Sometimes we hear, "from that money you can go on an all-inclusive vacation in [insert tropical country] for 2 weeks" when mentioning the price of a website or a course, for example. For cheaper services, the comparison is sometimes made to a (high class) pair of shoes or perhaps in meals or dinners. But you make it a lot easier on yourself if you shift your mind. Here's how.
What is the difference between an ordinary investment and a business investment?
Yes, purely in terms of money, you can indeed dwell under the South Asian sun of a website and you can indeed buy a nice pair of Louboutins for a new corporate identity. But here's the thing: you're not going to use that money for that. After all, services are business investments and in this case you are (incorrectly) comparing them to ordinary investments (because YES, a sunny vacation is an investment in your pleasure, enjoyment and vitamin D level).
A regular investment is for private purposes and a business investment is for, well, business. Business investments you keep purely business and it only becomes private/personal when you transfer the profits from your business account to your private account. Only then can you start talking about those wonderful dinners. Until then, it's pure business. So how does it work? Don't panic, we'll explain it for you.
So how does that math work?
Business investments expressed in monetary terms
Don't calculate from private investments to business investments or vice versa, but for business investments use a cost-benefit calculation. When you want to make a business expense, ask yourself: what does this cost and what will it get me, from a purely business perspective? Some examples:
- Marketing essentials of €200 ensure that you know what makes you unique, what you stand for and where you want to go. You can then incorporate this in your strategy, social media posts, business presentations, etc. and within a few months you will have sold 100 products for €20,-. Not to mention the long-term benefits that good branding will bring you, because you will be appealing to the right target group.
- A coaching program with a business coach for €1,000 ensures that you know exactly how to set up your business. Within a year you will get 3 new clients who want to use your art service and you will convert €5.000,-.
- Web copy of €750,- hits the right chord, appeals to your ideal client and translates your message in a way that suits you and your business. This will bring 4 new clients of €1.000,- to your retreat, because they are so attracted to your texts and your company.
- A €3,000 website appeals to your target audience and gets you 10 new clients who purchase your photography service a €800 within six months. These clients you had through your current Instagram channel
Business investments expressed in time
But that doesn't have to be in money right away. You can also start counting in time. When you outsource something, it costs money (in most cases). Whether it's an accountant or a designer, you hire a professional because he or she can do it better, faster or more efficiently. This saves you time, allowing you to focus on the aspects of your business that you are good at. The power of specialization!
For example, you yourself might spend 20 hours creating your marketing essentials because you've never done it before. And then you also don't know what the results will be, because yes, you're doing it for the first time. When hiring a specialist, you pay not only for those few hours they do work for you, but also for years of experience, passion, knowledge and skill.
Incidentally, of course, this applies not only to services, but also to products. Just calculate how much time you waste per day when you have a slow laptop, work unproductively because you don't eat healthily or are in an uninspiring work environment. Then investing in a good laptop, healthy meals or a nice desk/co-working space is really worth it.
Business investments expressed in time and money
And sometimes you find out with very simple math that it is much more advantageous to hire a specialist. Think of a photographer. Who has invested in a nice studio, high quality equipment and maybe nice props like pads, clothes or makeup - not to mention the training and all the knowledge.
If you would have to rent such a studio yourself for a day and buy or rent the equipment + assets, you really are cheaper to hire a professional. And just to tie it back to the hours: how long do you think you'll spend figuring out, editing, uploading, compressing and rolling out, if you have no experience with this? Right.
How will you recoup your investment?
Now we don't mean to say that every business investment is worth it. Look carefully at what you currently need and whether it could benefit you. Not every business chooses to have professional photos taken, and that's okay. Maybe you prefer to opt for (free) stock images now, until you have more budget for a professional photo shoot. Maybe you're really good at copywriting yourself and you'll pick up writing those blogs yourself for a while, until you run out of time. The entrepreneur's service may be absolutely top-notch, but the business investment has to suit you. That's the most important thing when making a business investment.
So look carefully at what something can benefit you;
- Does it save you precious time or perhaps a lot of struggles/sadness/pain because you don't like something or aren't good at it?
- Does it save you money because someone else can do it much better?
- Does it benefit you in the long run by benefiting from someone else's knowledge or skills?
And then when you totally flourish because you made a good business investment, then you get to reward yourself nicely by depositing your skyrocketet profits into your private account and booking a trip to the sun 😉
