Think Daily for Businesspeople Messages
Some businesspeople wonder -”If I’m reasonably or somewhat successful in business A, should I start business B, and then business C – I’ll be two or three times as successful.”
But it hardly ever works that way. Unless you have mastered business A, or have decided that you will get out of business A, starting business B is usually not a good idea. If you are like many business owners I see, they have twice the problems and less or no profit by being mediocre at two or three things instead of master of one.
Are you master of at least one?
Say I am paying a team of guys to dig a giant ditch with shovels. They can only move so much earth a day with shovels, so I can only pay them $5 an hour. The only way I can pay them more is if they become more productive. This will involve an investment on my part – in capital equipment – in this case an excavator. If I invested $150,000 in an excavator, I can pay the operator $25 an hour. Some jobs will go away (shovel operators) and others will be created – in manufacturing, servicing, selling and marketing the excavators.
Wage growth comes from productivity gains. Productivity gains comes from capital investment (facilities, software, machinery, etc.) But business owners will only make capital investments if they feel safe about the future, feel the risk is worth a potential reward and profits will not be taken away by excessive taxation, and if they have access to financing in stable financial markets.
If we don’t have a safe environment for businesspeople and entrepreneurs, we don’t have capital investments, innovation or wage growth for workers.