Cost calculation

Reality check! What is most important to you, the initial cost or short and long term value?

When Jim Rohn was 25 and broke, his first mentor, Earl Shoaff, recommended that Jim purchase the book “Think and Grow Rich” by Napoleon Hill. Jim Rohn, now a multi millionaire, purchased the book from a used book store for 47 cents. Jim Rohn estimates that the book helped him to earn hundreds of thousands of dollars. He spent 47 cents and gained value which earned hundreds of thousands of dollars. I repeat the question. What is most important to you, the initial cost or the short and long term value?

It is not unusual to hear people balk at spending $400 to start a business which can generate a hundred thousand dollars year after year. Look at the cost to value ratio.

A franchise will cost 250,000 to 500,000 to 750,000 for the initial purchase. In addition there will be employee costs, rent and utilities for the space to locate the business and inventory for starters. As the past owner of more than one brick and mortar business, I can guarantee that there are MANY additional costs associated with a brick and mortar business. Employee costs alone are extensive.

A home based business can be started from your garage or kitchen table or even a spare room in your house. Therefore, zero additional rent or utilities. No employees or employee costs which represents a huge decrease in expense and headache. There should not be any inventory. If you select a company where you have an auto ship and end up with a garage full of product, shame on you; that is an expense you do not need to incur.

Another factor to consider with a franchise or brick and mortar business is that you must physically leave your home and spend time at the business. This adds the travel expense of going back and forth to work as well as additional clothing expense; you can’t go to most professional businesses in your bathrobe. Lunches away from home becomes another expense,

Personally, I have a thirty second commute from my bedroom to my home office. No traffic. No weather challenges driving. No vehicle expense. No expensive restaurant lunches. No lost time commuting.

Every business everywhere requires marketing! There are many ways to advertise your business to fit any marketing budget. Every business will require marketing. Marketing will consume either time or money or a combination of the two. This is the one thing all businesses have in common.

Franchise and brick and mortar businesses are very expensive to start and operate. Home based businesses are extremely low cost to start and operate.

Bonus! The return on your investment is much faster with a home based business than any franchise or brick and mortar business and requires far less time to earn a profit.

Carefully examine the cost to value ratio. Home based business wins every time.