The Difference Between Recruiting Versus Sponsoring

Amateurs vs Professionals

Amateurs Recruit…Professionals do things a bit different!


I’ve been afforded an opportunity to hear Dominic Curry talk about this topic.  He said that in school we’re told to succeed, but we’re taught to fail.

Copy professionals and mimic what they do, and you’ll be more likely to succeed as well.  Find a great mentor and go to work!

Discover how to  become a Network Professional because it will make the difference between having a job for the rest of your life and creating a legacy.

A Vivid Example of The Difference Between Recruiting and Sponsoring

Have you ever been recruited into the Army, Air Force, or Marine Corps?  When you when to Bootcamp, did you see any Recruiters?

Exactly!  Recruiters will bring you in and then you will never see them again.  They’re only focused on their number.

People don’t want a Recruiter!  People want a Sponsor!

A Sponsor will help you evolve and become who you need to become in order to develop success.

Now that you have come across the concepts of recruiting and sponsoring and want to understand the core difference between them, let’s just try to understand them one by one and get ourselves educated with the difference.

We need to understand their advantages as well as disadvantages. First of all, we need to understand that these both are totally different concepts.

Recruiters are the people who would just bring you in, and you would never be seeing them again.

Goodbye Recruiters!

Whereas you will evolve alongside a sponsor, and he/she would help you at every step in order to achieve success.

So would you prefer a recruiter or a sponsor?

The choice is up to you.

Now that we have understood the basic meaning of both the terminologies, we will dig a little deeper and get ourselves familiar with the recruiting and sponsoring concepts in Network Marketing.

First of all, if you don’t know much about network marketing or multi-level marketing, we need to help you get familiar with the entire concept.

What is Multilevel Marketing (Network Marketing)?

Let’s try to understand it with an example. Let’s just suppose you have started your own business and would like to sell your products to a huge amount of people.

But How?

One of the most effective strategies is the concept of Multilevel Marketing. You can sell all of your products and just empty up all of your stocks.

All you need to do is give some share of your profits to the people who sell your products.

That’s the concept of Multilevel Marketing. Companies just encourage their existing distributors to recruit some more distributors who would sell their products, and in return, they are simply paid a certain amount of commission for their services.

People just make a lot of money through it and is considered to be a very effective strategy.

One of the examples you could take into consideration is Amway.

Amway is a company that sells health and home care products with the help of a multi-marketing strategy.

Now that we have understood the basic concept of Multilevel marketing, we now are going to shift our focus to the terms “recruiting” and “sponsoring” and just try to understand the basic difference.

What is Recruiting?

Recruiting for business is not as friendly as compared to sponsoring. Recruiting and sponsoring are totally different concepts.

Recruiting is more about looking after self. You will just be brought in by some recruiter and would never see him again.

They will leave your training at the hands of a totally different person. That’s the recruiter’s only job. You are on your own now.

It’s more of a self-serving process. Recruiters will make you sign up, fill a form, bring you in and carry on their search for the next one.

In Multilevel marketing, if you are a recruiter, you can build yourself a network by simply recruiting some people and ride on the track of success. The core points of recruiting are :

    • Gain
    • Build
    • Sign
    • Enroll
    • Win over
    • Retrieve

What is Sponsoring?

 Sponsoring is a totally different concept. You just don’t leave the people on their own here.

Sponsors spend some of their valuable time with the distributors.  They are focused on helping their distributors.

A sponsor would create and develop a game plan for their distributors and help them promote their business so that they would be able to start earning instantly. They would want to ensure that the people under them successful.

They don’t make everything about themselves. They take your responsibility and educate as well as mentor you. They want to watch the sights of you growing to massive heights. It’s more of a partnership.

The core points of sponsoring are :

    • Advocate
    • Support
    • Take Responsibility
    • Guarantee
    • Promote

Difference Between The Two Terms

Would you prefer being mentored by the person who knows a lot about the business and improve yourself under their guidance, or would you prefer not to learn anything much and keep doing the work?

If you try to put some focus on the question, it would alone be enough to help you understand the basic difference.

Sponsors are personally responsible for the new participants. They have a good understanding of the business.

They educate the people about their products and mentor them all along the way as they start with their sales.

It’s more like caring and education. It’s a total win-win situation.

