Summaries Business and Entrepreneurship Boost Your Business Profits: Key Strategies for Entrepreneurs

This is a summary of a YouTube video "How To Run A Profitable Business & Make Money" by The Futur!

4.6 (46 votes)

Understanding the difference between cost and value, taking risks, and understanding buyers' preferences are crucial for entrepreneurs to succeed in business and increase profits.

• 💰
  00:00

  Understanding the difference between cost and value is crucial for entrepreneurs to avoid bankruptcy and business failure.
• 💰
  07:38

  Charge appropriately for time, equipment, and profit in design to avoid financial loss and ensure a successful project.
• 💰
  13:28

  Taking risks in business can lead to high profits, as seen with volatile investments like WeWork, and assuming risk is the first step to becoming an entrepreneur.
• 💰
  18:39

  Buyers determine the value of a product, regardless of the seller's price, and if the value exceeds the price, they will make the purchase.
• 💰
  28:25

  Cut out the middle person and sell directly to customers to increase profits and lower prices, while learning basic business concepts to double your income.
• 💰
  34:51

  Buyers assign value to products based on their personal preferences, emotions, and perceived importance, and by understanding their needs and desires, sellers can increase the price of their products.
• 🍿
  41:49

  Movie theaters make most of their money from the concession stand by triggering an emotional response and bonding experience for moviegoers.
• 💰
  49:57

  Cost and price are different, a video needs 50k views in a week, and a business boot camp is for entrepreneurs who want to grow their business.

Key insights

Marketing and Value Perception

• 💸 Value is subjective and determined by the buyer, not the seller, when it comes to pricing.
• 💰 By learning about branding, marketing, customer service, and sales, you can double your profit and income for the next year.
• 💰 The same product can command a very different price based on subjective value and branding, even if objectively they are the same.
• 💰 The buyer determines the value: "We all get to determine what's valuable to us."
• 🤝 By asking discovery questions, you can help the buyer realize the value in their mind and potentially increase the price.
• 💰 Understanding and marketing towards a customer's emotional pain point is key to making money in business.

Pricing and Profit

• 💰 "Price is what it costs you to make plus profit" - it's important to factor in profit when setting prices for your business to avoid going bankrupt.
• 💰 Businesses can charge significantly more than what it cost them to make a product or service, with profit margins ranging from 5-80%.
• 💸 Safe investments may promise a 5% return, but investing in speculative tech stocks can lead to higher profits despite a higher failure rate.
• 💰 By bypassing the middle person and selling directly to the customer, a manufacturer can double their profit and offer a lower price to the customer, creating a win-win situation.

Detailed summary

• 💰
  00:00

  Understanding the difference between cost and value is crucial for entrepreneurs to avoid bankruptcy and business failure.

  • The talk is about the difference between cost price and value, and how they are often used interchangeably but have distinct meanings.
  • The speaker announced a $5000 business boot camp that will be offered for the last time at this price, and explained the difference between cost, price, and value.
  • Cost is the amount of money spent by a company on inputs such as raw materials, salaries, rent, interest, taxes, and duties for producing any product or service.
  • As a young entrepreneur, not accounting for profit margins and basic accounting caused me to lose money and caused tension with my mother.
  • Price is what it costs you to make plus profit, and not accounting for profit can lead to bankruptcy and business failure.
  • When a client asks for the price of a service, profit is implied, but it's hard to measure how much profit to include.
• 💰
  07:38

  Charge appropriately for time, equipment, and profit in design to avoid financial loss and ensure a successful project.

  • Charge for your time, assistant's time, gear rental, and find industry standard rates for gear rental to include in your estimate.
  • It's important to charge for equipment costs as they have a shelf life and decrease in value over time, and not doing so can result in financial loss when needing to replace or upgrade equipment.
  • Include profit in your estimate to ensure that you have money left over after paying for expenses and labor.
  • The lecture discusses profit and cost in design, with profit being 25% of the pie and cost being what it costs to complete the project.
  • Businesses can charge in excess of what it costs to make their products or services, with profit margins ranging from as little as 5-10% to as much as 80%.
  • Pricing services can vary drastically, ranging from 5% to 80% or more depending on the business.
• 💰
  13:28

  Taking risks in business can lead to high profits, as seen with volatile investments like WeWork, and assuming risk is the first step to becoming an entrepreneur.

