Turn around your business series by gaining just a bit of time
Do you suffer from long working hours? Do you feel that you have to do everything yourself? And do you constantly do this? So, you really are self-employed? Are you also surprised that your business is not growing at all? I have a few ideas for you on how you can gain time as well as an overview of the situation. This is in order to take your business to the next level. Would you be interested in this? So, let’s get started.
What you will learn from this article
- Getting to know your best friend even better
- asking the right questions and taking the right actions
- what you can delegate in order to have more freedom
- what really matters and what does not
What really matters?
“You just have to set your priorities right – after all this is your business, not mine.” Does this sound familiar to you? What are, in fact, the right priorities for the self-employed, for entrepreneurs like you and I?
In business, my survival as a self-employed person is dependent on my profit. I do not think that profit is the only way to measure success. I have to be satisfied with what I do and why I do it. My customers also need to be satisfied.
You will earn more money if you have set your business priorities in such a way that your customers are satisfied. This money does not necessarily equal profit. Profit is a good indicator of how well you serve customers.
One indicator of success is not how much profit you make
but how much of it you have left by the end of the month.
There is a simple way to gauge the importance of an activity. Try to determine whether or not this activity helps you make money – in the short term or in the long term.
There are a range of activities, be it within a company or for a self-employed person, that do not help you immediately to make money. For example, my estimate it that consultancies can charge for “only” 60 to 70% of their time. Time that can be charged for = time for which you can bill your client for. By this I do not mean to say that time for which you do not charge is time wasted. You will, however, need to be aware of this when you are working.
On the one hand, there are tasks crucial to your long-term success. Creating a marketing plan, creating and updating a liquidity plan, continuous professional development, certification and so on require that you put time aside. In the long term, however, this pays off considerably. The only thing is that you will not see results immediately. If you are having liquidity issues NOW and you are desperate for time for which you can charge, you should NOT stop doing any of the above. Just move it to outside your main business hours.
On the other hand, there are quite a few activities that are a true waste of time. These are the kind of activities on which you spend hours and hours and that do not help you make any profit at all. Things such as messing about with your website, checking social media again and again, reading your emails over and over again, dealing with invoices, constantly contacting the same people are all meaningless chatter.
If you feel the same way as I do about these things, I recommend that you ask yourself this question immediately: What kind of profit does this activity bring me?
I keep catching myself in the trap of doing things I do because I have read and heard that this is what you do to grow a business. This is without realising that what I am doing has never even resulted in profit! Here is an example: I keep looking at optimising travel costs for my customers. A fascinating, yet highly complex topic – looking back on the effort that I put into having satisfied customers in relation to profit… Whew – all of these were loss-making activities.
Understanding where exactly your profit comes from is a very healing realisation. Stopping everything that does not contribute to this is a true relief.
Here is a little exercise you can do immediately: Write down which customers have brought you 80 % of your profit within the past 12 months. If you are not exactly sure, get your book-keeping file, and find the invoices. Write down on a notepad where this customer came from. If you do not know, just have a guess. Was it a recommendation? Was it because of a marketing activity? Have you met this person on a train? When it this person’s birthday? When was the last time that you have been in touch?
This is the most valuable information for your business? Where does your money come from? Or in other words: Which customers have brought you 80 % of your profit over the past 12 months? What works and what does not?
You have to be very honest with yourself. After all you can keep the answer to yourself. This does, however, allow you to see one thing clearly: What does actually work well? And what does not work at all?
By now, I imagine, you know where I want to take you. Or do you? This is the key to success for your business. The reason behind this little “evil analysis” is so crucial because you can use it to free up new time for your most important activities.
How can your business succeed and grow if you spend time on unnecessary activities? On wasting time? On constant distractions that lack any purpose?
You probably are not hearing this for the first time. I feel the same way every now and again. Yet how can you improve, make more money and have more peace of mind when you keep doing the same thing? How can you attract new customers if you keep looking at social media updates all the time? Spending every day thinking about how you could pay the bills? Where you could run into debt again in order to fund your business activities?
Different results require different actions.
If you want the same (lousy) results as before,
Lousy, for me, means = not enough cash, working my backside off until 9 pm, working every weekend, having too little time for my family, being left with no money by the end of the month, going on holiday with a bad conscience on every day…
It does, however, do little if you simply agree with me. I want you to apply it to your business! Yes, I am ashamed of saying here and there that I was going to take care of the business – because I went to the office, not my business. A business is profitable! There have been times when I could not even pay myself a proper salary. This is why I preferred saying that I was going to the office, not the business. Shit.
