Master Small Business III - Warrior Edition

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Supercharging Your Action Plan

Objectives:

To form the habit of quiet time.
To begin writing an action plan.
To understand that talented workers are not always talented supervisors.
To know that good can get better and better.
To be motivated by the fact that material success can come quickly for entrepreneurs and commissioned salespeople.

Background:

Your twenty minutes of daily quiet time is a gift that you give yourself. Quiet time is your opportunity to stop and reflect on your past, present and future. Where have you been? Where are you now? Where do you want to go? Quiet time is your reality check. Are you doing what you want to be doing? Are your actions leading to the accomplishment of your goals? Yes, proceed. No, make changes.

Warrior Mindset

If at the completion of all of the Master Success Courses, all that has changed is that you have formed the habit of taking daily quiet time, then all the time and money has been worth your investment. Quiet time is your guiding yourself to where you want to be. It is not your parents, your spouse or your CO telling you how you should be and how you should act. It is you telling yourself. This may sound obvious but it is not. Many people are running in place; creatures of habit enslaved by routine.

   In preparation for your small business, you will move from the idea stage through the concept stage to the action stage.

   Let your ideas flow without limitation. You are capable of achieving many things. There are vastly more things that you can accomplish than doors that are closed to you.

   Let the ideas flow.

   Start by thinking about all of the things that you like to do. And, there are probably business applications for these likable things.

   Start by thinking about all of the things at which you feel you have above average ability. And, there are probably business applications, which could capitalize on these abilities. Start looking for positive role models in your life. Find people who are worthy of your patterning.

   Start looking at jobs that seem interesting to you.

Mike Ditka

   Start looking at people who have the positive long-term material, emotional and spiritual qualities that you'd like to have. Start to think about how they may have acquired them.

   Start thinking about any family business connections that you may have that would give you a head start toward financial independence.

   Start thinking about the 250 people in your personal network and what businesses they might help you to start. Decide how the people you know might help you connect with the people who can help you.

   Take your quiet time to let the ideas flow.

   Select your best idea. The next stage is to see if you can turn your idea into a viable business concept.

   If you think that you have the personality and strength of ego to be a commissioned salesperson, your path to riches is clearly defined. Go sell.

   If you are thinking about starting a small business or buying an existing small business, your task is more challenging.

   Is your idea realistic? You will be making your life easy and putting the success odds in your favor by seeking to clone an existing business concept rather than inventing a new one.

   Promoting and selling a new “never seen before” concept is very difficult and very risky. As far as possible, stick with the tried and true. Later, you will have ample opportunity to add your personal touch to your business; that is, once you have the business established.

   As your idea evolves into a concept, you will strive to keep the size of your business manageable. It is prudent policy to let the business start slowly and succeed by stages. For example, if you want to start a maid service with you as the only maid, you will put the success odds heavily in your favor. However, if you want to start a maid service with you as the administrator and five others working for you, the profits may be much greater but so are the responsibilities.

Warrior Mindset

Always be honest with yourself. You may be very talented and hard working but not a very good supervisor of others. Know thyself and plan accordingly.

   If you can start by just working by yourself, do that.

   If you can start the business at home, do that.

   If you can start the business without borrowing money, do that.

   If you can start the business part-time, do that.

   Succeed in stages. As you progress and you gain experience and knowledge and your promotions take hold and your customer base expands, you can always accelerate your plans. By keeping your business a manageable size, you retain control and you put the odds for ultimate success in your favor.

   When you feel that you have a viable business concept, your research begins. You want to talk about and read about everything that relates to your business. You want to familiarize yourself with any associations and trade groups related to your business. You want to speak with people who are directly and peripherally involved in your business. You want to find personal and business mentors.

   Your research efforts are concentrated when you are starting your business. However, you should regard researching as a continuing process necessary to keep both yourself and your business vibrant.

   Your research efforts should produce an action plan. You will plan exactly the steps required to start your business and the actions necessary to generate interest in the services or products you offer.

Nolan Ryan

Your action plan will include but not be limited to:

Establishing realistic objectives and goals.
Defining your market.
Consulting with industry experts/mentors.
Finding a suitable location.
Contracting with reliable vendors and suppliers.
Arranging workable financing.
Hiring competent employees.
Planning cost effective advertising and promotions.
Opening your doors to an enthusiastic reception.
Building a customer base.
Focusing on customer satisfaction.
Utilizing modern technology.

