The mindset you MUST have if you want to build passive income

Why planting trees beats picking fruit
Seth Kniep
October 9, 2017
Entrepreneurship
There’s a reason I don’t go yard selling, garage selling, or thrift shopping anymore.

Let me explain: I’m not against it at all. I think it’s a wonderful way to generate cash quickly. But there are some people on Amazon who do $30,000 a month with just two or three products.

It is extremely difficult to get to that if you’re constantly finding items through yard sales or thrift shops to sell. You’re doing much more physical activity and have much less time. If you need cash to start off with, and you need to liquidate things in your house so you can get the capital you need to get started, that’s great. But if you’re consistently stuck in the cycle of going to a yard sale, buying an item, posting it on eBay, and selling it, you have to stop.

It won’t make passive income, because as soon as you stop working, the money stops coming it. It’ll work to make money. But you have to work to make money.

There are two kinds of people when it comes to building income online. There are fruit pickers, and there are tree planters.

A fruit picker will walk into the woods, look for an apple tree, and pluck apples from one because they’re hungry. They can pluck apples all day. But they have to go out and find the apples. By the end of the day, they’re tired, they’ve eaten some of the apples for energy, and they have apples for dinner. And tomorrow, the apples are gone. They have to go back out again the next day.

The problem with this is that they can't scale. They can pick a hundred apples in a day, but to pick a thousand a day, they would need ten times as much time. You can't make more time. You can’t lengthen your life or make the sun slow down. They’ve undervalued their greatest asset: time.

The number one rookie mistake new sellers on Amazon or eBay make is always being busy. They think their greatest asset is money. It’s not. Your greatest asset is time.

The other kind of person you can be is a tree planter.

Now, the tree planter has to be very patient and very disciplined. They need one apple tree to live off of. They’re going to be hungry a lot. They’re not going to have a lot of apples. They’re not going to make a lot of success at first, and they'll be very limited. But instead of picking apples all day, they take seeds and plant a tree.

They water it, fertilize it, and give it the attention it needs. It takes a long time. It requires investment and care. But when it blooms, it produces apples for them. And once it’s there, it only needs to be monitored every now and then, but it will keep producing apples. Now the tree picker can plant another tree and help it produce apples. Then they can go and do a third, a fourth, a fifth.

See what happens? When you take the time to plant a tree instead of plucking fruit, it takes a lot of work, and it’s very hard, but once it’s growing and producing fruit, you have the time to go and plant another one and another. Before you know it, you can have a thousand trees producing apples for you with plenty of time still on your hands!

That’s why it’s so important we think this way. Your greatest asset is not money. It’s time. Do you want to build wealth? Then value your time more than your money. You need time to make money, and if you manage it right, you can make your money work for you.

Here’s what can happen, and it happened to me: I had over $20,000 in retirement. I was desperate. I had tons of debt. I couldn’t find a job, and everything was going wrong, so I liquidated my entire retirement. I paid over 30% in fees and taxes just to get access to that money. It felt good for a while, because it helped pay the bills and keep me going, but the problem is that I literally took a hatchet, walked out to my orchard, and chopped down my apple tree. It was making me money, but I killed it. I got a lot of fruit from it, and I was able to use the wood for firewood and keep me warm for a few nights, but soon it was all gone. It was if I had started with nothing.

Don’t chop down your apple tree.

I understand there are emergencies. Sometimes you may be so desperate that you have to. But avoid it if you can. Don’t chop it down. Go plant more apple trees. That’s why I teach passive income like planting trees: it is an investment for the future.

It’s like a golden goose. You have a goose, it lays you golden eggs, and makes you tons of money. One night, you get hungry and decide to kill the goose. It makes a nice meal, but now there are no more golden eggs. Don’t kill the goose. Feed the goose, and the goose will feed you for years to come.

If you learn to value your time, you will go so much further.

A lot of people start on Amazon thinking, “I’ve got to generate profit.” What they really need to be doing is taking that first batch of items that they order and look at them like promotional items. The goal of that first batch is not to make money. Forget about making money for a minute. You’re going to take those items, use them to get reviews, use them to run ads, and get your product listing high-ranking. You’re building a tree. Then next month comes around. People are buying your item. All of a sudden, you have money coming in.

Don’t go door-to-door selling your items and getting rid of them for cash. Invest in your listing on Amazon, get it promoted, and it will make money for you for months to come. And then once you have one going, you don’t have to keep up with it. You can build another one. And another one. And you can keep doing this until you have a whole ton of passive income rolling in for you.

 

Tip #3: Focus on what the supplier values

Rule #1 in all negotiation is to focus on what is valuable to the other party first. Then it's much easier to get what you want as well. The final deal needs to make sense to both sides.
Chinese suppliers value two things above anything else: friendship and long term business. Friendship often results in long term business. Chinese suppliers value friendship because a strong friendships between vendor and customer is a healthy business practice in Chinese culture. They will often address you as "friend."

They value long term business relationship because the cost of acquiring and learning the needs of a new customer is much more time consuming than working with the same customer for years. Business with an old customer is much less risky than business with a new customer. New customers are unpredictable and often flighty, resulting in wasted time for the Chinese supplier, going back and forth in a conversation with a customer who ends up not buying.
So how do you do this? In your communication with the supplier, mention "friendship" and "long term business relationship." Weave it in naturally and let them know that you value both of these highly.
Look again at my example message to a Chinese supplier:

Hello Cynthia! I own a US company that sells aromatic oils and accessories. 
I am looking for a manufacturer who can create an aromatic oil holder.
I am looking for a manufacture to build a strong friendship with for long term business relationship.
I would love to see if you can create the model I need. 
Please, see the specs in the image I attached to this email. 
I would appreciate your prompt response. 

We are looking for a good business relationship with a manufacturer! 

Sincerely, 
Lucy

Notice that I focused on what they value. I stated two qualities they value highly: 1) long term business relationship and 2) friendship. These two qualities go a long way in Chinese business culture, so leverage them!

Don't be surprised if you get responses referring to you as "dear" or "friend," while these names of endearment might seem strange and awkward to us in the west, but to the Chinese, they are standard. The reality is, if you are willing to do business with them in a long term relationship, then you are, by extension, their friend. Concepts like friendship, loyalty, long term, integrity, it all mixes in their culture of business. 

Photo by Joey Huang

Couldn't we stand to learn a thing or two from that style of doing business? How many of us here in the west have worked with corporate entities that we would categorize as soulless? The best business relationships form like friendships. They are people you want to stick with you. That's why I encourage you to be cautious about who you allow to do business with you. Finding the right supplier is a critical part of this process, and our members have access to all the tools and strategies for finding good people to do business with. Please consider journeying with us on this path of relationship and margin building. Don't let communication be a barrier to your passive income freedom. 

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Seth Kniep

Married a pearl. Fathered 4 miracles. Fired his boss. Turned a single dime into $104,857. Today, a self-made millionaire, Seth and his team of 8 badass coaches teach entrepreneurs how to build passive income on Amazon.

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