Rich Dad Poor Dad Before You Quit Your Job, Best Motivational, Inspirational, Full Audiobook Part 4
Rich, dad's before, you quit your job can. Real-life, lessons, every, entrepreneur, should know about building a multi-million, dollar business by. Robert T Kiyosaki. That. Vacation, on a private island in Fiji was. Our reward for, retiring early, Kim. Was 37, and I. Was 47. To stop, in. His book good to great Jim, Collins does a whole piece on knowing when to stop, reading. His book in 2004. Took, me back to the times when I also stopped, in 1984. And, 1994. There. Was no clear signal, no, sign from God saying, it's time to stop each. Time, there, was simply a moment, when I knew the process I was in had, come to an end it. Was time to stop and wait for the beginning of the next process, many. Times I meet business people who want to stop but can't stop they. Cannot stop for different reasons one. Common reason is that their bi triangle. Is weak, to. Cover up for the weaknesses, the, owner often has to work harder, or longer to make up for the weaknesses. Another. Reason is that the owner cannot afford to stop again. This, is a symptom, of a, weakness in the bi triangle. Another. Common, reason is that the owner although. Successful, continues. To work because he or she does not know what to do next, according. To Jim Collins a person. May need to stop first take, some time off and then look. For the next thing that is. What I did I simply. Stopped let, the dust settle and waited, a few years to see what would happen next. The more people you serve the, more effective, you become. 1984. To 1994. I was, firmly entrenched, in the S quadrant I was. Not going to make any premature, moves, toward, the B quadrant, as, expected. As our, success, grew so, did our exhaustion. Exhaustion. Is what, often occurs with successful, people in the S quadrant, since. An S individual, often does the work himself more. Success, means, more work an S, often, works for a dollar per our compensation, plan and as, we all know there. Are only so many hours in a day, when. Kim and I stopped it, was not the hard work or long hours that caused us to stop what. Was disturbing. Me was, how few people our, work was reaching after. All only, a few people actually pay, money to attend seminars and our, seminars, were, not only expensive, but also, tough like the Marine Corps we. Asked people to devote 10 or more days to attend one of our business schools. After buckminster fuller the, teacher who has had a tremendous influence, on my life often, said the. More people you serve the, more effective, you become, he. Was not into money but, he was into being of service, rich. Dad said one, of the big differences between an S and a B is the, number of customers, they can handle, he. Also said, if, you, want to be rich simply. Serve more, people. By. 1994. Our our last business school had, over 350. People in the class paying. $5,000. Each to attend if you. Do the math the, money was good what. Was not good was, that there were only 350. People I knew. That if I truly wanted to help those kids in Asia I was, not going to be able to do it doing things the way I was doing them in. Other words I knew, it was time to stop and figure out how to go from the S quadrant, to the B quadrant. Instead. Of trying to leap across the Grand Canyon, Kim, and I were now ready to climb up the other side it.
Was Time to go through what, rich dad called the, eye of the needle. Going. Through the eye of the needle. You know one, of the problems with being self-employed, in the S quadrant, is the word self, in many. Cases the self-employed, person, is the product the person who is hired to do the work when. You look at the BI triangle. Starting. From the cashflow level on up to product, the, self-employed. Person, is in charge of everything all, the, elements in most. Cases being, self-employed makes, it very difficult to, get to the B quadrant, it can. Be difficult to get yourself, out of the, way. Between. 1984. And 1994. I was, that person I was. The self and self employed, although. I did it intentionally the, reality, disturbed, me a question. I often asked, myself was, how can, I teach people what I have been teaching in our business, schools without. My personally. Teaching them. Training other instructors, but, that process, was a long hard, tedious. Process, it. Was difficult to find people, to go through the training process, to become instructors, it. Was hard to teach other people to teach the way we taught, it's. Not easy to get a class of over 300, people to learn accounting and investing. In one day it. Was almost as tough as teaching, them to walk across fire. After selling the business in 1994. I had, time to go back to my question how, can I teach people what I have been teaching in our business, schools without, my teaching, them I, moved. Into the mountains near Bisbee Arizona and. Was, secluded enough to begin working on the answer to my question, for. Two years I worked on the question, when. I left Bisbee, I had, the rough draft for, Rich Dad Poor Dad on my Macintosh computer. And a, rough sketch with computations. For, the cash flow board game I was. Going through the eye of the needle and moving. From the S quadrant, to, the B quadrant. Rich. Dad had, learned about the eye of the Neal from Sunday school he. Said a popular. Bible verse goes something like this it, is easier, for a camel to pass through the eye of a needle than, for a rich man to pass, into heaven, Rich, Dad continued, modifying. The verse to say forget. The camel, if a man can pass through the eye of a needle he, will enter a world of tremendous, wealth. Now. Dad was a very religious, man and was not making fun of the verse he. Was simply modifying, it to create his own lesson, in, business. Terms what, he meant was that for an entrepreneur, to pass through the eye of a needle the. Entrepreneur. Has, to leave himself behind. What. Passes through the eye of the needle is the, entrepreneurs, idea, or, intellectual. Property. There. Are many examples of. Entrepreneurs. Going through the eye of the needle throughout, history here. Are a few. When. Henry Ford designed. His automobile to be mass-produced. He, passed through the eye of the needle, up, until then most, cars were custom, ordered and handmade. When. Steve Jobs and, his team at Apple created the iPod, the, iPad the, iPhone and, iTunes. They. Went through the eye of the needle. When. Someone like Steven Spielberg or, George Lucas creates a movie they, to go. Through the eye of the needle. McDonald's. Went through the eye of the needle by franchising. Their hamburger, business worldwide, when. A network marketer, builds, a downline, of other business, owners he, or she goes, through the eye of the needle when. Investors, buy an asset such, as an apartment house that cash flows money into, their pocket each and every month they, have gone through the eye of a needle a. Politician. Who uses the media to campaign, is going, through the eye of the needle a, politician. Who goes door-to-door is, not. When. Inventors, or authors. Sell, their invention, or their book to a large company, which, in return pays, them royalties, they have, gone through the eye of the needle, when. I took what I had learned from Rich Dad and created, the board game and wrote the book I was. Going through the eye of the needle I was. Getting myself out, of the equation. When I created, my nylon, shoe pocket wallet for runners and did not first have my idea protected, by an intellectual, property attorney I was. Not going through the eye of the needle I was, simply giving my idea, to my competition, and making. Them rich they. Went through the eye of the needle and I, fell into the Grand Canyon, I had. A great new product, but without the legal level to protect my product, the BI triangle. Was, not complete. The. Chick breaks. Through its shell, when. I returned, to Phoenix with a draft of the book and the cash flow board game in hand I knew, I was making my move to the B quadrant, Kim. And I began to design and build a company according, to the BI triangle. The. Moment, we put our products, in the marketplace the. Heavens of abundance, opened up the. Product, line was officially, unveiled on, my fiftieth birthday April.
