In this episode of Life of an Electrical Contractor, I address the three most common mistakes that entrepreneurs make, whether they are electrical contractors or any other business owners. If you don’t address these mistakes, you will lose out on more money than you can ever count, burn yourself out, and lose the love you once had for the business you worked so hard to build.
The first is, invoice correctly. Many entrepreneurs make the mistake of fitting in the time to crunch the numbers when they have a slow day, but this pattern sets you up to be chasing money that is owed to you, and giving your labor away for free. Second, know your numbers. Entrepreneurs often overlook hours and expenses, and don’t realize that they are losing money. Third, pay yourself. As a business owner, you want to reinvest into the business, but if you don’t set a specific, measurable rate for your labor, you will undervalue your own time, and never be able to make a profit. To hear more details, and learn how these lessons can come home with you after work, watch the episode.
0:30 The top 3 mistakes beginner entrepreneurs make
1:20 1 – Bill/invoice correctly
2:20 Why I didn’t invoice correctly early on
3:45 Maybe you’re going through this and don’t even realize it
4:38 Are you screwing yourself with your billing cycle?
5:50 Create the system to fix the problem
7:20 The people you invoice aren’t your friends
8:01 2 – Know your numbers
9:57 Breaking even means you lost money
11:55 How do you calculate your hourly labor rate?
13:02 Don’t wait until you lose money to realize it
14:58 It’s painful but rewarding when you see how much you’re making
15:42 3- Pay yourself
16:35 When you pay yourself, you know what to charge per hour
17:54 You drive the business, you have to fuel yourself
20:30 Why be in business if you’re not going to pay yourself
22:25 Everyone makes these mistakes, not everyone discovers them
24:15 Why you need to know these three things, no matter what level you are in business
26:33 Wrap up, don’t forget to like and subscribe