Discover The Truth Behind The Passive Income Business Model: Part I – Scam, Pie-In-The-Sky or Ingenious Reward?

100%Have you ever known anyone who has entered into a passive income business for themselves, but never got their business off the ground, or for whatever reason quit almost as soon as they began? It’s true. The majority of people do give up only after a few months, only to label passive income businesses as a scam, a pyramid, or a pie-in-the-sky dream.

Click here–>To watch a celebrity home biz millionaire interview a Harvard Graduate Biz Professor on this subject

However, I find that most of these people began their new business with a “get-rich-quick” attitude and when their grandiose expectations were not satisfied, or they got turned down and rejected too often, they quickly became disappointed, disillusioned, deflated and quit. But the way I see it is that’s a blemish on them, not the passive income industry.

If you objectively examine the income structures of passive income economic models without being cynical or jaded, you’ll find they’re actually quite brilliant and really do work; that is, if you’re willing to commit 100% of yourself to your business. But isn’t this true for anything that’s worthwhile in life?

Let’s look at 3 examples to see why:

  1. You’re certainly not going to become an accomplished guitarist or pianist if you practice for 1-hour every other day, right?
  2. It’s very unlikely you’ll get an “A” or even a “B” in class if you’re not committed to doing the homework, the reading and showing up for lecture.
  3. It’s impossible to become a successful insurance or real estate agent if you don’t consistently market your business, talk to at least 10-20 people a day and ask prospects for their business.

This is true for almost any walk-of-life… you get out what you put in!

100%2However, it doesn’t require 100%, but 200% to be successful in business – 100% from you and 100% from the business model you choose to work with. It’s a waste of time to dedicate 100% of yourself into a business that isn’t capable of giving 100% back in earnings that are equal to your efforts.

Let’s examine 2 more examples to understand why:

1. If today you put in a 100% of yourself going door-to-door selling encyclopedias, that business would not mirror your efforts in compensation, as the mechanics of wealth are just not there due to an eroding, obsolete industry.

2. The same is true for the guitar/piano example above; if you put in 100% effort in playing an instrument that is substandard and incapable of holding a tune, you will fail at producing pleasing notes and soon quit because the defective instrument’s output will never be equal to your input no matter how long or hard you try.

Both endeavors above would be a waste of your valuable time if your goal is to become financially secure or a guitar virtuoso.

Fact #1: The right passive income business model can build you a 6-figure income (and more!) where there are no accounts receivable, no accounts payable, no overhead, very little inventory and no employees.

Now, I hear you say, “Sounds too good to be true.” Well, maybe it does, but let me ask you this: is that a good enough reason to stop exploring your income options and a chance to significantly increase your quality of life and be happier than you’ve ever been before? I don’t think so.

Fact #2: Millions of people are currently earning 6-figures annually from passive income businesses.

Therefore, to be close-minded about supplementing your current income and automatically saying, “No,” wouldn’t be considered making an informed decision until you adequately research, learn about and understand this economic model. Then after you have gathered all the objective facts,  make a decision. That would be the thought process and actions of a sensible business person!

However, for me to fully explain the passive income vehicle in 1-2 paragraphs, or even this entire article, wouldn’t be very effective until you know how to place value to a business. Moreover, most people who don’t understand a business concept where their start-up and marketing capital is at stake will experience worry, concern and anxiety, and quit before they begin. I find that in order to decrease and eliminate anxiety you have to increase knowledge. Therefore, I want to start out by explaining 4 key business elements that are essential for acquiring wealth.

4 principles to look for in a business to determine your likelihood of HUGE success:Success

1. A Big Expanding Market: This is where a product or service is consistently appealing to a growing group of targeted individuals on an ongoing, continuous basis. Let’s face it. The best VHS movie or cassette tape producers in the world wouldn’t succeed no matter how good they are, as success is very unlikely in an eroding, obsolete market.

2. A Unique & Consumable Product: If your product is unique, people must come to you to purchase it. If your product is not unique you strictly compete on price and convenience (whose location is closest to the customer). If you sell a non-consumable product or service then you’re unemployed until your next sale. To acquire wealth you must have repeat sells of consumable products, whether it’s electricity or water, or every time someone gets to the bottom of a box or bottle. This way, you get exponential monetary rewards by only selling customers on the product once.

