Monthly Archives: May 2005

Keeping a Promise and Selling Notes

I was cruising around the web one day when I stumbled upon ANOTHER financial blog. I’m not going to lie, I’m getting sick of these things popping up. I delete many off my list after 2 or 3 months.

Have a computer and a stubby protuberance on your body to type with???

Obviously many of these blogs are useful and interesting, and I do enjoy financial blogs from real experts in their field, or at least people who practice what they preach.

WHAT I REALLY LIKE are financial blogs where people keep track of their plans to make more money or outline their goals for success (whatever they may consider success).

Smarty runs a blog called Growing Money where he thinks of new ways to increase his wealth little by little. He did a whole series of money-making idea posts which I felt were “All hat and no cattle” so I challenged him to act upon one of them. Well, he did.

He Ebayed a bunch of his junk and will report the results. I told him I’d link him if he completed one of his ideas. Well here you go! Smarty, Growing Money, Smarty Growing Money
Ebaying is easy Smarty, your next challenge is to do something more gutsy! I am interested to see your results though.


On another ‘note’, literally…..I sold my class notes for two of my classes yesterday. The results were not what I expected! I will report full results by Friday.

Another thing, the Bottled Water Experiment continuation is not going well. I’ve met with Barry every day for the last week, only to be dissapointed by the weather. We need hot and swealtering….not cool, windy and gloomy like this whole last week.

Ciao,
-Nev

Stock Market Fluctuations & Water

Yesterday morning I got a pleasant surprise as Dynegy (DYN) was up 12% in my portfolio after a steady, downward decline.

After learning to be patient with my portfolio, it has really paid off. Dynegy has for example has earned me a 25% profit at times and put me in a 30% loss at times….but that’s in the short term. I won’t even bother explaining why long term holding makes a lot of sense, I’ll let Ramit Sethi from “I Will Teach You To Be Rich” do all the work.


Water Experiment Update:

After going home for Mother’s Day this weekend (I actually forgot to bring any clothes to Houston!), I found Barry yesterday and loaded him up with the remaining 60 bottles of unsold water.

Once we unloaded the water from my trunk, the sky became dark and the air became cool. Not good for selling water. Needless to say, sales were extremely low, and we rescheduled the selling.

Despite the results, Barry was still optimistic about upcoming hot, summer days:

So far, this bottled water thing is NOT going how I expected. But with the low sales aside, you’ve got to appreciate the fact his shirt says “Water $1” and then “Captain Morgan“!

Roadside liquor sales?? Now THAT’S a good idea!

Artificial Deprivation

When you can’t have something, you want it more. This fact of human nature can be exploited to save you money.

Personal Example:
Despite having built up a nice amount of cash from several businesses in my early college years, I would subconsciously deprive myself of money, making me “virtually broke” so I didn’t spend too much money.

I did this by just pretending I didn’t have any money in the bank. Unfortunately this method worked a little too well. I would only spend about $60 a month on entertainment, not a lot for a socially active college student.

My Remedy: The spending account.

I created another free account with BankOfAmerica and labeled it my Spending Account. This is the money I designate for spending on anything I want. This money is MEANT to be spent and not saved. It kept me from spending too much money, but also kept me from living like a total cheapass.

If I don’t have enough in the spending account, I don’t buy it.

Thanks to this method, I have a healthy amount of money to spend, and I don’t take it overboard.

-Nev


After this Financial Times article, I am now mentioned in 4 out of the 5 news sources needed to meet one of my medium term goals.

Ripe, Emerging Markets – Mexico

A lot of buzz is going on about China and their emerging economy. If it’s all over the press, it’s old news.

One emerging market I’ve been interested in (on the domestic and international level) is Mexico.

Some quick observations:

  • Hispanic Americans (wow, I’m so politically correct!) have the highest percentage level of disposable income in the United States. This means they are big spenders for their relative level of income. Appealing to this market will be big business.
  • The hispanic population is the fastest growing in America. In a few years, it is projected the majority of Texans will be Hispanic.
  • Strong trends that introduced new races into more mainstream culture are currently happening: Hispanic boxers, music artists, athletes, politicians etc. are rapidly on the rise.

States such as California, Texas and Florida can already see a very strong infusion of Hispanic culture. In fact, my favorite radio station in Houston is a Reggaetone station (Spanish Rap). That’s just on a domestic level. In Mexico itself things are starting to become more online, a great opportunity for anyone. So how do you profit from this?? EASY:

Take a look back at the United States and other developed countries before our full-blown internet age, and replicate the processes and new services offered.

One lucky lady who happens to be in the PERFECT position to take full advantage of this is Rebecca who runs a new blog called Trendy Tendencias. I have been reading her blog as she brings something fresh to the blogging world, and is identifying trends you can profit on. I’m keeping an eye on her as she brings all sorts of new trends in Mexico to my attention.

It would be wise to appeal to this market before the press jumps all over it.
-Nev

Bottled Water Experiment – Part Deux

During my first bottled water experiment I learned how to setup shop and shamelessly sell a product. The next item on my agenda is to delegate that task to others while I do nothing.

During the first experiment I met a homelss guy named Barry. He has a can-do attitude and also likes to make money. What he does NOT have is Capital and transportation.

Well I do.

