Good Part -Time Business To Own (5)

Read? Good Part -Time Business To Own (4)

I never like to be in Sales or doing activities/services that most of the time even you don't like that particular customers or important customers; but have little choice, pretend and suck up to them in order to make a living or profiting from them.

In the stock market, you don't need to know the buyers (customers) and still profit from them. You will never have to receive customer complaints and criticisms or listening to rubbish talks that you are not interested and never have to say the word "f... you or shit" when that bloody nasty person turns his/her back.

Good Part -Time Business To Own (4)

Read? Good Part -Time Business To Own (3)

Many people dream of setting up a business and I also often hear it from colleagues, friends and relatives.

What is business?

businessdictionary.com defines it as "Economic system in which goods and services are exchanged for one another or money, on the basis of their perceived worth. Every business requires some form of investment and a sufficient number of customers to whom its output can be sold at profit on a consistent basis."


Note the key points from the above definition:

• goods and services are exchanged for one another or money, on the basis of their perceived worth
• requires some form of investment
• sufficient number of customers to whom its output can be sold at profit on a consistent basis."

From the key points in the definition of business, it is quite obvious that my economic activities in the stock market qualified as a part-time business as  I put in my investment for stocks; exchange stocks for money on the basis of their perceived worth and I sold them at profit on a consistent basis. Customers are never a problem.

Anyone else interested in setting this part-time business? I can share with you. No problem.

No fixed overheads and the goods are rarely perishable.

Good Part -Time Business To Own (3)

Read? Good Part -Time Business To Own (2)

BTW, have you been to Singapore Wet Market? If you have been to a wet market before visiting stalls selling fishes. You may then understand my part-time business. Quite similar.

She will wake up at middle of night and travel to the Jurong Fishery Port Wholesale market to pick her favourite fishes and buys them at lower price and goes back to her stall at the wet market and sells them at higher.

On some day when the price of the fishes are cheaper she will buy more; and when the fish prices are higher she will buy less. She also prefer like to buy her favourite fishes as she have more confidence that these are types of fishes that her customers will like to buy and are willing to pay them at higher price.

Technically, I am doing the same thing in my part-time business. I am buying my favourite fishes from bears and anticipate that the bulls are willing to pay higher price for them. Any different from the fishmongers at the wet market?

Good Part -Time Business To Own (2)

Read? Good Part -Time Business To Own

I don't understand why people can't accept my part-time business.

Is that woman selling fish at wet market doing a small business? Yes right!

Most people have no problem to identify that woman is doing a small business. She chooses her fish at the wholesale market and buys them at lower price and then sells her fish at higher price to her customers and pockets the differences as profits.

So is there any difference between my part-time business and that woman's fish business?

She buys it lower from wholesale and sells it higher to her customers while I buy it lower from the bears and sell it higher to the bulls. Any difference between her business and my part-time business? No right!



Is Investing In Real-world Business Safer Than Stocks? - Part 3

http://createwealth8888.blogspot.com/2009/10/is-investing-in-real-world-business_17.html

Not surprising, 40% of the stalls are empty in Hougang Plaza Foodcourt, probably due to its new nasty neighbour - 24x7 air-con Kang Kar Food Court offering a 10% discount with Kopithiam card. How can old foodcourt compete when both food courts are selling almost the same kind of foods.

The only other stall at another coffeshop that biz is still so good is the Western food where new food court doesn't have one. No direct competitor.

From the perspective of pure financial return from investment dollars, I think investing in a real life small retail business can be more risky than investing in stocks.

When the real life retail business tumbles, the biz owner has to pump in more cash into the biz to keep it on going and end up with negative cash-flow; or else have to close shop.

This is somewhat similar to Margin, CFD or any other leverage trading, when the Market tumbles, the traders will be asked to top up the margin or the maintenance; or otherwise will be forced sell by the brokers.

For investing in stocks, when the stock prices tumble, investors don't need to put in more cash other than watching with horrors.

Do you still think that investing in stocks is more risky than investing in real life small retail business?

