Understanding Money Sources
Never enough money: How many times have you said that. You need capital
to get sales, buy inventory, pay your employees, purchase assets, pay
taxes, you name it you need money for it. Your need for capital is a
continuing one. To just stay in business or to expand, the small business
owner needs capital, but where do you get it?
Expansion opportunities or a chance to purchase cost-saving equipment
can also create a need for extra capital.
Available Sources
In order to secure the capital they need, small business owners must
understand the various sources of money that are available to them such as
the following:
- Capital generated internally.
- Capital available from trade creditors.
- Borrowed money.
- Sale of an ownership interest in the business to equity investors.
Each of these capital sources has unique characteristics. These
characteristics must be fully understood by the small business owner so
that he or she will know what sources are available and which source is
best suited to the needs of the business.
This section has been designed to help the small business owner in the
following ways:
- Recognize those situations that create a need for additional
capital.
- Identify the capital sources that are available to the small
business owner.
- Manage the business judiciously to take full advantage of the
capital that can be generated internally.
- Establish a plan to permit the client to take full advantage of
trade capital without jeopardizing credit status.
- Identify various specific sources of debt and equity capital.
- Identify collateral that can be used to secure loans.
- Identify potential compensation to equity investors such as
opportunities for dividends, capital gains, or a future public offering
that could attract equity capital.
How
The Need For Capital Arises
There is more than one way to skin
a cat. You'd better remember this old adage when your business needs more
inventory, personnel, and facilities. As your business grows, so does your
need for more and more capital. Remember there is more than one way and
more than one place to raise the money you need.
Causes of Additional Capital Needs
There are many factors that can create a need for additional capital.
Some of the more common are as follows:
- Sales growth requires inventories to be built to support the higher
sales level.
- Sales growth creates a larger volume of accounts receivable
- Growth requires the business to carry larger cash balances in order
to meet its current obligations to employees, trade creditors, and
others.
- Expansion opportunities such as a decision to open a new branch, add
a new product, or increase capacity.
- Cost savings opportunities such as equipment purchases that will
lower production costs or reduce operating expenses.
- Opportunities to realize substantial savings by taking advantage of
quantity discounts on purchases for inventory, or building inventories
prior to a supplier's price increase
- Seasonal factors, where inventories must be built before the selling
season begins and receivables may not be collected until 30 to 60 days
after the selling season ends.
- Current repayment of obligations or debts may require more cash than
is immediately available.
- Local or national economic conditions which cause sales and profit
to decline temporarily.
- Economic difficulties of customers that can cause them to pay more
slowly than expected.
- Failure to retain sufficient earnings in the business.
- Inattention to asset management may have allowed inventories or
accounts receivable to get out of hand.
Combination
Frequently, the cause cannot be entirely attributed to any one of these
factors, but results from a combination. For example, a growing,
apparently successful business may find that it does not have sufficient
cash on hand to meet a current debt installment or to expand to a new
location because customers have been slow in paying.
Short- and Long-Term Capital
Capital needs can be classified as either short- or long-term.
Short-term needs are generally those of less than one year. Long-term
needs are those of more than one year.
Short-term Financing
Short-term financing is most common for assets that turn over quickly
such as accounts receivable or inventories. Seasonal businesses that must
build inventories in anticipation of selling requirements and will not
collect receivables until after the selling season often need short-term
financing for the interim. Contractors with substantial work-in-process
inventories often need short-term financing until payment is received.
Wholesalers and manufacturers with a major portion of their assets tied up
in inventories and/or receivables also require short-term financing in
anticipation of payments from customers.
Long-term Financing
Long-term financing is more often associated with the need for fixed
assets such as property, plant, and equipment where the assets will be
used in the business for several years. It is also a practical alternative
in many situations where short-term financing requirements recur on a
regular basis.
Recurring Needs
A series of short-term needs could often be more realistically viewed
as a long-term need. The addition of long-term should eliminate the
short-term needs and the crises that could occur if capital were not
available to meet a short-term need.
Steady Growth
Whenever the need for additional capital grows continually without any
significant pattern, as in the case of a company with steady sales and
profit from year to year, long-term financing is probably more
appropriate.
Internal Financing Sources
Internal sources of capital are
those generated within the business. External sources of capital are those
outside the business such as suppliers, lenders, and investors.
For example, a business can generate capital internally by accelerating
collection of receivables, disposing of surplus inventories, retaining
profit in the business, or cutting costs.
