Guest post by Erin Blaskie
Does your business only have one income stream? Meaning, one way that you receive revenue from your paying clients?
If so, please read this post as this marketing concept might very well change your business and your life!
If you’re a one-revenue pony, you probably trade your time for money. This means that you probably sit at your desk (or on a couch or stand on a stage) and you do something in exchange for income. Maybe you provide a service or maybe you provide your insight and advice or perhaps you provide a speaking event. Whatever it is, you have one way to produce revenue.
Now, let’s imagine that you have a cap of eight working hours in each day. I know you may have more or less but let’s just say eight for the purpose of this example.
With eight working hours, let’s imagine that five of those hours produce you revenue whereas the other three are spent answering e-mails, creating proposals, entering expenses, etc. – all of the business stuff that no one pays you for.
If you have five billable hours in each day, let’s figure out your earning cap. We all have one – this earning cap is the maximum we can possibly earn if we only do what we are doing right now for the rest of our working life.
Five hours multiplied by your hourly rate is equal to your earning cap.
Here’s an example:
- 5 x $50/hour = $250 per day
- $250/day x 5 days/week = $1,250/week
- $1,250/week x 52 weeks/year = $65,000/year
See? You have an earning cap. Most people who come to me say, “I want to earn six figures” but they have no idea whatsoever how much they would have to earn in order to actually MAKE six figures per year. They just want that elusive figure. So, let’s see how much someone would have to make per day if they wanted to earn $100,000/year.
- $100,000/year / 52 weeks/year = $1,923/week
- $1,923/week / 5 days/week = $384.60/day
- $384.60/day / 5 hours/day = $76.92/hour
You can use the equation above to figure out how much you need to earn per hour in order to hit your various revenue goals. This will help you to understand how much you really can make without trying to over extend yourself.
Now, imagine that you had your five billable hours each day per the example above AND you had other revenue streams.
Imagine what it would be like to see sales come in from other sources where you aren’t actively working. Imagine seeing sales come in at night, when you are spending time with your family on the weekends and while you are vacationing.
Other revenue streams instantly boost your earning cap. In fact, adding income streams to your business blows the roof off of your earning cap because there is NO earning cap when you have the potential to make income wherever you are, regardless of what you are doing.
These other revenue streams can come from information product sales, affiliate revenue, group coaching and online training as well as membership sites and more.
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About the Author: Erin Blaskie, also known as the Bizinatrix, is in a hot, passionate love affair with the Internet. Whether she is leading her team of creative, outsourcing professionals or sharing information via the web, Erin brings to the table her enormous passion for tech, geek and the Internet