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Don't Spend A Dollar to Save Ten Cents

July 07, 2012 | Comments: 0 | Views: 218

Have you ever driven across town to save a dime a gallon on a fill up of gasoline?I have, and it just does not pay.If you fill the tank and your tank holds fifteen gallons, then you have saved a buck fifty.Maybe it is the psychological aspects that you are going for, but your time has got to worth something.

Over and over again, I preach to my clients the need to include their time when calculating the cost of a service or product.Maybe your time is not a direct cost, but someone has to order the goods, receive and stock the merchandise, pay the invoice and all the other aspects of providing the products that you sell.Are you are service provider?Do you include the time it takes to prepare for a presentation?How about extra training to keep up to date on the most recent trends or issues?

Almost every time I council a person who is thinking about going into business or even selling their existing business, for some reason they have not taken into account their time.For example, a woman wanted to start a retail shop.She had all of her numbers together, like the cost of inventory, space rental, hired help and so forth.Nowhere was even a mention of her time.I guess she just wanted to go into business for some other reason than to make money.Have you ever watched one of the television shows where people bid on an abandoned storage space?At the end of the show the commentator states how much they "made" on the deal.Never do they mention the hours they spent traveling to and from the sale and how much time they spend going through the junk and cleaning the saleable merchandise or any other costs associated with the transaction.This is a very misleading idea of making money.

I have heard of many treasure hunters who have spent their whole life in search of some buried treasure.They spend hours and days and years, with no apparent compensation.Your time is worth something.We all should place a value on our time.

If you want to start a business and while preparing your financial projections, assign some hourly or monthly figure to the time you will spend.Maybe it will be an average wage for whatever you do.For example, if you open a retail store, "pay" yourself at least the amount it would cost you to hire someone to work the job you are performing.Is it $15 per hour?Maybe it is $2,000 per month.The point is to put a dollar amount in the financial equation for your time.You are worth something and an investor or lender will want to know what you think you are worth.Good luck.

Randal Roberts has over 30 years of commercial and international banking experience. He has helped more than 2,500 different companies with their businesses. He is willing to help you find the resources you need to start your own business or improve the one that you already have. Visit for more information.

Source: EzineArticles
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