Capital can be generated externally by borrowing or locating investors
who might be interested in buying a portion of the business.
Internal Financing Sources
Before seeking external sources of capital from investors or lenders, a
business should thoroughly explore all reasonable sources for meeting its
capital needs internally. Even if this effort fails to generate all of the
needed capital, it can sharply reduce the external financing requirement,
resulting in less interest expense, lower repayment obligations, and less
sacrifice of control. With a lower requirement, the business' ability to
secure external financing will be improved. Further, the ability to
generate maximum capital internally and to control operations will enhance
the confidence of outside investors and lenders. With more confidence in
the business and its management, lenders and investors will be more
willing to commit their capital.
Basic Sources
Basically, there are three principal sources of internal capital. These
are as follows:
- Increasing the amount of earnings kept in the business.
- Prudent asset management.
- Cost control.
Increased Earnings Retention
Many businesses are able to meet all of their capital needs through
earnings retention. Each year, shareholders' dividends or partners'
drawings are restricted so that the largest reasonable share of earnings
is retained in the business to finance its growth.
As with other internal capital sources, earnings retention not only
reduces any external capital requirement, but also affects the business'
ability to secure external capital. Lenders are particularly concerned
with the rate of earnings retention, since the ability to repay debt
obligations normally depends upon the amount of cash generated through
operations. If this cash is used excessively to pay dividends or to permit
withdrawals by investors, the company's ability to meet its debt
obligations will be threatened.
Asset Management
Many businesses have non-productive assets that can be liquidated (sold
or collected) to provide capital for short-term needs. A vigorous campaign
of collecting outstanding receivables, with particular emphasis on amounts
long outstanding, can often produce significant amounts of capital.
Similarly, inventories can be analyzed and those goods with relatively
slow sales activity or with little hope for future fast movement can be
liquidated. The liquidation can occur through sales to customers or
through sales to wholesale outlets, as required.
Fixed assets can be sold to free cash immediately. For example, a
company automobile might be sold and provide cash of $5,000 or $8,000.
Owners and employees can be compensated on an actual mileage basis for use
of their personal cars on company business. Or if an automobile is needed
on a full-time basis, a lease can be arranged so that a vehicle will be
available. Other assets such as loans made by the business to officers or
employees, investments in non-related businesses, or prepaid expenses
should be analyzed closely. If they are nonproductive, they can often be
liquidated so that cash is available to meet the immediate needs of the
business.
Any of the above steps can be taken to alleviate short-term cash
shortages.
On a long-term basis, the business can minimize its external capital
needs by establishing policies and procedures that will reduce the
possibility of cash shortages caused by ineffective asset management.
These policies could include the establishment of more rigorous credit
standards, systematic review of outstanding receivables, periodic analysis
of slow-moving inventories, and establishment of profitability criteria so
that fixed asset investments are more closely controlled.
Cost Reduction
Careful analysis of costs, both before and after the fact, can improve
profitability and therefore the amount of earnings available for
retention. At the same time, cost control minimizes the need for cash to
meet obligations to trade creditors and others.
Before the fact, a business can establish buying controls that require
a written purchase order and competitive bids on all purchases above a
specified amount. Decisions to hire extra personnel, lease additional
space, or incur other additional costs can be reviewed closely before
commitments are made.
After the fact, management should review all actual costs carefully.
Expenses can be compared with objectives, experience in previous periods,
or with other companies in the industry. Whenever an apparent excess is
identified, the cause of the excess should be closely explored and
corrective action taken to prevent its recurrence.
Trade
Credit
Trade credit is credit extended by
suppliers. Ordinarily, it is the first source of extra capital that the
small business owner turns to when the need arises.
Informal Extensions
Frequently, this is done with no formal planning by the business.
Suppliers' invoices are simply allowed to "ride" for another 30 to 60
days. Unfortunately, this can lead to a number of problems. Suppliers may
promptly terminate credit and refuse to deliver until the account is
settled, thus denying the business access to sorely needed supplies,
materials, or inventory. Or, suppliers might put the business on a C.O.D.
basis, requiring that all shipments be fully paid in cash immediately upon
receipt. At a time when a business is obviously strapped for cash, this
requirement could have the same effect as cutting off deliveries
altogether.
Planning Advantages
A planned program of trade credit extensions can often help the
business secure extra capital that it needs without recourse to lenders or
equity investors. This is particularly true whenever the capital need is
relatively small or short in duration.