Whereas, in recruitment, we know that it’s all about just bring the people in and just let them start on with their work.

It’s something cool in the start, but it ends worse. You won’t like the way it ends. The people are not able to learn something new, and they just want to get their work done without observing any kind of growth.

In Network Marketing, the sponsors take you under their wings and guide you at every step in order to allow you to become a better salesperson and improve your range of sales. Whereas, in recruiting, you would just observe failure in the end.


If you would just ask me about choosing one option, I would simply go with the term “sponsoring.”

In the end, I am all about developing my skills and leading a better life instead of just working like a machine, which is the biggest disadvantage in the case of recruiting.

If you were able to be given a Blueprint to having success, would you want it?

Consider allowing us, Wealth Builders Worldwide, to sponsor and mentor you to the greatest financial success you’ve ever experienced in your time.  Click here to read more about My Gold System.

Essanté Organics Review – Top Online Team Builders

The exposé you are about to read is going to shock you and your entire family.

After reading this article, you may feel the need to watch this video and check the products in your home for the ingredients we’re going to talk about.

For the sake of your children, grand-children, and your entire family; we urge you to watch this video in its entirety.

Ask yourself this, why is there such an epidemic of ADHD amongst our children?

They can’t even concentrate in school anymore

Why are there so many cancers like breast, liver, colon, kidney, and prostate at epidemic levels?

Why are birth-defects and brain, liver, and kidney disease such national issues?

Sinus and asthma problems have also become major issues

Why are so-called old age illnesses now attacking our children?

What’s going on?

The short of it is that our immune systems are breaking down, drug companies can’t work fast enough to give us remedies to fix our illnesses.

During this explanation, we are going to discuss how and why this is all happening.  Then we will introduce you to a wonderful solution.

A solution that you can actually capitalize on as well.

Would you normally put your family in harm’s way?

By using products such as shampoos, soaps, personal care products, and cleansers that cause liver cancer, kidney cancer, breast cancer, heart palpitations, vomiting, sterility, miscarriages, and myriad of other nightmare health problems.

Of Course not!

But the fact of the matter is that most common everyday household items including personal care items, detergents, and makeup, to name just a few contain a toxic horror chamber of acids, alcohols, poisons and preservatives.

Women use nearly 200 toxic ingredients daily in their routine, and men use nearly a 100.

Theses toxins even in mild form, amount up, stay in our bodies, store in our cells, and break down our immune systems.

Here is a short list of the top toxic ingredients you will find in your home.

Once again check these ingredients against the products you use:

Propylene glycol, butylene glycol, ethylene glycol.

Now run into your garage and check your anti-freeze.  Anti-freeze is one of those glycols.

Now check your facial cleaners, shampoos, conditioners, toothpaste, under-arm deodorants, and baby products.  These glycols act as surfactants, wetting agents, and solvents.

They penetrate the skin fast, weaken protein and cellular structure.

They’re strong enough to remove particles from bones.

The EPA warns us not to pour them into our soil yet we smear them onto our bodies.

Propylene glycol often called ‘PEG’ resembles ethylene glycol in its physical properties, and ‘PEG’ is extensively in foods, cosmetics, personal care, baby care, oral hygiene products.

It’s a skin irritant that can causes liver abnormalities, kidney damage, and is directly related to Cancer.

They higher the ‘PEG’ content like PEG 20, 50, 100, or 120, the worse it becomes.

About one third of all the beauty and personal beauty care products you use morning afternoon and evening contain them and do not have a warning label.

Why are these glycols used in such abundance?

One answer they come cheap. The non-toxic ingredients needed to replace them are far more expensive.

Sodium Hydroxide

This time check under your sink. Checkout your Drano, or other sink or oven cleaners, especially check the crystal or dry Drano.

Crystal Drano is 100% sodium hydroxide.

This is a poison.  Read the warning label.  Look at the skull and crossbones. Yeah…it’s caustic lye, and you’ll find sodium hydroxide in most common toothpastes especially the ones claiming total or extra whitening.

I guess they figure…

If it cleaned your drains it will do a good job on your teeth.

It’s also in many of your soaps and facial cleansers.

Sodium Laureth Sulfate

Sodium laurel sulfate, or ammonium lauryl sulfate, these sulfates are strong detergents they are used in garage floor cleaners and engine degreasers.

