How to make good money

Post Reply New Topic

i am no authority on how to make money but i am on the verge of making quite a bit in the near future.

it is unfortunate that one needs money to make money.
i worked as a programmer for 16 years. for the first 10 years, i was the sole programmer at a company called "infohouse", and that company had exclusive access to scandata from many supermarkets. we received the data, and i wrote programs to analyze the data and provide a range of monthly reports for many companies (suppliers) who subscribed to them (i will not go into detail as it would take too long and i am learning how to summarize).

anyway i worked for infohouse for 10 years, and then the government changed the rules and the company had to close. some of the suppliers who bought my electronic reports wanted me to work for them, and so for the next 6 years i worked from home writing and managing systems for them.

at the time that infohouse closed i was earning $128,000 p.a, and when i started working from home, i earned $90,000 p.a for the first 2 years or so, but as time went on, those companies eventually outsourced their programming to india (the programs i wrote for them were their property, and they simply sent them to india for analysis and they were installed and managed for a fraction of the cost of what i charged).

eventually i had only one company i worked for (the main contributor to my income), and at the end, i was earning only $50,000 per year (which was ok since i did 3 days work per month for them), but they too fell to the attraction of indian programming companies, and on jan 20 2010, i was called to a meeting, and my contract was not renewed and i panicked badly.

---------------------------------


i desperately tried to find a job, but i was not suitable for anything really (i was 37 and considered too old for the young world of modern programming), and i eventually noticed a job for an "owner driver", and i rang the person and told him i did not have a truck and i was not physically as robust as a laborer, but i would buy a truck if necessary. amazingly i got the job.

i expected to work only until i found a better job, but as i was doing the job, i thought that if i owned the "run", i could make reasonably good money. the job was delivering frozen fries to fish and chip shops and pubs and cafes etc, and i noticed that the demand was continuous and unfaltering.

i realized that the demand for chips (fries in US) was not affected by the global financial crisis. in fact the demand grew for chips because they are cheap and provide many calories. the poorest of people bought chips to fill their appetite, and the rich people bought them because chips are tasty.
everyone seems to like chips.

so i bought the run (for $60,000), but it was only 3 days per week, and i continued to drive and deliver myself for a profit of about $600 per day. i had to buy the chips that i sold, but it was much better than getting $250 per day as a driver.

the person that sold me the run also had another run (3 days per week) that was making a similar amount of money, so i bought that one as well eventually (the person i bought it from was more interested in bulk supply and not individual deliveries of 20 boxes odd to many shops, so he was happy to sell me that run as well).

i got a driver then because i could provide him with 6 days per week (but i gave 1 day of work per week to my friend which is a nuisance). it is difficult to get a driver when you can only offer them 3 days per week, but when you can offer them full time employment, it is much easier.

from then on i was able to stay at home, and the only work i do (usually) is to call my customers the day before their deliveries to get their orders and liaise with them as to how satisfied they are with the stock. i also enter everything into my accounting system i wrote to handle the business, but that takes a few minutes.

i was a bit worried about competition, so i investigated what other suppliers were charging for their chips, and i saw they were quite greedy ($6 per box profit they were making), and i also found a brand of chips that is not mainstream, but better tasting and cheaper than mainstream chips.

mainstream chips are chips like "birdseye" and "edgell" and "mccain", and they cost approx $35 per 15 kg for their chips, and then the other chip suppliers added $6 per box and sold them for $40-$41 per box.

the chips i eventually decided to use are "marvel" chips, and they are very cheap, but better quality than the mainstream ones. 1 box of marvel chips costs me $26 per box, and i sell them for about $29-$31 per box, and as a result, i have loyal customers, and my usual sales of them are about 200 boxes per day.

shops are reluctant to try cheaper chips that they never heard of, but everyone will take a free sample, and i stopped at shops to give them a free box of chips (i gave them my name and number and showed my drivers licence so they did not suspect i was a psycho poisoner), and soon they rang me and became my customers.

then it started to spread by word of mouth because many fish and chip shop owners have friends who also own fish and chip shops (not in their area so who would not provide competition), and i was rung up often by the shops that i did not service who had tried my chips and who knew the price but eventually i just had to refuse their requests for deliveries because i can not treat my drivers like slaves, and i am careful to ensure that my drivers finish work by about 1-2 pm.

i am now going to build a new run that will include the shops who want my chips but i can not presently supply to, and if i can have 4 runs eventually, i will be making enough money to employ someone to do accounts and ring the customers so i will have no work to do except pay my supplier for the stock i require to fuel my business.

someone who is more entrepreneurial than me may like to go up and up and up and have maybe 20 or even many more areas that they service (it is very possible), but that is too much for me. i will be happy with 4 runs.

