I think the worst problem that bright freelancers or founders face is the length of the day.
Regardless of how good or fast we are, there are only 24 hours in a day, and no more than 7-8 of them are dedicated to working. This means that once we get some traction, we hit an impenetrable barrier.
At the beginning of our career or business, this problem is not so visible…
We still have to work hard to attract clients, and our schedule is freer.
But the moment our business gets running, we realize that our opportunities to take on new clients and projects are severely limited.
There are several methods of alleviating our situation, and this article is about one of them.
Namely:
💡 What is “leverage” and how to use it?
Let me remind you that a lever is “a rigid bar resting on a pivot, used to move a heavy or firmly fixed load with one end when pressure is applied to the other” (Oxford Dictionary).
It is used for lifting heavy loads due to its length.
Therefore, if a person wants to lift a load heavier than themself, they will use a longer lever.
Do you remember what Archimedes said?
“Give me a place to stand, and a lever long enough, and I will move the world.”
In our case, we are not talking about a wooden bar, but we are making an analogy between it and any other tool that helps us achieve disproportionately greater results than usual.
For example, in financial theory, loans taken out to supplement one’s own money and thus invest a higher amount are “financial leverage.”
If you have $10,000 and an investment with a 5% annual return, you will have $10,500 after one year. You have earned $500.
But if you take out a loan of $90,000 and add your $10,000, then the investment is $100,000. At the end of the year, you will have $105,000. You have earned $5,000.
Of course, you have to pay back the loan with interest! So the profit is less.
And it should be clear that the RISK is much greater. In the first case, if the investment is unsuccessful and leads to 10% losses, this means that you will get back only $4,000.
But if you “played” with loans, you would lose $10,000. In other words, you would get $90,000 back, just enough to repay the loan minus the interest. So, the loss would be even more than $10,000.
Anyway…
We can achieve some “leverage” in our business…
How?
Well, with the help of:
💡 NINE TYPES oF “leverage” to get more work done faster
To overcome the barrier I talked about earlier, we need to approach it SMARTLY.
The reality is that if we rely only on our own efforts, we will never make good progress. No matter how productive we become… No matter how proficient we are…
Why?
Because with the right leverage, we can achieve MULTIPLE times more. For example, 10 times or 20 times our own efforts. Such an increase is not possible with manual labor.
Therefore, if we want to do 10 or 20 times more work and have much higher income, we must use one of the following 9 “business levers”:
1. Automation
If we find a way to use software and bots in our daily lives, we will be limited only by the demand for the products we produce with their help.
We can rent huge servers that spew “product” around the clock…
The question is, is anyone going to buy it?
For example, a freelance marketer can use ChatGPT to quickly and easily create documents such as an “ideal customer profile,” “list of article ideas,” and even pretty pictures for social media.
2. Outsourcing / Subcontracting
Outsourcing is a modern and affordable leverage for achieving more results.
In one sentence:
It means hiring freelancers or companies to do some of your work for you. If their rate is lower than the rate you get from the client, then you can make a great income from the difference between the two.
The only things that limit you are your ability to find new clients and the number of “projects” you can manage and coordinate simultaneously.
For example, if you are a freelance copywriter, you can take on more significant tasks involving graphic design and even Facebook page management. You can outsource part of the work to another freelancer.
3. Hiring employees
In practice, we are talking about the same thing as outsourcing, but this time, you are making a bigger commitment.
You must sign employment contracts and manage full-time employees. I am not a fan of this leverage and would only use it as a last resort.
But others like to deal with that kind of stuff.
4. Information products
Here we are talking about the creation of e-books, online courses, templates, checklists and other digital products.
Why are they a “leverage”?
Well, because you create them once, then you can repeatedly sell them to many customers. You can offer them even to people who have not purchased anything yet.
For example, a freelance graphic designer can create various “templates” with beautiful pictures and text for social media to sell to clients after hiring them.
So they earn extra income WITHOUT SPENDING MORE TIME (which they don’t have).
5. Productised Services
This leverage is about creating services that do not require extensive customization and personalization.
In other words, you offer the same service to everyone.
The trick is to formulate it so that it takes as little time as possible without compromising quality.
For example, the WordPress site designer uses “templates” that allow them to create certain types of websites quickly. This way, programming and design resources, which are usually quite expensive, are optional.
6. Consultations
Consulting is a great way to make the most of your time.
If you are a good specialist, you possess knowledge and skills unavailable to your clients. They often don’t even know precisely what they’re looking for!
This is an excellent opportunity to explain it to them during a paid consultation.
For example, a social network marketing specialist can sell consultations on “Which social network is the best to advertise on?”.
7. Product reselling
The idea here is to find products that complement your offerings but that you are unable to produce. Accordingly, you resell them for a small markup.
But don’t make the mistake of believing we’re not discussing a good opportunity!
Some people deal only with reselling or recommending products (affiliate marketing), and that way, they generate substantial income.
8. Software
This type of “information products” deserves its own number on this list.
Just like books and online courses, software can be created once and sold unlimited times. Therefore, it offers a good profit opportunity.
And you don’t even have to create it yourself!
For example, many hosting companies offer their services for resale with “white labeling.” This means the product version does not have their logo, colors, or other company marks.
So you can brand it and sell it as your product.
9. Premium prices
This is my favorite leverage for achieving higher income from the SAME amount of work.
If you have a quality product or service, plus a solid track record, you can easily double your prices without the new sales costing you twice as much effort. This means you immediately double your revenue.
Great, right?
Summary
- We all have only 24 hours in a day, which limits the amount of time we can spend working.
- If we rely only on our efforts, it will be tough for us to make real progress because no matter how much we improve, we cannot improve 10 or 20 times more.
- Business leverage helps us multiply the result of our time and efforts many times over, and in some cases, there is not even enough “demand” to absorb everything produced.
- There are 9 excellent types business leverage that help us level up our productivity.