Yet they’ll be in 90 Percent…get that 90%…of your beauty and personal care products that foam, why? it’s the cheapest way to create foam, they are linked to eye damage, depression, diarrhea, skin irritation, and even death.

Our bodies retain these sulphates for extensive periods of time this means that even smaller dosages amount up to higher and higher levels of toxicity in our bodies think of what that means to smaller bodies like infants and children, think of the unborn infants. Any wonder why attention deficit in learning disabilities are at epidemic proportions.

If that’s not enough to frighten you consider this, most of us know that formaldehyde is used as a preservative in mortuaries and medical laboratories, but did you know that the National Cancer Institute says that for formaldehyde is also used to produce many household products.

In fact, formaldehyde is often used as a preservative with no discussion of the potentially dangerous and destructive effects on the human body.


You could be using something in your house or on your child’s body that contains a chemical normally used in the embalming process.

Here’s another example, chemicals that end in the letters AMINE these chemicals are often used in lubricants, paints, and cleaners.

The most common are Diethanolamine or ‘DEA’, Monothanolamine, and Triethanolamine.

Along with being used in corrosive products DEA-related ingredients are frequently used in cosmetics.

These costa confections are easily absorbed through skin and accumulating body organs even the brain. Indeed, according to the US Food and Drug administration, the national toxicology program, and the EPA in “an association was found between the topical application of certain DEA related ingredients and cancer.”

The FDA even advises consumers who want to avoid cosmetics containing DEA-related ingredients to be sure to review the ingredients statement on cosmetics labels.

Parabens and phenoxyethanols in spa products and personal care products have been found in breast cancer tumors.

In fact parabens and phenoxyethanols are hormone disruptors and may cause damage to liver and kidneys, birth defects, decrease sperm count, and early puberty.

Color pigments and fragrances are two other horribly unhealthy products that most people don’t realize are found in literally thousands of items,  For example fragrances can indicate the presence of thousands of separate ingredients including many that are toxic or carcinogenic.

Most of us use these products every single day in the enclosed environments of our homes which are supposed to be safe secure sanctuaries for our children and loved ones.

According to the nonprofit organization environmental working group or EWG more than 500 product sold in the US contain ingredients that are banned in cosmetics in Japan, Canada, and the European Union.

What’s more..

Nearly 100 products contain ingredients considered unsafe by the International Fragrance Association.

Additional EWG research shows that 22% of all personal care products may be contaminated with the cancer-causing impurity “1-4 dioxane” including many children’s products.

Of course, we would all like to believe that the product’s made for children or bearing claims like hypoallergenic or safe for choices but unfortunately, it’s just not true.

Most cosmetic marketing claims are unregulated and companies are rarely if ever required to back them up, even for children’s products a company can use the claim like hypoallergenic or natural, but there’s no definition for these terms so they mean absolutely nothing except to try to trick people into thinking the products are safe.

As a matter of fact, an investigation of more than 1700 children’s body care products found that 81% of those marked gentle or hypoallergenic contain allergens or skin and eye irritants. This is a nightmare of epic proportions, but what’s to be done?

Most people still don’t know where to buy nontoxic products, it’s not like you can go to the drug stores, or grocery stores, or Department stores, and find replacements–even the most expensive are often the most toxic.

They might come in prettier bottles but there just as bad.

The Solution

Thankfully there’s a solution to this frightening cornucopia of malignant ingredients and products.  A brand new line products that are not just certified organic but also 100% chemical free and completely and totally non-toxic.

Experts at Essanté Organics have been formulating a complete catalog of products to support a green 100% chemical free lifestyle, when the functional botanicals and the purest organic and wild crafted ingredients are used in the Essanté’s top secret formulations not a single solitaire chemical is used guaranteed.

Thanks to such an amazing product that will change families lives’ forever.

The global community is starting to pay attention.  In fact, Essanté Organics products have already been featured numerous times on television and in nearly 100 national and international magazines including publications like star magazine, Us Weekly, Vogue, and Elle,

They’ve even been featured at the Screen Actors Guild awards, the Grammy, the MTV Music Awards, the Emmys, and many more red carpet events.

What if you could make a living through giving imagine that you could reach out in kindness every day to others and be able to make a living doing it.

What if that living could provide you with a lifestyle of financial freedom for you and your entire family?

