Writing a Business Plan: Week 9: Supporting Documents

IMAG0041, a photo by duelin markers on Flickr. 

Ah, our final week in the series! The Supporting Documents section of your business plan contain all the documents you mentioned in the body of your plan, but "include as the final attachment or even as a separate document, depending on who is reading your plan". Garrett Sutton states in Writing Winning Business Plans, "these are all the documents that can help convince the readers of your plan that your business is worth their time and money. These documents need to stand alone; so they should be introduced or referenced in their corresponding sections first, then arranged simply and finally, either attached to the final plan or offered as a separate document.... Supporting Documents give credence to your arguments, back up your numbers, show how you came to your decisions, and how you'll make your plan work.

Include the following documents in this section:

• resumés
• letters of reference
• personal finances
• leases
• contracts
• other legal documents: copyrights, patents, trademark, insurance policies, articles of incorporation
• other attachments: demographic information, maps, etc.

Consider also attaching the following:

• glossary of industry terms
• product information
• additional/more specific marketing data
• marketing materials
• financial analyst reports
• newspaper and magazine articles
• company history
• press releases
• web pages"

Sutton also mentions keeping a notebook and folder to gather ideas and clippings. I have fallen behind in that aspect also, but there's no time like the present. I'd like to thank the internet for allowing me to save important emails, do some postdated research, so to speak, and allowing for apps like Dropbox and Flipboard where I can leave important clippings.  Plus there's nothing like a deadline to motivate - WIBO Business Plan Competition, here I come! 

Until next week...

Writing a Business Plan Series: Week 8: Break-Even Analysis

Water Lilies at Brooklyn Botanic Garden, a photo by jbylund on Flickr.

My favorite part of the business plan: Break-Even! While at WIBO, they made a point to ensure we all understood how important break-even is. If you do not know your break-even point and prices, you are doing yourself and your business a real disservice. Knowing this critical formula will keep you from underselling your product and services, from scrambling to keep up with the competition, and from closing your doors prematurely. We spent four weeks on it!

Get your spreadsheets and calculators out. You need to know the direct and indirect costs for each and every product/service you offer and the percentages each of them represent. It's like balancing a checkbook. "How much will your business need to sell in order to cover its costs?"

Garrett Sutton describes break-even in his book as opening night in his production comparison. "The movie [has] been made. Now how many tickets [do] you have to sell to break even?" You should also do this for the month. You can use "this tool for bidding on jobs and taking on new business. You need to know where you [are] every month and you [have] to hold your margins to reach your break-even point before moving into profitability."

"The break-even analysis is a good tool for entrepreneurs because it encourages an in-depth understanding of costs. And it's good for lenders and investors because it says a lot about whether or not you, as writer of the plan, are realistic in your assumptions."

Sutton goes a step further in describing the break-even point of a business. "It is that point at which you can start to breathe a little easier. It is the point when you start to think maybe going into business for yourself was a good decision. It is the beginning of stability. It is the point too many businesses never reach. But, numerically, it is the point at which your fixed and variable expenses (including costs of sales) are met by your product and/or service sales. You won't be making a profit, but you will no longer be taking a loss." (I think another dream of an entrepreneur is to never take a loss.) "You can display this point in a number of ways in your business plan. In graph or table form, show dollars of expense compared to either dollars of revenue or units of production. In a mathematical presentation, you can find the exact break-even point with this formula:

break-even = fixed expenses + (1-variable expenses / sales)

He suggests it might be best to present this data in both formats because the graph is great since we are largely a visually based society and because bankers and other analytical types will appreciate the mathematical formula.

Here is the link to WIBO's Powerpoint presentation of break-even:

http://www.docstoc.com/docs/40162238/WIBO-Break-Even-Analysis-Primer

Do not skip this important step. You need to know your business and it's numbers. As Robert Kiyosaki says, "you need to mind your own business". Until next week...

Writing A Business Plan Series: Week 7: The Balance Sheet and Income Projection

The Other Side of The Bridge, a photo by Maxim34374 on Flickr.

It turns out that WIBO is having their 2nd Annual Business Plan Competition, open to all WIBO alumni. What better way to test the theories of Garrett Sutton's book and this blog post than by entering and hopefully winning $20,000 for my business!

Now to discuss the Balance Sheet. If you remember from a few posts back, Sutton compared it to "the audio/video mix in terms of production. It answers the question: what is your business worth? It's the balance of your company's finances and present data on it's assets, liabilities and net worth. All balance sheets use the same format and are simple to create." Here's a sample balance sheet from www.accountingcoach.com.

"Your assets fall under four categories: 

• current: can be converted to cash within one year 
• long-term: investments to be kept for at least one year 
• fixed: resources not meant for resale 
• other: assorted assets unique to business' circumstances 

Your liabilities fall under only two categories:

• current: payable within one operating cycle 
• long-term: mortgages, vehicles, notes, etc.