A planned approach should involve the following:
- Take full advantage of available payment terms. If no cash discount
is offered and payment is due on the 30th day, do not make any payments
before the 30th day.
- Whenever possible, negotiate extended payment terms with suppliers.
For example, if a supplier's normal payment terms are net 30 days from
the receipt of goods, these could be extended to net 30 days from the
end of the month. This effectively "buys" an average of 15 extra days.
- If the business feels that it needs a substantial increase in time,
say 60 to 90 days, it should advise suppliers of this need. They will
often be willing to accept it, provided that the business is faithful in
its adherence to payment at the later date.
- Consider the effect of cash discounts and delinquency penalties for
late payment. Frequently, the added cost of trade credit may be far more
expensive than the cost of alternate financing such as a short-term bank
loan.
- Consider the possibility signing a note for each shipment promising
payment at a specific later date. Such a note, which may or may not be
interest-bearing, would give the supplier evidence of your intent to pay
and increase the supplier’s confidence in your business.
Ready Availability
Trade credit is often available to businesses on a relatively informal
basis without the requirements for application, negotiation, auditing, and
legal assistance often necessary with other capital sources.
Usage
Trade credit must be used judiciously. Its easy availability is
particularly welcome in brief periods of limited needs. Used imprudently,
however, it can lead to curtailment of relations with key suppliers and
jeopardize your ability to locate other, competitive suppliers who are
willing to extend credit to your business.
Debt
Capital
Debt capital is an amount of money
borrowed from a creditor. The amount borrowed is usually evidenced by a
note, signed by the borrower, agreeing to repay the principal amount
borrowed plus interest on some predetermined basis.
Borrowing Term
The terms under which money is borrowed may vary widely. Short-term
notes can be issued for periods as brief as 10 days to fill an immediate
need. Long-term notes can be issued for a period of several years.
Payment Schedule
When the terms of a debt are negotiated, a payment schedule is
established for both interest obligations and principal repayment.
Discounted Notes
In some cases, particularly in short-term borrowing, the total amount
of interest due over the term of the note is deducted from the principal
before the proceeds are issued to the borrower. Such a note is called a
discounted note.
Short-term Borrowing
Short-term borrowing usually requires repayment within 60 to 90 days.
Notes are often renewed, in whole or in part, on the due date, provided
that the borrower has lived up to the obligations of the original
agreement and the business continues to be a favorable lending risk.
Availability
Commercial banks are the ordinary source of short-term loans for small
businesses.
Credit Lines
When a business has established itself as being worthy of short-term
credit, and the amount needed fluctuates from time to time, banks will
often establish a line of credit with the business. The line of credit is
the maximum amount that the business can borrow at any one time. The exact
amount borrowed can vary according to the needs of the business but cannot
exceed its established credit line.
These arrangements give the business access to its requirements up to
the credit limit, or line. However, it pays interest only on the actual
amount borrowed, not the entire line of credit available to it.
Long-term Debt
Long-term debt is borrowing for a period greater than one year. This
general classification includes "intermediate debt" which is borrowing for
periods of one to 10 years.
Small Business Applications
For small businesses, borrowed capital for periods greater than 10
years is usually available only on real estate mortgages. Other long-term
borrowing usually falls into the "intermediate" classification and is
available for periods up to 10 years. Such loans are called "term loans."
Mortgage Payment Schedules
Principal and interest payments on mortgages usually involve uniform
monthly payments that include both principal and interest.
Each successive monthly payment reduces the amount of principal
outstanding. Therefore, the amount of interest owed decreases and the
portion of the monthly payment applicable to principal increases. In the
early years of a mortgage, the portion of the monthly payment applied
against the principal is relatively small, but grows with each payment.
Term Loan Payment Schedules
For term loans, payment of principal and interest is ordinarily
scheduled on an annual, semiannual, or quarterly basis.
Repayment Schedules
The dates on which principal and interest payments are due should be
scheduled carefully. For example, a manufacturer with heavy sales just
before Christmas and receivables collections through January might best be
able to schedule repayments in February. If a payment were due in October
or November, when inventories were high and receivables were climbing, the
payment could be crippling.