8, 1997. From the start of the Rich Dad Company we, had a few struggles, to breathe life into the business, the, main struggles, we had were, keeping up with demand, travelling, the world to open new markets and counting. The money in June. 2000. The call from The Oprah Winfrey Show came and the, heavens really, opened Kim. And I were leaping from, s to B at, this. Point I began, to better understand, what rich dad meant by being. True to the process, the. Process will give you glimpses, of a better future, just, to keep you going the. Power of mastering, the bi triangle. Harnessing. The power of the three types of money competitive. Cooperative. And spiritual. Money. Going. Through the, eye of the needle. After. Being on Oprah's, show I truly. Felt like the chick that had finally, cracked through its shell before. Oprah, no, one knew me after. Oprah regardless. Of where I go in the world people stopped, me on the street to, let me know they have read Rich Dad Poor Dad or played, the, cashflow games. In. 2002. I was, in an antique, store in Stockholm, Sweden the. Owner a very, blond Swede was, an expert, in Chinese antiques. Recognizing. Me he said I was. On a buying trip to China a few months ago while. Floating down the Yangtze River I glanced. Into a houseboat, and saw a Chinese family, playing, the Chinese version of your cash flow board game. At. That moment I realized, that I had kept my promise, to those kids in the sweatshop, kids. Who, were working to make me rich, now. My products, were working for kids just like them teaching. Families, people, young and old how, to have money work for them rather, than working all their lives for money and then, hoping, to have the government take care of them. In February. 2004. The, New York Times did a full page feature story about the cash flow game and about, the hundreds, of clubs forming, throughout the world, clubs. Were forming, just to play the game and to, learn what my Rich Dad had taught me when. I saw that article I could not believe my eyes I could, not believe the, magic to. Me the, New York Times writing, this article was, as big as being, on Oprah's, show. When. I saw the article I knew, that what I had learned from teaching my business school for entrepreneurs, and business, school for investors, had, been successfully. Transformed. Into a product, the, cash flow games that, could teach what, I used to teach. People. Were now learning the fundamentals of accounting, and investing, in less, than a day on top. Of that many, of the players have had significant. Breakthroughs, in how they see the world for. Them the, game delivered, the paradigm, shift the, shift from, seeing the world of money as a frightening place to. Seeing it as an, exciting, place. Instead. Of looking for experts, and blindly, turning, their money over, to these so-called experts, through. The game many, people, realized, that they could become their own financial. Experts. They. Could take control of their, own financial future and many. Of them have. Best. Of all instead. Of personally, teaching only 350. People at a time and charging. Them thousands, of dollars the. Cash flow game was now going to them and teaching. Hundreds, of thousands, of people many, of them for free. Instead. Of my teaching, them they, were teaching themselves and then, teaching and sharing, with others. I saw the New York Times article I knew, the 10-year period from 1994.
To 2004. Was, coming to an end however. Even. Though that tenure process, is complete, we, know the, mission continues. Get, yourself, out of the, way. Before. You quit your job you, may want to remember the lesson, of this chapter the. Lesson is that the scope of the mission determines. The product, it, is very tough, making a lot of money or serving, a lot of people simply. By working harder, physically, if. You want to serve a lot of people and/or. Make a lot of money you. May need to get yourself out of the way and pass, through the, eye of the needle, before. You quit your job you may also want to determine if you would be happiest, in the S quadrant, or the. B quadrant, if. You want to grow into, the B quadrant, remember. That it takes much stronger, fundamentals. In the bi triangle. And an, even stronger team, to, allow you to, go through the eye of the needle and, before. You quit your job you. May want to have a moment of silence, in memory of, the dot-com companies. That failed I believe. The reason so many failed, was, that many of the entrepreneurs were. Attempting, to leap from the e quadrant. To, the B quadrant, when. The bust came day. Two looked. Like wily coyote with, only air beneath their feet they. Did not make, it through the eye of the needle. A winning, team success. Or failure. In business, has, to do with work ethic, determination. And desire. Most. People, who make that jump have tons of all three yet. The biggest determining. Factor has. Even more to do with learning three critical, skills that, will turn any business, into, a success. First. In order. To build a business you, have to be able to sell because, sales, equals, income, when. Income, is lacking it's, usually because, the owner doesn't like to doesn't. Know how to or, is, simply reluctant, to sell, without. Sales, however you, have no income there. Is a myth that you have to be an attack dog to sell, not. True. Second. In order, to build a real business or, network and move out of the S quadrant, you have to be able to attract, build, and motivate.
A Great team in, the. World of small business, everyone. On that team has to be willing to sell, regardless. Of their position in the company in, order. To make that happen the third element becomes, critical, that. Is your ability to teach others in the business how to sell how to be great team players and how, to succeed, it. Is this skill that ensures growth profit. And longevity. The. Sad fact is that most business owners are never taught how to do any of those things as a. Matter of fact most, of us are conditioned, to believe that, sales is a nasty task, that. If you want things done right you, have to do them yourself and that, teaching is what you experienced. In school. When. We work in business the very first, thing we do to increase income, is to help people establish. What we call the code of honor the. Code is a simple, set of rules that, turns even ordinary people, into a championship. Team a team. That not, only sells but, is hungry to learn and enforces. An incredible. Level of accountability for. Personal, conduct. Formants and numbers. It. Articulates, the behaviors, that are critical, for success, and it, demands the agreement, of all team members to, play that way. Most. People would like to be the best they can be as a. Business, owner you. Have to create the environment or context. That will make that happen it's. Not only something that you can learn but, it's something, that will make you successful. Many. Times in business it's, not what you deliver, but, how you deliver, it that makes the biggest difference, it's. The strength and commitment of your team and their, passion, to promote and serve others that, determine, your reputation. Your, success, and your. Cash flow, blares. Singer rich. Debt advisor and author, of sales, dogs and team. Code of honor. Right entity. Few. People appreciate, it but choosing, the right entity structure for your business is just as important, as choosing the right partner, for your business, if. You go into business with the wrong person your, efforts, may be doomed from the start, the. Wrong person, may to freely, spend your money may. Obligate, the company, to contracts, it cannot fulfill and may, alienate co-workers. Before the first product, or service, is ever, delivered, the. Wrong partner can leave you unprotected and, waste, all of your efforts, and energy. Likewise. Choosing. The wrong legal structure, can also lead directly, to failure. Starting. Out you, want to have as much asset, and legal protection, as possible. But. By choosing a sole proprietorship. Or a general, partnership, bad. Entities, that offer no protection whatsoever. You. Stand to lose everything, you build into your business along. With, all of your personal assets. Plaintiffs. And their attorneys, love to see businesses, operated, as sole proprietorships. And general. Partnerships, because, they can reach both business, and personal, assets. When they bring a claim they. Have free, rein to, reach all of your assets. Instead. Use. A good entity, such as a C corporation, S, corporation. Limited, liability, company. Or limited. Partnership. These. Entities protect. Your personal assets, from, attack against, the business and like. The right partner, the, right entity will help you advance your protection, and future. Prospects. Garret. Sutton Esquire, rich. Debt adviser author. Of buying. And selling a business start, your own corporation. Writing. Winning business plans, and the, ABCs. Of getting. Out of debt. Rich dad's entrepreneurial. Lesson number eight design. A business that, can do something, that no other business. Can do. Chapter, 8 what. Is the job of a business leader. The business leader. What. Is the business leaders, most important, job, I asked, rich dad well. There are many jobs that are very important, it, would be hard to say if any one job is more important, than the other, instead. Of just one job I can, tell you what I think my eight most, important, jobs are the. Following, is rich dad's list. One. Clearly. Define the mission goals. And vision, of the company to. Find. The best people and forge. Them into a team, three. Strengthen. The company, on the inside. For. Expand. The company on the outside. Five. Improve. The bottom line, six. Invest. In research and development, seven. Invest. In tangible, assets, eight.
