This is a concept that needs to be understood before a person invests in any business. There are times when people will feel discouraged and disappointed after investing their money in something, and it takes longer to see the returns.
There are times when people will give up too soon or give up too late, so wisdom and knowledge are required to guide how to deal with it.
It differs from project to project. There are projects with a quick return (short-term) and long-term projects. In Real Estate, I consider it a long-term project where the return on investment can not be appreciated immediately.
Businesses like Agriculture, and Horticulture investment can be achieved in a shorter time. You buy seeds and inputs for about $300 to plough tomatoes on a Hector size of land. In 3 months, you can sell and return more than $1000.
Recently, one of my uncles bought a brick moulding machine. He spent a reasonable amount of money on purchasing the machine, pallets, accessories, and generators and putting up a shade.
He told me that this business is going to take some time before it generates a big return. He will be required to establish proper production, staff training, advertising, and organizing a proper supply of raw materials and cement.
It's a process that may take him about 6 months or above for smooth operation to appreciate the return on his investment. However, he was aware of this procedure before he started the business.
The Biggest Task
His primary challenge at this time is overseeing operations while the initiative is still being established. It's going to be tough to keep pumping money without any return. Sometimes pockets will run dry.
In these circumstances, you will be tempted to borrow, unless you have a side hustle business that will sustain you in this dry period.
Such measures must be put in place before initiating such an investment. We always witness projects that are left unfinished, as a result of poor planning, or failure to understand the Return On Investment time frame where finance will run dry before the profit is achieved.
It is very important to understand the timeline where you will get the return on every investment that you make so that you may prepare accordingly to avoid being stuck in the middle.
When you are stuck in the middle of the project or at a great loss because you can recover your partly invested amount and also fail to get funds to finish off, you will be likely to end up selling the project at a giveaway price attempting to recover your investment.
This is the most discouraging and disappointing situation that will paralyze you from ever trying any initiative in the future.
In conclusion, when investing your money in a project, kindly make thorough plans, conduct thorough research, and avoid working on assumptions.
Do the necessary research before you start any project since the success of any work you undertake is entirely your responsibility.