3. Trends and Timing: The individuals who are making REAL money are the people in front of large trends; and these savvy business people get there by studying what creates them. Modernly, it’s the baby boomers (BBs – born between 1946-1964) that create the largest trends today. They’re nearly 1/3 of the US population at approximately 78 million strong and control about 65% of all the money, and spend close to 50% on all Consumer Packaged Goods (CPG) with an estimated annual spending of more than $2 trillion in the U.S. alone. In fact, BBs modify and expand every industry they get involved with. If you can predict where the purchase behaviors of BBs are going next you can make a lot of money!

Let’s look at a few examples of past Baby Boomer buying patterns:

  • In 1940, the BBs launched into stardom a little known baby food company called Gerber. By 1955, just 10 years after the BBs were born, Gerber had sold 1.8 billion jars of baby food;
  • When the BBs took their 1st steps Buster Brown and Kinney shoes became multi-million dollar companies;
  • When the BBs went out to play Mattel and Hasbro became rich providing entertainment to this young group;
  • When BBs went through their teenage years, fast food restaurants became billion dollar companies feeding the BBs;
  • When BBs went into their 20s & 30s in the 1970s & 1980s, the housing sector boomed for 15 years, and at the same time the stock market had a 15 year rise.

Baby Boomers have an 18 year span from the front edge to the back edge. This is a very important number for you. If you get in front of a BB trend, you get a full 18 year run of popularity for your consumable product, and that’s why you should study the front end or the nose of BB trends.

As a shrewd business person it’s part of your job, no matter how you currently make a living, to be looking for industries that are expanding or are about to expand. It really doesn’t matter how long you’ve been in business in another industry or profession, or what you’ve been educated in; either you’re in front of trends or you’re not! There is absolutely no rule that mandates you to have a loyalty to something just because you’ve been educated in it or have been doing it a long-time. Sure, continue pursuing your passion, but be open-minded to supplementing your income. By doing so you’re not being traitorous toward your present profession, you’re being smart!

To leverage on Baby Boomer trends there are 3 questions to ask:

  1. How can you fashion your current business offer, advertising, marketing and business plan toward the current purchasing trends, behaviors and lifestyles of baby boomers?
  2. What business can you enter into for minimal start-up that already caters to BBs in order to supplement your income?
  3. What are the next BB trends to get a jump on the front edge?

First off, BBs are between 49-67 years old. So, what do you think this group’s current, expanding trends are, or their next big trends will be? What are BBs current or next desires, concerns and needs?

Let’s look at some current Baby Boomer buying trends to get an idea:

  • Healthcare, Wellness & Fitness: InShopping general, BBs will almost spend and do anything to prevent deteriorating health from decreasing or eliminating their active lifestyles, such as diabetes, obesity, high-cholesterol, heart disease, cancer, depression & anxiety, dementia & Alzheimer’s, and tendonitis & arthritis, in order to continue their active, healthy lives.
  • Looking Younger: “Anti-aging facial products are very popular among boomers and spending on these products jumps significantly between younger and older boomers.” “Overall, Boomers aren’t trying to find the Fountain of Youth, but the Fountain of Vitality,” explains Matt Thornhill, coauthor of Boomer Consumer. “They know they’re older—not aging, just growing older—so they aren’t trying to fool anyone that they’re still young. But they will spend time and money doing whatever is necessary to maintain vitality. If you have a product or service that helps Boomers maintain that vitality until they take their last breath, you’ll be making money for years to come.” Thornhill also notes, “No one wants to freeze their face in time like Cher or Joan Rivers. Rather, they want to reduce wrinkles or age spots so they look vital, active, healthy—not younger.”
  • Food & Beverage: “Boomers are using healthy eating as a key strategy in their goal to live longer, healthier lives.”
  • Clothing: Because of BBs quest for an active, youthful lifestyle, many clothing manufacturers are marketing “youthful clothing lines geared towards the middle-aged, mature adult.”
  • Grandchildren: “Boomer grandparents are also doing more with, and for, their grandchildren, spending a collective total of $35 billion a year on their grandkids.”
  • Adult Children: “Nearly 50% of parents with children between ages 18-39 are supporting them in various ways including living expenses, transportation costs, spending money, medical bills and help with paying loans like student debt.”
  • Technology: “Younger generations are the first to adopt new technologies, but once they go mainstream it’s the boomers’ adoption that is driving the real growth of technology.”
  • Home Remodeling: “When housing markets crashed between 2005 and 2009, the remodeling share climbed to more than two-thirds of total residential investment,” according to the JCHS (Joint Center for Housing Studies of Harvard University). While it may take several years for the housing market to recover, the JCHS predicts that home improvement spending will increase by about 3.5 percent per year, until 2015.”
  • Education: “One-third of the nation’s student loan debt is held by individuals over the age of 40. Though some individuals choose to further their own education during midlife, it is likely that many baby boomers are helping their college-age children with college expenses and loan payments too.”

