Money can be earned fast or gradually with time. Generally the return starts coming slowly in business. Fast ROI involves risk and sometimes manipulations. It’s a short cut but manipulation does not always mean cheating or negative work. Examples of manipulations are, over commitment for getting large order, taking order more than the production capacity or committing thing that could be not delivered. Earning fast buck is never suggested. Customer might get attracted initially but eventually will see through the plan and will lose faith in the company. Always remember, short cuts are only helpful in short run not in the long term business. It also cuts the life span of the business.
Analyze the ROI beforehand. If the project or business cannot give us the ROI as per our aspirations then it is better to find another project which suits our aspiration and temperament.
It is unwise to get into a business because it has good money and everyone is doing it. But we should find a business which suits our personality and psychology. Then we will be happy with our business and will do it whole heartedly. It will have more chances of being successful, even if it comes later than other fast money making projects. Success that comes with time stays longer.
Difference between Business and Project
Before calculating ROI we must first understand the difference between Business and Project. Project is a work which has to be completed within a fixed time period and in a fixed budget. Whereas, a business has a start date but it is an ongoing process. A business can have multiple projects in it. Project has a life cycle where it will have start, growth and end. However in business there will be start and growth, sometimes decline but it is ongoing.
Projects have estimated ROI within the short term. Projects should be taken as per our interest and capabilities. They usually give profit or loss within the stipulated time however the risks are high in it and loss usually irreparable. Projects do not give a second chance whereas in business if loss is incurred we still get time to recuperate.
Why do we make Project Report for starting Business?
Since the financial report of the business is made considering certain time frame hence it is called a project report. Here the projections are for a certain time period like five years or fifteen years depending upon the interest of the financing agency getting associated. The agency wants to understand the viability of the business and its return within a certain time frame.