Collateral
Loans may be secured or unsecured. In a secured loan, the borrower
pledges certain assets as collateral (security) to protect the lender in
case of default on the loan or failure of the business. If the business
defaults on the loan through failure to meet interest obligations or
principal repayments, the note-holder (lender) assumes ownership of the
collateral. If the business fails, the note-holder claims ownership of
those specific assets pledged as collateral before the claims of other
creditors are settled.
Typical Collateral
In long-term borrowing, fixed assets such as real estate or equipment
are usually pledged as collateral. For short-term borrowing, inventories
or accounts receivable are the usual collateral.
Inventory Financing
Inventory financing is most commonly used in automobile and appliance
retailing. As each unit is purchased by the retailer, the manufacturer is
paid by the lender. The lender is repaid by the retailer when the unit is
sold. Interest is determined separately for each unit, based upon the
actual amount originally paid by the lender and the period between the
time the money is paid and the lender is reimbursed by the retailer.
Accounts Receivable Financing
Basically, accounts receivable financing falls into two categories as
follows:
- Assignments. The business pledges, or "assigns," its
receivables as collateral for a loan.
- Factoring. The borrower sells its accounts receivable to a
lender ("factor").
Although these arrangements are not loans, in a pure sense, the effect
is the same.
Receivables Assignments
When receivables are assigned, the amount of the loan varies according
to the volume of receivables outstanding. Normally, the lender will
advance some specified percentage of the outstanding accounts receivable
up to a specific credit limit. For example, look at the schedule below.
The company can borrow up to 80% of assigned receivables, up to a maximum
of $100,000.
Accounts Receivable Amount Borrowed
100,000 $80,000
125,000 100,000
150,000 100,000
On the first line, accounts receivable are $100,000 and the amount
loaned is 80% of $100,000, or $80,000.
On the second line, outstanding receivables are $125,000. The amount
loaned increases to $100,000 ($125,000 x 0.80).
On the third line, accounts receivable are $150,000. Eighty percent of
this amount would be $120,000. However, this exceeds the established limit
of $100,000. Therefore, borrowing is restricted to the $100,000 limit.
In many industries, accounts receivable financing is considered a sign
of weakness. However, it is quite common in others. This is particularly
true in the garment industry and in personal finance companies.
When customers must pay invoices directly to a factor, it may create
doubts about the company's financial stability and, therefore, its ability
to deliver.
When accounts receivable are assigned, the borrower is still
responsible for collection. Upon collection of any receivable, the amount
borrowed should be repaid. Interest is based upon the amount borrowed and
the time between receipt of proceeds by the borrower and repayment.
Factoring Accounts Receivable
When accounts receivable are factored, they are sold to the factor and
the borrower has no responsibility for collection. The borrower pays the
factor a service charge based upon the amount of each receivable sold. In
addition, the borrower pays interest for the period between the sale of
the receivable and the date the customer pays the factor.
Since the factor is responsible for collection, it will only purchase
those receivables for which it has approved credit.
Unsecured Debt
The secured creditor's risk is reduced by the claim against specific
assets of the business. In default or liquidation, the secured creditor
can take possession of these assets to recover any unpaid amounts due from
the business.
Holders of unsecured notes do not enjoy the same protection. If the
company defaults on a payment, the unsecured creditor under normal
circumstances, can only re-negotiate the amount due, perhaps by seeking
collateral, or force the company to liquidate. In liquidation, the holder
of an unsecured note would normally have no rights that are superior to
those of any other creditors.
Restriction on Business
Therefore, when accepting an unsecured note, the lender will often
place certain restrictions on the business. A typical restriction might be
to prevent the company from incurring any debt with a prior claim on the
assets of the business in the event of default or failure. For example, a
term note agreement might prevent a company from financing its receivables
or inventories since this would result in a prior claim against the assets
of the business in liquidation.
Such restrictions may have no effect on the business' ability to
operate. However, in other cases, such restrictions could be severe. For
example, a business may have a chance to sell to a major new customer. The
new customer may insist upon 60-day credit terms which will require the
business to seek additional external financing. Normally, this financing
might be readily available on realistic terms from a factor. However, the
restriction of the unsecured note could prevent the business from taking
advantage of this significant opportunity for sales and profit
improvement.
Personal Guarantees
The liability of a corporation's shareholders is generally limited to
the assets of the business. Creditors have no normal claim against the
personal assets of the stockholders if the business should fail.
Therefore, many lenders, when issuing credit to small corporations, seek
the added protection of a personal guarantee by the owner (or owners).
