3 Simple Ways Entrepreneurs Can Facilitate Diversification

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If you’re a serial entrepreneur, you’ve certainly been here before: you have a great business, selling something. Maybe grow oranges and sell them to an orange juice processor. Maybe you have an EBike franchise and rent eBikes. Or maybe you sell legal newsletters. You are very good at selling these products and services, which leads to what many would describe as a business success. Let me share an experience I had during the pandemic and how diversification protected me from potentially disastrous consequences.

Before the pandemic, in the winter of 2019-20, I was chasing two interesting businesses. The first was the concept of luxury group homes or the idea that it would be easier to admit someone who was used to a certain lifestyle in a luxury group house than in a traditional group house. The move from living in your home to being placed in a single room in a traditional group home could alter life and accelerate your disappearance. Combine the concept with the idea that there was a lot of luxury housing in the Phoenix area, where it had major real estate and construction connections, and the dice were rolled. By February 2020, it had purchased several luxury homes and was in the process of renovating them. Then, the pandemic affected and the collective houses took the weight. I was left with an inventory that had to make the mortgage payments, while maintaining the maintenance.

The second focused on the concept of cannabis churches in California. The legal precedent in this state had established that cannabis could be considered a sacrament, in the same way that wine is considered a sacrament in the Catholic Church. So I bought a cannabis church in Los Angeles in the winter of 2020. Parishioners visited the church, listened to, and participated in a sermon while participating in the sacrament. Then the pandemic hit and restrictions were placed on meetings in California. We briefly explored the delivery of the sacrament to the homes of parishioners, but local law enforcement dismissed this concept. Time is everything. Today, in South Florida, cannabis users can literally ask for cannabis delivery via WhatsApp, and it will be delivered to your doorstep, not as a sacrament, but as a recreational drug.

Regardless, two business ideas were destroyed and I was left with a major financial responsibility. Fortunately, I adopted diversification. My company, Burns Funding, which offers alternative financing resources to existing and potential entrepreneurs, was thriving. I was able to absorb the financial shocks and start other businesses. So how do you adopt diversification as an entrepreneur? Here are three very simple ways:

Related: Diversify Your Income – Protect your finances with these strategies

1. Become a channel

Taking the example I gave above about the orange tree owner, explore making your business a destination that sells other people’s products. There is an operation near the small town of Arcadia, Florida, called Joshua Citrus. Since starting 33 years ago with a retail store and a planting stand in the middle of the old family grove and farm, the family / entrepreneurs have expanded their retail store to sell products from other companies, such as jams. , jellies and honey. This helps protect your income stream if a freeze affects your harvest.

2. Take advantage of a trend

Maybe you have, or are thinking of buying, an EBike franchise. Owning and operating one of these can be very cost effective. The only flag in the field I can predict would be oversaturation. EBike franchises are popping up left and right, which means the employer could experience a reduced market share. Consumers also buy eBikes, especially in retirement markets like Florida, Arizona and California. You can take advantage of this trend and diversify your revenue streams by repairing eBikes.

Here’s another example: Decades ago, I started a moped rental business in the Northeast. I was one of the first to do so. When other entrepreneurs entered the space, I realized there was something missing in the industry: insurance for these growing operators. I worked with an insurance company to create a product that could sell to my competition, solving a problem they had, while diversifying my revenue stream.

Related: This is a good time to diversify and expand your business

3. Deploy your skill in another area

I have a friend whose passion is journalism. In 2001, he worked as a corporate communicator for a large technology company listed on the stock exchange. When the company had a reorganization and offered a lucrative compensation package, it took the money and started a business of publishing legal bulletins. The problem was that he had limited income, so it would take a few years to build the business. He understood that while his passion was journalism, his best hope for keeping the business going was to diversify. The logical direction was to use a skill he had (write) in another area. He founded a public relations firm, which allowed him to build his journalism business. While he could have moved on from public relations, he understood that diversification would protect his journalistic business from threats, such as competition. Thus, it maintains the public relations firm to this day.

Related: 4 Ways an Entrepreneur Should Diversify His Income

As you can see, diversification is extremely beneficial, and you now have three easy ways to make it easier. Diversification can protect the entrepreneur and help us achieve our dreams.

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