Are you working too hard? Now don’t get me wrong, having your own business requires effort for sure. And in many ways it requires more effort than working for someone else. But if you do it right, the more effort does not feel like more work, and certainly does not mean suffering like so many people do in a job. But like I said, you have to do it right. I want to share with you 3 reasons it’s harder to make $50,000 than it is to make $100,000 or more.
- Trading time for dollars. Now I know you’ve probably heard that phrase a million times before, but let me explain a bit deeper what it means and where your attachment to it comes from. If you went to school in the United States (and probably elsewhere, but I am not familiar with other places), you were conditioned from a very early age to be a worker. You got up early, often before you want to, eat breakfast whether you were hungry or not, went to school, and were told all day long when to sit, when to move, when to eat or drink, go to the bathroom, play, concentrate, etc. You were also told what to pay attention to, what to learn, what to value, how to follow instructions, and what would be approved or disapproved of. Your time and your value were regulated strictly by the clock and grades. I need to say here that all of this is a relatively new occurrence since the 19th century and the advent of public education and factory work, which were developed hand-in-hand. But that is an article all its own!
~> The point here is that very often when people in service professions first create their own businesses, what they do is create a job for themselves. They think, okay I do massage therapy or life coaching and I’m going to charge $100 per hour. That sounds pretty good, doesn’t it? They set up their pricing this way because they are accustomed to thinking in terms of selling their time, rather than selling the result or the transformation that their service provides. It’s deeply conditioned from school to make sense this way. But it really doesn’t. It’s a way for employers to keep track of their employees, just like teachers track their students. Because when you are in service, what really matters is what people get from working with you, not the amount of time it takes to get that result.
- Under-charging for your time. What you don’t realize is that when you are in business for yourself, you have many responsibilities in addition to providing your actual service. You have your financials, your marketing, your sales, and very often your office maintenance, and a variety of other tasks to handle. You should plan that for every hour that you provide your service, you are working 3-5 additional hours doing everything else. That means that $100 an hour is really more like $20 an hour, if that. Doesn’t sound so good anymore, does it? So what so many people do is not do the marketing and the sales—it seems like the place where they can cut out work, but then of course their businesses suffer. Sound familiar?
~ > And if you are accustomed to thinking in terms of charging for your time, it is very difficult to raise your rates, because you think I have to work twice as hard to make twice as much money—I have given my clients twice as much. But twice as much what—that’s worth thinking about, isn’t it?
~ > When you start to actually get busy, you find you hit a wall about what you can actually get done? I see this all the time with clients—at first we focus on filling their one-on-one practice, which is where everyone starts, and you want to keep it going because of course it’s a big part of what you love. But then you get too busy—your hours are full, you don’t have time to do the rest of your business, so you cut back on everything but providing service, and your marketing suffers, your bookkeeping suffers, and sometimes your love life suffers, too.
- Doing everything on your own. Admit it, you do this. You try to do everything yourself, and what you won’t do, doesn’t get done. This keeps more solo entrepreneurs making less money than they actually can probably more than anything else. Because once you get your practice going, and you are busy, you don’t have time to do everything yourself. Not if you want to grow. But if you are like most people, you don’t hire someone to help, or not the right person, or not for enough hours. And you don’t because you think you can’t afford it. So you hit that wall I was talking about, and you can’t grow, and so you fill up then empty out—feast or famine. Ugh.
What I am describing here is what happens when you create a job for yourself. You are still in the same mindset—or similar—to that of an employee, only now your business is your boss, not someone else. And if you are doing this, you are working too hard—and it really is not necessary.