And your business' net worth is given according to the legal structure of your business. This should be prepared on a regular basis because it helps you spot trends and plug cash leaks before they sink your company. For a new business, you can choose to include a personal balance sheet of your personal finances to show your ability to handle money, or not to show you value your privacy."

"Income Projections need to be based on realistic expectations and real world experience (talk to or hire professionals) to help you get the numbers right. There are two types of forecasting types: button-up and top-down.

• Button-up: uses the knowledge from the frontlines to predict the future needs of your business
• Top-down: plans for the future with the end in mind; starts with goals from 3 years out, then backtracks the steps it will take to get there. Think big picture."

Well, I'm playing catch up now. Our previous family emergency plus my own little encounter with the gases in my basement office has temporarily stalled the creation of my plan. But with the SMART goal of entering the WIBO competition, I am renewed. Onward!

Until next week...

Writing a Business Plan Series: Week 6: The Financials: The Income and Cash Flow Statements

Macy's Fireworks NYC 2013 - Empire State Building Color, a photo by Bob Jagendorf on Flickr.

Happy Independence Day! I hope you all had one of celebration and reflection, but it's back to work and back to the our business plans.

Garrett Sutton, Esq. breaks down the important financial components of a business plan in his book, making it easier for entrepreneurs to add details to their bigger picture dreams. WIBO gives them the practice of actually doing the math, creating the tables and putting in the mental work to fulfilling their dreams. Both provide samples of what an Income Statement and Cash Flow Statement ought to look like.

"The Income Statement or Profit and Loss Statement or Statement of Operations reveals business profitability at a set point in time. It shows what a business has spent and on what, plus what the business has brought in and from where, to tell whether the business made money

 or not. It needs to be prepared monthly AND yearly; with the data coming from company records."

It has basically five main components:

• Income which includes net sales, costs of goods sold, gross profit, and other.
• Expenses which includes direct (or controllable or variable), indirect (or fixed or office or overhead) and other.
• Net profit/loss before income taxes
• Income Taxes
• Net profit/loss after income taxes

"The Income Statement helps you track the effectiveness of your plans by showing how expenses and sales are affecting profits or losses and helping you to plan for variations in sales volumes from month to month."

The Cash Flow Statement shows "the difference between the money coming in and the money going out along a timeline. [Create a table that shows how] much money you expect from whom (by category, such as sales) and when (by date, week, etc.), plus how much money you'll need to pay out (expense) to whom and when." Sutton quotes Robert Kiyosaki:

"Many small business owners fail because they don't know the difference between profit and cash flow."

Make it easier by preparing "separate budgets for revenues, cost of sales, fixed expenses and variable expenses. Also create separate tables of all sources of incoming and outgoing cash (these don't have to be in the actual plan).... The timeline can be for any stretch of time you want, but the further out you go, the less accurate your numbers will be. Stick to one fiscal year and work month to month to reflect reality and your ever increasing expertise. Use the traditional format and break categories into subcategories:"

Totals                                            Beginning Cash Balance               Cash Receipts                                Total Cash Available                     Cash Payments                              
Total Cash Paid Out
Balance
Incoming Loans
Equity Deposits
Ending Balance 

I like spreadsheets, so this portion will be more enjoyable. Which portion has been your favorite so far? Until next week.

Writing Your Business Plan: Week 5: The Financials & Uses of Funds

Chesapeake Bay Retriever in her element, a photo by PLR_Photos on Flickr.

         My apologies for the long delay in posts. We had a family emergency that took us into Virginia. This picture is in homage to how well we were treated there. Maybe I'll make it part of my dream to live near water and one of these adorable water dogs.
         This week starts our foray into the financials of a plan; and I may have to spend four weeks covering it instead of my planned two. Before I delve into the Uses of Funds, I want to give an overview and point of reference for all these numbers we're going to put in our plans.
         In Garrett Sutton's Writing Winning Business Plans, I love how he prefaces the need for these numbers. "If your plan's purpose is to attract funding, you'll need to know how much to ask for and what your willing to give in return - interest, ownership and the like." No matter what stage of business you're in, "you will need money." "The numbers you put into your financial spreadsheets are not the point of The Financials section. Rather, the numbers are merely symbols standing in for principles. It is the principles that you need to understand."
         The stage of business you're in determines which financial documents you put in your plan as well as the audience you're presenting your plan. An existing business needs an added Income Statement, Balance Sheet and possible Business Financial History. He also gives a good analogy to help entrepreneurs put it all in perspective:

Accounting Term                       Production Term               Answers the question:

Income Statement                       Snapshot                             Am I making money?

Cash Flow Statement                Video                                   Where did the money move?

Balance Sheet                            Audio/Video Mix                What is this worth?

Break Even Analysis                  Opening Night                   When do I start making money?