Well, now you have the opportunity to be involved in offering these remarkable products to consumers, while making a healthy income as a result.

Companies that are first to market always control global market share in their niche.  Microsoft, Xerox, Redbull, Starbucks, and have all become household names, and Essanté is faded to join this elite group by becoming the leader in the chemical-free living industry.

Together we can impact every family around the globe, imagine how your lifestyle will change since you can receive an income from every single on of them. We invite you to become part of the Essanté family, a family that represents long term vision, stability, compassion, and commitment, to delivering health benefits and massive financial rewards.

Is Online Team Builders A Scam?  Not!

What’s great about the Online Team Builders (OTB) platform is that you’re being coached that Millionaire Coaches and Mentors who care about your success.

If you’ve ever tried to have success in the Network Marketing or Referral Marketing industry but failed, it mostly due to the fact that you’ve likely not been mentored and had a daily method of operation in order to build long-term residual income for your family.

Online Team Builders is DEFINITELY NOT a scam in any stretch of the imagination.  However, it will make you decide whether  you want success because it will take work to build walk away, residual income.  OTB is a team of professional builders with a concept which will allow most people who have not built their network over their years of life.  Remember…your network is your net worth!  If you don’t have people to influence about a particular concept, you’ll have to find a way to get in front of a massive amount of consumers and business builders.  OTB will help the right people do this with precision!

Direct Sales Versus Affiliate Marketing

Regardless оf whаt оthеrѕ mау think about Sales and Marketing, thеrе is mоnеу to bе made Onlinе.

Thеrе аrе numеrоuѕ buѕinеѕѕ mоdеlѕ to work fоr and wоrk frоm, аnd your Direct Sales vs Affiliate Marketingеаrningѕ will оnlу bе limitеd bу thе wоrk you рut in.

Thiѕ ԛuiсk blog post guide will present twо common methods on hоw tо mаkе mоnеу оnlinе аnd hеlр уоu dеtеrminе whiсh is thе bеѕt орtiоn fоr you.

Thе mеthоdѕ tо bе diѕсuѕѕеd are Direct Sаlеѕ аnd Affiliate Mаrkеting Prоgrаm.

Dirесt Sales

Direct Sales iѕ a mеthоd оf selling a соnѕumеr product or a service, реrѕоn-tо-pеrѕоn аnd аwау from a fixеd rеtаil lосаtiоn.

These consumer рrоduсtѕ are ѕоld thrоugh in-hоmе рrоduсt dеmоnѕtrаtiоnѕ, hоmе раrtiеѕ,” аnd oneon-one ѕеlling bу salespeople. Suсh products оr services аrе uѕuаllу mаrkеtеd tо customers by independent ѕаlеѕреорlе оr tеаmѕ оf ѕаlеѕ реорlе.

Depending on the ѕаlеѕ company structure, the ѕаlеѕреорlе mау bе саllеd consultants, distributors, rерrеѕеntаtivеѕ, оr a numbеr of оthеr diffеrеnt titles.

Dirесt ѕеlling can bе a part-time jоb оr a full-timе business, dереnding оn the needs and wаntѕ оf thе ѕаlеѕреrѕоn. Dirесt sales is оnе оf the оldеѕt ѕаlеѕ mеthоdѕ still gоing ѕtrоng tоdау.

Affiliаtе Mаrkеting

Affiliаtе marketing iѕ a rаthеr hоt buzz wоrd thеѕе dауѕ fоr реорlе thаt аrе intеrеѕtеd in mаking mоnеу online are that want tо ѕtаrt аn оnlinе business.

In fасt, Intеrnеt Mаrkеting соuntѕ as оnе оf its mоѕt imроrtаnt соmроnеntѕ thе ability to mаkе mоnеу аѕ аn Affiliаtе Mаrkеtеr.

In ѕоmе ways, thiѕ fоrm of есоmmеrсе iѕ ѕimilаr tо оfflinе ѕаlеѕ that mоѕt salespersons use аѕ their рrimаrу mеаnѕ of gеnеrаting inсоmе.

Whаt thiѕ means iѕ, Affiliаtе Mаrkеting iѕ thе same аѕ оfflinе sales in the ѕеnѕе that whеn уоu make a sale оf a рrоduсt, уоu еаrn a соmmiѕѕiоn relative tо the аmоunt of the initial ѕаlе.

