Most people, who want to establish a financially-secure future, choose to start their own business by trading goods like shoes, art, crafts, clothing or antiques.
A friend of mine set up a trading business in Indonesia . We met when we were still earning our degrees in Melbourne , Australia . He imports steel and plastic from China and distributes them to his home country. It took him two years before his business stabilized and he is now making a good living out of it.
Even though there is now an ocean between us, we manage to talk once a year over the telephone. He asked me once if I wanted to meet him in a trade show in China . He learnt how to speak Mandarin so he finds it easy to get around China . With his ability to communicate with the Chinese, he offered his assistance to me if I ever wanted to start my own import or export business.
I had the option of trading in whatever goods I wanted. According to my friend, it could be 'anything you can think of'. Had I taken the option, I would have traded shoes because I can vary my investment size according to my financial capability. With limited funds to invest, I can buy only a few pairs of shoes. If I can find a lot of money to invest, I can order big too. I had a couple of months to decide. So I did some thinking.
Readers of this article may not be considering trading shoes, but I will use it as an example to help you decide about the choices available to you.
RESEARCH & INFORMATION
For someone to trade shoes, you would have to:
- Research the local market for shoes,
- Find out more about the big players in the shoe business,
- Get acquainted with the different types of shoes and how much they are selling for,
- Find out what costs are involved in importing shoes and
- Determine how you can market and distribute them.
When I trade currencies, I have all the information I need by looking at a chart. It takes a long time to learn to do this well, but so does selling shoes.
To order a thousand pairs of shoes, you would require a lot more money than what it takes to start trading forex: usually, anything between $200 to $300 is sufficient. (In my book: The Part-Time Currency Trader , I discuss the costs of trading forex).
To start, you would have to establish the paperwork necessary to ensure that you get familiar with the legalities of the goods you wish to import and distribute.
What if a particular shipment of shoes does not sell, because even though they may have been popular in other countries, consumers in your country might not like it? Do you have more money to order another batch?
What if the stock you buy is defective and the seller does not want to have anything more to do with you? You can take them to court, but can you muster the resources to do so? You can threaten them by not doing business with them ever again, but would they care when they have other businesses to deal with?
Successful entrepreneurs have taken at least two years to stabilize their business. Others take a lot longer. When starting and building a business, your expectations need to be set for the long term, because it will take time.
Harrison Ford -- the famous American actor -- had a strategy. He saw that many of the actors, who came to Hollywood with dreams of becoming superstars, gave up because it was too hard. So he figured that he could succeed one day, if he could only persevere with all the hardships associated with his endeavour.
Your ability to stay focused on a task long enough to attain success would be greatly improved if you liked what you do. Would you enjoy being surrounded with things related to shoes for most of your life, or would you hate it?
The forex market is open 24 hours a day. You can buy and sell currencies in your pyjamas at midnight if you like and the transaction is complete before you go back to bed.
BENEFITS OF TRADING FOREX OVER SHOES
There are advantages in trading shoes, but I could see more benefits in trading currencies. You do not need to worry about the process of importing or exporting, transporting goods, defective items, marketing and distribution as well as ensuring that you are complying with the law. Furthermore, in forex, you do not have to invest too much just to 'test the waters'.
ONE MONTH LATER
A month later, I rang my friend and told him that I might take him up on his offer in the future, if it was still available. However for the moment, I explained that I had more passion for currencies than I had for shoes. He laughed and we agreed to meet one day so that I can tell him more about currencies.
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About The Author:
Marquez Comelab is the author of the book: The Part-Time Currency Trader. It is a guide for men and women interested in trading currencies in the forex market. Discusses addresses you need to know to get started including analysis, tools, indicators, trading systems, strategies, discipline and trading psychology. See: http://marquezcomelab.com.