Income Generation vs Income Protection – Where is Your Time Best Spent?

Income Generation vs Income Protection – Where is Your Time Best Spent?

Owning and operating a business can be the most rewarding thing you can do for your financial future. Along with all the good stuff usually comes with a whole lot of work and many long days and weeks. Business owners wear many hats:

  • You are involved in business plans and their execution. You determine how the income is generated and how the business spends money.

  • You oversee the management of employees.

  • You handle the management and care of the business facilities.

  • Marketing and advertising are your decisions, even if you hand them off to others.

  • You deal with product or service quality daily.

  • Protecting the business from threats, internal and external, is your job too.

  • Handling customer complaints is your job too, or at least you supervise the activity.

  • Your business decisions in all these areas are ongoing and they contribute to the success or lack of it in the future.

Some small business owners, especially those just starting out, work 12+ hour days, six or seven days each week, and then they do bookkeeping and planning at home in their “off time.” It is understandable, as many businesses fail in their first two years of existence, and often it is because of cash flow problems.

You don’t have to get into anything as complicated as time and motion studies to check and see if you are spending your time on activities that grow a business and your cash flow or if you are doing things that others could do as well. What if you replaced your time in those activities with business-building endeavorsi?

  • Bookkeeping & Tax Planning – Even if you are a digital geek and can do your bookkeeping entries in the latest super software or online, it is still time that is not contributing to business growth. How much time do you spend online researching taxes and how to reduce yours? What if you made a call or met with your accountant or tax professionals to make the top-level decisions and then let you know when changes are necessary? What if you took those research and bookkeeping hours each week and used them to call some of your best repeat customers and thank them?

  • Creating Ads or Marketing Pieces – This could be a good use of your time if you are a wizard at it, but usually the business owner is best at their business. Finding a better way to display products or to reach more online customers is a better use of your time than laying out a newspaper ad you could have someone else doing.

  • Insurance – Determine what you need through consultation with a business insurance professional, then let them set it up. You can better spend your time in understanding your risk and minimizing it to decrease your insurance costs over time.

  • Legal Issues – You probably are not a lawyer, so you are not making legal decisions, but are you NOT making decisions that could put you in legal jeopardy? Take the time and spend a little money to learn about your business risks and how to protect the business without your daily supervision. Is there insurance for some risks, or maybe legal insurance is an option? Set it up and forget it; go out and generate business.

  • Facility Maintenance – You make the big decisions about what the place should look like and the care and maintenance, then turn it over to someone else. Unless you are planning a change that will better display products for sale or attract more service customers in the door, do not spend a lot of time in the maintenance details.

Rather than taking each individual task and trying to see if it is worth doing, perhaps a better approach is to note the tasks that you know deliver customers, purchases, and profits directly. For each item, note bullets about what you can do to increase the results. For each bullet, check the tasks that do not generate business and delegate one out for each income generation task item bullet.

To take a top-level approach, determine which of the activities taking up your time and not directly resulting in more business, increased sales, or profits. Replace them with items off another list where you enter your activities that deliver customers and increase cash flow.

i CFO: Income Producer vs. Overhead, from


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