Good Deals Are Not Found, They Are Made.
Business is the process of creating value by solving problems. A good deal is comprised of a problem and a solution. Finding a deal is the same as finding a problem. We make a deal good by creating a solution. The better the solution the better the deal. There are several forms of value, and the better understanding you have, the more creative you can get when building your solution. Here is a list from the book The Personal MBA:
Product - Create a single tangible item or entity, then sell and deliver it for more than what it cost to make.
Service - Provide help or assistance then charge a fee for the benefits rendered.
Shared Resource - Create a durable asset that can be used by many people, then charge for access.
Subscription - Offer a benefit on an ongoing basis, and charge a recurring fee.
Resale - Acquire an asset from a wholesaler, then sell that asset to a retail buyer at a higher price.
Lease - Acquire an asset, then allow another person to use that asset for a pre-defined amount of time in exchange for a fee.
Agency - Market and sell an asset or service you don’t own on behalf of a third-party, then collect a percentage of the transaction price as a fee.
Audience Aggregation - Get the attention of a group of people with certain characteristics, then sell access in the form of advertising to another business looking to reach that audience.
Loan - Lend a certain amount of money, then collect payments over a pre-defined period of time equal to the original loan plus a pre-defined interest rate.
Option - Offer the ability to take a pre-defined action for a fixed period of time in exchange for a fee.
Insurance - Take on the risk of some specific bad thing happening to the policy holder in exchange for a pre-defined series of payments, then pay out claims only when the bad thing actually happens.
Capital - Purchase an ownership stake in a business, then collect a corresponding portion of the profit as a one-time payout or ongoing dividend.– Josh Kaufmann, The Personal MBA
A Good Deal For Someone Else ≠ A Good Deal For You
SWOT analysis has four pieces which can be broken down into internal and external factors and then harmful and helpful factors
Strengths are your internal helpful factors these are things special or unique to you they're going to set you apart from others
Weaknesses are your internal harmful factors these are things or skills that you don't have that are going to prevent you from performing as well as somebody else
Opportunities are going to be your external factors that are beneficial and these are going to be resources that you have access to that once again somebody else wouldn't have.
Threats are your external factors that are going to be harmful
When performing SWOT analysis, you can either answer the questions in a general fashion or you can be very detailed. It's very easy to go through a really quickly and it's something that you can do to analyze where you should be developing a business where you can create value combining it with the aforementioned list we can build a value creation and value delivery system. Additionally, by looking at your helpful factors that set you apart, we have our sales and marketing bullets.
Use Leverage To Get More Value
We cover our Threats and Opportunities by leveraging and trading our strengths and opportunities. There are 4 currencies to trade the 12 forms of value: Money, Credit, Knowledge and Time.
Money is by far the most obvious of these for currencies but I want to talk about credit credit is not just your FICO score credit is credit you are given by other people. Of course your FICO score come from people as well but this is truly your relationship value when you have a very strong credit with people and you can work with them to that point that is something you can Leverage.
The next item that I want to bring up is knowledge. This is by far the most expensive piece to leverage for we want to have as much knowledge as we possibly can so that we don't have to pay for other people's knowledge additionally when we're looking at how much knowledge we have that's going to put us in a better position to receive better Knowledge from somebody else this is why it's important to always seek education and be a lifelong learner
The last one is time and for me time is by far the most valuable piece in this whole system we sleep about 7 to 8 hours which leaves about 16 hours left or approximately 1000 minutes that can be broken up into 100 10 minute blocks. you get a hundred blocks a day. The thing is once you use your blocks you can never get them back. You can always get more money you can always build your credit you can always build your knowledge you can never get more time.