing to pay more.
|
| considerable influence with lawmakers.
| |
| | If you can't do that, perhaps you should
|
| History's "haves" have always enslaved
| |
| | go back to the drawing board. You might
|
| the "have nots," economically, if not
| |
| | have an unprofitable product or service
|
| literally. Do not count on any help from
| |
| | on your hands.The above rules take us all
|
| your elected officials whose names
| |
| | the way back to the basics of a viable
|
| appeared on ballots in the first place
| |
| | business idea: do you have a product or
|
| due to political contributions from the
| |
| | service, for which you can demand an
|
| industry. According to an article in the
| |
| | adequate price, and sell and deliver in
|
| Washington Post (Jim VandeHei, March 27,
| |
| | sufficient volume, at a profit-after
|
| 2005; Page A01): "Credit card and banking
| |
| | paying all necessary and ordinary
|
| companies, who are leading the lobbying
| |
| | business expenses? Bootstrapping a
|
| effort, were top financers of Bush's two
| |
| | business startup to get it off the ground
|
| campaigns. MBNA, Credit Suisse First
| |
| | is to be admired when it works, but a
|
| Boston LLC, Bank of America Corp. and
| |
| | lack of resources is one of the most
|
| Wachovia Corp. were among the top 20
| |
| | cited reasons for business failure-so
|
| contributors to Bush." (Shortly
| |
| | beware. It should be noted that many
|
| thereafter, sweeping changes to
| |
| | entrepreneurs cut themselves short and go
|
| bankruptcy laws, favoring credit card
| |
| | without health benefits, insurance,
|
| companies and the banking industry, as
| |
| | training and self-development, adequate
|
| referenced above, were passed by
| |
| | time off, and numerous other perks as
|
| arguably, the banking industry's, and not
| |
| | well as necessities that foretell their
|
| "your," legislature.If You Must Use
| |
| | ultimate demise. We all have ideas, and
|
| Credit Cards, Practice "Safe Swiping"
| |
| | many of these ideas are quite clever.
|
| If you do decide to use credit cards to
| |
| | You don't have to be a managerial
|
| start your business (or as a consumer in
| |
| | "somebody" to have a great idea, either.
|
| general), you must find ways to protect
| |
| | (Corporations can sometimes act downright
|
| yourself from the risks involved.
| |
| | "dumb" in failing to harness the creative
|
| Practice "safe swiping" every time you
| |
| | power of rank and file employees).
|
| slide that credit card of yours through a
| |
| | Nevertheless, the pages of business
|
| card reader and charge on your account.
| |
| | history are strewn with the wreckage of
|
| This is no different than safe sex, or
| |
| | otherwise visionary plans, gone
|
| anything else that might put you and your
| |
| | awry.Perhaps the most critical issue is
|
| well-being at risk. It helps to
| |
| | whether or not you can enlist the support
|
| establish certain rules to go by.Rule
| |
| | that you need in every context that is
|
| number one: Don't be in a hurry to start
| |
| | necessary to launch and operate your
|
| a business if you do not have the
| |
| | business. It's a pretty good sign when
|
| resources to do so in the first place.
| |
| | you tell four friends about your idea and
|
| If everyone you talk to is skittish about
| |
| | they all immediately pull out their check
|
| your idea, you really need to question
| |
| | books. Are you truly prepared to start
|
| its viability in the first place. Turn
| |
| | your business? You'd better be pretty
|
| over every rock looking for alternatives.
| |
| | sure of your answer before you take the
|
| Finding a backer, such as a supplier who
| |
| | entrepreneurial plunge, especially if you
|
| wants you to succeed, or finding a
| |
| | plan to fund your startup with credit
|
| customer who commits to purchasing and
| |
| | cards.Dr. Robert Lahm is the founder of
|
| advances the money up front, would
| |
| | several businesses and Web sites, an
|
| represent two such alternatives. Save
| |
| | entrepreneurship professor, a public
|
| money in your personal piggy bank and
| |
| | speaker, and a writer. His typical
|
| accumulate resources. Start out with a
| |
| | topics include creativity and innovation,
|
| revenue source from some activity that
| |
| | careers, start-ups, and small business
|
| feeds into a longer-term vision. For
| |
| | marketing. Webmasters and other article
|
| example, develop a part-time business
| |
| | publishers are hereby granted article
|
| into a full-time business over a period
| |
| | reproduction permission as long as this
|
| of time. Think small and manageable.
| |
| | article in its entirety, author's
|
| Think of planting tiny seeds, and
| |
| | information, and any links remain intact.
|
| nurturing growth until it's time to
| |
| | Copyright 2005 by Dr. Robert J.
|