Be. A good corporate citizen. What happens if the, leader cannot, perform, those jobs I asked, you. Need to change leaders said, rich dad besides. If, the leader cannot do these things the company will probably disappear anyway, that. Is why most new companies, are gone within, ten years. A mission, over. The years I have met many people with, an extremely, strong sense of mission I have. Had people come up to me and say things such, as I want. To save the environment, my. Invention, will eliminate the need for fossil, fuels I want. To start a charity, that provides shelter for runaway kids, my. Technology, is what the world has been waiting for I want. To find a cure for that disease. While. There care and concern may, be genuine, many, of these good-hearted, people fail, to fulfill, their mission simply, because all they have is a mission. A lack, of business, skills. Earlier. In this book I mentioned, that many people spend years in school or at work developing skills, that, are not relevant or important. To the bi triangle. I mentioned. The example of, a school teacher who, may have years of education, and teaching experience yet. Those years of Education may not transfer, to the bi triangle. If that, person decides, to become an entrepreneur. That. Person, simply, lacks business, skills. When. I left the Marine Corps in 1974. I too was, in that predicament by. 1974. I had, two professions. My, first profession, was as a licensed, ship's officer, licensed. To sail any ship of unlimited tonnage, throughout. The world I could. Have made a lot of money with this profession, the problem, was I did, not want to be a ship's officer anymore. My second, profession, was that of a military, pilot with great training and years, of experience. Many. Of my friends went, to work for the airlines or with, police and fire departments, as pilots, I could. Have done the same thing except. That I no longer wanted, to fly, in. 1974. When, I returned, home to see my dad struggling, financially I suspected. That I had found my new mission or, at least, a problem, worth solving the. Problem, was all I had, was, a mission, when. You look at the bi triangle. There are levels for people specially. Trained in accounting, law, design. Marketing. And systems. There. Are not levels, that say ship's officer, or pilot so. I was, just like the many people I mentioned above people. With a mission but. With a lack of real business skills. What. I did have going for me was, that I had years of apprenticeship, - Rich Dad I had. Worked in all aspects, of the BI triangle. Through his businesses, so. I did, have some business experience, but, only as, a kid at least. I knew that a business was a system, of systems and I, understood, the importance, of the BI triangle.
As A business, structure. Rich dad. One. Day I complained, to rich Dan that I had almost no marketable, skills that applied to the bi triangle. Pointing. To the team side of the bi triangle. I complained. That no major corporation. Would hire me to be on their team I wind. On about not having a formal education at any of the levels after. I was through complaining, I looked, up at Rich Dad for what I hoped would, be a sympathetic answer, all. He said was neither. Do I a. Mission. Is all, that rich dad started, with. What a leader does a, leaders. Job is, to change the company to allow it to grow and serve more people if. The, leader cannot change the company the leader keeps the company small and the, company may begin, to shrink, once. Again I used, the bi triangle. To further clarify this point. When. I was in the S quadrant, our, products, were the business school for entrepreneurs. And the, business school for investors, the. Problem, with the business was, that I was too much a part of the product as well, as the rest of the bi triangle. If. I was going to be a leader I needed, to stop and completely, redesign, the business, trying. To fix a poorly designed business. While the business is running is like trying to change a flat tire while the car is still moving, that. Is why Kim and I stopped and took, two years off, before, we started, a new business. Building. A new bi triangle. In. 1996. When, I came out of the mountains around Bisbee, Arizona all, I had, were, pencil, sketches, of the cash flow game board a rough. Draft of Rich Dad Poor Dad in, my computer, and a, simple two-page business, plan as, the. Sole employee of, my yet to be formed company, I knew. My next, step was, to find the right people and put a team together. Sketching. The game board was the easy part, finding. Someone who could engineer the, information, systems, required, to make the game work was, the first step, the. Game had to be engineered to, literally, change the way people think about money at. That time there. Was only one person I knew who had such a mind that. Was an old friend named Ralph, parta fondly. Known as Spock. We. Call him Spock because he looks like Leonard Nimoy of Star Trek Fame he. Also happens, to be as smart as the character, Nimoy played. This. Is where the four types of thinking, are important. For. This phase of the business I brought, the C thinking, and P, thinking to the project, I was creative, enough to sketch a crude game board design, and I understood, how people learned, from my 10 years of teaching, spot.
