Understanding Money Velocity In Your Business

Understanding money velocity can be a very beneficial to any entrepreneur or business person. If you are entrepreneur or just want to make some extra مكن عد النقدية– then listen up because this will help you tremendously.

The velocity of money is just a measurement or an equation that will tell you how fast you are recouping your money. For example. If you put $20 into advertising, then how long would it take you to get that $20 back?

This is assuming that you are getting it back at all (of course). So money velocity is the really how fast the money is moving. This idea applies to business as well as investments. If you are looking to invest money into a business or an investment, then you will want to know the velocity of the return on your investment.

If you have a some-what automated business, then the velocity of money will be much easier to figure out. If you were to look at any investments it would be also be a relevant question to ask how fast your money will return to you.

Money velocity becomes even more powerful when you are building an asset along the way. An asset is something that you are building or investing in- that will pay you in the future.

Let’s say you have a $100 that you could spend in your business or invest with. You would want to try to invest that $100 into something that could pay you in the future and get your $100 back as soon as possible.

The faster you can move the money- the better. So you want to put that $100 into an investment and take $100 out of it as soon as possible while leaving the initial $100 in the initial investment.

I am in the business of online marketing. I have products to sell, and I sell them via the internet. Really anyone can do this, because there are 1,000’s or even 10’s of 1,000’s of products online that you can sell and make a profit from.

So in this particular business I need to know how long it is going to take me to recoup my advertising dollars. If I put $25 into advertising, then I need to know how long it will take to get that $25 back.

In the world of online marketing, your biggest asset is your email list. So you want to try to build an asset (an email list in this case) at the same time that you are making money through sales.

To do this you would simply send users to a Lead Capture Page before the actual Sales Page. Doing this will allow you to build your asset (an email list) and make sales of the product at the same time.

Understanding money velocity my change your perception of money a little bit. Most of us are taught to save money and hold on to it. We are taught to put our money away and let it sit in a savings account or in some other “low risk” place.

A business man who really understands money velocity can grow an empire almost methodically. They move money quickly because they understand that the quicker their money is returned, the quicker they can invest it into a new asset.

An online marketing business can be looked at the very same way. The quicker you can get your $25 back, the quicker you will have that money to invest in to more advertising. Plus you are growing your biggest asset in the process… yup, your email list of hot prospects.

I find it a little bit weird when people don’t want to invest money in their business. In order to bring in new customers quickly you must be willing to spend money on advertising. I guess it’s understandable why people feel this way. We were never taught to think like entrepreneurs in school.

Most people are afraid to spend money in advertising because they are approaching entrepreneurship with an employee mindset. They don’t understand that is costs money to start a business or acquire new customers.

Most of the time people are scared to invest money, because they can’t see the bigger picture. They may invest $25, and if they don’t get that money back right away then they may quit and think that it doesn’t work.

An Entrepreneur will chalk that $25 up to a learning lesson and they will try again. An entrepreneur will keep advertising and testing until they become profitable. They will keep testing and tweaking the campaign until they learn how to invest $25 and get $75 in return.