         
         To start this section, "make the first page an overview of the financial data".  What follows is your Uses of Funds statement. "Uses of Funds tells how you'll use the funds you're requesting by providing a summary of business needs, capital expenditures, working capital, total use of funds, and sources of funds. It's short and to the point. Be specific as to what the borrowed money is for, how much you need and how it will be disbursed. Give details to show whether the investment will make a profit and especially how the profit will increase." I'm glad we went through many of the tables and charts needed for this section at WIBO, I just need to adjust my old numbers to more current realistic ones.
         Next week, we'll cover the Income Projection and Income Statement. Have a great one!

Writing A Business Plan Series, Week 4: The Marketing

frozen water, a photo by arvindgrover on Flickr.

WIBO describes marketing as the "totality of all the activities involved in developing customers: researching, planning, promoting, prospecting and selling." Garrett Sutton says in his book its "the systematic process that inspires targeted customers to take action and buy your product and/or service." Your first page of this section should be an overview of your entire marketing plan.

Markets

"Start with a description of your overall potential (or real) market, then work your way into a more manageable discussion of your target markets. Include their demographics, psychographics - their needs, interests, attitudes, and lifestyles - and industrial demographics." 

Competition

I'm going to enjoy writing this section. Sutton's example is to "think of it as a novel or movie: both need conflict and dramatic tension to succeed. Challenge the hero/heroine to overcome... with knowledge and determination to prevail... Find stories on the internet about the entrepreneurs in your industry who became successful and study their strategies."

Distribution & Sales

WIBO states that "selling is helping people buy wisely what they need to satisfy their wants, overcome their problems and achieve their objectives." Sutton states "this is about understanding the purchasing patterns of target customers and setting your business up to make use of those patterns. Prepare month-by-month spreadsheets for each product/service you have with explanations. Describe any changes in pricing or volume and any strategies you have for physical locations and the web."

Marketing Design & Research 

The marketing campaign, essentially. Both WIBO and Sutton show how businesses exist in ever-expanding spheres of influence. Show how your business interacts within these spheres. Include information about your business, the competition, the market, the industry, the government, international affairs and other market factors; and consider which marketing vehicles will best suit your business.

Product Design & Packaging

WIBO stressed that everything with our business name on it needs to be of high quality and well thought out. Sutton states "to know the taste preferences of your target market and the psychology behind them." What he calls "positioning", WIBO calls "differential advantage". 

Pricing Strategy

You'll need to "create a pricing plan for every product/service you offer. Base it on careful analysis of product costs, overhead, competition, and target markets; include discounts, return policy, and warranties. Back this up with statistics and research."

I like Sutton's notes on how to enter the market: when ought "be more about your customers than you". 

Writing a Business Plan Series, Week 3: The Business, Part 2

Bluebell Woods, a photo by TheGirlsNY on Flickr.
I know this isn't a picture of water, but it is a sea of periwinkle from one of my favorite places: bbg.org.

Going back to Garrett Sutton's Writing Winning Business Plans, he states that while location is not "a critical factor for all businesses, it should be discussed in all business plans... Begin with the basics - [address, zoning, why this site was chosen, what facilities are at this location] - then expand on each." Then add the site's history, a physical description, and contact numbers." He wants us to ask ourselves many tough questions about business climate, so it's much more than place of business. "Allow for [either expansion or downsizing], and address all the factors that accompany them: personnel, buildings, land, parking, traffic, zoning, lease agreements, and the like."

Management and personnel fall under his chapter on logistics. According to his The Rich Dad Tip, this is "one of the most... read sections of [a] business plan... Write it according to a "'People Magazine/gossip style nature' because people want to read about what others are doing." Team is a crucial part to a B-I Triangle business' foundation. Sutton has an in-depth way of sorting out personnel needs with index cards. With one skill/task per card, include time estimates and the cyclical nature, then rate myself on how well I perform it. Balance this with how much time will be spent on the business, and then prioritize by importance or cost. Complete this and I'll begin to have a "good idea of my personnel needs and start-up costs as well as for the future." 

WIBO'S coverage of bookkeeping and accounting (Records) influenced me so much, I went out and bought some ledgers and Angie Mohr's Bookkeeping Boot Camp. I know some of my weaknesses lie in this area. Sutton states to "add record keeping and/or accounting systems and why they were chosen. I need to "understand [my] system, show that [I] can handle the load" and show how they will help "improve [my] business".

Insurance and security are a huge deal for businesses and is part of my and my customers' protection. Sutton wants his readers to consider their goals to:  

1. keep liabilities to a minimum 
2. prove to potential investors that I recognize the realities of product and personal liability in my industry

The latter shows investors I'm not a "high risk" and ensures they "see a return on their investment. It also shows I'm "ready, willing and able to reduce the risks of my business". The insurance list is very long. I need to know the standards for real estate so I don't get too much coverage and "plan for my security needs now". I'll need to sit down with an insurance agent soon to make sure I have everything my business needs in these two areas. 

