Research and see what you can do better

Small business owners do everything, marketing, sales, finances, customer service and delivering the goods or services to their clients want. That are a lot of activities and for most of them you do not get paid.

Lets say for example you work 60 hours per week or 240 per month. You are a designer who makes Logo’s and you charge $60 per hour you work on developing artwork. You have on average 15 hours per week you bill out and 45 hours you work on other activities. This makes you $3600 a month.

In this example you can see that the revenue generated does not allow you to grow your business as your fixed costs and living expenses will eat up most. The real problem in that in real terms you get paid $15 per hour.

Some might think that $15 per hour is not bad and it probably isn’t a disaster. What the real issue is that you are working to many hours and you do not have time to take on more work. Therefore you are stuck and cannot grow the business.

So how do you get out of this problem?

The first step is to reduce the number of hours spend on other activities. Do some research and ask yourself do you really need to do all these things and if you stopped a few would your business fall apart? Could you get away with only spending half the time on some activities? If you can you will create free time for billable hours. That means more income and more profits meaning cash for growth.

If however you do not see any opportunity to eliminate some activities you need to start writing down all your activities. Once you have these activities you need to classify them and group activities that belong together. Let me give you an example:

 

I had a business coaching client who spend 10 hours per week on invoices and expenses with multiple trips to the post office and hours of sorting and classifying their paper work. Those are 40 hours a month she could not bill for and it was costing her lots of money.  If she were free she had enough prospects on her books and she could stop turning down clients. So where did the work go? You never guess but the babysitter was happy to do it for an extra few pounds per hour. This allowed her to bill 20 more hours a month in the first month she asked the babysitter to take on the extra work.

 

There are other ways to get someone else to do the work and if you charge $60 per hour and could take on more work you should investigate which activities you can outsource for a fraction of that. But remember first try to get rid of all the hours that do not ad value before you outsource.

 

Little breakthroughs like this can really jumpstart your business.