Brought The T thinking, and a thinking to the project, as a. Trained, CPA, with an MBA and a, former banker with an extremely, high IQ spot. Lives in a world of his own very. Few people can carry on a conversation with. Him he. Speaks a dialect of English I doubt anyone, else understands. Arriving. At his home I spread, my crude sketches, and diagrams, on his dining room table. Doing. My best to communicate, by words gestures, and pointing. At my sketches, Spock. And I finally began to converse. It is tough being the creative and people side of the project speaking. To what I hoped would be the technical and analytical side. Finally. About. An hour into the discussion, Spock's, eyes lit, up he. Was beginning to understand, the people and creative, side. Why. Do people, need this game he asked this, is common sense. Chuckling. I replied, to you, it's common sense you. Have an MBA your. CPA, and a former banker so. To you this, is common, sense but. To the average person, this, is a foreign, language for many, people this, is a radically. New way of thinking. Spock. Grinned, the, points, on his ears grew a little longer, give. Me three months and I'll give you what you want, we. Agreed upon a price for his services, shook, hands and I left feeling confident. That I had found the right person for the task. Three. Months later and after, much interaction with me he, had all the complex, mathematical, equations done I had. Done my part and made better crude sketches, together. Kim Spock, and I played the game, surprisingly. The game ran well it. Was a tough game but the numbers worked the, lessons, were revealed, and we, were happy. The. Next person I went to see was, an intellectual, property attorney to. Begin the process of filing for patents, trademarks, and other, legal fences, to protect, my intellectual, property. Spock. Went back to work with, his a thinking, cap on using. His analytical, mind this time and began. Back testing, the game on a computer. He. Ran the game through 150. Thousand, different simulations. Without. A failure, when. He handed me his pages of mathematical, computations. He, was grinning, from ear to ear. The challenge, of the project, had made him very happy. This day I have no idea what, the math on those pages meant but, when I turned those same pages over to my attorney, he, grinned just like Spock I felt. Like I was in school again the. 2a students. Were going over test papers and enjoying, it and I, the. C D, and occasional, F student wondered. What they were so excited, about as you. May have already guessed I was, now building, a new bi triangle. As, entrepreneurs. Kim, and I were clear, on our mission, now, as leaders. Of the project, and using, the five levels inside, the triangle, as a guide we. Were now putting, together a team.
After. About a month my attorney called and said you. Can now move forward and show your game to other people, we. Do not have a patent, yet but, I have filed the application and, you've staked your claim you. Still need to have people signed confidentiality, agreements before. They see your product, as. You may recall this, is the step I left out when I created, the runners shoe pocket wallet. Within. Weeks after, inventing the product I began, selling, the shoe pocket, without protection, in less. Than three months our competitors. Were selling my creation, it. Was a devastating mistake, but. Learning my lesson from that mistake was about to pay off in a very very. Big way. The, big test, for. The next few weeks, Kim Spock, and I worked to get our prototype, games ready we. Had played the game with a number of our friends and, the game worked well, the. Reason the game worked well is that, all of our friends are professional, investors, now. We were about to beta test the game a beta. Test is a trial run to see if the game works with the average player. The. Game at that stage was just rough sketches on heavy butcher paper and we, used different caliber, bullets as game, pieces the. Bullets worked well because their weight helped keep the paper down, we. Reserved, a hotel conference, room enough. For about 20 people and then, began calling people mostly. Strangers to, come and play you. Have no idea how hard that was when. People found out the game was an educational. Game about investing, in accounting, most. People found an excuse, to not be there does. It require math, asked, one person when. I said yes he. Hung up. Game is played. One. Bright Saturday, morning in walked, nine people, one. Who agreed to be there simply, did not show up after. A few niceties, the game was on and it, went on and on and, on. There. Were two tables, one, table with four people and one, with five, after. About three hours one, person raised her hand to signal she had won her game the. Game had worked for, one person and the, game went on and on, and on. Finally. At about 1:00 p.m. we, shut the game down. Frustration. Was so high I thought, fights were about to break out no. One else had gotten out of the rat race no. One else had won the game as. People, left many, politely, shook my hands but no one said much most. Just gave me a strange look and left. Decision. Time. After. Packing up our boxes, Kim Spock, and I had a debriefing, session, maybe. It's too hard I said Kim. And Spock nodded. But. One person got out of the rat race she, won the game said my perpetually. Optimistic wife, Kim. Yeah. But most people didn't win I moaned they, didn't get out of the rat race they, didn't learn anything all, they did was get, frustrated, I. Did. My best to make it simple said Spock I don't, know if I can make it any easier without, losing, the objectives, for playing the game, well. Let's. Get the boxes into the car and go home Kim. And I leave for Hawaii tomorrow, we'll. Have to decide if we go forward with this project or shut, it down. For. The next week Kim, and I would get up have, our coffee and walk on the beach one. Morning I would be overly, enthusiastic, ready. To continue with the project the. Next morning I would, awake depressed, ready, to shut the project down, this. Went on for a week it, was a horrible, vacation. The. Reason I spend so much time talking. About this period is that, it was a very tough time for me when. People say they have fears about taking, risks and going, forward on a project well, so, do i Kim. And I were, in turmoil, during this period of time it. Was go or no-go it. Was put up or shut up it. Was live our mission or just. Go back to making money. Kim. And I both believed, that many of the important, lessons that Rich Dad had taught me had, been transferred, into, our new game we. Knew we had to move forward, Spock.
Kim And I decided, to go through the eye of the needle we. Had transferred, this knowledge I had learned from Rich Dad and placed. It in a tangible product. This. Took place in the summer of 1996. And I then went forward, and hired, a graphic artist to bring the game to life, he. Then shipped his work to a game manufacturing. Company in Canada, in, November. 1996. The, commercial, version of the game was played at a friend's investment, seminar, in Las, Vegas Nevada, the. Game worked. Participants. Loved the game the. Paradigm, shifts we wanted were happening. Immediately. We, flew to Singapore to another friend's investment, workshop once. Again the, game did its magic. Trademarks. And trade dress. We. Then worked on the graphics that help identify, the Rich Dad brand you. May noticed that most of our products, have a similar, theme look, and feel, we. Use specific. Colors purple, grey black, and a few secondary, colors, people. Associate, the color schemes with the Rich Dad Company if. People infringe, upon our trade dress or trademarks, which people, often do our legal. Team begins. Talking to them our our, trademarks, and trade dress, our assets, called intellectual, property, that have great value, all over the world in China. They, call rich dad the purple storm. The, business takes off. Once. The business was put together the, company, began to take off order. Started flying through the door cash. Flowed, in all. Debts, were immediately, paid off and soon, the company was bursting, at the seams we. Were forced to buy an office building to house a growing, company, Rich. Dad Poor Dad maid The Wall Street Journal, and The New York Times best seller lists one, of the few books on the lists not, published, by the large publishing, houses. Publishing. Houses started calling, offering. Us a lot of money to sign with them, Oprah. Show called and in, the summer of 2000, after I was on her program, the company really, exploded, almost. Overnight we, became an international. Success. Expand a business, there. Are many ways a business, can expand, one. Replicate. The entire bi. Triangle. Basically. Once, you work the bugs out of the first business, you open more of them many. Retailers, and restaurants expand. This way in. Many cities there, are restaurants that have three or four successful, stores, located. Throughout the city in order. To grow bigger the, leader may need to change leaders, often. The, owner will sell to a bigger company and start, over again. To. Franchise. McDonald's. Is the most famous example, of expansion. Via franchising. Three. Take. The company, public through, an IPO, with. Funds from places like Wall Street the, company, can tap into a virtually, unlimited supply.