I so like Sutton's Litigation section, that I'll quote a most important paragraph:

"But litigation and lawyers are now a permanent part of the business landscape. Some entrepreneurs, companies, and even real estate investors focus on their legal strategy as much as they do on marketing. Sophisticated investors understand this and will not be deterred by the presence of litigation that occurs in the ordinary course of business. That said, investors could have second thoughts about investing if the result of the litigation could snuff out the company's survivability, such as an environmental or hazardous waste claim, or the inability to use a key proprietary process. But also know that failing to disclose such a material matter as litigation can give those same investors a claim against you personally for misrepresentation and fraud. When in doubt, disclose."

Writing my business plan is exciting and there are many more questions I must ask myself. It's a first draft, so I'm going to have to push myself to completion, but so far, so good. Until next week...

Writing a Business Plan Series, Week 2: The Business

Week 33 NYC Skyline from Brooklyn Promenade, a photo by KimCarpenter NJ on Flickr.

For the next two weeks, I'll discuss The Business section of the business plan. This week I'll concentrate on Strengths and Weaknesses, Legal Structure, Business Description, Product Description, and Intellectual Property Description, using structure and templates from WIBO and Garrett Sutton's "Writing Winning Business Plans".

Strengths
According to Sutton, two types of strengths exist: common and competitive. "Common strengths are what I do well. Competitive strengths are what I do better than anyone in my field." WIBO considers the latter to be "your differential advantage".

I need to ask myself some serious questions: "are my strengths currently underutilized? What might I do to take advantage of my unique attributes? Knowing the difference is important because a business can improve through common strengths, but can dominate through competitive strengths. In what part of my business do my strengths lie? In my product? My operational logistics? Sales and distribution? Unique leadership skills or corporate vision? Which of my personal strengths can help my business?" I know I can be a bit of a dreamer, so  I "need to think creatively to highlight strengths that will realistically apply to my business". I also need to "understand the whys and hows of my strengths".

Weaknesses
These also come in two forms: common and catastrophic. "Common weaknesses are those shared with other businesses, like start-up hurdles. Catastrophic ones will consistently put me at the bottom of the pile. Common ones can be overcome, catastrophic ones can't or won't be overcome. Maybe one of my weaknesses happens to be a competitor's strength." 

Legal Structure

For my legal structure, I like the freedom an LLC gives me. I'm considering a Wyoming LLC because Flow Properties will invest throughout the country. They act as umbrellas over smaller LLCs which many of the properties will be structured as. 

Intellectual Property Description

WIBO gives great advice on how to protect your business' property - with trademarks, copyrights and patents. They state "the best way to ensure the fruits of your creative labor is to completely develop and market the finished product to the widest consumer base possible while excluding your competition using" the above mentioned protective devices. Sutton adds domain names and trade secrets to the mix.
One of the Rich Dad Tips listed in his book "strongly suggests filing for all available rights before distributing your plan." I consider that to be one of the best tips as I've learned that lesson firsthand.

Well, I have plenty of work to do, if the process of getting this blog post out is any indicator. Where are you in completing your business plan? 

Writing Your Business Plan Series, Week 1: The Mission Statement

Japanese Garden, a photo by TheGirlsNY on Flickr.

After many changes in writing just my marketing plan and my desire to be able to say: "I have a complete business plan", I've decided to use my blog as a platform to get it done. Every week, I'll cover a different section of a business plan, share my experiences and ask for your opinion, at times.

Let's start with the mission statement. The mission statement is part of the Executive Summary. Since the executive summary summarizes a completed plan, it might be best to do that part last. I'm going to isolate the mission statement from the executive summary, for now, to provide focus. I'm structuring my business based on Robert Kiyosaki's B-I Triangle. The base of this triangle, really a tetrahedron, is the mission statement. I'm inspired that the foundation of a truly successful business is its philosophical or spiritual foundation. 

According to a bplans.com article "How To Write a Mission Statement", the statement should only be about three sentences and full of substance. It's also about you, your company and your ideals. Just don't follow their link to Dilbert's Mission Statement Generator, since the folks at Dilbert have taken down the page. (OK, you can follow it if you like, the comic for the error page is worth it.)

In Garrett Sutton's book, Writing Winning Business Plans, he poses the all-important question each business owner ought to ask themselves: "Why are you in business?" He suggests taking a few weeks to journal about this and other questions before writing your business plan. For a moment, I found myself getting indignant, only because I've spent months, years even, doing just that. I was indignant until I realized this series will serve as a more definitive journal for my business plan.

I love what Sutton states comparing mission statements and goal setting: "If you think of your mission as a compass, you can consider your goals the map." As I further define both my personal and business goals, I get the sense I'll need to be flexible and open, given the fluid nature of a business plan. He also asks "can you now summarize your mission statement in one sentence?" That's different from bplans.com advice. I took Sutton's advice and went with the one sentence statement. Here's what I've come up with:

Flow Properties is a real estate investment company that uses Feng Shui to provide harmonious homes in urban areas.

