Living a Relaxing and Profitable Lifestyle with the 80/20 RuleWritten by Chris Brown
Copyright © Chris Brown http://www.SuperiorIncome.com
This article may be used freely as long as author's resource box (at bottom) is included; article and resource box must remain unedited.
In this article, you will learn some simple and effective ways to live a more relaxing and profitable home business lifestyle. Many of us started out with a picture of ourselves working less and ended up working just as much or even more than ever imagined we would. Managing your time can become a major headache. Are you ready to see shuffle drift away?
Family, friends, errands and fun are a few of important factors in living a relaxing and profitable lifestyle – lets look at how you can delegate your time for a more easy going home work environment.
The 80/20 Rule – Pareto's Law
Vilfredo Pareto, an Italian economist, observed in 1906 that in his country, 80% of wealth was owned by 20% of population. After his observation, others took notice of 80/20 idea in many other areas of life.
In 1930s and 1940s, Dr. Joseph Juran observed what he called "vital few and trivial many". Dr. Juran's principal goes something like: 20% of something is responsible for 80% of results. This has long since been known as Pareto's Principle or 80/20 Rule.
Find Your ‘Vital Few'
The following metaphor has worked well for many people; if you have a hard time visualizing then this may throw you off; stick with us, this can be of great benefit to you.
Zoom out and take a look at everything that comprises your home business. Imagine seeing all of your tasks sitting on a table – Watch as one side of table lifts upward and your tasks begin sliding towards edge. Pay close attention to see tasks that slide least – see tasks that stay on table – these are your ‘vital few'. Pick up ‘trivial many' from floor and see yourself putting these in a very big box.
Now, picture your self putting your ‘vital few' tasks that were left on your mental table in a small box – imagine that you keep this box on your desk. Now, mentally take big box and put it out of site…let it fade away for now.
The Wholesale MisconceptionWritten by Chris Malta
"The Wholesale Misconception" One thing that’s constantly misunderstood by people trying to run a home business on Internet is word “Wholesale”. Some people think that working with a real wholesale supplier means that they will magically be able to sell products for less than anybody else on planet, for ever and ever. They’ll be only one who ever gets such good prices, and they’ll earn millions because no competition can touch them. They’re retire happily in a couple of months, and buy a big house in Beverly Hills, complete with a butler, a private chef, and a little satin doggie bed in every room for casual use of family Basset Hound, Duke. Then they find that they may actually have to compete with companies who have more buying power and get better price breaks, and suddenly honeymoon is over. They run around screaming that supplier is not a real wholesaler, and is cheating them. The sky is falling, and it’s time to get Duke to storm cellar because all their dreams are being blown away by bad, BAD people who claimed to be wholesalers, and really are NOT! The truth is that they’ve simply been confronted with a perfectly normal aspect of retail sales that they had not anticipated, and need to be educated about. Even when using genuine wholesale distributors, you're going to find some stores selling products at a "retail" price that is lower than your distributors’ "wholesale" price. There are VERY good reasons why you'll see this happen, and it's extremely important to understand why it happens and what to do about it in order to sell successfully on Internet or anywhere else. As I said, it happens for a variety of reasons; most common of which is that retailer with "lower than wholesale" price is a large retail operation that bought THOUSANDS of product at a dirt-cheap quantity price break, and also qualified for huge manufacturer's wholesaler rebates. You can't compete against that with a home business; no one can. The term "wholesale" is relative, no matter who your distributor is or how you find them. What you're getting as a small business is a supplier's genuine "first level" wholesale price. For example, one factory-direct supplier we work with has an initial wholesale price for 1 to 36 dart boards. Then second price level is reached, and there's a lower price for 36 to 72 boards, for example, then a lower price for next higher quantity level, etc. When dealing with single item orders in your home business, you are obviously going to be getting "first level" wholesale price.
Again, wholesale is a relative term. Yes, genuine wholesalers DO sell at significant discounts below Manufacturer's Suggested Retail Price. However, you have to watch what you sell. Electronics, for example, are a very tough market, because EVERYBODY is trying to sell electronics on 'Net right now. All these people are so busy trying to undercut each other that they have driven "market price" of these items down so low as to make it very difficult to make a profit, even at wholesale. For example, if Manufacturer's Suggested Retail Price (MSRP) for a VCR is $149, and it is available at "wholesale" for $69.00, that's a 54% discount off MSRP. That's a pretty good profit, right? However, with everybody getting roughly same price break, there are a lot of people out there who are ruining market for everyone else by selling that product for, say, $79, thinking they will undercut everyone else and make money by selling volume. Pretty soon, everyone else sees this, and tries same thing. Eventually, Internet "market price" for this VCR BECOMES $79, and everyone is flooding market with it at that price. That's only a 13% percent profit margin, and that product is no longer worth effort for anybody. So, even though product IS available initially at a great wholesale price, its market value is ruined by those who (wrongly) assume that only way to sell is to have absolute lowest price anywhere. Sales is much more of an art than that. If selling something were simply a matter of absolute lowest prices, Wal-Mart would be only store on face of Earth. Without going into too much detail, sales is a mixture of choosing right product, or combination of products, for your web site. It's presenting a clean, attractive, focused site. It's giving customer some little value-added bonus at your site. It's providing absolute best customer service that you can. All these things help a customer to trust you, and when they trust you they are willing to spend a little more to buy from you. One of our retail sites is www.ElectronicDartShop.com. We sell Arachnid Electronic Dart Boards there. We sell ONLY those products on that site; just 14 of them. Our site is clean and attractive. We have a page listing all rules for all dart games that can be played on those boards. We pay very careful attention to customer service. And guess what? We are NOT lowest priced store for those dart boards, by any means. Yet we are one of highest-volume Internet dealers of products around, according to factory. Why? Our customers trust us, and are willing to pay a little more because they feel they will get more value from us than they will from some guy who just throws up a cheap-looking site full of all kinds of unrelated products and only pays attention to price-cutting.