If you want to get rich, you have to build something that people need. Or at least, that’s how things are supposed to work. It’s simple economics, after all. And well, the principle of supply and demand is what lies at the core of almost every successful business that ever was and ever will be.
But given that there are so many businesses that have already been established, you might think that as time progresses, entrepreneurs may have to exert extra effort to come up with something unique and useful.
There is another option — you can simply buy a business instead. After all, why would there be a need to expose yourself to risk when you can invest in something that’s been tried and tested? Well, there are a few factors that you need to consider:
Solid reputation
If there’s one thing that drives sales, it’s a good reputation. Businesses that have been able to establish a loyal customer base often enjoy a stable cash flow because of the repeat customers that buy their products or use their services on a regular basis.
There’s a good reason that Samsung and Apple are two of the most popular phone manufacturers. When you buy a reputable business, you don’t have to build up a reputation. You’re bound to get a loyal customer base. On the other hand, if you build a business from scratch, you’re going to have to do quite a bit of marketing. Add in the fact that depending on how good what you’re offering really is, it can take a long time to establish yourself as a business that can be trusted.
Return on investment
Naturally, you’re going to want to earn money back from your business as soon as you can. This also depends greatly upon the reputation of your business. A new business will usually attract people who are curious.
The problem is that people are pretty critical and more often than not, they’re going to lean towards something that’s already been tried and tested. It’s only practical that they’re going to want to minimize risk. And unless you offer something that’s truly compelling, you’re going to have difficulty getting your investment back if your business still needs to establish itself in the market.
Demand
As discussed earlier, at the core of every business lies the principle of supply and demand. When a particular commodity is aplenty and demand is low, prices will also tend to be low. The exact opposite can be said when supply is low, but demand is high. The price will, of course, be high.
A prime example of such a scenario comes in the form of the sneaker scene where manufacturers intentionally produce a limited number of exclusive shoes. Oftentimes, this results in extremely high resale prices.
Now, if you buy a business, chances are that business is going to have already been established. This can either work in your favor or against it, and well, you’re already going to have some competition in your chosen field.
Now, if you do decide to build a business from the ground up and that business turns out to be the first of its kind, you’re going to enjoy the benefits of having a high demand for your products or services. And this high demand is often the tinder to the flame of a business’s growth.