I like it. Let's see how or if it changes during the series. What's your mission statement? Have you written a business plan? If so, where did you start? Until next week...

Walking Through the Frozen

frozen lake & reeds, prospect park, a photo by katinalynn on Flickr. 
I chose this picture because even though Spring is officially here, it doesn't feel like it. Plus much of my business progress is frozen under the surface.

I'm a little frustrated this week. Working on my mobile app, and subsequently, my website is taking much longer than expected. Seems I need to come at this from a different angle, set some new parameters.  I prefer a list for lots of things, a template so to speak. I gravitate towards that type of structure and direction so I am free to focus on other things. Like my wardrobe: fashion tells me what's in style, what types of clothes look best on me, how much of each I need, I'll choose what I like and love based on another form of inspiration.

I need that with my website, too. My previous web hosting company, although good, made compiling the different elements similar to a right-handed person using their left hand for the first time.  Nothing bad, just different and needed some time getting used to. Wix.com seems to make it easier. I started creating my online store and mobile site. (Hurray!) But more is needed. I need to do more planning, writing, rewriting and walking. Yes, walking. The hardest aspect of writing is getting your thoughts onto paper. Walking helps me do that.

Julia Cameron in The Vein of Gold says: "Walking opens us up. It feeds us. Image by image, it spoons up for us a broth or soup of soul food, which sustains us as we do the work necessary to shape and reshape our lives. In other words, we can walk our way out of  'problem' and into 'solution.' If I am snagged on a story line, I walk it out. If I am stymied about what to work on next, I walk until it comes to me. When I am tangled in the plot lines of my work or my life, I take a walk and allow the walk to sort things out."

Thankfully, I walked for an hour today. I'm racking up minutes for my GirlTrek Challenge, but to be honest, I'm falling short. I ought to be walking daily. Instead I'm using the cold weather as an excuse. And that just goes to show me I'm getting out of this experience what I'm putting into it. Time to step it up!

Until next week, answer the poll at the top of the page. Let me know how you deal with the tangles in your life.

Ritual of the Red Envelope

Legends Hotel 6, a photo by Andy Cardiff on Flickr.

         I am a Black Hat Sect Feng Shui consultant. I love to watch and experience how energy or ch'i flows in an environment. I also love how well the information, wisdom and knowledge is protected through the ritual of the red envelope. Feng Shui has remained intact for over 4,000 years. Think of how many other cultures, languages and oral histories would still be present if such protective care were taken with them! My teacher, Nancy Santo-Pietro, is such a compassionate person who gives so much to her students. While in her certification course, she asked us to come up with our own way of describing the ritual. Many years later, I can still say hers is the best one I've come across.  On page 145 of her first book, Feng Shui: Harmony by Design, she writes:

When transcendental cures are offered, the giver needs to request of the receiver one, three or nine new red envelopes, depending on how many cures were dispersed. Nine envelopes are usually given to the person with the cures when the receiver wants to express his/her greatest respect and thanks to the giver, but one or three are acceptable of only one or two cures are prescribed. These envelopes can be traditional Chinese red money envelopes (Hong Pao) or any generic red envelope from a local card shop. The important thing is that they were never used before and that after you complete the ritual they will be discarded and never used again. Inside each red envelope is a token monetary gift. The offering can be as little as 5 cents or 1 cent when it is being offered to a nonprofessional. When the envelopes are being presented to a Black Hat Sect Feng Shui expert or consultant, then the practitioner's fee goes inside the one, three or nine red envelopes. After the envelopes are received, before the individual/consultant can spend the money, she or he must sleep with it under his/her pillow or mattress for one night after blessing the envelopes, while reciting the Three Secret Reinforcement. It is important to remember to follow the Red Envelope Ritual, no matter if you share the cures with friends, family or clients. If you find that you are uncomfortable asking for the red envelopes or the person you are sharing these cures with doesn't want to follow through on providing them, then accept those signs as an indication that you are not ready to share these cures and most probably the other individual is not ready to receive the information just yet. Knowing when to help and when not to help is a very valuable and important skill to have. If you take this part of the Feng Shui process seriously, then be patient with yourself and the process - trust that you will know when it's the right time to share the information with others.

         Words to live by. I bring this up because I wrote last week that I would create a Feng Shui analysis for Detroit.  And I'm almost finished - just looking for a way to make a viable, virtual red envelope system. Hopefully within the next few days. I can only describe it as an interesting process.

Can Detroit Move Its People in a Sustainable Way?

Detroit People Mover, a photo by mrkumm on Flickr.

         Another part of my earlier conversation about Detroit real estate investing concerned its rail system. I first needed to get over the shock of its arson problem before I could adequately address it. It led me to wonder: can a big city thrive without a good transit system? Being from NYC, I'm biased and would answer with a resounding "no", but felt the topic needed more investigation.

         Detroit has The People Mover, a small, driverless monorail encompassing the downtown area.  Most of its passengers are tourists, with Saturdays being its heavy day. Considered by some to be "cost inefficient", there are plans to expand its reach. Given all the city's issues, when would be the best time to introduce the expansion, if at all?

