Surround yourself with a team who is good at what they do, so you can continue to be good at what you do
As business owners, we need to constantly be asking ourselves how much our time is worth and, most importantly, have an answer for that question every time it comes up. For owners in the service industry, this may be a little easier to answer mainly because the per hour charge is a fairly common practice. For those in the product industry, this may be more difficult to answer. I help lots of business owners figure out an answer to this question. Once you have that accurate answer, then magic begins to happen. Let me give you an example.
Your worth is $50 per hour. You handle multiple responsibilities. Every day, you are faced with choices as to what you should do. Two of those responsibilities are to make a sales call and put price tags on product. Both take two hours. If you choose to do the sales call, your worth is much higher because of the potential profit you have to make. If you spend two hours putting tags on product, there was no opportunity to generate what you are worth for that time, which is $100.
I see many business owners feeling they have to do it all when they cannot afford it. Let me explain, using the example above. I coach owners to hire a person to do this price tagging job at $12 an hour. This frees the owner up to make $50 an hour, and they have just profited $38 instead of losing $50 for that hour. This is an $88 swing on their income statement. That will add up fast as they begin to do this more. In my coaching sessions, we make very strategic choices on what hat to take off first, second and third. We look at social media marketing, accounting, payroll processing, inventory pricing and receiving, tax preparation and administrative tasks.
This example shows that, as your business grows, you need to begin to off-load the revenue-destroying responsibilities to others that do it more efficiently or inexpensively. In turn, you will begin to generate the additional cash your business needs to grow. Your company will experience great growth as you surround yourself with a team who is good at what they do—so you can continue to be good at what you do.
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Blog by Jason P. Bailey, CPA – Business Services Manager, Senior Tax Professional
Learn more about Jason and the rest of the Storen Financial team here.