The only diffеrеnсе in mу еxаmрlе аbоvе is thаt thе ѕаlе actually tаkеѕ рlасе in cyberspace (оn thе Internet) inѕtеаd оf face-to-face in a traditional brick аnd mortar ѕtоrе.

Bеnеfit Of Dirесt Sales

Thе Benefits Of Dirесt Sales Oрроrtunitiеѕ:

• Yоu саn choose your оwn wоrking hоurѕ and thе ԛuаntitу of wоrk that you can hаndlе. You саn сhооѕе bеtwееn wоrking раrt-timе оr fulltimе.

• You gеt a chance tо mееt different people. Dооr-tо-dооr mаrkеting mаkеѕ you riсh in experience. Grаduаllу, you’ll bеgin ѕроtting роtеntiаl сuѕtоmеrѕ bу their wау оf соnvеrѕing with you. With timе, уоu’ll get tо knоw аll kinds оf реорlе present in the wоrld. Some аrе hаrѕh; ѕоmе are роlitе; ѕоmе аrе finicky; some are easily реrѕuаdеd; thеrе аrе ѕоmе whо mау еvеn ѕlаm thе dооr in уоur face; while ѕоmе may еnjоу tеѕting уоur knowledge аbоut the рrоduсt оr ѕеrviсе you’re ѕеlling. At thе еnd оf the dау, уоu’ll have some grеаt еxреriеnсеѕ tо ѕhаrе with оthеrѕ.

• You bесоmе indереndеnt finаnсiаllу. Yоu can even еаrn some еxtrа buсkѕ in thе form оf inсеntivеѕ оr commissions.

• You’ll роliѕh уоur communication skills and expand уоur social nеtwоrk.

Direct ѕаlеѕ opportunities hеlр ѕhу people ѕhеd their inhibitiоnѕ and
dеvеlор mоrе соnfidеnсе to interact with реорlе.

• There’s оvеrаll реrѕоnаlitу dеvеlорmеnt.

• Another bеnеfit оf dirесt ѕеlling iѕ that уоu саn dо it раrt-timе аnd ѕtill mаkе a dесеnt amount оf еxtrа mоnеу each month. Yоu can wоrk a few hоurѕ еасh week with уоur dirесt ѕаlеѕ buѕinеѕѕ аnd receive a decent соmmiѕѕiоn сhесk each mоnth аѕ wеll as frее рrоduсtѕ, depending оn уоur dirесt ѕаlеѕ соmраnу’ѕ соmреnѕаtiоn рlаn. Yоu саn wоrk your direct ѕаlеѕ fоr a fеw hours еасh wееk аnd build еnоugh buѕinеѕѕ аnd income to аllоw уоurѕеlf thе option оf deciding tо ԛuit уоur rеgulаr jоb аnd mоvе intо a full-timе buѕinеѕѕ that givеѕ уоu the mоѕt еxсеllеnt flеxibilitу.

The bеnеfitѕ оf thiѕ career аdd up ԛuiсklу, and if уоu саn motivate уоurѕеlf аnd ѕtiсk to thе tаѕk at hаnd, you can hаvе success and your own business that саn рrоvidе уоu аnd уоur fаmilу with mоrе time together оr juѕt рrоvidе you with a lot mоrе money!

Benefit Of Affiliаtе Mаrkеting

No Nееd to Dеvеlор Your Own Prоduсt

Thе true bеаutу оf Affiliаtе Mаrkеting really shines through with this аѕресt.

Whеn уоu sign uр fоr an Affiliаtе Program, уоu сhооѕе thе рrоduсtѕ уоu wiѕh to promote without аll thе hаѕѕlе associated with hаving to dеvеlор it, ship it, deal with рауmеntѕ, ѕtоrаgе оr even сuѕtоmеr inԛuiriеѕ. Hоw cool iѕ thаt?

Wоrk Frоm Hоmе

Thе dаilу соmmutе tо work with the nеvеr-еnding trаffiс hаѕѕlеѕ can be a thing оf thе раѕt. Of соurѕе, whеn уоu аrе just starting оut with your Affiliate Mаrkеting business, thiѕ ѕсеnаriо mау continue fоr mаnу more mоnthѕ or еvеn уеаrѕ, but the роtеntiаl fоr аn end tо it is very rеаl.