   With this action plan, you need a successful you. You need the Military Action Principles™.

   You need desire. Someone else can’t want success for you. You have to want the life that financial independence can offer you and your family.

   But desire is not enough.

   You need determination. You need to believe in yourself and your ability to overcome obstacles. It’s called faith. You must possess the spirit and the inner fortitude to be willing to do whatever it reasonably takes to succeed.

   But desire and determination are not enough.

   You need common sense. You have to be engaged in a mainstream business with a reasonable chance for success. You must study your market and allow your market to dictate your direction.

   But desire and determination and common sense are not enough.

   You need the ability to invest. Even with all of the planning and hard work that you do, you will not progress if you only consume and don’t invest. You must be able to delay gratification and take a portion of your profit and put that money back into your business.

   And you have to blend all of the qualities above with a moral consciousness.

   You have to do unto others as you would have them do unto you. You have to balance your life between business, family, community and your personal needs.

   If you can make this plan and put it into action, you will succeed. You will be in the top ten percent of your profession. You will have enough money to invest and retire rich in twenty years or less.

Story:

Andrew Martin Talks with Alex Darby

   Alex Darby spoke with Andy at Taylor Realty about eight months following the end of his story. Alex has read Andy's story.

   AD: “Andy, where do you stand now? What happened with the limited partnerships?”

   AM: “Well, Mr. Darby, as you read, Taylor Realty Partners One was a single shot deal put together with the sole purpose of buying the Riverdale Shopping Center. With the improvements we made, we have boosted income by $30,000 a year to $210,000. We've also initiated a Merchants' Association for the center with the dual purpose of allowing the tenants to express their concerns to us, the management, and also to enable them to do joint advertising which we also partially fund.”

   AD: “Tell me about your other partnership, Taylor Realty Partners Two.”

   AM: “We were able fully to subscribe TRP Two in four months. Most of the TRP One limited partners came on board for TRP Two because TRP One is a success. We also have several new investors in TRP Two. Presently, we are negotiating to buy two small neighborhood shopping centers for TRP Two. As Don said, it hasn't been tough finding investors for these partnerships and it won't be hard in the future if we keep building from a successful base.”

   AD: “Andy, with all this property, how do you find time to manage it all in addition to your other activities and responsibilities?”

   AM: “Well, Mr. Darby, you've come right to the heart of the problem. I haven't rushed into buying properties for TRP Two because I want to be sure that I have a good management team in place before I do invest in anything else. One of our investment brokers happens to be very computer literate. He's getting the bugs out of our computer management program and has the Riverdale Center online. With this fellow and the computer up and running, we should be in good management shape. But I'm not rushing things. I learned that lesson.”

   AD: “So, you're doing what, Andy?”

   AM: “I have a dual focus. I'm handling the acquisitions for the partnerships, buying the properties, and I'm managing our office, which is now 90% into commercial/investment real estate. We now have fourteen employees. And there are a few other projects.”

   AD: “Other projects? Can you tell us about those?”

   AM: “Sure. Working with Don has really opened up my eyes to the world. You see, when Don was my age, he owned five income properties. When his daughter Susan had her problems, he was wiped out. Everything gone. He had bills you wouldn't believe. But Don is a proud man and he met his obligations but it put him back to square one. It can happen. Don has fought his way back all these years. He and his wife Jane have not only helped their daughter but many others with head and spinal injuries. I'm now helping Don and Jane with their work.”

   AD: “How so, Andy?”

   AM: “Well, that brings us to TRP SP; that's Taylor Realty Partners Special Project. Don and I are attempting to raise $750,000 for a real estate syndication devoted exclusively to buying, rehabbing and renting barrier-free homes for the disabled, for example, people in wheelchairs. I have a particular interest in assisting disabled veterans.”

   AD: “Excuse me, Andy, but $750,000 doesn't sound like it would go very far.”

   AM: “Well, Mr. Darby, one project, one home at a time, it will work. We are working with the state and local government to procure additional funding. We're working with the local housing authority and the Veteran's Administration. Don and I aren't shy about putting the arm on the banks to work with us.”

   AD: “A team effort.”

