Building a sound and successful business takes both book and street smarts. Getting the right education can train you to deal with all sorts of business scenarios and to be prepared with strategies that can make your company thrive even in tough market conditions.
Having on the street smarts and having been in tough situations that you survived, gives you the confidence to push through tough times and the knowledge base that only experience can create. During different times and situations regarding your business, you may call on each of these sets of skills or even use them together to create success.
Similarly, you need to use every tool and asset available to create success for your enterprise. This includes selling the right products and services that customers want. If they inquire about it constantly, you need to supply it or another business will and take your customers.
You also need to look at ways to utilize the capital your business generates in order to maximize the returns to your business. One way to do this is to consider investing the excess profits your company generates. Excess means profits that would normally sit in a bank for an unusually long period of time generating little or no interest for the company.
If you are to make these types of investments, you must be very careful and invest on those things that allow for limited exposure as you gain good returns. Here are a few good examples:
Over the last four decades, the stock market has been one the most consistent profit generators for investors. This continues to be the case as the market today is at an all-time high. The challenge is though that the market as attractive as it is, can have collapses and if you invest at the wrong time you can lose a lot of money, so any strategy built around the market has to include some risk management.
The best ideas for this is to buy mutual funds which purchase a basket of stocks of similar types, They might focus on technology, home building, utilities, oil or any other market sector. By spreading the risk over sometimes dozens of stocks risk is mitigated. Equities experts like Mr. Jean-Yves Sireau recommend another to mitigate risk which is to purchase options around the stocks you purchase. Options form a hedge against a stock moving in the wrong direction. And you can set up your option purchases, so that even if the stock you invested in goes down, you can still profit over the short term, while you wait for it to recover.
Over time real estate returns better profits than any other investment. This is because people always need somewhere to live or to place their businesses. When you look at real estate as a business investment, the first place to start is with the places that house your company.
Do you rent space for your offices, factories storefront, or warehouse? If so, you should consider trying to buy instead. Not only would this create additional deductions for your company, if you purchase a multi-unit building, you can rent out the excess space to other businesses. Additional real estate purchases can include real estate in your city. Since this is not your primary business, aim for the neighborhoods and types of properties that you are already familiar with.
In any case, take your time and work with a licensed real estate agent to assist you through the process. If you are too busy to take on this business consider investing in a real estate investment trust or REIT which is an investment that purchases several or many properties and treats them all as a single investment. REITS are managed by real estate experts and you can see their track records and the management’s CVs before you invest.