If you want your business to be a business and to even grow a little, then start by spending your time with different activities. Growing a little means this for me: having money left at the end of the month – without staff, fixed charges, and the whole ‘overhead’ shit that only costs you money.
If this is what you want, you will have to make changes. This is a precondition. For this you have to rid yourself of these behavioural patterns and ways of thinking in order to help your business and yourself progress. How are you thinking of achieving this? Surely this comes with planning – this is what you might think. Yes, it takes a little bit of planning, very little, though. It is more like guideposts for hikers. If you do this, you know what guideposts on a hiking trail are like? I love it when I have achieved yet another milestone. It is not the path that is the goal – in business – but the goal is the goal.
In business, the path is not the goal. Instead achieving this goal is the goal. Cash is king. Why? Because cash guarantees independence, for a lifetime. Without a cash reserve, you will not make it through setbacks, and you cannot make mistakes. And you can be sure that you will make mistakes. You need cash to rectify this.
You would like to know if I, too, need cash to rectify mistakes? Yes, I used, for example, CHF 300,000 in order to pay for national insurance contributions that directors and their employees had not paid. Yet I was responsible for them. According to Swiss law it is the administrative council (supervisory board) that has to clean up the mess. It was because the others decided to splash out on fancy clothes that I had to foot the bill.
Nobody had taken care of this. At a conference for consultants I had spoken to a colleague about customer acquisition. We discussed ways to get those 2-3 appointments per month with people who might potentially be interested. This involves less than 30 minutes a day, an email, and a telephone script. There were about 50 people in the room, listening to this conversation. We launched a competition. The consultant with the highest number of client appointments secured could win a prize of around Euro / CHF / USD 1,000. Yes, somebody won this prize. However, this is not my point. Everyone in that room was complaining about not having enough appointments with potential clients. 90 % of the people in the room have NOT implemented the advice, and they have not used the templates.
When you get to the point when you understand that it takes a different kind of activity to achieve different results, you have made it.
Being someone who wanted to escape the trap of getting the same, unsatisfactory results, I had to take drastic action. Every minute of my life that I spent doing the same thing as I had before was, in fact, a lost minute of my finite life. This is for the part of our lives where we have full mental and physical capacity. You and I know how soon this can change.
What is your first activity?
This is the most important question that you will be asking yourself from now on. What is the first activity, the first teeny-tiny activity, the first mini step to achieve your goal? What is it that you do to get started and to make this dream a reality? Look at David Allen’s GetThingsDone method. Do NOT say I want to earn more money in the next quarter. This is not a goal. Instead split your goal into smaller, achievable, individual steps. Set aside time in your diary, and finish the job. And then you take your next tiny step.
Do not make this mistake in your planning: An ex-employee of mine, a lady I had to let go because she spent the entire day planning every single step before she planned the planning process again and rethought and documented everything. She never started implemented any of this either. Instead of spending hours thinking about what needs to be done every tiny step of the way, please start by taking one small step. The whole step will follow all by itself. Yes, this does come with the disadvantage of not knowing exactly just how long implementing this step will take altogether. But the advantage is that you will be seeing successes happen every day.
A lot of successful business people, entrepreneurs, actors, and people in general have made it a habit to say no more times to ideas tempting to be implemented.
Successful people say no more times than anybody else.
I, too, have a lot of ideas. It is very difficult that I have to let go of 99 % of my ideas if I want to be successful. After all it takes time to implement ideas. Above all this takes time, effort, and money. Whenever an idea comes up and starts screaming for attention, I have to decide immediately whether I want to say YES or NO to it. Do this, too! Say thanks, but no thanks.
Every new idea screams for attention. Saying YES to this idea has the power of a nuclear bomb on my reasoning, meaning that one Yes can make me drop everything I have tried so far. A Yes to a new idea turns me on because anything new is stimulating. AND YET any new idea requires time and money, and it takes me away from things that have worked well in the past and that I have made profit from.
Dear God in heaven, please spare me with new ideas and keep me on the path of what has worked well and what has brought in money. This is because nothing is more harmful to me than tackling new ideas all the time and losing my focus on my goals as a result. Please keep me from this. Amen.
You have to make a decision. Trying something new every now and again OR perfecting what you have. When doing this, think of a sports star such as Roger Federer. Why is he so good in his early 30s? It is because he has perfected his play. With a lot of talent and training. Would he be just as good if he were also a football player, a swimmer, and a golfer? This is a rhetorical question.
Perfect what you have so you do not end up in the hell of tactics. Less is more. You have no idea what needs to be done? No problem. Just start and what comes next will fall into place.
