I often ask people the following question: “How do you make money?” and then I get answers like:
- You sell stuff for more than it cost you to buy or make.
- You address your client’s needs.
- You solve problems.
The list goes on and on…
The truth is that it is illegal to ‘make’ money as it is the government’s job to ‘make’ money; we are only allowed to ‘earn’ money.
So how do we then earn money?
Let me share my view with you:
- To earn money, you have to create value worth paying for. In other words, someone else must be willing to trade their hard-earned money for the value you have created.
- This is a very simple concept and if you want to truly see the impact of this in your life and business, you should continually focus on understanding what value you create for your employer or clients. This will enable you to focus on the 20% that generates the 80% of your revenue, leaving you with 80% more time to refocus or simply spend on things such as your family and friends.
- If you are employed and earning a salary, you must understand that you get paid to help your employer realise his/her vision and dream and if you don’t play your part, you will be replaced by someone who is willing to. So, figure out what value you must create to help realise the business vision and you will be rewarded with freedom and flexibility, if you don’t, you will be punished with policies and procedures.
- If you are a business owner, you must figure out what value you create for your clients. If you don’t understand this and the market shifts or your client’s needs change, you might be left with a failing business and not know how to redirect it.