I recently tracked Barry down and gave him a proposal. If I set him up with several cases of ice cold bottled water and a couple of ice chests, he could sell the water all day (instead of simply begging for money) and we would split the revenue down the middle. Obviously at first I get the sour end of this because I will be paying for everything…..but I also don’t do a fraction of the work he will have to do.

SO LET’S GET STARTED:

The previous day I went to Walmart and loaded up my car with 5 cases of water and one ice chest.

120 bottles of water cost me $19.80 + tax. The cooler cost me $18.86 and tax.
Total Spent so Far: $40.22
Even if he sells all 120 bottles, I will barely make a $20 profit on the first run.

I then brought all the products home and began cooling them:

Each 24 pack case had 3 gallons of water and packaging:
1 Gallon = 8 lbs.
1 Case = 24 lbs.
5 Cases = 120 lbs.

I could only fit 3 of the cases for cooling overnight. The rest would be cooled in the ice chest later.

The next morning I met near the selling corner where Barry and I agreed to meet at exactly 10:00am. He showed up exactly on time (Seriously, the SECOND my watch hit 10, he showed up riding a bicycle). Unfortunately for us, it was gloomy and under 70 degrees (I’m in Texas approaching summer…what the hell!?!)

I gave him another shirt I made that said “Water $1″ on both sides. I forgot to take a picture but it looked exactly like the last one I made:

Barry then immediately started selling the already-chilled bottles of water while I made an ice-run (I didn’t buy ice in case he didn’t show up). I went to 711 and bought 40 lbs. of ice, a sandwich for Barry and a spare box (box was free). The total came to $9.22 . Total cost of experiment so far: $49.44. The chance of making a profit are pretty much gone now.

We loaded up the ice chests with water and ice, Barry did most of the work.

I had got the spare box from 711 upon Barry’s request. He had an idea where he would place the box saying “Bottled Water $1″ further down from his starting point, informing drivers of the approaching vendor.

Before I saw what he wrote he said, “Damn, I spelled ‘bottle’ wrong and I misplaced the dollar sign.” It was too late to change the spelling, and we both agreed the comedic value would probably increase sales!

Before I left for class, we took a pic together. A guy in a wheelchair took it. I accidentally had the camera on black&white mode. I only sold one bottle of water, and that was on accident. A taxi driver saw me carrying the “Bottel” box, smiled and pulled out a dollar. I sold a bottle before I even reached the median, without trying! Keep in mind the purpose of this is to delegate the grunt work.

Barry tried his best to look clean, I even brought him an old pair of shorts I no longer use.

FIVE HOURS LATER…..
I came back after he had been selling all day. He sold exactly 60 bottles, meaning we had 60 bottles left. The combination of cold + gloomy weather + Tuesday = not a great day to sell.

The fact that you can sell 60 bottles of water on a cold day made us look forward to the upcoming sunny, swealtering days!

We split the $60 in half.
Barry got $30.
I got $30.
So in the end I LOST MONEY. 49.44

BUT ALL HOPE IS NOT LOST. This Wednesday Barry will sell the remaining 60 bottles. It shouldn’t cost me anything as the bottles are still being chilled with the same ice in the coolers.

We also want to give Barry a “brand name” by making him the “Water Guy” that everyone knows and trusts. People are more likely to give money when it looks like you are working for it.

This water experiment might actually turn out to be a decently lucrative side income for me in summer. I will be in Austin over the summer, and Barry is willing to work everyday. I will keep posting updates on the progress!

-Nev

House Keeping

Few points of interest:

-Part 2 of the Bottled Water Experiment will be posted tomorrow. That’s right, I’ve got Barry the Bum selling 5 cases of bottled water this Tuesday. So far I’ve invested $42. Will he run away with my investment or outperform all expectations?

-My Alamo Apprentice team (Here and Here) beat the opposing team by 152% and set a new record for food/drink sales for a Wednesday night.

-I bought my first tailored suit. Thanks to “Bob” for the hookup.

-I bought another pair of shorts from Nordstrom. I still can’t believe how courteous and helpful their employees are. My own friends aren’t even that nice to me!

-PineCone Research sent me a $5 check for a 20 minute survey. Very painless process, and they sent the check in less than 5 days. Brought to my attention by Jim at Barganeering.

-I didn’t meet my 4-31-2005 goal of making $11,000. Son of a……. It was pretty much an arbitrary number that I selected, but I’m still very dissapointed I failed. I will continue to keep track of how much money I’ve made for another few months. I need to further analyze the wrong steps I took to miss the goals.

-I’ve added FORUMS to the site. It’s a work in progress, but fully ready for posting. Registration costs $150.00…..just kidding, it’s free and not even necessary (you owe me now!)

Assuming the Risk and Reaping the Reward

Frequently when starting a new business, the proprietor will usually experience a certain amount of criticism and skepticism from others.

If the business fails, the proprietor will get a million “I-told-ya-so’s”….but if it succeeds, everyone wants to be your friend.

Here is a quick illustration of this phenomenon.

If the proprietor is serious about their idea, they will follow through….

Notice the rapid change of opinion once success has been tasted. The reason is because most people are afraid to take the risk of failing (which pretty much every entrepreneur will do at some point).

Once the original proprietor has got through all the initial risk, it is very easy to find people who all of a sudden think the business was a great idea.

Lesson Learned: While you should take comments to heart, you should not let doubters discourage you from trying a new business idea. Business ideas are only good as their jockey’s.