How To Realistically Set Your Fees - Part 2Written by Chuck & Sue DeFiore
Effect of Expenses
The last article examined how to calculate your realistic billable hours. If you remember, we arrived at approximately 1100 hours in a year. To earn our mythical $46,000 per year, you needed to bill at a rate of $42 per hour. Now we need to take into account expenses of running a business and see where those put our hourly rate.
Most costs fall into three general categories: business and office expenses; salary and personal taxes; and, benefits and profit margin. In this article, we will concentrate on first category, business and office expenses.
Everyday expenses are part of doing business, and these must be reflected in prices you charge or you will not be in business for long. Expenses to consider are rent for office space. If you are home-based, you will still have an increase in utilities, such as gas and electric over your regular household bills. You will have telephone costs, postage, copying costs, stationery, office supplies, subscriptions and possibly, membership dues.
You will also need to make periodic upgrades to your office equipment and furniture. Items such as computer hardware and software; fax machine, copier, filing cabinets, telephone headsets, etc. All of these items add to hourly rate you charge for your services. You must have a good estimate of what these costs total each year or you will end up cheating yourself. If you do cheat yourself, you are going to drastically increase your stress levels and lose much of enjoyment of running your own business.
Let's plug some numbers into our costs and see how they affect our hourly rate.
Organizing Your Day Written by Chuck and Sue DeFiore
One of hardest things for most individuals working from home is to stay focused. One of best ways to stay focused is organization. In addition, being organized will help your time management skills. The two are very much intertwined.
Planning out your day is very important. What you will do in morning, afternoon/and or evening, depending on what hours you work is paramount.
Have a trigger that starts your day. For example, my trigger is I finish my morning walk. Once this is done, I make a cup of Java and to office I go.
Once in office, computer goes on, along with auxiliary equipment. I check my tickle file, my calendar for day, and pull my To-Do file.
While I am looking at these items my mail program is working to check e-mail. I delete junk and deal with additional mail by answering it, or placing it in a folder to deal with later.
At this point depending on your business you should start dealing with items in your tickle file and To Do List.
For those of you just starting to run a lease purchase business you should be doing following:
Check your goals Check your calendar and tickler file Check your e-mail and answer If you need to, go through your newspapers and your other lists for sellers to call. Otherwise, do your call backs and set up appointments if appropriate Start calling - 1/2 hour from each list Send out follow-up information Enter calls in database Read in your area, both on and off line Visit on-line groups that relate to business Check e-mail and respond Do your To Do list for next day Add appointments to calendar
For those of you in lease purchase business be sure to check your Step By Step First Month in your manual. Remember it outlines what you need to do first month. The above list will vary for you, if you need to drive neighborhoods, meet with sellers and/or tenant buyers, put up flyers, or speak at meetings.