Easy vs Hard Money
Lets start by eliminating what isn’t an easy way to make money:
- Start a eCommerce/drop-shipping business
- Become a freelancer
- Sell stuff that you already own on eBay/Craigslist
- Bitcoin/cryptocurrency investment (or scam)
- (Fill in the blank) latest internet trend
All of these things are either not very easy or won’t actually make any money. When I say they won’t make any money I mean they will likely be a downgrade from whatever you day job is. The reason is that all these highly publicized business ideas that get constantly regurgitated on the internet are tried by millions of people. They have little to no barriers to entry so that anyone can try them. Whatever blog you read about someone who made a fortune drop-shipping is already out of date and can’t be repeated. Assuming all the people who write about these online businesses are at least honest to the fact that they’ve actually done what they’ve said and been successful with it, their strategy is already dried up. Once someone has found a niche product or unique idea, they will exploit it until others catch on, the margins become non-existent and nobody makes any money. The people who get in early can make some money but it will dry up eventually. At this point they abandoned their strategy and realize they can make more money writing about/teaching it that actually doing it.
Whenever you see someone teaching a course about how to make money, realize they are teaching it because they couldn’t make money anymore by doing it. This means that if you want to start a business or find a way to make money, you need to go where it’s not crowded. All the hot online industries are crowded with millions of people all trying the same thing.
If your business idea feels like it is too easy or too good to be true then it probably is. It probably doesn’t add any value. If it doesn’t add value, it will fail. Buying a product from an overseas manufacturer and drop-shipping it adds almost no value to anyone. Most of the time all you are doing is marking up the price and hoping someone is dumb enough to buy it.
If you want to start a business that can add real value and sustain success, it is unlikely you will read about it on the internet. You need to look at real businesses that you know are profitable and find ways to improve them. You need to find a way to add real value to real people.
For example, the first business venture I ever tried was a house sitting business when I was a teenager. I took care of my neighbors pets and watered the plants when they were on vacation. They had a real need that I was able to fulfill. At the end of each day, I could easily point to something that I had done that solved a problem for another person; my customers were happy to pay me for it. This venture was a small idea that I did when I was a teenager but the concept remains. If you want to make money you need to provide real value.
I’d suggest looking in places where most people don’t want to work. There are dozens off different industries and businesses where you can easily establish yourself in the market without a lot of sophisticated competition. For example look at the liquor industry. For decades liquor stores were run down, hole in the wall store fronts that were in strip malls between laundry mats and sandwich shops. Then Bevmo and Total Wine came along. They saw that there was an industry that was being run by small unsophisticated operators. These operators were inefficient and couldn’t provide a top quality experience. They created high-end, large scale stores than were operated similar to retail giants like Target and Walmart. They brought in smart people who could innovate the industry, people who would have previously never considered getting into the liquor business.
Today they same opportunity exists in industries like landscaping, plumbing, HVAC, and other trades. None of the smartest and most successful people want to start businesses in these “blue collar” industries. One of my dad’s friends started an HVAC business over thirty years ago. He barely graduated high school, worked some odd jobs for a few years then ended up in an HVAC trade school hoping he could get a job to survive. He ended up starting his own business installing AC units. He’s made tens of millions of dollars over the past 30 years and just recently sold his company to retire. He’d be the first to tell you that it doesn’t take a genius to start an HVAC business. He attributes his success to simple things like showing up to appointments on time and smiling when he talks to customers.
If you want to make “easy money” you need to find something you know how to do and solve problems for people. There are tons of business opportunities that nearly anyone can do. They take very little experience and training, you mostly just have to show up and do the work. All the “easy” money and “passive income” you read about is actually really hard. Making money in a crowded market that everyone wants to do is extremely difficult. Making money doing something that no one wants to do is easy. Learn to do something that no one else wants to and you’ll make money the rest of your life.
Originally published at the-percent.com on July 7, 2018.