Low Set Uр Cоѕtѕ

Aѕ mоѕt реорlе already have a computer аnd Intеrnеt аt thеir diѕроѕаl, еithеr at hоmе оr thе local librаrу аt a сrunсh, thе cost of ѕеtting uр your Affiliаtе Mаrkеting business iѕ vеrу low.

If уоu hаvе nо idеа how tо ѕtаrt, jоining a Training Program is a gооd mоvе, аnd this will usually hаvе a price, but thiѕ dоеѕ nоt need tо bе еxреnѕivе.

Other initiаl costs maybe buying a domain nаmе and web-hosting, neither of thеѕе аrе vеrу еxреnѕivе, around $10.00 реr year fоr dоmаin аnd web-hosting fоr under $10.00 a month. A reliable орtѕ in email ѕеrviсе is also vеrу advisable аnd соѕtѕ around $19.00 a month.

Yоu can get started fоr under $100.00.

Wоrks Fоr Yоu 24/7

Onсе уоu hаvе ѕеt uр a ѕuссеѕѕful Affiliate Mаrkеting Program, thе роtеntiаl tо have аn income while уоu sleep оr holiday iѕ amazing.

Like аll buѕinеѕѕеѕ, thеrе is wоrk tо dо to get уоur nеw buѕinеѕѕ uр аnd running, аnd mаintаinеd.

Yоu nееd tо wоrk on уоur business rеgulаrlу, еvеrу dау fоr a numbеr оf hours in the bеginning, but аѕ уоur ѕuссеѕѕ grow, less timе and еffоrt is rеԛuirеd, аnd уоur buѕinеѕѕ will juѕt kеер рrоduсing.

Rеfining аnd uрdаting will аlwауѕ bе rеԛuirеd, but аѕ уоu bесоmе mоrе exреriеnсеd, thе time nееdеd to аttеnd to mаttеrѕ is оf your choosing, your buѕinеѕѕ, your hоurѕ, уоur рrоfitѕ.

Sо аѕ уоur buѕinеѕѕ grоwѕ, it will produce аn inсоmе for you whilе you аrе оff dоing other thingѕ.

Some Affiliate Marketing Programs you may want to consider…

​Click here to Leverage on how to become a Freelancer
(Graphic Designer, Web or App Developer, FB Chatbot Developer, etc)


How to Survive from the Inflation and Excessive Expenses

The term inflation refers to the phenomenon of rising prices.

In other words, it also refers to the gradual loss in the valuation of the money.

In simple words, it means if you could buy 10 gums for $1 in 1991, you may be able to buy only eight in 2021 for the same amount.

The US Bureau of Labor Statistics defines inflation as a process of continuously rising prices.

This decline in the value of money is a function of several economic parameters.

InflationWhile we can do precious little in terms of arresting this, the question is how we deal with it.

You may have seen that when people save for their retirement funds, they often talk about inflation adjusted numbers.

But it is not just your savings that are impacted by inflation.

Businesses are perhaps some of the most affected units.

Inflation invariably delivers a double whammy to them.

On the one hand, they have to deal with the problem of money-losing value, and on the other, customers losing their purchasing abilities.

While large businesses have a certain degree of cushion, small businesses become the big casualties.

Tackling Consumer Purchasing Trends

This is invariably one of the first impacts of rising inflation.

They are the lifeline of any successful business.

But if they see a rapid increase in prices, they will stay away from it.

But this will affect demand and eventually the production.

That becomes unsustainable for any business.

So, one of the first tactics to use is to absorb some of the shocks and hope to average out.

But this will not go on for too long.

If the price rise or inflation remains unabated, there is a gradual price rise.

A sudden hike in prices can shock the consumer, so they try to increase it gradually.

But this is a tricky business.

If all the competitors on a given space agree, then this format works.

But in case you are only one, it can often have a double blow, rising input cost and low sales.

This is because consumers are generally smart.

If they notice that only one player in a given space is raising prices, they will quickly stay away.

That will hurt businesses over long-term, and companies often take time to go back to the same level of sales.

This is a point where you can try stealthy inflation tactics.

In this, you do not change the price of the packaging.

But at the same time, you reduce weight.

So if for so long, people were buying x unit for $10, they will buy x-10% for $10.

Most times, consumers are more focused on the price point.