This protects the creditors if the business fails, since they retain a
claim against the personal assets of the owners to fulfill the debt
obligation.
Interest Rates
The interest rates at which small businesses borrow are relatively
high. Banks and other commercial lending institutions normally reserve
their lowest available interest rate the so-called prime rate, for those
low-risk situations such as short-term loans for major corporations and
public agencies where the chances of default are slim and the costs for
collection, credit search, and other administrative tasks are minimal.
Because of the higher risks involved in loaning to small businesses,
lenders often seek greater collateral while charging higher interest rates
to offset their added costs of credit search and loan administration.
Equity Capital
Unlike debt capital, equity capital
is permanently invested in the business. The business has no legal
obligation for repayment of the amount invested or for payment of interest
for the use of the funds.
Share of Ownership
The equity investor shares in the ownership of the business and is
entitled to participate in any distribution of earnings through dividends,
in the case of corporations, or drawings, in the case of partnerships.
The extent of the equity investor's participation in the distribution
of earnings of a corporation depends upon the number of shares held. In a
partnership, the equity investor's participation will depend upon the
ownership percentage specified in the partnership agreement.
Voting Rights
The equity investor's ownership interest also carries the right to
participate in certain decisions affecting the business.
Legal Liability
The personal liability of equity investors for debts of the business
depends upon the legal form of the organization. Basically, the investor
who acquires equity in a partnership could be personally liable for debts
of the business if the business should fail. In a corporation, the
liability of equity investors (shareholders) is limited to the amount of
their investment.
In other words, if a partnership should fail, creditors could have a
claim against the personal assets of the individual partners. If a
corporation should fail, the only claims of creditors would be against any
remaining assets of the corporation, not against any personal assets of
the shareholders.
Equity Investor's Compensation
The purchaser of an equity interest in a business expects to be
compensated for the investment in any of the three following ways:
- Income from earnings distribution of the business, either as
dividends paid to corporate shareholders or as drawings in a
partnership.
- Capital gain realized upon sale of the business.
- Capital gain realized from selling his or her interest to other
partners.
Capital Gains
Capital gain is the term used to describe any excess of the selling
price of an investment over the initial purchase price. For example, if
you purchased an equity interest in a business for $5,000 and later sold
it for $8,000, you would realize a capital gain of $3,000.
Earnings Distribution
The equity investor in a partnership is entitled to a share of all
drawings paid out to partners at a percentage established when the
interest was purchased. For example, assume an investor acquired a 20%
interest in a partnership. The distribution of earnings to all partners in
a given year is $20,000. The holder of the 20% interest would receive
$4,000.
The dividends received by the equity investor in a corporation depend
upon the number of shares held. For example, if a corporation voted a
dividend of $1.50 per share in a given year, the owner of 1,000 shares
would receive a dividend of $1,500 (1,000 x $1.50).
Sale (or Liquidation) of Business
If a business is sold or liquidated, the equity investor shares in the
distribution of the proceeds. As with an earnings distribution, the share
of the proceeds in a corporation sale depends upon the number of shares
held. In a partnership, each partner's share of the proceeds is based upon
the percentages specified in the partnership agreement.
If the proceeds received by the equity investor exceed the original
purchase price, this excess is considered a capital gain and taxed
accordingly.
If the business were liquidated, the assets would be sold and the
proceeds would first be used to discharge any outstanding obligations to
creditors. The balance of the proceeds, after these obligations had been
fulfilled, would be distributed to the equity investors in accordance with
their share-holdings or percentages of interest.
Sale of Equity Interest
As a business prospers and grows, the value of an equity interest grows
with it. Therefore, the equity investor may be able to sell his or her
interest at a price higher than the initial acquisition cost.
For example, an equity investor in a corporation may have purchased his
or her interest at $10.00 per share. As the business grows, he or she is
able to sell the shares at $15.00 per share, realizing a capital gain of
$5.00 on each share sold.
Capital Gains vs. Dividends
In many cases, the equity investor in a small business is primarily
interested in capital gains. Aside from the tax advantages, the equity
investor usually realizes that the earnings of the small business are
better retained in the business than distributed as dividends or drawings.
Retention of earnings permits the business to grow so that the value of
the equity interest increases. The investor can realize a return on the
investment through a capital gain derived from selling his or her shares
or upon sale of the business.