Of Money as long as, the company keeps on expanding. For, license. The products, this. Is the way we designed, the Rich Dad company, to expand. Licensing. Is basically. Allowing another business, to produce your products as our. Success, grew our, licensing. Which, is the legal level of the business, expanded. To 42, different languages, in over. 55, countries, it. Costs, us no money to produce or store, the books we. Do not need a giant, warehouse and extensive. Sales force or a, large inventory, to. Ship product, around the world. The single tactic multiple. Strategy, plan. Training as a military, officer required. That we know the difference between a tactic, and a strategy in very. Simple terms a tactic. Is what you do a strategy. Is the, plan on how to get the tactic, done. One. Of my military science, instructors, was adamant, about the importance, of using a single tactic, multiple. Strategy, plan of warfare, to win he. Would say a military. Leader must focus on one objective, or tactic, he, must only want to do one, thing, everything. Else is a strategy. On how to, get that one tactic, done, he. Would then use examples. Of military conflict, after military, conflict. That was won by the leader that had the best strategies, focused. On a single, tactic. When. I entered, the business world I carried. His lessons with me soon. I began, to see that companies, that used the single tactic multiple. Strategy, type of planning, were, companies that won in business. For. Example Domino's. Pizza, started with a single tactic to beat its competition, to. Distinguish, itself in the Pizza Wars Domino's. Designed a company, around a single tactic, that, tactic, was, to promise pizza. In 30 minutes or less an entire. Business was designed, around that single, promise a single. Tactic, to. Make that single tactic a reality, the, company, then had multiple, strategic, plans, once. Domino's, entered the marketplace it, immediately, began, taking market, share from, its competitors, competitors. Such, as Pizza, Hut could not compete because the business was not designed, to, meet such a promise. To. Combat Domino's, Pizza. Hut increased, advertising the. Communications. Level to. Announce new and different types of Pizza the, product, level the. Pizza wars were on, Pizza. Hut was fighting with a better product, Domino's. Was, fighting with a guaranteed, faster, delivery. If. You have read Jim Collins book good to great you, will notice that many, of the great companies have. Single tactics, Jim. Collins does not call it a single tactic multiple, strategy, way of winning instead, he. Calls it the hedgehog principle. In. His book he, uses Walmart's, single tactic the, lowest price for good products, as the, reason it beats his competitors, who, have multiple tactics and even, more strategies, in. Other words Walmart's. Competitors, simply. Have not clearly, defined their, own single, winning tactic. Walmart's. Entire business, is focused, on one promise, a promise.
Customers. Clearly, like that. Means Walmart. Does not win in the product category like. Domino's it, wins in the system level of the bi triangle. You. May recall the Thomas Edison won the Electric Light battle, at the system level not. At the product, level, Henry. Ford also. Won at the system level, he. Simply mass-produced. Low-priced, cars for the working family, he. Never promised, the best made cars he. Just promised, the best priced, cars and then, designed. A business, around his promise. McDonald's. Does not produce the best hamburger, Ray. Kroc built a business around. The idea, of selling. The best franchise, to, people who want to own a franchise. When. I was in the Arizona, mountains, the very simple, business plan I came up with was, based upon one, single, tactic and three strategies, the. First page of the simple two page plan looked like this. Tactic. Play, the cashflow, game. Strategies. One, write, a book to. Do, an infomercial, three. Teach. Investment, seminars, using, the game on. The. Second page I wrote, a brief plan, on how I thought, I could accomplish the three strategies, the. Single, tactic was to get as many people as possible to, play the game I knew. That if I created, a great game and people played, it their, lives would change, they. Would be able to see another world of opportunity, they. Would be less inclined to blindly. Turn their money over to people they thought were experts, such, as mutual fund managers, and might. Be inspired to become their own financial. Experts, that. Was it I knew. If successful. I would make money from the strategies, as well, as the single tactic. Risk idea, the. Lesson, always. Have a low-risk, idea or strategy, to fall back on, Rich, Dad taught me that whenever you start a business or invest, in something you need to have a low-risk, idea, for. Example when. Investing, in real estate if. The investment paid me something each and every month that, was a low-risk, investment, even. If the property did not go up in value I was, still receiving, some compensation, for my investment dollars, the. Strategy, of teaching, investment, seminars, using, the game was, my low-risk, idea, since. I came from, the seminar business, I knew, that if the other two strategies, did not work and no, one wanted my game I could, recoup my investment in, the product development of the game simply. By putting on investment. Seminars. Simply, put a low-risk. Idea, is something, you know you can do. Design, a business, that can do something, that no other business can do. Second lesson, designed. The business around a unique tactical. Advantage, in. My plan my, tactic, was to play the game so I virtually, eliminated. All competition. I eliminated. All competition, because, if the legal work was strong no. One else could do what our business, did no. One else has our cashflow games, as rich. Dad said design. A business that, can do something, that no other business can do. Simply. Put focus. All your efforts on your core strengths your, unique product, the. Plan worked. Once. We had built the books to a certain, level of success on our own we. Licensed, other publishers, around the world to, publish versions, in other, languages, we. Licensed, the rights to sell certain products, through infomercials. We. Went on the road to. Do investment, seminars across the United States in, Australia. And in, Singapore. Cash. Flowed, in from all three strategies as well, as from the sales of the game. When. I talked about spiritual, money I really. Did not think we would have made as much money as we did from, just our strategies, it. Was like magic. Oh geez today. Today. The tactic, is the same all. Of our strategies are focused, on getting people to play the cashflow, games, today. The, number of strategies, has increased, today. Our business, looks like this, one. Books. In 42, different languages, two. Games. In 14, different languages, 3, network. Marketing companies, using, our products, for. A coaching, company 5. A seminar. Company, 6. A national. Radio show. 7. Cash, flow clubs throughout the world 8. Digital. Online game, initiatives, 9. Curriculum. Initiatives, including. Rich, kid smart kid calm which, offers free games, and curriculum, for kindergarten, through twelfth grade.
