Sam
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Sam in Stack That Money,

​One Trap You Must Avoid When Starting Your Own Business: Demand


Determining a Need

Everybody knows the basis of economics is supply vs demand. Building your own business is the first step to moving from the consumer side to the producer side. When people create a business, they are creating a supply for the market. (stop being a consumer). However, the demand side of the market often gets completely neglected!

Listen to the market. There must be a need. Forget about doing what you love. The market is selfish and only cares about what it wants. Why are most artist poor? Because they create art based on what they feel like looks good. Most artist do not create a m the market wants. Not everybody can appreciate the artist’s “creativity” and “genius”. The result? Nobody buys. There is no revenue.

Revenue is the lifeblood of any new business. When your market fulfills a true need, revenue will come to you which you can reinvest to grow the business. A smart investor knows that the sales figure and profit margin for a company is all that matters. The fancy logo, the beautiful packaging and everything else is just window dressing.

The hardest job for a marketer is to advertise and sell a product which the market doesn’t want. The business owner loses money, the marketer makes less because the owner can’t afford to pay him any longer to run the campaign, and everybody ends up frustrated.

The purpose of owning a business is not to satisfy your passion or to make you rich. No, the business exist to satisfy what the consumer wants. As a producer, you need to cater to the consumer’s selfish needs. Think of starting your own business like having your first child.