As a result, this is a relatively simpler option to get away with.

It is no doubt sneakier than a direct price rise.

But the advantage is the relative loss in demand and consumers is much lesser.

This keeps the relative margins in place.

Communicating Changes In price

You also make investments in changing this pricing in the packaging.

Whether you produce detergent or have a departmental store, consumers need to know about the new prices.

In case you have an eating joint, a new menu has to be published too.

What are the options for tackling these costs?

While on the one hand, you are trying hard to reduce expenses, this is increasing its manifold.

You also pay for the labor involved in making these changes possible across the board.

This is exactly where the concept of tagging everything separately too shape in the departmental stores in the 1970s.

The idea is when the individual prices are put up, it is much easier to change them.

Moreover, it offered a lot more flexibility to businesses in tackling inflation.

Perhaps online menus in a tab or iPad in restaurants is also a function of this very phenomenon.

The idea is to spend as much money as possible when you can afford to.

What makes this situation even more alarming is the inability to make actual projections.

Inflation is a function of several economic parameters.

Often most of it join hands together for you to see the final impact.

Organic and loose packing is also perhaps a function of this necessity.

After all, small businesses will have to eke out a living.

Unlike a huge business like Unilever, a small soap maker will go bankrupt reprinting individual packaging material.

So it makes more sense to create a generic packaging.

The place next to MRP is left empty and filled as necessary.

Depending on the business situation, you can simply paste stick-on price tags.

These are functional, economical and make for better business sense.

The idea is to make the business as inflation proof as possible.

Dealing With Cost Of Inventory

Inflation does not just curb the purchasing power of customers.

Businesses feel the pinch with their own inventory cost too.

After all, they have to pay for their raw materials and other input expenses too.

If the value of money is reducing, it has an all-round effect.

The rise in input cost is one of the first casualties.

If you sold a packet of goods for $2 and your input cost was 50 cents, your profit earlier was $1.50.

But as inflation comes to play, this expense rises to $1.

Therefore, your profit now reduces to $1 as well.

Moreover, the replacement inventory begins to cost more than what you just sold.

One of the reactions then is to cut down the inventory levels to manage costs.

That again results in the shortage of inventory and a further rise in prices.

This led to the creation of the Just In Time inventory model.

It was a primarily Japanese concept championed by the likes of Toyota and behemoths.

In this case, companies store comparatively much lesser inventory.

You will send orders as and when you got new orders from customers.

But this needs precision and reliable inventory channels for proper execution.

Toyota started this inventory control way back in the 1970s.

But it took the company well over 15 years to perfect it.

In this case, timing is crucial and has to be precise.

A single delay at any point can lead to an outright halt in production.

But the interesting aspect of this approach is, this is a versatile formula.

It works equally well both in the inflationary situation as well as deflationary ones.

It completely wipes out the prospect of carrying inventory too long.

As a result, the risk of selling it at a higher or lower level is cut out.

Dealing With Borrowing Costs

This is another major concern during a rising inflation scenario.

When money flow is comfortable, and banks have adequate liquidity, they expand the loan portfolio aggressively.

For a small business, getting a loan gets that much easier.

They easily get attracted to the lure of these loans.

But what most lose track of is the ever-rising inflation numbers.

They expand as aggressively as they get loans.

But as the inflation noose tightens, maintaining the profit margins will be a challenge.

Often businesses miss the point early on.

What makes the borrowing cycle even more excruciating is the banking policies during easy money.

Also for many, they feel this is a smarter way of taking out money when it is available.

It is common knowledge that somewhere mid-way in the inflation cycle, getting a loan becomes that much difficult.

Though the value of the loan might be cheaper in absolute terms, you need profit to pay it off.

But it is this money that starts getting more and more scarce.

Eventually, the lack of liquidity will curb the borrowing power of businesses.

This is because interest rates will be tightened at some point to curb inflation.

This is the point where lenders start becoming cautious.

Even good credit risks are not able to secure financing.

For many businesses that rely on credit, this could also mean insolvency.

Therefore, it is imperative to manage your borrowing cycle.

Overleveraging the business, especially for the smaller ones is never an option.

As the economic crisis snowballs, uncertainty in markets will rise.

Growth and expansion become a casualty.

So, you have to carefully assess your borrowing policy in a way that you are well protected against this risk.