Company Grows by, adding, partners, who can add to our strategies. Via. Licensing. Or Co venturing, we, do not have to grow the size or number of employees, of the rich dad company, our. Company remains, small, but, has big partners. Jobs of leaders. At. The, start of this chapter I listed. A set of jobs rich dad thought were important, for a leader, once. The product was developed and protected. Legally via, patents, and trademarks, Kim, and I focused, on the following three jobs, of leaders, one. Strengthen. The company on the inside, to. Expand. The company on the outside, three. Improved. The bottom line. Working. For, cooperative, money. Through. All this very rapid, growth the, company, handled, the expansion, without a hitch, instead. Of success, destroying, us as it did with the nylon wallet, company the, rich dad company grew stronger, with the growth the. Company, grew because, we were cooperative, working. For cooperative, money every. Dollar that came in from our licensed strategic, partners, was, a cooperative, dollar, by. Cooperating. Instead, of competing, our, strategic. Partners get richer and so. Do we I believe. Our company, was pretty well designed it. Was designed to, grow we. Leveraged, the talents, of our team to build and protect intellectual, property and, then, leveraged. The intellectual, property, through licensing all over, the world we. Found the right team to guide us in this process as. We. Grew the rich dad company we. Did not have the growing pains many small companies go through we. Did not have cashflow problems, space, problems, or adding. Employee problems, the. Company, remained, basically, the same size even as we grew exponentially. What. Expanded, was the number of strategic partners. As, we grew more, and more money flowed in and very, few, dollars flowed out all. My years of screwing, up correcting. And learning, were paying off. No, more glimpses. Today. Instead. Of just a glimpse of the world I want to live in Kim, and I live in a world better, than we ever dreamed of it. Seems like magic and it, is magic, the. Money and lifestyle, are great but, it is the sense of making a difference in so many lives that, is the true magic when. I think back on my dad sitting unemployed, in front of the TV set the, kids in the sweatshops in Asia from my wallet business, and then. To the family's plane cash flow on the Yangtze, River that. Is the real magic as, dr.. Buck mr. fuller would say it's. The work of the Great Spirit as Lance. Armstrong, says it's. Not about the bike. The entrepreneurs, job is done. Once. I saw the article about the cash flow game in the New York Times I knew, my job as, an entrepreneur, was over we. Had done our job. Kim. And I had, taken the business as far as we could take it we, knew it was time for a new team in the. Summer of 2008, our new, team took over the. Team has changed, but their jobs are the same, their. Jobs as leaders are, clearly. Define the mission goals. And vision of the company. Find. The best people and forge, them into a team. Strengthen. The company, on the inside. Expand. The company on the outside. Improve. The bottom line. Invest. In research and development. Invest. In tangible, assets. Be. A good corporate, citizen. Rich. Dad's, entrepreneurial. Lesson number nine don't. Fight for the bargain-basement. Chapter. Nine how. To find, good, customers. One. Day during my junior year of high school rich. Dad and I were walking past an, entrance, to a hotel, when, we heard a man's voice shouting. Loudly I will, not pay you another dime you. Have not kept your agreement. Looking. Up I saw a family of five with, a very upset, father yelling, at a local, man in a Hawaiian print, shirt, but. All you have paid is a deposit, the local man protested, you, still owe us the balance I cannot. Let you check in until the, balance is paid you. Were to have paid your balance in full a month, ago you're. Lucky we even held your rooms for you this, is our peak season it's. A good thing you did hold our rooms for us snarled. The father you'd, have heard from my attorney if you hadn't I, still. Need to be paid said, the local man holding, his ground I told. You that I will pay you don't, you have ears just, check us in and I will pay you the father growled I have, a check right here made, out to you let. Us get into our room and we will settle this once and for all this. Was, the era before credit, cards. You. Need to pay in cash a, check, will not do that, is why we ask you to pay in full in advance. It gives us time to clear, a personal, check. What. Is wrong with you ask the Father now shouting, at the top of his lungs don't.
You People understand, English I told. You I would pay you now show us to our room do. I have to call your boss to get things done a. Crowd. Started, to gather not. Wanting, to make a scene the, man in the Hawaiian, shirt picked up the mountain of suitcases, loaded. Them on a trolley and directed. The family, to their room, he'll. Never get paid said, rich dad as we continued, how. Do you know I asked. We. Dealt with the same guy three years ago he, did the same thing to us he's. Going to go to the room write, the check and then, stop payment, on it. What, happened after he stopped payment, I asked, by. The time we found out his check was no good he, had already checked out we. Called him once he was back on the mainland, I believe, they live in California, and we, tried to collect, then. What happened when. We threatened, to take him to court he agreed to pay us half of what he owed he. Said our service, was bad and he felt he was paying us what we deserved, he. Said he was being generous, paying 50%, of what he owed us since. It would have cost more to take him to court we, agreed, even. Then it, was six months before he paid anything, we. Walked for a while in silence, disturbed. I finally. Had to ask is, this, common, in business, yes. Unfortunately it. Is you. Will always have good customers, and bad customers. Fortunately. I have, found about 80%. Of all customers, are good customers. 5%. Are like him just, horrible. And the, other 15%, are, in between replied. Rich dad Oh on. Top, of that this, same guy had the nerve to call again last year and try, to book a tour package, with us what. Nerve. Did. You do business with him are. You kidding laughter rich dad I had, already fired, him our reservation. Department, had his picture and his name on our do not do business with again list the. Person, taking the call remembered. His name and told, him we were full this. Was before computers which. Keep track of customers, today. You. Fire customers. I asked, in surprise. Absolutely. Said rich dad you, fire bad customers, just, as you would fire a bad employee if. You, do not get rid of your bad employees, the, good employees, will leave if, I, do not fire bad customers, not, only will my good customers. Leave but, many of my good employees, will leave as well. But. Aren't some of the complaints, or upsets, your fault too I asked. Couldn't the complaints, be legitimate, yes. Replied, rich dad often it is our fault our staff, doesn't make mistakes or may offend customers, our systems. Can breakdown that. Is why we look into every complaint and take, it seriously, just. As you look both ways before, you cross the street when, it comes to complaints, we have to look both ways at. The customer, and at, our operations. Is. It hard firing, people, I asked, being. 17, years old at the time the, thought of firing someone, especially, an, adult frightened. Me it. Was not something I wanted, to do. It's. Never Pleasant said Rich Dad it's, one of the more unpleasant yet. Important, jobs of an entrepreneur. Your. Job is a people, job, people. Are your biggest assets, and biggest, liabilities. One. Day you'll, have to fire someone I am. Sure it will be an experience you will never forget. Dad and I entered, a restaurant, and found a table to have lunch, once. The waitress had filled our water glasses handed. Us the menu and explained. The specials, rich. Dad continued, with his lesson on people, the. Same is true with advisors you. Must be able to fire bad advisers if. You have accountants, or attorneys, who do a poor job or, if the job is too big for them or if they, are only interested. In receiving their fees and not helping your business your. Business will suffer if. You do not get rid of bad advisers, you, are responsible. The. Ultimate price of bad advice is far. More than what you pay your advisers in fees for good advice, I had. One accountant give me bad tax advice and it cost me nearly. $60,000. In back taxes, and penalties on top. Of that it cost me another $12,000. To hire another, accounting, firm to straighten out the mess in. Addition. This, mistake, upset me so much that, I was not effective, for months, and the business suffered, as a result, so. As, an, entrepreneur you. Must realize, that you are responsible, for your own mistakes, as well, as for the mistakes of others. Were. You angry at your accountant, I asked, yes.