         How does Detroit's system compare with others in the U.S.? I found three slideshows depicting the best transportation systems in the country & the world. I must say my Brooklyn pride is a little dented! NYC is ranked #2 in two of them and #7 in the third. US News places us second to Denver, CO (I need a moment). Environmental Graffiti has us second in the world to Hong Kong. And AskMen has the most recent poll and uses criteria such as wi-fi and mobile phone service, cleanliness and safety. Unsurprisingly, Detroit did not appear on any of these polls.

         According to City Solutions a blog created by National Geographic and C40 Cities,  cities across the globe now contain over 50% of the world's population.  By 2050, they will hold 75%. In a recent article, "Unlocking Sustainable Transport Starts with Cities" , a noted point was how can cities "scale up sustainable transportation", an increasing necessity given the growing shift to urban living. Unfortunately, "[all levels of governance], on a daily basis, make investment decisions that threaten to lock new and existing cities into unsustainable patterns". Is Detroit a harbinger in this respect?

         Three ingredient are crucial for success, according to the Science Direct abstract titled "The Key Factors for Providing Successful Public Transport in Low Density Areas in the Netherlands":

1. the presence of financial means
2. cooperation between stakeholders
3. flexible supply of scheduled and on-demand transports.

         The first two may be Detroit's biggest obstacles to overcome. My look at Detroit has been quite revealing thus far; but before I wrap it up, I want to do one more thing - a Feng Shui consultation. As a certified consultant, I rely on them to provide me with the best foundation from which to make decisions.

Until next week...

Can Detroit's Fires Be Put Out?

Detroit fire, a photo by Sam Beebe, Ecotrust on Flickr.

I had an interesting conversation last week about my buying and holding interests in Detroit. I was told about the documentary "Detroit on Fire" by Constance York, a woman who spent about two years talking to the members of the Detroit Fire Department (DFD) and the unprecedented number of fires there. 

According to the film, "there are an estimated 70,000 vacant homes in the city, but the numbers change daily and don't include vacant buildings". Detroit had "approximately 6,500 fires in 2008 with 60% - 70% of them being arson". DFD continuously fights an unusually high number of them on a daily basis, and the numbers increase annually. The setters of these fires are as varied as their motives for setting them. While fire damaged buildings can be part of an investors portfolio - a way to obtain property, rehab it, and then sell or rent it for a profit - Detroit poses a unique problem.

The best strategy might now be to buy, demolish and hold. A maintained vacant lot may be the best way to help rebuild the city. If you choose to demolish a property, please use a reputable demolition company as the unconfirmed conspiracist theory suggests that demolishing a home destroyed by fire is cheaper and simpler than demolishing one untouched by fire, and some companies or individuals may be taking advantage of this. The film states that "in 2010, Detroit was given $24 million in Federal funds to help stabilize neighborhoods.... Mayor Dave Bing reported that 1,800 of these homes were demolished [in 2010]." Demolition makes the city safer overall - less traps, less squatting, less repeat fires. 

A burning Detroit is deeply troubling but not hopeless. Deeply troubling due to the amount of despair; to the "3,000 missing people", including children; to the anger and rage; to its burning for the past 50 − 60 years; to see these Gilded Age structures destroyed; and to seeing Americans suffering this way. Detroit has hope because of the push to rebuild; because it has been done before in other cities; because Earvin "Magic" Johnson has the gift of successfully infusing new life into depressed neighborhood; and because I have a very special place in my heart for firefighters, especially FDNY. Now I've made room for DFD. And thank you, Constance, for doing such a great job with "Detroit on Fire". As investors who solve problems, it's time for us to turn our attention to this American city. May Detroit stop burning very soon.

Detroit's Revitalization

detroit riverfront, a photo by grgbrwn on Flickr.

Detroit was on my mind last week as I spent a good part of it analyzing some of its residential properties. I found a handful of promise in only a few. And my small success had me wondering what's the best strategy to use there.

I've lived long enough as an urban denizen to know cities have their share of ups and downs - the bigger cities experience them within their many neighborhoods all the time; and Detroit's plight is well known. The pressing question to be asked is "when will their comeback take effect?". In one year? 10? 20? Or longer?

Buying and holding might be the best bet. The Information Age is taking hold and replacing the manufacturing relics. The Detroit 2.0 Movement and Dan Gilbert of Quicken Loans are working hard and fast to bring the city back to glory.  Magic Johnson has partnered with Detroit Venture Partners to help inject new blood. My most pressing hope is for the crime rate to go down, as that will encourage more people to return. Getting one or more fiscally sensible properties, while watching Detroit's Renaissance take place right before your eyes might be a great experience in and of itself. I think it's time to get my business plan ready.