That alone will ensure that your sustainability in low liquidity.

Dealing With Investments

We noticed earlier that as the liquidity reduces in the market, the business suffers.

The lack of new investment affects growth and general business expansion.

But without new credit, how will investment come about?

Borrowing inflation and investment are all interlinked that way.

It is almost like one factor affects the other.

As high inflation almost strangulates new spending, even simple upgradation becomes an avoidable expense.

With lower profits and higher cost of production, just day to day running of the company can be a challenge.

Investors start worrying about their returns on earlier commitments.

That is what stymies growth even further.

The point here is taking a relook at the business model.

Many times, small businesses have to relook at introducing an inflation safe element.

This can comprise of a variety of aspects that seeks to push the business forward.

So, it goes without saying that if you want to shut out investment completely, it will stunt growth.

You will be unable to take advantage of existing market opportunities.

When conditions are extreme, the solutions have to be so.

Think about how Buffett’s Berkshire Hathaway bought GE during the severe economic downturn that ensued post-Lehman Bankruptcy.

He bought the GE common shares when it was absolutely low.

But 5 years later, when the company turned around, he managed to sell the shares at a distinctly higher rate.

So panic cannot be your reaction in this kind of situation.

You have to think in a rational way and take a step that is best for the business.

This will make sure that the long-term business prospect remains intact.

The overall margins too will be maintained in this form.

As a small business owner, you should be prepared to take the risk then.

Inflation Impact On Wages

Employee wages form a major chunk of any business’ expenses.

However, when a company is grappling with inflation, these wages take the maximum hit.

The overall bonus and wage hikes come to a standstill.

They are hit both ways.

On the one hand, the prices are going higher, and on the other, there is no rise in wages.

Eventually, they will begin to struggle, in terms of meeting their financial commitments.

That is never a happy situation.

Soon after this, the dreadful pink slips will follow.

Companies will start laying off employees.

Joblessness rises as more and more companies start managing cost.

The question is, how can a business survive in this type of situation?

They cannot afford to pay too many employees, so no new investment, tighter borrowing.

This is a classic catch 22 situation.

Often the best survival policy for businesses, in this case, is keeping the employee strength lean.

You do not have to keep it too low but do not recruit more than required.

That way, the relative wage expenses will reduce significantly.

Also, try and encourage multi-tasking within the organization.

The flat operating systems in most small businesses can help to a large extent.

Try and see how each person can contribute holistically to the overall growth.

If required, incentivize them for multi-tasking.

The overall expense in this will reduce even if you maintain a specific pay scale.

Also, keep a conservative bonus policy.

When liquidity is easy in markets, most companies give out lavish bonus.

As a result, this reduces a considerable amount from the war-chest in times of need.

So, the best policy is to create a fund that will help you tide over most emergencies.

That way, you are better prepared to deal with exigencies.

It also creates a goodwill amongst employees.

Keep A Close Watch On Your Margins

For most small businesses, it is impossible to predict an inflationary situation.

In fact, for many small businesses, this is absolutely a new concept.

For many, it will be the first time they will face it, whenever it happens.

Therefore, in this situation, watching your margin can offer you the best protection.

As inflation starts creeping up, these margins tend to get pinched first.

The eventual impact follows much later.

But if you are an astute business person, you will look at these waning margins as a warning sign.

Many times, you need to go back to the basics of doing business.

A conservative business policy is what will make the day for you.

It will mean that you will be watching your leverage and margins closely.

That way, your risk appetite will lessen, but at the same time, your relative standing in the market improves.

You are better poised to tackle an emergency if it strikes.

In many ways, it will mean that you may not see an astronomical surge in your business.

On the contrary, you will follow the tortoise pace of sure and steady growth.


Therefore, surviving during inflation can be tricky for small businesses.

They will have to balance business growth with relative market uncertainty carefully.

Investment and borrowings too have to be managed carefully.

Often, this will mean that as an entrepreneur, you will have to make tough calls.

But in the end, it is the business that should take prominence.

The core concept is being prepared for difficult times.

Inflation should not hit you like a hurricane.

Instead, you should be the ant preparing for winter.

You need to be well prepared with supplies and potential Plan B when inflation does hit.

That way, your business will not succumb to the woes triggered by inflation.

It will come out stronger from the inflation cycle.

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