
All business survives on net profit.
In accounting terms here is how you calculate Net Profit. i.e. (Total Business Revenue) – (Total Business Expenditure) = Net Profit
In the business world, there are two types of industries Service and the Product industry.
So if you are in the service industry you survive on paycheck by paycheck or hourly charges to the client. You have to work every hour of every day to get ends meet.
But if you are a product company you create a product based on your market research and user research. You find consumer problems/requirements/gaps in the market and then you try to solve them by creating your product in that category. So building a product is based on solving problems that your users are having.
In my case, I was a designer by profession. I graduated with a BFA (Bachelor of Applied Arts) in Advertising. After my first two jobs, I tried freelancing in the web, UX, print, branding and animation film industries. I was the lone proprietor of my business. I was doing everything talking to clients, executing a project, delivering it and then waiting for the final payment to be released. It was too much for me at that time.
(more…)