And No I really. Could not blame him at the, time my, business was growing so fast I, did, not pay attention to the quality of my advisors at. The time I did, not realize that all accountants, are not created. Equal, he. Should have told me he did not know what he was doing but, he didn't want to admit it he. Was afraid I would fire him, soon. The, size of my business, was too big for his expertise, he. Was in over his head, I should. Have let him go earlier, but, I was too busy besides. I liked, the guy and I knew his family I kept. Hoping he would grow with the company. Fortunately. He, didn't. Finally. I did let him go but, only after the losses from his bad advice were very high so, I don't blame him I'm, the only one, ultimately, responsible for, the business as the, business grows your, advisors, need, to grow with you or go, I learned. A valuable lesson. Was. It hard firing, him I asked, it. Was extremely, difficult if you. Cannot hire and fire people, including. Yourself you, should not be an entrepreneur. Remember. This your. Success, or failure. As an entrepreneur, depends. A lot on your people skills, if. You have strong people skills your business will grow if. You have poor people skills your, business will suffer if. You, hire people simply, because you like them or because, they are relatives, and you, cannot fire them when they need to go then, you have poor people skills. Remember. That people are different and as, an entrepreneur you. Need to be flexible enough, to work with different types of people, people. With different skills, ambitions. Dreams. Behavior. And experiences. If. You cannot work with different types of people once. Again your. Business will suffer. That is why you always said to Mike and me a leaders. Job is, to get people to work as a team that, could. Be your most important, job, remember. That departments, of a business attract, different types, of people for. Example sales, people are different from administrative, people they. Are very different people, almost, opposites, and you, need to treat them as opposites, for. Example, never, ask an administrative, person to hire a sales person, instead. Of hiring a hard-charging sales. Person who loves busting, down doors the. Administrative. Person will prefer to hire a nice calm. Sales person, whose, only sales experience, was working as a checkout clerk at the supermarket. Also. The, administrative, person, would want to make sure the person enjoyed, filling, out forms, and doing paperwork. Why. Would they do that I asked, because. Birds, of a feather flock, together. Administrative. People think that paperwork is the most important, part of the sale they. Have no experience in, knowing how hard it is to get that sale you'll. See once you get into the real world in general. Sales. People don't like administrative. People why. Because in, general sales, people hate paperwork, and administrative, people. Are terrified, of selling so, don't, try to make a top-flight, sales person, into a file clerk or, ask.
A File clerk to become a flamboyant, sales person so. Is that where most of the friction lies I asked, between sales and administration oh. No. Said. Rich Dad emphatically, a business. Is one, big ball of friction, it. Is a working, model of human conflict it. Is a melting, pot of egos, that is always, boiling. When. You look at the BI triangle. You will understand, why a business. Is a blending, of different people different. Temperaments, different, talents, different education. Different ages. Sexes, and races. Every. Day when you come to work most, of your problems will be people problems, a salesman. Made promises, the company cannot keep the. Customer, is irate your. Attorney will not agree with your accountants. Assembly. Line workers, will, not agree with the engineers, who designed, the assembly, line management. Is at war with labor. Technical. People are fighting with creative, people analytical. People do, not get along with people people, college-educated. People feel, they're smarter, than people who did not go to college, add. To this interoffice politics. Or worse, sexual. Affairs within the company, and you, will never need to watch TV again in most. Cases a business. Does not need a competitor. A normal. Business has so many competitors inside. The business it's, amazing, that anyone gets any work done at all so, that, is why an entrepreneur. Needs to know when to fire someone if one. Person, upsets, the balance the. Whole business can boil over because, the internal, friction gets, too great. Exactly. Smiled Rich Dad I'm, sure you see it in your classrooms, at school every, day you. Can already see the different, characters, in your classmates, I smiled. And said and on. My football team my, baseball team and even, in band class. That. Is why every, team has a coach a band. Has a conductor, and every, business has a leader a leaders. Job is to turn people, into teams. One. Of the reasons so many people, are self-employed, or owned businesses. That stay small is, that the leader is either not competent, with dealing with people or, simply. Does not want to learn to deal with so many different people. Business. And making, money would be easy if it were not for people. The. Waitress returned, to take our order after, she left RIT, had continued, let. Me give you three tips I have learned about dealing with people in business tip. Number one is what, I call the pain-in-the-ass, factor. That. Means all people, have skills and talents, and are, also pains, in the ass I do, not care who they are they. Have all three including. Me if. They're pain-in-the-ass, factor, exceeds, their skills and talents it is time for them to go or, to move them to another part, of the business. Chuckling. I said maybe. Someday you'll earn a Nobel Prize for the pain-in-the-ass factor. I should. Said, Rich Dad every. Person in the world who, deals with people will stand and applaud me and. What. Is tip number two I asked. Learn. To hire slow and fire, fast said, Rich Dad take. The hiring, of people very, seriously, and slowly. Screen. Them carefully, and if. It is time to let them go do, it quickly, too, many managers, allow, people too many chances, if. You can't fire them for some reason then. Move them and isolate, them don't. Let them contaminate. The rest of the people in the business, maybe. You can help them find jobs at a company, where they might be happier, and more, productive or just.
