Business is easy: Be of service. Charge more than it costs. Take the money now. We really make it harder than it is. Perhaps it’s not the mechanics of business that get in our way. Maybe it’s the emotional baggage we attach to money. Or the things we think we know about business. Once upon a time, I nearly sank the family plumbing business. To fix it, I had to un-learn a few commonly held myths that that were tripping me up.
Myth #1 – Do what you love and the money will follow.
When you do what you love, it will come easily and naturally to you. And you might deceive yourself into thinking that the money doesn’t matter. The money DOES matter and it will not just magically appear when you do a good job. Certainly, do what you love. But mind the money.
Myth #2 – You must charge the “going rate” or you will price yourself out of the market.
After all, you are bound by what “the market will bear.” Well, the market bears all kinds of prices. You can buy a compact car for $10,000. Or a Lamborghini for $250,000. It isn’t the market that sets prices. Marketers set prices.
Myth #3 – You need to lower overhead to make more money.
I suggest that most business owners need to increase their overhead. Why? Owner’s salary is an overhead item. And most owners don’t make nearly enough money. The better way to make more money: raise your prices and increase your sales.
Myth #4 – Profits and Principles don’t mix.
Principles depend on profits. This myth is the most insidious of the lot. Look inside yourself. Are you sabotaging your success because, deep down, you don’t believe that good people can be really, really rich?
Remember the Victor Hugo story, Les Miserables? Also immortalized in the Broadway smash Les Miz, the hero of the tale, Jean Valjean is sent to prison for stealing a loaf of bread. Was Jean a thief, a corrupt criminal? Mais non! He stole the bread to feed his starving family. When your back is against the wall, when you are short on cash and your bills are due, you might consider options that you would never consider if your checking account were heavy.
It is much easier to maintain your principles when you have plenty of money. But, so many business owners justify their lack of profitability by saying, “I’m not in it for the money.”
If you are in business, you are in it for the money. Otherwise, you will be out of business. Or, you’ll stubbornly hang on to your losing business and compromise your family’s financial future.
Worse yet, you’ll make an integrity-damaging decision because you have less money than obligation. As a consultant, I’ve run into lots of situations where an owner, a manager, a bookkeeper has gotten into some kind of money challenge. A lack of profitability. A job gone bad. An addiction running rampant. Good people can do bad things when their backs are up against the wall. It’s easier to do the right thing when you aren’t struggling to make ends meet.
Truth: Profits and principles are not mutually exclusive events.
Mother Theresa was a simple woman, a Catholic nun who devoted her life to the care of the poor, sick and dying people of Calcutta, India. Some consider her a saint. She understood that it took money to provide that care: clothes, medicine, food, shelter. The greatest gift she could give was love, and she loved without limits. But love alone won’t quell the cries of a starving baby. It takes money. Mother Theresa was one of the all time greatest fundraisers. She asked every head of state, every visitor to her convent and hospice if they would contribute. Even Mother Theresa was in it for the money.
Overcome your limiting beliefs about money. Make lots of money, and use it to accomplish wonderful things.
“Money never made a fool of anybody. It only shows ‘em up.” ~ Elbert Hubbard