According to Beth Brady, global head of Nielsen Marketing, “With boomers poised to make up half the U.S. population in 2017, marketing to boomers just makes good sense!”

LeverageTherefore, if you want to acquire wealth you must align yourself with companies and industries that have positioned themselves in front of baby boomer trends.

4. The Ability To Create Leverage: This knowledge and skill is not taught in our culture. Instead, what we’re taught is to get an education, make a resume and then exchange our expertise for someone’s money, or work for someone else exchanging our time and labor for money. The problem with this is if you’re not trading your knowledge or working, you’re not making any money, like when there’s a low-demand for your expertise or labor due to a number of reasons such as economic factors, or even going on vacation (if you’re self-employed, vacations cost you not only the vacation money but also the money forgone by not working during your vacation). Every hour you don’t spend trading your knowledge or labor for money costs you money!

Leverage: An increased means by which to obtain something; e.g., investing $1 million at 10% interest would earn you roughly $10,000 a month whether you’re on the golf course, on vacation or spending time with your family, so you’re leveraging off your money. This is a leverage that anyone would die for, but very few people have because they don’t have the capital, the means to generate it or the knowledge to do so.

I am now going to tell you about a leverage concept that is available to everyone including yourself. And if you get nothing at all from this article other than a basic understanding of this simple business model I’m about to explain, you’ll gain some very valuable info for future consideration.

Imagine that you operate your own small business and you employ just one person, Bob; Bob works for 40-hours a week and you work 40-hours a week too. You as the owner get paid for 80-hours of work because, as the boss, you get to take a portion of Bob’s labor and productivity as income back to yourself. In other words, you’re leveraging off of Bob’s efforts and labor. So in theory, the more employees you have working for you the more leverage you acquire. In practicality, however, it’s very difficult to obtain leverage from employees. Have you ever heard the old saying, “If you have 1 employee you have 1 headache, but if you have 100 employees, you run an adult daycare center?!?”

The reason why it’s hard to leverage through employees is that they will never work as hard for your business as you will because, since they’re not the owners, they don’t get paid as much as you do, they have no pride of ownership and thus, their heart and soul is not in the business, so they lack your superior work ethic. As soon as you leave to run an errand, it’s time for half-speed employee, talking to each other, talking on the phone, texting, playing computer games, taking a coffee break and even taking a nap; not to mention office supply theft (post-its, pens, rubber bands, paper clips, printer paper and ink, software and even inventory).

Of course, there are always exceptions to this case, but in general it paints an accurate picture. The #1 source of business losses is employee theft, including stealing time! The fact is, most employees do not use time and attention optimally and get distracted quite easily and lose focus whether it’s deliberate or not.

 So, the rule of thumb for reaching TRUE leverage is:

You Must Create A Work Environment With A Level Playing Field Where Everyone Has The Same Opportunity To Gain The Same Amount Of Compensation – Only Then Do You Acquire TRUE Leverage… An Ingenious Reward!

(This article content was conceived from a concept by Tim Sales)

Click here–>To watch Tim Sales speak on this subject

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