   AM: “Yes, sir, Mr. Darby, we view this as a public-private partnership.”

   AD: “Your intention, then, is to build rental units. Won't you have to manage them?”

   AM: “No, we won't. The State Department of Social Services and the State Office of Veterans Affairs will work with both the Newton Housing Authority and the Head and Spinal Cord Injury Association to select suitable and compatible residents for the homes. It's my hope and Don's that down the line we can build units, either single family houses or condo units for sale to disabled people to allow them to be homeowners and build equity. Some of the disabled are fully financially dependent but others either work part-time and receive partial subsidies or work full-time and just need a one-time financial boost and the right house. That is a house without architectural barriers.”

   AD: “And, this is all non-profit?”

   AM: “From my standpoint and Don's, yes, but there are significant tax incentives and benefits available to the limited partnership shareholders.”

   AD: “So, Andy, everybody wins.”

   AM: “Yes, win/win, Mr. Darby. I've certainly won because I can put my expertise in real estate to good use for a good cause. This whole business of working with the Head and Spinal Cord Injury Association has allowed me to put my life in perspective. Actually, my very early successful beginning was too tempting. I was a workaholic by day and becoming an alcoholic by night. I thought that nothing could stop me. Well, I was wrong but I was very lucky.”

Andy being Interviewed 2

   AD: “Money isn't everything to you then?”

   AM: “Mr. Darby, don't measure me for a halo quite yet. I'm still basically a salesman out there scrapping for the next deal, the best deal I can make. I still treat myself very well. I have the money. I make a lot of money. But, I have perspective and I have patience. Well, actually, I keep working on the patience part.”

   AD: “How is Mr. Taylor doing, Andy?”

   AM: “Very well, thank you. A big change, which I haven't mentioned, is that Mr. Taylor is almost seventy-two and wants to retire. He's now only working part-time. Don will still have his arrangement with the company. I've worked out an agreement with Mr. Taylor to buy the company.”

   AD: “Andy, you have accomplished a great deal in a relatively short period of time. Three years ago, you wouldn’t have believed you’d be in the position you are now.”

   AM: “You’re right, Mr. Darby. Three years ago, I was ready to sit and wait for the phone to ring while I did crossword puzzles.”

   AD: “After all this, Andy, would you say that you were lucky? Lucky to have Don and Jim Taylor. Some readers will probably think that you were just lucky in associating with these two successful men.”

   AM: “Mr. Darby, I wouldn’t argue with them. They may be right. Who knows? Who can pinpoint success? Certainly, Don and Jim helped. But, maybe it was the research. Maybe it was the newsletters and the Roundtable Meetings. Maybe it’s that I’m a good salesman. Maybe, I just found the right career. Perhaps it was just because investing in real estate is so good. Or, it could have been the starting of the partnerships. Maybe it was making my mistakes early when I could handle them. Was it all luck? Who knows? It was probably a compilation of a lot of things.”

   AD: “So, taken all together, it worked.”

   AM: “Yes, I believe so. It was more than just one thing. I hear it, too. People will say, ‘Ah, he was lucky.’ Or, ‘Ah, if I had only bought real estate when he did.’ Or, ‘Ah, that kid’s got some money behind him somewhere.’ I can’t help what other people believe about me. I can only believe in myself and keep trying to be a responsible person.”

   AD: “People are jealous of your success, then, Andy?”

   AM: “Some are jealous. Some are proud. Most are living their own lives and don’t give me a second thought.”

   AD: “And, that’s fine with you?”

   AM: “Yes, Mr. Darby, that’s fine with me. As Mr. Taylor did with me, if someone wants to work toward success, I’m there to give any advice I can and to point him or her in the right direction. But, the right direction almost always involves effort and it’s usually without an instantaneous reward. Some people can handle that and some can’t. If they can’t and just want to do crossword puzzles, well, we need those people in the office to answer the phones, also. They decide for themselves, not me.”

   AD: “Andy, it sounds like you’re ready to be a mentor.”

   AM: “I hope I can work with others and help as I’ve certainly been helped. Yes, sir.”

   AD: “Thank you, Andy, and I wish you continued success.”

Learning From Andy

In one defining moment, Andy’s attitude changed. In one defining moment, his future changed. He got tired of failing. When enlightenment struck, he happened to be in the real estate investment business, but he could have still been in the insurance business or the computer business. Because his style and attitude changed, the end result would have been the same. When Andy’s style and attitude changed, his life changed with it.

