Most coaches and consultants undercharge for their work. It is just as easy to overcharge. If you are not finding clients perhaps you are overcharging, although it is usually not a good idea to bring your prices down. I shall explore this in more detail next Wednesday. Today I shall explain how making profit saves time.
Work Life Balance
We hear a lot about work life balance, primarily because so many people in employment work overtime. When the demands of work are excessive, to the extent there is little time to do anything else, many people start to question why they are doing it. The question may be a response to some life changing event such as a heart attack or diagnosis with a problem such as diabetes or stress. Sometimes someone will simply realise other people have time to do stuff other than work.
The same applies when you are self-employed. There may be fewer checks on your excessive working because you don’t have managers or colleagues to question it.
I met someone the other day who told me she can offer 3 one-hour consultancy sessions seven days a week. That’s 21 sessions a week. So, I asked her wouldn’t she rather work only 4 days a week. She would – the question is: how? She needs higher prices. How to get to higher prices is a non-trivial question but at this stage I’m making the point.
You may be good at something you enjoy doing but the pleasure begins to pall if you have an endless sea of working days ahead with no let up.
Anything you do below the market value is an act of charity. There is nothing wrong with that but understand what it means. Imagine the balance sheet of a conventional business, where you subtract expenditure from income to calculate your profit. If you work at a low rate or for free, you are in effect donating your profit. If you work out the cost of your charitable work, you can add it to your income.
You may find you would make a profit if you charged for charitable work. Now, there’s nothing wrong with pro bono work. Many social enterprises do this and record the costs of what they give away as part of their profit. This is sometimes called the triple bottom line, where you account for social and environmental benefits as well as financial profit.
There’s no reason a self-employed person can’t do the same but be clear. It reduces your profit and increases the time you put into your paid work. Perhaps it would be better to wait until you are making a profit and then spend it!
Spending the Time Profit Generates
So, let’s consider the time you spend if you have time to spare.
First, the internet marketing gurus will tell you about the wonderful leisure activities you can partake in once you have money. You can pay for staff, not only for your business but also for domestic life. Staff free up time. Now you can sit back and enjoy life!
Of course, life isn’t like that. Leisure time may be eaten up by domestic responsibilities. You could employ a nanny to look after your children. Is that what you really want?
So-called leisure time is the time you need to pay attention to other aspects of life. Family, health, education are all aspects of a fulfilled life. They are essential and you will certainly feel pain if you neglect them.
Employing staff is not a bad idea. I won’t enter into the pros and cons here but point out something you may not have spotted. When you have time freed by your higher income, you have more time for your business.
The business owner I mentioned earlier explained if she filled 21 sessions, she would have 60-80 clients. Now I think these would be 60-80 unhappy clients. If she could generate income to cover her needs from just a few clients she could spend more time with them (they’re paying her more remember), do research on their behalf, improve her skills through training and genuinely have time to develop her business.
The extra staff may not be needed; the extra time may be sufficient. But staff do free up time you need to do what you do best, while they do the routine stuff you don’t really need to do but do now because there is no-one else to do it.
And with more time, you can invest further in your community. I shall write about spending money on charitable or community work in a later post. With more time you can afford to seek new investments of time or money in projects that interest you and benefit others.
Conclusion
So, more time for leisure and family, for doing your business better and for making investments in your community or charity work.
The challenge is to get there. I may move onto this in later posts. My non-directive consultancy specialises in how to get into this enviable position. I’m happy to talk to anyone interested with no obligation.
Let me know if this post is helpful and if you have any questions for me to write about later.