----------

so i guess the moral is to determine the continuity of demand, and the volatility of demand, and the general quality of the product, and the continuity of that quality of the stock, and the pricing competitiveness of what you can offer, and the reliability of supply (i have 2 drivers so if one is sick the other one gets the work).

continuity of demand is the most important thing, and chips are the best example of a product that can satisfy all those factors.

sorry i have rambled.

It's mainly sportswear that I sell at the moment. I've only been doing it for a couple of months and I am just starting to see an actual profit now, having had to invest in stock first of all. I am pretty pleased with my progress, and, as you say, making a living this way does seem very achieveable.

I'm interested in looking at other product areas but it takes quite a lot of time to research and experiment with to the point that you can start committing to larger investments in stock with the confidence that you will make a sensible profit. I understand that electronics/computers is very competitive and so very low margins although perhaps there's more scope to operate in the 'accessories' market which you seem to be referring to.

Very sensible.

Yes, the accessories market, and the market for small cheap electronics, is much easier to enter. The reason being that all the goods are homogeneous. I mean I can easily buy and sell the exact same thing bigger retailers are selling, because all the smartphone cases and cheap media players and whatever are made by the same few people in China. So I don't have to compete with superior or more well established products so much. There are a few "luxury" case manufacturers, and there are obviously companies making high end electronics, but on the end of the scale I'm talking about, the vast majority of products are still very generic.

I do recommend you do some research first, because to make a profit you do have to buy in bulk, but if you have people who will buy then you can make fairly good money. It's also worth noting that if you sell to end customers in markets as well as online, you can charge a much higher price. Something that goes for £5 on eBay may well go for £15 in a market or a small shop.

Hi b9,

Thanks for your interesting post and, well done, with your chip runs! Sounds like you've really had your eyes open to spot an opportunity as well as, to some extent, been in the right place at the right time. I do have a sense that there are opportunities around all the time, if only I could see them. I have a sense that it is blinkered vision or habitual thinking that is preventing me from spotting opportuities.

Not that I can't see any way forward at all. And also, it is more realistic to expect to grow something fairly steadily rather than have something big happen over night. I think I want success yesterday which can get in the way of focusing on what is working at the moment and which, with sustained focus, can before too long become something of the sort that I am in a hurry to get.

Your moving into chip-runs strikes me as having a lucidity of mind to take on something that had not been your own personal traditional way of earning a living. I think I am sometimes telling myself, perhaps subconsciously, that I am this or I am that, I can't do that etc, and so not even seeing opportunities that are there for the taking.

I did some investigating and got a tax rebate after being really stuck and got inspired on how to reclaim money I was owed, get additional money I was entitled to but didn't know about. It has become a bit addictive to be honest but if you want to be as you put it an ambitious earner, OP, one must have ambition and something not too short of obsession. I wouldn't say passion because another pastime could come up and be much more satisfying. Money isn't everything

People make money in many different ways.
Some do it through investment. Some gambling. And so forth. But ultimately it all comes down to knowledge and influence in things you enjoy or can stomach doing.

And if you can't find ways to earn the money, find ways to save it. Saved money is as good as money earned.

For sure. Saved money translates to business finance as pure profit. However, one can only do so much by saving money and it is a case of diminishing returns. One must also make money, and one of the benefits of making money, one of the reasons why I want to make 'good' money is so that scraping and saving is less of a concern. Still a good point, though, and perhaps one that can too easily be forgotton in the pursuit of gains.

I studied C++ programming from 1998 to 2000 and got pretty good at it and had a portfolio of work.

But what I saw first hand is that these goody-two-shoes "human resource" people (nontechnical people hiring for technical positions) have inordinate power and the only thing they look at, and I mean the ONLY thing, is years of corporate experience.