Yes, at times Andy was a selfish jerk. His redemption came from his willingness to see himself as a jerk and his willingness to change. Andy was honest with himself; he took responsibility, and this made the difference. Then, Andy’s military self-discipline had to kick in and he had to change his ways and be a better person.

Warrior Mindset

Take a deep breath and do what you know you should be doing. This is not a secret. This is the Military Action Principles™. Do what you know you should be doing.

   Andy could be working for a large real estate company and pretty much be doing what he's doing. He could be bringing new business into the office. He could be setting up limited partnerships. After three years, he might be making a low six-figure salary. He would be successful.

   However, as the general partner setting up limited partnerships, it is very possible that Andy is already a millionaire and probably a multi-millionaire. This is after three years!

   Lots and lots of real estate agents sell houses. Lots of real estate agents sell small investment properties. Some real estate agents sell commercial real estate. A few real estate agents sell office buildings and shopping centers. Rarely do real estate agents buy office buildings and shopping centers. Because, then, they aren't called real estate agents but go by different names: investors and developers. Investors and developers are the multi-millionaires.

   In the Navy, you can't jump from Ensign to Commander to Admiral. In the Navy, they aren't going to promote a Seaman to a Petty Officer First Class. You have to go through the ranks and pay your dues. This is not true in business. If you are an entrepreneur or a commissioned salesperson, you can choose to leap forward. You choose. You choose who you are and where you are and what you want to be doing. You choose.

   As Andy's story began, Don didn't even like Andy. Andy was a jerk. Two years later, Don was helping Andy put multi-million dollar deals together.

   The stories in this Master Small Business Course are fiction but they are representative of the style and the attitude of people who have achieved what you want and what you deserve as a warrior.

   Today, take your quiet time and stop and think. Where have I been? Where am I now? Where do I want to go? Take your quiet time and stop and think. Who has done or is doing what I want to do? How different am I from them? Who will be my mentors? How can I start to build networks?

Warrior Mindset

Without any excuses, can you take the rusty old lawnmower and mow one lawn and have one satisfied customer that leads to two that lead to two hundred? Why not you? You are the warrior. You have to walk up to that front door and knock and ask for the business. You have to love your customer and do an extraordinary job.

   You can find Don and Mr. Taylor and Shelia Goff and Mr. Baker and Uncle Giro. Research. Look. Ask questions. Listen. There are people willing to volunteer to mentor you. They are already successful and such people are usually willing to help pull up the next guy or gal. They will help you get started and will help you build your network to your success.

   Don't be average. Average people are doing today what they did yesterday and what they will be doing tomorrow.

   Take your quiet time. Consider and use your warrior skills. The average people, the ordinary people, cannot or will not walk up to that front door and knock. You are a warrior. You can.

Warrior Mindset

Read business biographies. Donald J. Trump and Jack Welch and Conrad Hilton and thousands of others, who have done what you want to do, will share their ideas, secrets and strategies with you. You must read and you take action. The operative word is “you.”

Operational Limitations:

Most people are trapped by the comfort of the known, the status quo.
In the midst of the turmoil of modern life, it's easy to succumb to the feeling that what you are doing is all that you can do.
In the military and in the corporate world, promotions may be limited and subject to the whim of others.
Most people don't want to venture toward success if the price is hard work and temporary failures. This is what average and ordinary means.

Action Plan:

If you haven't already, start reading a business biography. When you finish that book, start another. Keep going. Keep learning. In twenty years, you can buy a powerboat and go fishing. For now, read. All education is self-education.
Quiz college students on their career plans. Impressed?
In your circle of friends, how many people would read the Military Action Principles^™if you gave them a copy? In a day? In a week? Ever? Impressed?

Jargon:

   Action plan - A specific list of activities that lead to goal accomplishment.

   American Stock Exchange (AMEX) - The second-largest stock exchange in the United States. It trades mostly in small-to medium-sized companies.

   Architectural barriers - Obstacles in or around a building, which would prevent full access by all persons.

   Fixed Rate Loan - A loan where: (a) the interest rate remains the same for the whole term of the loan or (b) the interest rate remains the same for a specified period during the loan term, so the repayment amounts also remain the same during the fixed period.

