/biz/ - Business & Finance

[Anonymous No.633314]

Can an honest and friendly man ever succeed in entrepreneurship, or does it require at least a bit of heartlessness?

My business is failing because I don't mark up to hell and back and because I don't partake in malicious business etiquette. My contemporaries will lie and cheat and they're making literally 50-75x my gross profit. I made 18,000$ last year, my once-friend who started in the same industry at the same time grossed just shy of 900,000$ the same year.

[Anonymous No.633318]

You can be honest and friendly, but you have to be ruthless with the competition. If stepping on the other guy's throat will help your business, you do it without hesitation.

[Anonymous No.633320]

To give an idea of malicious practices since it's up to interpretation: here's how my once-friend has excelled:

>pay wholesale accounts lump sums if they do not deal with company a, company b, company c, and if they do already, cease working with them
>if he and another company are vying for a wholesale account with restrictions, will pay lump sum to ensure he gets the deal
>slander on Facebook, other social media avenues
>paying board organizations that blanket the industry to deny membership to company a, company b, then advises consumers to only buy from people on the board

Should I be doing these too? Is this why he's succeeding and I'm not, because he employs unethical practices?

[Anonymous No.633323]

>>633320

Oh, I forgot the most egregious example of all:

>will pay suppliers either higher amounts for products or lump sums to ensure they don't deal with company a, b, c, etc. Suppliers in the industry are finite.

We're no longer friends because my primary supplier cut ties after my friend paid them to no longer work with me (at this point my company was grossing more than his).

>>633318

It's a very close-knit industry. I'm friends or at least acquaintances with loads of people in the same business. I wouldn't step on their throats just as I would hope they'd not do the same to me.

[Anonymous No.633329]

>>633323
That is why you fail.

[Anonymous No.633353]

>>633314
>too dumb to mark up prices so he can be properly compensated for all of his work
>think it's about "integrity"
You just have no business sense tou stupid hipster.

[Anonymous No.633507]

>>633323
Get a VC to invest in you and then people will flock to the one that is getting backed by venture groups. Taking marginal gains from a product or service is a growth method and you have a wider user base. Those numbers are how you apply for venture funding and then vendors will want exclusive contracts because you will grow faster.

Your friends can't keep up with a company that has external money and connections of a venture group.

[Anonymous No.633538]

$900,000>$18,000

Man up and do something unethical. Nice guys finish last.

[Anonymous No.633541]

>>633314
obey the little rules so you can break the big ones

[Anonymous No.633549]

>>633320
how is any of this malicious? What am I missing here?
>cease working with them
Isn't that like shooting yourself in the foot? Why wouldn't you want the extra business? if someone is already working with company a and you cut them off they are just going to do all their business with company a
>if he and another company are vying for a wholesale account with restrictions, will pay lump sum to ensure he gets the deal
and? this is free market competition, obviously people like having their accounts paid in full, the purpose of a business is to make money and if you can't do this then you're doing it wrong
>slander on Facebook
like anyone except neurotic tumblrinas care what some trolls says on the internet
>paying board organizations that blanket the industry to deny membership to company a
that will make this board organization inefficient then some other board organization can pick up the slack, competition, why would a business listen to a board organization that tells them to pay more for a company that doesn't do a better job

[Anonymous No.633558]

>>633323
>will pay suppliers either higher amounts for products or lump sums to ensure they don't deal with company a, b, c, etc. Suppliers in the industry are finite.
again, competition, supply & demand, it works both ways, pushing prices up or down

Market stalls have a lot of apples to shift and have to drop prices very low to compete. Auction houses often have to push the price up to sell rare vases. It is mathematics + or -

not sure what the big deal is

[Anonymous No.633599]

>>633549
>cease working with them
>Isn't that like shooting yourself in the foot? Why wouldn't you want the extra business? if someone is already working with company a and you cut them off they are just going to do all their business with company a
You got it wrong.
-friend owns company a, OP owns company b
-company a paid supplier x to stop supplying to company b

[Anonymous No.633683]

Basically, it sounds like you're pissed off because you failed to protect your supply channel in a market with limited suppliers. Conversely, your friend negotiated for some exclusivity, and probably took some additional risk in terms of guaranteed purchase commitments.

Your inaction/negligence cost you, and his risk-taking paid off.

I'm not seeing the ethical angle here at all. I'm see dumb/smart business practices.

[Anonymous No.633700]

>>633314
>Can an honest and friendly man ever succeed in entrepreneurship, or does it require at least a bit of heartlessness?

Yes of course. But it depends what you see as heartless; a friend of mine almost lost his business because when he lost a couple of lucrative contracts he didn't lay anyone off, wanting to instead keep all the guys employed.

What he came to realize is that it's better to let people go and have a profitable business that can support SOME workers rather than have the whole thing sink.

With regard to your mark-up, why wouldn't you want to increase it in order to maximize profits? With those profits, if your business is good, then you'll be able to employ more people and support more families - You'll also be able to provide a great service to more people.

You definitely don't need to lie and cheat.

[Anonymous No.633709]

your friend is an asshole who is some kind of wannabe robber baron. pretty sure that what he does is anti-competitive behavior.

http://en.m.wikipedia.org/wiki/Sherman_Antitrust_Act

ignore all the edgy sociopaths in here.

[Anonymous No.633710]

>>633709

specifically:

For example, the Clayton Act added certain practices to the list of impermissible activities:

price discrimination between different purchasers, if such discrimination tends to create a monopoly

exclusive dealing agreements

tying arrangements

mergers and acquisitions that substantially reduce market competition.

[Anonymous No.633728]

>>633320
How do you not know about anti trust laws? Take it to the next level and find out who you can report him to.

[Anonymous No.633729]

>>633709
>>633710
>>633728
LOL at the internet antitrust lawyers. Get a clue idiots. Exclusive supply contracts are perfectly legal.

[Anonymous No.633732]

>>633729

those are fine, but paying someone specifically not to do business with a competitor is not.

http://en.wikipedia.org/wiki/Tortious_interference

[Anonymous No.633737]

>>633732
How can you tortiously interfere with a contract when OP didn't have a contract?

As I already said, OP's failure was not locking down his supplier. If he a contract to assure his continued supply, then his friend couldn't have legally done anything. But OP was lazy, negligent, or ignorant and opened the door to a more aggressive competitor.

[Anonymous No.633886]

It sounds like what you have, at the very core of it, is a supply chain problem. I'm not such what the barriers to entry are or how much investment would be required but you would probably benefit from vertically integrating your supply chain.

If your competitor is stealing your suppliers, then become your own supplier. Seems straight forward enough.