When you are an entrepreneur, there is an everlasting battle being fought against cost. Often times, small business owners and entrepreneurs focus on cost in terms of dollars and cents, but the overlook the costs in terms of time. It is very important to recognize and respect the distinction. I know in the beginning of my entrepreneurial journey, I searched long and hard for how to make a business work on a shoestring budget; even a zero budget. Sure enough, if you seek, you shall find. The problem is, in many cases when you eliminate a cost in dollars it increases the cost in time. The most common example is doing things yourself as opposed to paying for someone else to do it for you; whatever “it” might be.
After you finish reading this post, you may be able to find money or resources you didn’t realize you had. read carefully and at least consider the suggestions and ideas presented here and I am confident that you will be able to have more money to put towards your business and more time to spend on the things that matter most.
To keep things in terms of marketing and business, let’s look at SEO, for example. SEO might seem to some to be some sort of magical skill that only techies or high-level marketing firms can handle and perform effectively. The truth is, anyone can learn and implement SEO. Here is where the cost comparison comes into play though. You can either spend time to learn SEO and then spend time implementing it or you can pay someone for this service. If you do it yourself, you are saving money, but the time being spent to perform SEO tasks is time that could have been spent focusing on the primary goals of your business. So it comes down to the value you place on your personal time as well as the time being diverted from other things that need to be accomplished.
So, what are we to do?
Limitations Of Time Versus Money
Simply put, time is finite while money is not. In other words, you cannot make more time, but you can make more money. There is only 24 hours in a day, right? This represents your spending limits for time. The more time you spend on something, the less time you can spend on something else. I personally have a habit of sacrificing sleep so I can spend more time on other things. Some would say it is unhealthy to make that kind of a sacrifice. I say, I will sleep when I don’t have to worry about money anymore.
Now, money, on the other hand is a resource for which limits can change. There are ways to make more money. It is a matter of finding the right leverage. What is great about the way business works is that if you do it right, you can use money to make more money. So, in essence, the money gets the work done, so you can spend your very valuable and limited time doing what matters most. This can be seen in almost every business that exists.
Let’s look at retail stores; any type will do. A retail business buys products at wholesale price and sells those products for retail price. As I am sure you know, wholesale costs significantly less than retail. So, you put a dollar in and get two dollars out. This is, of course, a very high level of looking at it, but that is really what is happening. It gets quite a bit more complicated when you get into the nitty-gritty of it, but I think you see the big picture.
While it sounds easy at a high level, it is not so seemingly easy when you try to get a business started. A real chicken and egg situation confronts every person who tries to start a business. This brings us back to the curse. In order to get a business started and running, you must spend some combination of time and money. The less money you have, the more time has to be spent instead.
So what is a person to do when trying to build a business and there is little to no money to work with?
Before taking a look at how to make use of the resources you have, I find it best to first look at ways that can improve the available resources. The first step in this direction is cost management. A gas station owner I once knew gave me a great analogy for this concept. I can’t remember his exact words, but the message was this: If you are hungry you have different foods you can choose from. Let’s say you could either choose a hot dog or a hamburger. Both will satisfy your hunger, but the hamburger is more expensive than the hot dog. If you choose to eat the hot dog, you have not only taken care of a basic need, but you have saved some money as well.
So, it’s about being aware of the choices you make and, on top of that, making choices that will save money. I want you to think about a typical week in your life. Think about what you spend money on during the week. Try to just mentally walk through each day. An even better exercise is to just staying taking note from this day forward of what you spend your money on. I bet you will find that you buy little things here and there and not even realize that it has an impact on your money. It’s not surprising either when you consider that the cost for the little things we buy is fairly low.
For example, if you are like me and love coffee shops, you know it is easy to spend around 5 bucks or more on a single drink. If you are one of these people who stop by Starbucks on the way to work each day, a quick mental calculation will tell you that in a months time, somewhere around $100 is being spent on coffee. What if, instead, you make your own coffee in the mornings. You could even buy your favorite blend of Starbucks coffee from the grocery store for less than $10 per bag. One 16oz bag off coffee can produce 30 to 40 cups of coffee depending on how much you use to brew with. Even if you are a big cup drinker and you go through two bags of coffee in a month, that is still a savings of about $80. That is huge just for changing one habit.
What other things could be replaced for a cheaper options that satisfies the same need? Imagine, instead of replacing one habit for a cheaper version of that habit, you drop the habit completely. I will let you mull this over in your head, but I hope you can see that by changing or dropping habits for your costs throughout each month can literally create a very viable budget where there was not one before. Do yourself a favor, spend the next month writing down every little thing you spend money on. If you were inspired by this post and decided to start changing your spending habits, note down what you would have spent on a item if it is something you would have typically purchased. At the end of the month, highlight all the things on the list that you could either do without or could make an alternate cheaper choice for and add up the cost. The amount you come up with is your potential new budget for spending towards your business.
The choice to make a change is not going to be easy unless you weigh it against how it effects your business. If you can look at one or more of your spending habits and you can realize that spending that same money on running and growing your business is more important than spending that money on something frivolous, it will be easier for you to make that change.
So, you have optimized your spending habits and now hopefully you have a bit more to work with. What is next?
Transition From Leveraging Time To Leveraging Money
The ideal situation for any entrepreneur and business is leveraging money to make more money. However, in the beginning, you may not have that option. Even if you are managing your costs and spending habits to give you more of a viable budget, it still might not be enough to keep you from having to do some of the grunt work of your business. So, if you have to spend time, spend it on things that will return you the most money. This is a matter of prioritization. For any business, there are endless and ongoing things that need to be done. Typically, you won’t be able to get it all done in the time that you have. So, put it all in a list and start putting things in order. Ideally, you want to have the things that will bring you closer to increased profits to be near or at the top of the list. High enough so that they can be accomplished.
From this point, it is a matter of a beautiful back-and-forth of growing your profits so you can grow your budget. Then, of course, with a bigger budget you can start leveraging more and more money to free up some time and further increase profits. With a bigger budget you could hire someone to do some of the grunt work. Now you can tackle more things on your list that can improve your business and bring in more money. This is the cycle you want to find yourself in. At some point in this cycle, the time you spend will be for only the most important tasks on your list. In some cases, you can remove yourself completely so that the business runs on auto-pilot. It depends on the business and also depends on each entrepreneur’s preference. Some people love the work they do in their business. By freeing up their time, they get to focus on the parts they enjoy; the “get to’s” instead of the “have to’s”.
I do realize that this is all easier said than done. I think you can see the big message here though. You will always have to spend some combination of time and money; there is just no way around it. Hopefully this post can help you realize a path to spending mostly money so that your very precious time can be yours to use as you please.
I hope this has been helpful. Please feel free to leave a comment or ask me any questions. I would certainly appreciate it if you share this post so that others may get some use out of it. Until next time, I wish you the best in your pursuit of success.
Incoming search terms:
- htl li 2xpe00