Pay Them to leave it. Will be less expensive in, the long run. Remember. To do it humanely and illegally. All, people need to be treated with the appropriate, dignity, many. Times when, I have let people go they. Were happy, to move on I have. Found that if people are acting up or underperforming. It. Is not because they are lazy, many. Are simply unhappy. For a number of reasons if. You, as a leader can find a way to make them happy find. It. You. Mean a person can be a good employee but be working in the wrong job or Department it. Happens all the time said, Rich Dad in fact. I have, been the person who took a good employee and put him in the wrong job I'm. The person who made him unhappy, what. Did you do, well. Years. Ago I had, this young man who was a great salesperson, he. Worked hard treated. His customers, well and made, the company and himself a lot of money so. After. A few years, I rewarded, him by promoting him to Sales Manager, I put. Him in charge of 12, other salespeople. He. Was fine for about a year but then he began to come to work late the sales, numbers, fell and the, sales team was, unhappy. Did. You fire him. No. I was going to but, I thought it would be better to re-interview. Him again, once. We sat down and had a heart-to-heart talk I found, the problem by. Promoting, him I had, turned him into an, administrative person. Doing. Exactly, what he hated doing paperwork. Oh sure. He had a fancy title VP. Of Sales he. Made more money and had a company car but, he hated the mountains of paperwork and attending. Meeting, after meeting he. Simply, wanted to be out on the street talking, to his customers. So. Did he go back to sales. Absolutely. Good. Sales people are hard to find so I gave him a raise a bigger, territory, and he kept the car he. Got richer and so, did the company and. What. Is the third lesson I asked, the. Third lesson is that there are two kinds of communicators. Said, Rich Dad when. They're upset or, unhappy, one, type of communicator. Will come talk to you face-to-face they. Lay the cards on the table in front of you and the. Second I asked. The. Second type stabs, you in the back they. Gossip talk, badly about you spread, rumors or. Complain to everyone, else but never to, your face. Basically. These. People are cowards, they, lack the courage to confront, you to, be forthright. Often. Blame you for their lack of courage, saying. You are too mean or will, not listen or they, are afraid of being fired, their. Perceptions. About you could be true but generally. These, people will choose to talk behind a person's back rather, than face, to face it's, just in their nature. So. How do you handle that I asked. Well. One. Way is it every meeting I remind, my staff of the two types of communicators, and leave, it at that I say. To them there, are people who speak to you face-to-face and, there, are others who speak behind your back which. One are you. Once. The rest of the company is aware of the two types, they generally, remind, someone, who is gossiping, or stabbing someone in the back about. The two types of people it. Doesn't totally stop the gossiping, but it does keep it down and in, general, overall, communication. Improves, I also. Tell them that I would prefer to be stabbed in the chest rather. Than stabbed in the back so. I don't tell them what to do I simply. Give them a choice. Have. You been stabbed in the chest, I asked. Oh a. Number of times and I. Deserved, it I needed. To be corrected and reminded. To be open-minded as much as anyone else as much, as it hurt it was less destructive, than a stab in the back. Aren't. People afraid of being fired oh, there. Is always that risk smiled. Rich dad that. Is why it takes courage and excellent, communication, skills to be successful, in business in many. Instances. It is not what you say but, how are you saying it so if. The communication is going to be unpleasant put, on your creative thinking cap and figure. Out the most humane and kind way to, say what needs to be said and always. Remember the, communication. Does not mean talking. Communication. Also includes, listening. When. Two people are upset and both are talking, for. Increases. In communication. Decreases. The, reason God gave us two ears and one mouth is, to remind, us to listen, more than speak. So. Being, an entrepreneur, is a lot about people and the communication, skills needed to communicate to, them. Rich. Dad agreed and continued, saying. Leadership. Requires great, communication. Skills to become, a better entrepreneur requires. You, to focus on improving your, communication skills. One. Of your first steps in your leadership development is to, develop, the courage to be a face-to-face communicator. And to, work on developing your communication. Skills, if. You are establish. Your. Business will grow.
Entrepreneurship. Is for, people with courage it's, not for cowards if. You, will work on always improving, your communication skills, your, business, will grow. Remember. That just because you're talking does not mean you're necessarily, communicating. And in. Sales telling. Is not, selling. Communication. Is a far, more complex. Process, than simply moving your lips and wagging, your tongue. Sitting. Quietly, as rich, dad enjoyed his meal my, mind went back to the angry father the, customer, whom rich dad had fired I asked. And that is, why you told that I are a customer, that you had no vacancies, it. Was better than telling him what you thought of him. Yeah. As the. Entrepreneur one. Of your jobs is to protect, your company, and your employees, from cheap customers, the. Customers, who, want more than they pay for the. Customers, who want something for nothing I had. To find a way of firing that customer, without getting, into an argument again I knew. He would stab me in the back if, we got into it that. Is why I make it a point to fire, cheap customers, politely. And discreetly. Isn't. That cruel or discriminating. Against poor people I did. Not say poor people said Rich Dad raising, his voice the. Word I used was cheap, cheap. Customers, not poor people there. Is a difference there are rich cheap people and poor, cheap people cheap. Has nothing to do with money it, has to do with the state of mind in some. Cases I would, say it borders on a mental illness, also. I would not classify cheap, people in the same category, as bargain, hunters we. All love a bargain yet. As much as we love value. For our money a very few of us want, value at the expense, of someone else but. A cheap person does a cheap. Person borders, on being a thief and sometimes. They, are thieves if it's. Not money they're stealing they, steal your time and your energy they. Steal your peace of mind. For. All the months of misery that that, one guy caused our company, it would, have been better for us to let him just stay for free he. Sucked the life out of our business for months, he. Seemed to enjoy messing, with us he, always changed, the deal and said, we said things we did not say he. Always wanted, a better price even. After, he agreed to pay a set price he. Seemed to enjoy having, us come after him instead. Of spending time on our good customers we, spent time on him, having. A bad customer can, cost us good customers, that. Is why I say, that you need to fire your cheap customers, they're, too expensive this. Is a very important, lesson to learn if you want to be an entrepreneur, always. Remember. Take, very good care of your good customers, and fire. Your, cheap customers. Find good customers. In, business. A very important, word is the word margin. It is. As important, to term as cashflow, in fact, both terms are intricately.
Related In. Overly. Simple terms margin. Is the difference, between what it costs, to produce your product and the, price you sell your product for for. Example let's, say it costs you two dollars to manufacture. Your widget and you sell, your widget, for, ten dollars in this. Case your gross margin is eight dollars there. Are three reasons why a product's, gross margin, is so, important. One. The. Gross margin, finance, is the rest of the bi triangle. Looking. At the bi triangle. You can see that a product's margin must, provide enough cash flow to feed, the rest of the triangle. Margin. Pays for the team's salaries. Legal, fees the, company's system, operations, marketing, and accounting, these, are also known as operating, expenses, -. Margin. Determines, the price of your product obviously. The, more margin the, higher the price of your product, 3. Product. And price determine. Your customer, to. Help clarify this let's, look at the automobile, industry a Rolls. Royce is known as a very expensive. Car it, attracts, a certain type of customer. If Rolls. Royce suddenly, announced, it was going to produce a low-priced, budget, model many, of their rich customers, would probably, start looking for another brand, of car. Wrong, car wrong price. Wrong. Customer, recently. Jaguar. Announced, it was dropping, its lower priced model, because, it realized, that offering a lower priced model had heard its sales after. Losing, seven hundred million dollars in one year they. Finally realized. That they should stay at the high end