Lessons Learned in 2003, part 3

I learned that sometimes you need to know when to let go
People get married to their ideas. They try something and they hang on to it long after they should have moved on. This is a hard one because there is a fine line between perseverance and hanging on to something.

The nature of business is funny. People often try their hand at a few thing before they find THE thing that works for them. Things go wrong when people try something that doesn't work and don't try something else.

How do you know when you need to let go? I don't know. Most people know because it is a gut feeling. Sometimes being open minded enough to accept change is all you need to catalyze your thinking to making things work, making things click.

Some people ask how long will it take them to become profitable. I don't have a crystal ball. Some ideas and business models are just so great that they start to work immediately. Some are so bad that they will never really amount to much, no matter what. Most are in the middle.

People have all kinds of ideas they are into. And their businesses are floundering to varying degrees. Some just need fresh ideas and a little new energy to get back into the swing of things and some just really didn't have a good business model in the first place.

You have to know the limitations of what you are doing
And this is part of the above. If you are planning to sell knitted hats to people with large heads, know that the market for that is limited, it's not the same as selling jeans. But, if you plan on just selling jeans, well know that you need to be more specific than that.

One of the areas where this comes up A LOT is children's clothing. Yes, there is a large market for children's clothing. I know this, I have children. But the fundamental aspect of children's clothing (when it comes to off price) is that there really is only so much someone will pay for it, no matter what it is. Listen, women will buy a $15,000 Chanel coat on eBay for $3000, a $800 pair of Manolos for $300 and so on. But you are only going to get a few bucks per piece of children's clothing. Sure there is the Gymboree and the (insert other brands here) that people pay a premium for. But that premium is much lower than what is paid for "grown up" clothing.

Anyhow, most of the time people are only making a few bucks per piece of clothing, three, five maybe more, maybe ten dollars (for few items) or more. Yes there are some doing very well, but here is where most people fall. So obviously, they think they need more volume. And I have to ask a lot of them, do you really want to do more work? The goal, at some point, is to break the link between time and money or at least improve the ratio of time to money. So if it takes you X amount of work to sell 1 item (the amount of work is the same no matter how much the item costs) do you really want MORE work or do you need to figure out how to make more money per item?

I mean, there are only 24 hours in a day.