  • No question provided, TLDR not possible.
  • The goal is to get 50,000 views within a week for the whiteboard session, and if achieved, the video will remain on the channel for free.
  • Profit in business comes from taking risks, and the amount of profit is determined by the level of risk taken.
  • Investing in volatile assets like WeWork can lead to high returns, with some investors expecting up to 20,000 times their initial investment.
  • When a client asks for a fixed fee, the contractor assumes risk and adds profit to accommodate the unknowns, which is the first step to becoming an entrepreneur.
• 💰
  18:39

  Buyers determine the value of a product, regardless of the seller's price, and if the value exceeds the price, they will make the purchase.

  • Build on each concept, it's important.
  • The seller gets to determine the price as it is their responsibility to sell the product, but the value of the product is subjective and determined by the buyer.
  • Buyers determine the value of a product based on their needs and wants, regardless of the seller's price.
  • Setting a high price for a product is not taking advantage of the customer if they see value in it.
  • Buyers determine the value of a product based on their perception of its worth, and if the value exceeds the price, they will make the purchase.
  • Manufacturers sell products to retailers with profit in mind, who then add their own profit before selling to consumers at a higher price.
• 💰
  28:25

  Cut out the middle person and sell directly to customers to increase profits and lower prices, while learning basic business concepts to double your income.

  • Learning basic business concepts can help you make more money, sound more credible, and have real conversations with clients about their business, as seen in the disconnect between price and cost and the rise of manufacturers selling directly to customers through Kickstarter campaigns.
  • Manufacturer can sell directly to customers, resulting in lower prices for customers and increased profits for the manufacturer.
  • Cut out the middle person to make more money by selling your creative services directly to the end customer.
  • Learn how to brand yourself, market, provide good customer service and sales to double your profit and set a goal to double your income for next year by applying the principles taught in the last 15 minutes of the lecture.
  • The speaker mentions their Venmo account for donations to support their content creation.
  • Two t-shirts with the same function and purpose can have vastly different prices due to the use of premium materials and branding.
• 💰
  34:51

  Buyers assign value to products based on their personal preferences, emotions, and perceived importance, and by understanding their needs and desires, sellers can increase the price of their products.

  • Buyers determine the value of a product, as people assign different values to things they consider important.
  • The biggest driver for logo design is emotional and it's what the customer wants to feel, with the example of a clothing line logo being valued at $2,000.
  • The speaker offers to design logos for two individuals, but one is willing to pay significantly more than the other.
  • You cannot invent value in the buyer's mind, but by asking questions and doing discovery, you can help them realize the value and increase the price.
  • 524 viewers are watching as the speaker discusses Coca-Cola in a media episode.
  • The lecture discusses the different prices of identical Coca-Cola cans sold in wholesale places, vending machines, and movie theaters.
• 🍿
  41:49

  Movie theaters make most of their money from the concession stand by triggering an emotional response and bonding experience for moviegoers.

  • People get more thirsty at the movie theater, which might determine their choice of drink.
  • Buying drinks at a vending machine is more expensive but convenient, while buying in bulk at Costco is cheaper but requires more planning and effort.
  • Movie theaters make most of their money from the concession stand, which has a monopoly on food and drinks, triggering an emotional response and bonding experience for moviegoers.
  • Attaching an emotion to a product can increase its price, and convenience and a sense of accomplishment are examples of emotions that can be used.
  • To sell effectively, businesses need to understand their customers' pain points and market towards their emotions, rather than just selling a product or service.
  • We all seek greater social status.
• 💰
  49:57

  Cost and price are different, a video needs 50k views in a week, and a business boot camp is for entrepreneurs who want to grow their business.

  • Cost is the sum total of what it costs to make something without profit, while price depends on profit, risk, and understanding of customer value.
  • The video needs to reach 50,000 views within the first week or it will be taken down, and viewers can support the future by sending money.
  • The business boot camp is for entrepreneurs and solopreneurs who want to grow their business and Warren Buffet's quote "price is what you pay, value is what you get" is a shrewd financial advice.

Q&A

• What is the difference between cost and value?

  Cost refers to the expenses incurred by a company in producing a product or service, while value is determined by the buyer based on their perception of worth.

• Why is it important to account for profit margins?

  Not accounting for profit margins can lead to financial loss and potential business failure.

• How can entrepreneurs determine the price of their services?

  Entrepreneurs should consider factors such as time, labor, gear rental, and industry standard rates to determine the price of their services.

• What determines the value of a product?

  The value of a product is determined by the buyer based on their needs and wants, regardless of the seller's price.

• How can businesses increase their profits?

  Businesses can increase their profits by understanding buyers' preferences, taking risks, and effectively marketing towards customers' emotions and pain points.