Public Stock Offerings
When businesses are first organized, equity capital is usually secured
from a combination of sources such as the original owners' personal
savings and through solicitations from friends, relatives, or other
persons known to have financial capability for such investments.
As the need for equity capital becomes greater, say $200,000 to
$1,000,000, it is customary to seek capital through the services of
professional finders, who receive a fee for securing the capital needed.
These finders normally have access to wealthy individuals, capital
management companies, estates, trusts, and others with sufficient capital
to make such an investment.
At higher levels of capital need, shares are sold through public
offerings. The public offering seeks to attract a large number of
investors to purchase stock, in large or small amounts. A market is then
created for the stock. Shares purchased by the public, as well as the
shares held by the original owners, and any subsequent equity investors
can also be sold at the going market price. These transactions do not have
a direct effect on the business' capital position since it does not
receive the proceeds from the sale.
The equity investor can realize a capital gain by selling shares at
prices higher than the original purchase price.
Risks of Equity Investment
The equity investor assumes substantial risk. Unlike the secured
creditor, the equity investor has no specific claim against any assets of
the business. In liquidation, all claims of all creditors must be
satisfied before any remaining assets become available for distribution to
the owners. Even then, the equity investor's participation in the proceeds
is restricted to a share that is proportionate to the number of shares
held or the partnership interest.
Since the risks of equity investment are so substantial, particularly
in the case of small businesses, equity investors expect a considerably
higher return than the lender.
A lender might be willing to loan money to a business at an interest
rate of 10% or 12% since it has certain legal protections in the event of
default or liquidation. The investor of equity capital in the same
business might seek
a far higher return, perhaps 20%, 50%, or even more in order to
compensate for the added risk of equity investment.
Summary
This section was developed to teach
you about the various sources of capital that are available to the small
business owner. The need for additional capital occurs frequently in many
small businesses. The ability of the owners to anticipate the need and to
know the various money sources available to them will help them secure
needed capital on favorable terms.
Internal Sources
Those businesses that are alert to opportunities for internal capital
generation will often find that this effort not only minimizes the need
for external capital, but also opens the doors of the outside money market
to them.
This section has explored both internal and external capital sources,
showing you how you can minimize your need for external financing through
proper asset management and retention of earnings.
External Sources
You have seen how the availability of trade credit can be utilized
intelligently in order to maintain favorable supplier relations while
taking full advantage of the credit that is available to you from this
vital and convenient source.
Various types of loan arrangements were also explored, considering both
short- and long-term needs as well as typical requirements for security
through pledging of specific assets or the owners' personal guarantees.
Finally, the equity capital market was studied so that you understand what
the equity investor expects in return for a commitment of capital and the
effect that the equity investor's interest can have on your business.
Food For Thought
When you define your
happiness by what you don't have, then you can never be happy. If you
feel you need more in order to be complete, then when you get it
you'll still feel like you're lacking. We've all heard people say, "If
only I had ____, then I'd be really happy." But happiness is what you
are, not what you have.
Instead of focusing on what you don't have, be thankful for what you
do have. Be actively thankful. Think about the fact that you are alive
and be thankful for the air you breathe, the water you drink, the food
you eat, the warmth of the sun, the coolness of an evening breeze. Be
thankful for your family, your friends, the people who listen to you
and care about you, the people who depend on you. Be thankful for your
mind, and for your ability to use it to create things and solve
problems, and for the education you have.
When you focus on the abundance that you already have, it will expand
and grow.
The median length of a career in the United States is only six years.
That means that 50% of the people in the U.S. change careers every six
years. That's careers, not just jobs.
It used to be that people could go to school, learn a trade, and work
hard in that field until retirement. The world just doesn't work that
way any more. And isn't that an incredible opportunity -- for
individuals, for businesses, for innovation and for society.
The opportunity comes at a price, though -- the suffering of those who
are displaced from work by rapidly changing technology and innovation.
Whole industries are sometimes lost virtually overnight. Look at what
happened to the vinyl record industry when music CDs came along.
You owe it to yourself, to your family, to your community to be a
lifelong learner. For it is the willingness to learn and adopt new
things that will enable you to take advantage of the incredible
opportunities of the future. This is an attitude you'll want to adopt
in every area of your life. Innovation can add value to everything you
do -- look for new ways to be entertained, to eat, to communicate, to
handle financial transactions, to travel, to exercise, to serve
others, and of course, to learn. Seek out innovation and you'll find
something useful almost every day. |
