Why Entrepreneurs shouldn't quit their Jobs.

#WorkingCapitalManagement #FIFOManagement #FMCGBusiness #Entrepreneurship #PassiveIncome #ActiveIncome #BusinessIntelligence #BusinessSystems #BusinessAnalytics?#Sustainability #MoneyManagement #Financing #Accountancy

Unless you're coming from a Privileged background; for example Old Money, Affiliates in High Places , Rich Family. It then becomes tricky to run a profitable enterprise. The reason being?the establishment of a new brand needs time to be absorbed by the masses or the correct market .??

You may need Higher Working Capital Management. The entrepreneur that comes with a new idea or new service first has to bare the cost of running until they become profitable.

Acquiring an established brand could be a shortcut to barriers of entry . But an established brand can run you into the Millions. You would also have to abide by the established brands idea and system . This intern makes you seem like a copy cat.?Which in turn is not entrepreneurship but in fact franchisee-ship.?

The franchisor(entrepreneur) is laying out the industrial structure , infrastructure and engineering of the business system they implement when running an enterprise.?The business is simply a copy of a copy.

Henceforth it's always best to establish your own brand in the market so as to get a better fitting of what you contribute to the market.??

You're running costs then become much cheaper than that of buying an established brands running costs.?

Although you may have figured quitting since the equity is saved up . The future is still unpredictable. We still need a fully functioning business before saying we have established a foothold on the market .?

This means a business that has been running at least 7 years in profit to truly recognize the value of why we created the business . This doesn't mean 7 years of Profitablity on Paper but 7 years of Practical Profitablity.?

Which means we have to go to work to continue to finance unexpected events that may appear within the business cycle. These events can also deplete the working capital management needed to run the business .?

Events such as a machine breaking down during business equals outflows of economic benefits out of the business.??

Or stock not being bought on that particular day or month equals the disposal of valuable inventory (depending on the type of good being sold) customers want fresh products .?

Henceforth the application of FIFO . Whatever is not fresh we don't keep .?

It's very rare for a business to start it's first year in profitablity whether it's Service or Product based.?

So the entrepreneur must then engage , train and delegate duties and responsibilities for the business . Meaning the creation of employment to help and sustain the products and services being sold on a daily basis.

The entrepreneur will then continue to work and then monitor the business at the end of day to evaluate performance/failure of the business.?

While continuing to maintain the household and business expenses.?The foreseeable expenses in the present were not counted before the business . The expenses were pertaining to 9?to 5 income .?

A business should be able to pay, restock , and re-finance itself and then pay you , your family, your household , staff and still make a profit to pay the tax man.?We can then see how sophisticated the business can get .

Versus waking up going to work , getting paid . Henceforth we then need a hybrid of the two to create sustainability.?We can monitor the business at the end of day .

The main purpose of business would be then to start it off as Passive Income.?We want to prove that it is indeed passive before it becomes a liability.?

So we keep our Active Income as an insurance policy on our Passive Income. The reason being we now have Two Incomes instead of One Income .?We will then compare the 2 incomes against each other.?Why ? To see if the Passive Income can compete the Active Income .?

If we have several years of evidence that the Passive Income can outweigh the Active Income this is clear evidence that we can shift our efforts to the dream business .?

However if Active Income is greater than Passive Income , we must stay in our Careers because the career is much more rewarding than the business?