Kim Barrett here! Today I want to discuss the business mindset theory of time vs money. Over the many years of being in business, I find this is a common question I receive whether it be out at an event, in a workshop or from our clients and that question is “What does the principle of time versus money mean to you?” Which is a great question right?
Everyone who reads or listens to my content knows I like to make comparisons to real life examples so lets kick this off with one. Let’s say that I need my car cleaned…. I could personally sit and clean my car very very easily. It may take me an hour or so to do after I wash it, clean the windows, the interior, the tyres, shine the tyres and so on. That is a lot of time [and effort]. OR, I could spend $60, take it to a car cleaner and they’ll clean it for me in 30 minutes [as they have maybe 3 or so people working on it together].
In that 30 minutes I could be chilling at the little cafe next door and spend time making calls, checking client’s ad campaigns, catching up with my team, and plenty of other things. This is just one very simple example of evaluating the concept of time versus money.
Now let’s compare this to your marketing! If you decide you want to start running Facebook ads, you could spend so many hours trying to figure out the platform, how it works, what objective to set, what targeting to use and you’ll be there in front of your computer for hours. I’ve spoken to hundreds of people who have done just that, and they all ended up coming to me and saying, I thought I could just watch a YouTube video or read a few articles and it would just all click for me and magic will happen.
I hate to say it but it’s not the case.
It takes A LOT of hours to learn Facebook advertising strategies, it’s on the 10,000 hour principle! Which explains that it takes 10,000 hours to become an expert in any one area. You know I would say I have probably done more than 10 000 hours, probably closer to 20,000 hours running ads, looking at different marketing strategies, copy, funnels, marketing creative. And I’m still learning, I’m by no means a complete expert, Facebook and marketing is a forever changing landscape so I can never know EVERYTHING. But I also spend money to accelerate my time. Now what do I mean by that? Well I would rather pay someone who is an expert at something to mentor me, teach me, train me in an area rather than spending time because to me [as an individual in my personal life but also as a business owner], time is a finite resource. I only have so much time in a day that I can use as opposed to money I can spend, money I can make back [or spend MORE money to get your cash washed AGAIN because you just got sprayed with sprinklers when you drove out of the car wash, right?].
So, how do you work out what to do? Where to spend your time and where to invest in experts? Well the simplest way is [this is gonna sound a little bit weird] but we have to do some quick math. To figure out what first of all is your time worth? Right. The easiest way to do this calculation [and for some of you this may be confronting, but it is very much required] you need to figure out *exactly* what your hourly rate is. If you’re running your own business, this may be an eye opener for you. You need to input the total number of hours that you *put in* versus the total number of dollars that you *take out* of the business.
Let’s just say that you…
Take out $100 000 from your business.
You work 50 hours a week. You’re out there hustling, you’re out there making things happen in your business right? So you’re working 50 hours a week and you take one week off right? Let’s just say you take off Christmas week. That means 51 weeks a year you’re hustling.
51 x 50 means that over a year, you’re doing 2550 hours. [eek!]
Then if we divide that by that cheeky $100,000, you’re earning 39 bucks an hour.
Now, if you’re taking $100 000 out of that business, anything *anything!!* that is NOT worth $39 an hour to you, for instance maybe it’s cleaning, doing your book-keeping, or cleaning your car….you need to outsource that to someone else! You need to take that time away and focus on something else. Now when I look at what I am doing, I always look from a perspective of $500 an hour task because in an hour, I can be on the phone making a sale, I can be on the phone doing something that is so important to me, building a joint venture relationship which could bring me hundreds of thousands of dollars. So for me if it’s not worth $500 an hour, I need to outsource that. I need to send that to someone else to focus on. I need to free up my time to focus on the most highly valuable thing. Which means I’m more than happy to pay someone. I’m more than happy to invest money to reclaim that time. I’m more than happy to send that to someone else to do the task so I can reclaim that time and ensure that I am getting the most out of my time.
When I’m thinking about what I have to do, I don’t think about how long it’s gonna take me. I think about what it’s going to cost me to get it done. What will it cost me to send that to someone, to outsource it, to get someone else to focus on that versus me having to sit there, work it out, focus on a menial task, whatever that might be. Unless I enjoy it. [If I enjoy it of course I’ll do it, for instance I love cooking, I can zone out and enjoy what I’m doing, that’s important too]. But if I don’t then I want to redirect this task so I can really focusing my time, energy and effort on the most high value things.
So we’ll circle back to your marketing. For you to figure out a Facebook ad, set it up, run it, optimise it, make sure that it’s working, stay up to date on all the changes that are happening, it’s a lot of time that you will invest when really [for probably not as much as you expect] you can get someone who is highly skilled in that key area, to focus on that for you right? When I’m weighing it up, I go what is the time versus money investment? I’ll invest money *every time* over time so that I can have more time to focus on business growth, winning awards like the 2 Comma Club Award, the Marketing Hall of Fame Award, I’d much rather focus on those types of things rather than focus a minute on small things that are gonna take up my time, energy and effort.
I *highly recommend* that you do this task in order to work out what your hourly rate is and then how you are able to outsource those other tasks that are considered low value [and subsequently be spending more time ON the business rather than IN the business, making more money, growing at a more rapid pace].