Good Part -Time Business To Own

I own this good part-time business for a number of years. This business is so good that it doesn't come with headaches dealing with customers, suppliers, colleagues and bosses. It doesn't come with any fixed overhead costs too.

It is about buying and selling some different types of financial product online and all done via cash settlement by the latest T+5. T is the day of transaction.

If you are interested in this business, let me know.

Is Investing In Real-world Business Safer Than Stocks? - Part 2

7. Competitors Risk - This risk is so real and can happen sooner than expected.

Is Investing In Real-world Business Safer Than Stocks?

That coffee shop next to Hougang MRT station has a number of good years until recently Hougang Mall built an extension building to it and guess what?

It houses a 24x7 KopiTiam Food court and if we buy food using KopiTiam Card, there is a 10% discount.

Both noodle stalls at the coffee shop and KopiTiam food court are selling Pak Choi Mee at $3 a bowl, but at KopiTiam food court after discount it is only $2.70; so it is cheaper and in air-con environment.

Not sure for how long can the noodle stall at the coffee shop survives with a new competitor selling it cheaper and in a better eating environment?

Is Investing In Real-world Business Safer Than Stocks?

After this shocking market crash in 2008, some investors may think that investing in the stock market is far too risky, and they are not sure how to deal with this uncertainty of market shocks going forward?

They may be thinking that they may be better off in investing in real-world business producing real assets in the areas that they are familiar with or interested in; and getting their investment returns from the real-world business.

Let me share my thinking because I too have been thinking about it in my earlier days for many moons.

Unless you have the entrepreneurship spirit in your blood and you need to fulfill your dream and reach the Self-actualization stage in Maslow's hierarchy of needs. I said: "GO FOR YOUR DREAM!"

But, it is just about investment returns from pure financial reasons, then you are taking more risks than expected.

Investing in stock market is likely to be exposed to two risks - market risk and stock risk and these risks can be mitigated through proper portfolio risk management and control.

You just need to acquire the relevant knowledge and skills to manage your risks.

One clear advantage in investing in the stock market if you treat it seriously as your business entity is that there is virtually zero fixed cost overhead.

But, investing in the real-world business, there is fixed and variable costs overhead, and in bad times your fixed costs overhead is going to kill you earlier than expected.

In running a real-world business, there are just too many risks to manage and control, and list out some of common risks associated with running a business:

1. Operation Execution Risk

2. Sales Risks

3. Pricing Risks - under-pricing or over-pricing

3. Supplier Risk

4. Customer Risk

5. Cashflow Risk

6. Refinancing Risk

7. Competitors Risk

8. Market Risk

9. Staff Risk

10. Fraud Risk

So do you still see investing in stocks is far riskier than investing in the real-world business?

I said again, unless you have the entrepreneurship spirit in your blood and you need to fulfill your dream and reach the Self-actualization stage in Maslow's hierarchy of needs. Then I said: "GO FOR YOUR DREAM!"

Investing in Stock Market As Your Business Or Your Pension Fund

Do you invest in stock market as your "Business" or "Pension Fund"?

Most Value Investors are likely to treat investing in stock market as "Pension Fund". The objective of a Pension Fund is long term investment, and hopefully with regular dividend income , re-investing dividend income, and capital appreciation for future draw down.

But, if you treat investing in stock market as "Business" as I do. The approach to investing is completely different. As a "Business" owner, you have to actively manage Revenue, Stock Inventories and Cash flow.

You have to set average monthly Revenue target to ensure that you can meet the Yearly Revenue target.

Sometime to meet the average monthly Revenue target, you have to trim the inventory level by doing a clearance sale on stocks for lesser realized profit than expected.

You may have to maintain sufficient inventories to meet your short, mid and long term business goals or even change the mix of inventories by disposing slow moving stocks that are not going anywhere or stock up with more exciting stocks.

You are very active on cash flow management to ensure that you have sufficient purchasing power to pick up your inventories when discounted assets are available for sales in the market.

As a "Business" owner, your main objective is to keep expanding the business further and to achieve higher and higher revenues as possible and to ensure future business growth is achieved within your risks management to meet your final investment goals.