Get external experts when you have no idea how to plan or implement something! Or delegate it at a fixed rate. It is more worthwhile to spend your time exclusively on activities that help you earn money and to spend some of the money earned on experts who can show you how to do what you want to do or experts who will complete the task in question for you.
If you are feeling overwhelmed because you are spending too much time on wasting time, you have to act before a financial or energetic burnout even occurs. Being active is much better advice than waiting for things to happen all by themselves.
Your new best friend: The diary
My best friend in the business (not at the office) is my diary. Very successful people use their diaries in order to note down all of their appointments and projects and jobs that need to be done. You write everything in your diary. That is how you know that everything is saved there.
This comes with the huge added bonus of helping you sleep much better at night. Because you do not forget things anymore. Are you saying that you had no idea just how long it would take you to get the job done? It happens. Add the task to your diary regardless. Be very focused while you are working to implement this task (no distractions). Set a deadline for each task.
If you do not have enough time, you will automatically learn from this for next time. And that is when you reserve the next time block for the remainder of your tasks.
Every task and every project has a beginning and an end.
Every task and every project can be divided up into individual stages. I do this WITHOUT using to-do lists. Instead I have everything written down in my diary. This comes with the advantage of allowing you to see exactly how much time has already been allocated to different tasks. It also makes saying no easier.
If you set deadlines that you cannot meet, learn from this. If you keep taking new jobs without having finished existing job and ongoing jobs, you are setting yourself up for complete and utter failure.
If you are not taking this seriously, then what is the point?
If you have a habit of ignoring deadlines and amassing to-do lists like inactive members, it is time that you radically changed your system. Just make it a habit.
I love to plan weeks ahead.
I love it when my inbox is empty at the end of each day. It is satisfying.
Delegating well – giving tasks to third parties who can do them better
What do particularly successful self-employed people and other people do for your business? More than delegating. They are also good at determining what they are good at. An example? Is there really any point in working on your website monthly every Saturday – to save money? Would it not be better to find a freelancer who can do this quickly and well because they have the experience and the knowledge it takes?
No money for this – is that what you are saying? Then you should consider the following: What can you do better than a person based in India? Looking for customers, for example, because you are here, and you are familiar with the market, and people want you. Imagine what would happen if you spent an hour looking for customers instead of polishing up your website? Would this be worth USD 10 per hour? This is one of the hourly rates of Indian-based freelancers who could polish up your website. Use the international division of labour to your advantage – the people doing this are well-qualified and they love doing this.
This is not about exploiting these people. No, they are doing this of their own volition, and they love it. This is not about delivering sub-standard work, either. Any type of work has its value. I do not differentiate between low-quality and top-notch work. This is about the fact that certain tasks and activities are better and must better be taken care of by people other than you. This is about efficiency and effectiveness.
People who do everything themselves, because they think that this is how they are going to save money, are way off. We all have different skills and duties. Finding customers and making them happy is probably your duty. Fulfil it instead of working on your website.
It is shocking to hear people tell me that they cannot afford help. First of all, we are not talking about salaried employees. If you need a logo, you can buy it cheaply on the internet. You can hire a freelancer. Describe what you want and advertise for bids, for example on Upwork, while indicating the amount you are willing and able to pay. And you will almost certainly get a reply as to whether or not this is feasible. If not, contact suitable freelancers and ask them what a realistic rate for this type of work would be. Start with what is possible, but definitely do this: You must spend the time you have outsourced finding customers. You must use this time in areas in which only you can operate. This is added value. Otherwise it would simply be luxury. If you can afford it, great. However, generally speaking, medium-sized and bigger companies do not do it this way!
You do not outsource because you are too lazy to complete these tasks yourself or because somebody else can do it better! Wrong. Wrong. Wrong.
You outsource tasks so that you have more time to do what you are good at – customer acquisition, working on jobs, making customers happy. This is the purpose of the whole exercise!
Here is how you can do this successfully and correctly in financial terms: You should not block your own thought processes with complicated thoughts about whether or not outsourcing makes sense for you. Just try it once, and take 5 % of the money that your customer pays you. Put it into outsourcing in order to have tasks completed that help you and your business progress. You must absolutely use the time that you gain by doing this for customer acquisition and for work to do with your customers. This is the only way you will achieve added value that pays off.
Do you want to wait until your business is big enough before you outsource tasks? Do you want to wait until you make more money in order to start this?
You have to make a decision. It is up to you to decide whether or not you want to invest more time in customer acquisition and customer relations. However, do not fund this by adding to your existing debt. Paying for outsourcing or staff by adding to your debt is wrong. Only use money that you have already earned.
Do you not have enough money? Then you should definitely keep reading my blog. I will introduce you to the topic of raising your prices soon.