LEARN ABOUT MONEY (LESSON 8)

RELATIVE INCOME VERSUS ABSOLUTE INCOME

Bheema electronic store is successfully executed and making good turn over,everyday he counts his profit and turnover as it surge he is even more motivated to apply Innovative solutions to his business,being enthusiastic he meets ram to share that he is now richest man in his town.

BHEEMA: Hello ram,now I am the richest man in my town

Ram: OH good to hear

BHEEMA: Do you know my monthly turn over is 50 lakh and profit of almost 30 lakh

RAM: How come,your town population is too less to make such a whooping profit

BHEEMA: Good question,I have scaled my business to neighboring town through E commerce,people are finding comfortable to purchase from local brand  than a corporate one.

RAM: Everything is ok,how many hours you have dedicated to your business

BHEEMA: Eighty hours in a week

RAM: Then you are not the richest man in your town

BHEEMA: What,are you joking?

RAM: No,In your town there are people making 20lakh profit by working 40 hours a week.

BHEEMA: But its less

RAM:Yes,there is standard terms to calculate whether a person is rich or not that is known as RELATIVE INCOME VS ABSOLUTE INCOME

BHEEMA: What is it?

RAM: RELATIVE INCOME is hourly income,ABSOLUTE INCOME is per year income,3crore per year/50 work week=600,000 per work week,600,000per week/80 hours work week=7500 per hour,on the other hand your neighbor 2crore per year/50 work week=4lakh per week, 4lakh work week/40hours work week=10,000 per hour

BHEEMA: What is this per hour?

RAM: You are making 7,500 per hour but your neighbor is making 10,000 per hour who is richer

BHEEMA: But how come for me you calculated by 80 , for him it is 40 hour only

RAM: He is working 40 hours per week,but you are working 80 hours per week that is why

BHEEMA: In real terms I am working harder than him,just to make less money compared to him

RAM: Yes

LESSON LEARNED

ALWAYS CALCULATE YOUR INCOME BASED ON WORKING HOURS

RELATIVE INCOME IS THE REAL MEASUREMENT OF WEALTH FOR THE NEW RICH

                                                                                           -TIMOTHY FERRIS

Learn about money(Lesson 7)

BEING UNIQUE VERSUS STUPID

Bheema has started construction for his electronic store,meanwhile he gets to know that Innovation always wins his mind forces him to think in a different way as he heard that eCommerce giants are entering into his town till now there was no service offered to his town.The fear made bheema to think and he came up with an idea rushed to ram's house to ask his advice on this. 

Bheema: I have started to think like you.

Ram: what?

Bheema: Have you heard about eCommerce operations beginning in our town,I have plan to overcome them.

Ram: Oh then tell me.

Bheema: They are offering product and service(delivery),I am going to offer product and delivery(service) in my town.

Ram: But that's not going to work out

Bheema: You are dump

Ram: Understand the E commerce has lot of mobiles which consists of various models,prices,companies and the latest products.

Bheema: so?

Ram: How can you think the customer would come to your shop where choices are a single percentage compared to E commerce.

Bheema: but I heard being differ rent wins the game

Ram : Ya, but you must also know that you have to fix what is wrong not what is right.

Bheema: Do u mean I am wrong?

Ram: No,you have to fix what is wrong in your buisness

Bheema:what?

Ram: E commerce giants need logistics partner when they enter into smaller towns as their own logistics wouldn't be feasible to a small town,In your town there is only a one logistics company and it has no plans of scaling up also.

Bheema So,what?

Ram:collaborate with the logistic partner before they collaborate,after that as the company have no resources to handle new clients they will reject the offer.Later you will the be the only mobile shop owner and E commerce   for your whole town.

Bheema: will they if I offer delivery service

Ram: will buy from Amazon(products not available nearby),their service was in your town.

Bheema: Yes

Ram: Then it will be successful as you are the only one in your town who had both online and offline electronic store.

Bheema: Its like a dream

Ram: But remember being different doesn't win always.

LESSON LEARNED

BEING DIFFERENT DOESN'T WIN ALWAYS 

IN THE NAME OF BEING DIFFERENT DON'T BE STUPID

                                                                                 -TIMOTHY FERRIS

                                        

                                                

                                                                           

Learn about money(Lesson 6)

FILL THE DEMAND 

Bheema understands lots of aspects of financial market and entrepreneurship,however when it comes to implementing it practically he fails frustrated bheema discontinues his financial classes and moves to meet Ram in great anger as if a stone has fallen on his head.

RAM: What happened?

BHEEMA: As if you don't know anything.

RAM: What do you mean.

BHEEMA: Explaining what happened ..........................

RAM: Oh it seems like you were doing well with my practical examples than a course

BHEEMA: Ya

RAM: OK, here after I will be guiding you as I have been guiding you earlier.

BHEEMA: That is always better

RAM: What about your vegetable business.

BHEEMA: Not well , you advised me to change the business model but I didn't that is the problem.

RAM: Not only that

BHEEMA: Then what else

RAM: You don't have enough market, the start up has accessed everything

BHEEMA : What?

RAM:  Remember what I have explained in lesson 4.

BHEEMA: Ya,so now what should I do

RAM : Look where is demand

BHEEMA: How?

RAM: Start new business,by looking at demand.

BHEEMA : Are you mad,I don't have enough money at all for my expenses

RAM: No, from where do you purchase electronic item

BHEEMA: From my neighboring town

RAM: Why?

BHEEMA: Because it is not available here

RAM: Then fill the demand

BHEEMA : Are you asking me to set up a electronics store

RAM: Yes, now a days you are better in understanding few things

BHEEMA: Will it be successful because I am in dearth of money

RAM: Do you buy an item which is available in your town from neighboring town

BHEEMA: No,why should I?

RAM: Then it will be successfull

BHEEMA: OK ,now I got it

LESSON LEARNED

ALWAYS FILL THE DEMAND MUST BE YOUR FOCUS

CREATING DEMAND IS HARD BUT FILLING DEMAND IS EASY

-TIMOTHY FERRIS