The Perfect Idea of Money

"The sun radiates just the right amount of heat and light, and we are supplied with the perfect balance of gases in the atmosphere, to support life on Earth. Our planet rotates on its axis with total precision. and without any wear or tear on itself." - Arnold Patent, You Can Have It All

I love this quote because it keeps things in perspective, removes my worries and reminds me of the true nature of perfection. Perfection is not something we have to strive for: it's right here, right now.  Last week's airing of Nova's "Earth from Space" not only reminded me of that tenet of perfection, but expanded it. The data satellites have collected about the role of Antarctica, brine, phytoplankton, lightning, and our magnetic field, to name just a few, is the equivalent of when earlier humans realized the Earth is not flat. Our human role gets highlighted in the end (no spoiler alerts here) and I was left questioning why we humans behave so destructively when we have everything provided for us.

Then I asked myself a question. Why haven't I created everything I've wanted in my life? Well, I'm clear that transmuting what I was taught and exposed to into the thoughts and beliefs that are on par with successful investors and business owners requires a great deal of focus and work. And, I'm eager to experience (and share) that moment when it comes.

I want to purposely create a point where money is generated from my ideas, instead of disproportionately from punching a clock as an employee. This blog seems to be that perfect place, so I applied to Google's AdSense program... and was rejected. At its first tinge, I saw just the rejection. "Why" didn't register right away. I'm guessing it's because I don't have enough traffic yet. I'll figure it all out this week, then try again.

The perfection is revealing itself though: finding out why will show me exactly where I need to go, where more focus is needed. I'll need to make a few adjustments, just as our great planet makes millions of its own. In the meantime, I'll celebrate this moment of perfection with some well-dressed water fowl. Above is a picture of some African Penguins taken at Connecticut's Mystic Aquarium - a nod to our southernmost pole, Antarctica and a first grader's science project.

Until next week...

Just Keep Swimming

I was on the fence about how to return to my blog, being embarrassed about the long delay in my posts. The best thing to do in an instance like this is to just be honest, take responsibility and move on. Here goes: when I make a mistake, I tend to shut down. I'll work on taking time to lament whatever needs lamenting and then getting back to business. Kind of like what I'd do if it didn't work out with a guy I was dating - spend a few days expressing all my feelings and then getting back out there! Life simply happened, and in some instances much larger or horrible than we could ever imagine: Super Storm Sandy and the shooting at Sandy Hook. Two huge opportunities to practice compassion and to re-focus on what's really important - living our lives the best way we know how.

On a positive note, many great things are happening as well. One of my siblings is expecting, I've moved and changed web hosts for my site. The new website is not online yet and I had to change URLs from flowproperties.com to flow-properties.com. It means rethinking and recreating some parts of my company when I liked what I created. I took a fabulous course at the New York Real Estate Institute called Investor Profit Lab. I learned so much! The most important skill I learned was a concrete way to analyze properties. I do 25 per week now! I'm working to getting it to 25 per day.

I have a new accountability partner - Janice Saunders of One Jazzy Life. I've known of Janice since my competitive swimming days. We weren't on the same teams; but when I saw her, another girl of color, tearing it up in the pool I took notice. She received even more of my respect because she was, hands down, much faster than I was. I don't think we ever raced each other in the same heats until the All City Championship of my junior year. We were both in the final heat for the 50 yard freestyle. This race would determine who would be the fastest girls in New York City! And to think, two Black girls up for the title! Alas, tried as I might, I came in fifth. She (correct me if I'm wrong, Janice) came in third. Yes!! Due to my decade of conditioning in the pool, I was okay with the loss because it was a personal best time for me. You win some, you lose some - just never quit. I have been in awe of Janice ever since.

Fast forward some twenty or so years later, I bump into a very familiar looking pharmaceutical rep at the now defunct hospital I was working in. It took me about a week and a conversation with an old high school classmate for me to realize who she was. After hitting me like a lightning bolt, I couldn't wait for her next visit to the hospital. I want to apologize to my former colleagues if we created a scene in the department's hallways. We decided we needed to go to lunch to truly "catch up" and we have been each other's support system ever since. Now if we can just go on a scuba diving trip together -I'm in dire need of a reliable dive buddy. Turns out, Janice has been moving and shaking for quite some time. We're both starting our own businesses, so the timing is perfect. But if you need any kind of coaching, call on Janice, she's a master.

So with new skills, more accountability and new goals, my direction is becoming more clear. My intention is to be consistent. On that note, I'll save next week's post to discuss my new goals. Nothing like a blizzard to get a person to focus inward. Thanks Winter Storm Nemo! See the attached pic for a look at his wrath in New York.

A mini post: 

I just ordered my first options contract and became an affiliate of their program. Good things, good things!

http://www.uslegalforms.com/?auslf=YourName  Example: http://www.uslegalforms.com/?auslf=JohnDoe

Spring Cleaning the Office

Time for me to come up for a little bit of air. I'm in the midst of spring cleaning my office - it's a doozy of a job and I need to go to my happy place to decompress a bit.

