Searching for The Perfect Business - 1

Sep 7th 2010 at 9:56 AM

The Richard Russell* Model
Part 1

Richard Russell first published his article –The Perfect Business in the early 1970s long before the Internet was invented. It is amazing how many of the 12 criteria that he established are met by the modern wave of ecommerce, cyber marketing or internet marketing as we know it today.  In this series of articles I will show how your business on the internet matches each of Russell's 12 criteria. I have juggled the order in which Russell first laid out his 12 criteria but I have not changed a word from his original presentation.

Russell Criterion 1.
"The ideal business sells the world, rather than a single neighborhood or even a single city or state. In other words, it has an unlimited global market (and today this is more important than ever, since world markets have now opened up to an extent unparalleled in my lifetime)."
Any traditional bricks and mortar store, restaurant, factory, craft shop, business consultancy or service business that you could open would operate in a market limited to a large extent by ‘locality' whether it is street, district, village, town or country.. But your Internet business will have the capacity to do business with customers and partners wherever they are in the whole world, so long as like you, they are connected to the World Wide Web and are able to pay for your products or services in an internationally exchangeable currency.
This ability to sell to the world removes much of the limitation to growth and expansion of your business. It is the reason why a small bookseller in America has grown in just a few years into the giant international corporation Amazon. There are countless other examples.

Richard Russell Criterion 2.
The ideal business has minimal labor requirements (the fewer personnel, the better). Today's example of this is the much-talked about "virtual corporation." The virtual corporation may consist of an office with three executives, where literally all manufacturing and services are farmed out to other companies.
You can and should start your Internet Marketing business with one employee –YOU. And it gets better. As Russell indicated, it is also possible to grow your internet business into a multi million dollar enterprise with no, or at least few physical employees. The use of computers and internet technology also gives you the freedom to outsource at competitive rates the best virtual assistants from anywhere in the world.

Russell Criterion 3.
"The ideal business enjoys low overhead. It does not need an expensive location; it does not need large amounts of electricity, advertising, legal advice, high-priced employees, large inventory, etc..."
A computer which you may already own, fast internet connection which is available almost any where in the world, appropriate software much of which is available for free or at low cost and a place that you could work without being disturbed (your kitchen table, bedroom or den) are really all you need to start. Some successful internet business people actually do much of their work from a laptop hooked up to the wireless connection at their favourite coffee bar while sipping a drink.
What will you sell? If you have an existing business you can take your business online and expand your market internationally. If you have no business and no product you could become an Affiliate Marketer selling digital products for other companies. You will need no upfront costs to pay for inventory, no warehousing, no shipping, no customer service and no list of unpaid and overdue customer accounts.
What is an Affiliate Marketer? He/She is somewhat like your traditional commission agent, but operates a virtual business, not limited by geography or capital.
This combination of low or no location costs, no employees or outsourced labour and services and no inventory delivers low, low overhead. Low overhead is a major factor in determining profitability and success of any business online or offline.

In the The Perfect Business Part 2 I will examine 3 more of Richard Russell's criteria for The Perfect Business. Here is a sneak peak; Portability, Inelastic Demand, Low Overhead.

*Richard Russell is the Editor/Publisher of Dow Theory Letters which he began publishing in 1958. He has been writing and publishing the Letters every three weeks since (never once having skipped a Letter). Dow Theory Letters is the oldest financial services letter in America that is continuously written by one person in the business.

Please to comment
Sep 8th 2010 at 9:34 PM by ecco1729
Thumb up!
Sep 8th 2010 at 5:36 AM by jnol
great stuff

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