   Interim financing - A construction loan made during completion of a building or a project. A permanent loan usually replaces this loan after completion.

   Market Capitalization - The total dollar value of all outstanding shares. Computed as shares times current market price. It is a measure of corporate size.

   National Association of Security Dealers Automatic Quotation System (NASDAQ) - An electronic quotation system that provides price quotations to market participants about the more actively traded common stock issues in the OTC market. About 4,000 common stock issues are included in the NASDAQ system.

   Net worth - The difference between total assets and total liabilities.

   New York Stock Exchange (NYSE) - Also known as the Big Board or The Exchange. More than 2,000 common and preferred stocks are traded. The exchange is the oldest in the United States, founded in 1792, and the largest. It is located on Wall Street in New York City.

   Old boy's club - A tight network of business relationships, usually males.

   One man show - A sole proprietorship.

   On the take - Accepting a bribe.

   Over the counter market (OTC) - A decentralized market where geographically dispersed dealers are linked together by telephones and computer screens. The market is for securities not listed on a stock exchange.

   Variable Rate Loan - A loan where the interest rate can vary from time to time in line with base lending rate movements, so the repayment amount may increase or decrease if the base rate increases or decreases.

Questions & Answers:

Ask your questions on the BillFitzPatrick.com Forums.

   I'm thinking about opening a business in an inner-city neighborhood and I'm getting nothing but negative feedback. What do you think?

   As more and more big businesses pull out of inner-city neighborhoods, a vacuum is created that can be filled by savvy entrepreneurs such as yourself.

   The many people who live in the inner-city have the same wants and needs as everyone else. They need food, clothing, shelter, and recreational opportunities. They need restaurants and convenience stores, beauty salons and tailor shops. They probably need you and your enthusiasm. Do your research. Travel through other inner-city neighborhoods and find businesses that are working. Talk to residents. Talk to existing small business owners. Talk to city hall and to local banks and the SBA (Small Business Administration). You may find incentive programs for entrepreneurs willing to provide a quality product or service to neighborhoods in need.

Seneca

   What are percentage leases and are they a good idea?

   Percentage leases are common in mall leasing and uncommon elsewhere.

   In a percentage lease, a storeowner normally pays a set-base rent followed by a percentage of sales above the base as additional rent. The percentage lease forms a partnership bond between tenant and owner since the more money the tenant makes, the more rent he pays. Therefore, there is an incentive for the landlord to help the tenant make money. The landlord's help is usually in keeping the property well maintained and in advertising to build foot traffic.

   Am I entitled to free start-up months when I sign a commercial lease?

   Negotiating a month or two of free rent to set up your business is common in commercial leasing situations, but is not an entitlement. You must negotiate each point of your lease carefully and you should seek legal counsel before you sign and make a long-term commitment to any location.

   Since most businesses require that you make substantial leasehold improvements to a property – someone else's property – you want to be sure that you have a strong lease. And, since you will probably be investing a great deal of money in getting customers to find you, you will want a stable location, a permanent address.

   In setting a value on a business, an appraiser will give close consideration to lease condition and terms. You may have a great ice cream shop, but if the lease is up in a year and the landlord won't renew, you stand to lose a great deal.

Support:

From The American Small Business Association: http://www.asbaonline.org/
From The Better Business Bureau: http://www.bbb.org/
From The International Council for Small Business: http://www.icsb.org/
From the M.I.T. Entrepreneur's Club: http://www.mit.edu:8001/activities/e-club/e-club-home.html
From the Mother's Home Business Network: http://www.homeworkingmom.com/
From the National Business Association: http://www.nationalbusiness.org/
From the National Business Incubation Association: http://www.nbia.org/
From National Federation of Independent Business: http://www.nfib.com/page/home.html
From Small Office Home Office: http://www.soho.org/

Sandbox:

	What kinds of things can you be doing right now that can start to lead you to success?
	What elements make up an action plan?
	What personal qualities are necessary for success?
	How has Andy developed his business?
	In what ways has Don been a friend and mentor to Andy?
	What good is Andy now doing for others?
	What almost happened to Andy in our story?
	What made Andy a success?
	What do other people think about Andy's success?
	How does a person make the final decision on whether to be a success or not?

Go to Mission 8

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