My happy place is the Brooklyn Botanic Garden (BBG), especially in May; the only month when you can see nature put on an exclusive parade just for her patrons - Bluebell Wood. Nothing pleases me more than to walk through that calm sea of lilac and bask among the 45,000 Spanish Bluebells.

Unfortunately, BBG won't allow me to roll about in the bluebells nor spread a blanket to have lunch in the middle of them; so today's lunch is at their excellent Terrace Cafe. I'm nursing a bit of a cold, so it's the hearty soup of the day for me. What I love about Terrace is the high quality yet unassuming fare they serve.

Mental Clutter

I'm not surprised I caught a cold. According to Louise Hay's Heal Your Body, one of the "probable causes" for the common cold occurs when there's "too much going on at once" in one's life. Makes perfect sense.

Spring cleaning while starting a business is a lot on the plate and this deep spring cleaning is downright confrontational. I'm doing nothing short of moving into an entirely new level of thought. I'm switching from "E" (employee) to "B" (business owner).

Switching Sides

In Robert Kiyosaki's CASHFLOW Quadrant, Robert's rich dad explained to him why it's so hard for a person to make that switch. "The part of you that's addicted to being an "E", or afraid that life will end, begins to kick and fight back. It's like a drowning person beginning to fight for air, or a starving man who will eat anything to survive.

"It's this battle that goes on inside of you that makes it so hard. It's the battle between who you no longer are and who you want to become that is the problem.... The part of you that still seeks security is in a war with that part of you that wants freedom. Only you can decide which one will win. You'll either build that business or you'll go back to finding a job - forever."

Forever? Nothing like the prospect of forever to get my attention. Up until now, my security-seeking side has laid my office in ruins.

Creating Harmony

Clutter stagnates ch'i and a home office is a notorious collector of clutter. In Nancy SantoPietro's (my favorite Feng Shui teacher) Harmony by Design, she discusses the issue of clutter. "The main problem with clutter is that it blocks and distorts the natural flow of ch'i.... Make sure that those items aren't preventing you from being on an energy level that will permit you to move forward."

If I'm going to have an auspicious start to my business and win this battle, the clutter must go. One obstacle is time - this last stand of E vs B is taking much longer than I thought.

Technological Onslaught

In Brook Palmer's Clutter Busting, I'm following his exercise to clear the clutter from your computer. You must first relax yourself in front of it, before turning it on; go through each and every email in your inbox; take a break; go through each email folder; go through your contacts; go through your favorites and bookmarks; take another break; then go through all the desktop folders. Once finished, thank your computer, say goodbye to it and shut it down.

At first read, it seems like a day or two's work. His timetable is certainly more realistic than the one suggested in The Declutter Workbook: 101 Feng Shui Steps to Transform Your Life by Mary Lambert. She suggests spending two hours in getting your emails down to 50.

Granted these two books were published in 2009 and 2004, respectively. The authors couldn't have possibly have foreseen the activity of today's average email account.

I had to spend some time watching MSN Hotmail's demos for their revamped email system. Only then was I able to stop beating myself up about the constantly building emails in my three accounts. According to them, the average person receives 14,500 emails per year per account (!).

And my computer - bless his old microchip - is running the way I feel: congested. The situation is dire, indeed. Two months seems a much more reasonable time limit to get my office back into tip-top shape.

Paradigm Shift

Thankfully, I'm noticing a change already from the seemingly little I've done. So far, I've created new automatic rules to deal with my newsletters and emails, I designed better file folders and linked two of the accounts together for easier cleaning. I've also cleaned and defraggled my hard drive. My laptop is already showing improved performance.

The best way for me to tell if I'm moving in the right direction is to notice nature's clues. Not only did I catch Bluebell Wood at its brief peak; but I also witnessed saw something I've never seen before: adjacent to the bluebells is the Rose Arc Pool. In it I, and a few other patrons, saw a mother duck and her nine new babies swimming behind her. Synchronicity at its best!

How does a NEW family of wild ducks end up in BBG? I know the Audubon Center is across the street in Prospect Park and it wouldn't surprise me in the least if that's where I saw them. And I've seen the occasional duck or two in BBG - but never a mama and with so many of her babies.

Birds have a very special place in Feng Shui. According to About.com's Feng Shui 101, birds are "considered [to be] powerful symbols of new opportunities that are there for you even in times of adversity."

Mandarin ducks mate for life and are a powerful symbol of love and commitment. Cranes reflect wisdom and longevity. Peacocks are a "manifestation of the celestial Phoenix on Earth".

And while these ducks seemed to be of the mallard variety, there ARE mandarin ducks and peafowl across the street at the Wildlife Conservation Society's Prospect Park Zoo.

The nine ducklings? Nine is the most auspicious number in Feng Shui. I believe I just received the best confirmation I could possibly get! I'm very excited and optimistic about the business opportunities ahead and will do all that I can to take advantage of them.

I wish you all the same.