Let’s Start with the why.Hopefully, you have a “why” for building your business.Your why, the compelling reason you are working in the nooks and crannies of your life. The reason you are skipping your Starbucks every morning.You must provide a strong “why” to work a network marketing business.Well, you need to have a strong why for having a business mindset or you will sabotage all your sacrifice and hard work.Here is why:
You Live in a World with an Employee Mindset.Unless you are already a business person, your business will be sabotaged by your employee mindset.For example, employees:
- Do just enough to not get fired.
- Expect the “security” of a paycheck.
- Do not lose anything more than a job if the business fails
- Do whatever it takes for the business to succeed
- Understand that in the beginning there is no profit; but later the profit will exceed the amount of work involved
- Lose their investment if the business fails
Here are three vital steps to developing a business mindset:
Keep a Separate Bank AccountThere is nothing like having a bank account labeled – Business Account – to make you feel like a business person.But there is a more practical reason to keep a separate account. You will find tracking your income and expenses much easier with a separate account.Get a debit card to use instead of your personal credit card.And always get a receipt. Write on the receipt what business activity is tied to it. Then keep that receipt.Commit to this rule: all business expenses come out of your business account. Your personal and business lives are intertwined but you must be disciplined in keeping the money aspects separate.There are three benefits to doing this:First, you will be your accountant’s favorite at tax time.And you will pay less taxes if you have faithfully kept your expenses separate. The equation is simple: more expenses to offset your income means less taxable income.Second, you will be aware as the loss in your business decreases and eventually the profit increases.You don’t need a fancy system. Just look at your monthly statement. You will be able to recognize the cash flow picture.Third, you will grow in your sense of ownership. You will be motivated to make more calls, to post that blog consistently, to watch the webinar.Ownership will help you manage your expectations, as well.It is simpler if you don’t pay with cash. If you need to pay cash, maintain a petty cash fund, keep the receipts, and replenish from your business account.
Commit to Give Money to Your Business Every Month for at Least a YearThis will help you grow out of the employee mindset and into the business ownership mindset.If you were keeping an accounting system. The money you put into your business account would be equity – ownership.When you spend for business expenses out of your business account, you are not decreasing your equity. You are creating an expense that will offset the income that you earn.Your equity will only decrease if you take money out for personal uses.When you put money into your business account, you are investing in your business.Keep track of that. If you invest $1000 a month in your business, at the end of the year you own a $12,000 business. If you are generating more than $1000 a month in income, you own a profitable $12,000 business.And if you can’t invest $1000 a month, do what you can.Calculate what you will need to spend: product (Most companies require a product purchase and even if yours doesn’t you need to be using your product. People will ask you. You must be able to say yes. That makes personal product purchases a business expense.), travel to events (Those are business expenses – plan for them by putting money into your business account every month.), cell phone and internet expenses.
Understand That Commissions Paid Are Income to Your Business Not YouI once heard an excited new liquor store owner tell the wife of a famous brewer about their new business venture.I did not expect her only comment, “Don’t drink the profits!”So when you get that wonderful commission check or direct deposit, “Don’t drink the profits.”Don’t go buy the new car, just yet.Yes, reward yourself. You have worked hard for that commission. But if your reward requires spending money use personal money. Or make the reward sitting and watching a fabulous sunset. Or taking a walk first thing in the morning.Remember whatever you spend personally comes out of your equity – your ownership.And don’t quit investing personal money into your business account until it can stand on its own with the business income you are generating with your hard work.You will, someday, be able to draw on than account.Be patient and . . . You will be able to abundantly bless others out of that account.