Time is of the essence, and nothing shapes your ability to earn money more than time. How long does it take to complete a project? Billable hours. How long does it take to bill a project? Unbillable hours.
It’s the accruing unbillable hours that threaten to destroy small businesses. The paradox is that the more successful you get, the less opportunities you have to capitalize off of your success — at least, until you figure out a smarter way to work. For most of us, that means delegating tasks to save time.
If you make $60 an hour and it takes 10 hours to complete a logo design, you make $600. Now, if you spend one hour on billing and related administrative duties, you’ve just lost $60, so your profit is down to $540. What if you do 10 logo designs a month? Your gross is $6,000, but your net is $5,400 because you lose $600 in administrative duties. You’ve essentially done one entire logo job for free. Multiply that by 12 months and you’ve lost $7,200. By 20 years? You’ve lost $144,000 — more than an entire year’s income.
That should get your attention.
Now, let’s say you outsource your billing for $15 an hour, so you’re free to work that extra hour at $60 for a profit (not loss) of $45. Again, using our formula, you make an extra $450 per month, an extra $5,400 per year, and you’ll net an additional $108,000 over 20 years.
Which would you prefer: Losing $144,000 or gaining $108,000? The choice is obvious. Being in business for yourself is about more than peddling your skills, it’s about making smart efficiency decisions. This is the time-loss continuum — anything that you can have someone else do while you make the real money is worth outsourcing. You’ll gain time and save a lot of money in the process.
Image used under Creative Commons license from Flickr.
