Welcome to the Streamlined Solopreneur, a show for busy solopreneurs to help you improve your systems and processes so you can build a business while spending your time the way you want. I know you’re busy, so let’s get started.

Hello and welcome to Episode 456 of the Streamlined Solopreneur. I am fresh off my first speaking gig on stage in about 5 years. And, it was at Podfest. I talked about how you can save 6 hours per week through automation. And invariably when I talk about automation, I also talk about delegation, which ends up saving me even more time per week. 

One of the great questions I got during the Q&A, which by the way, shout out to everybody who stayed for Q&A after my talk.

I was the talk right before lunch and I know that people are like hungry and anxious to like walk around. And so the fact that you stayed longer like, into the lunch period just meant a ton to me. So thank you so much to everybody who did that.

But the question was, how do I know if it’s worth automating and delegating? And this is a great question. Right? Because there are definitely times where I have invested time and effort into automating when I definitely didn’t need to. 

So, in this episode, I’m gonna tell you about opportunity cost, where you should be investing time and money, and I’ll give you a rule of thumb for automation. 

So let’s get into opportunity cost. Something that has stuck with me since high school, since I took that economics class, and whenever it was 2002, was the idea of opportunity costs. This actually changed the way I think because I was already running my own business in high school, and it was my web design business at that time. 

You know, I, before the web design business, I started do like, selling mixed CDs and and whatever else I could do to make money in high school. That was in addition to my traditional high school job. 

So, my web design business was already in full swing. And so I had, like, concrete examples of this. And so what is opportunity cost exactly?

It’s the basics. The basics of opportunity cost are what is the cost of me doing one activity versus another? And the example that my teacher used was choosing to go to a concert on a Friday night versus choosing a shift at work. 

And, generally, the opportunity cost answer was if I chose to go to the concert instead of work, the opportunity cost would be the cost of the ticket, gas, and food, plus the lost wages. So just for easy Math here, let’s say I made $10 an hour and it was a 4-hour shift after school. That’s $40 in lost wages. Let’s say the ticket because this is 2,002 costs me $60. That’s a $100. Gas may cost me $20. That’s a $120. And let’s say food cost me $40. The opera wow. It was really cheap to go to a concert in 2002. The opportunity cost for me to go to the concert versus a shift at work would be a $160. Is that worth it to me? I would say, both high school Joe, and 39-year-old Joe would agree that is worth the opportunity cost. 

When you look at this in your own business, right, especially when we’re talking about automation and delegation, you wanna look at the cost of doing a task that you can automate and delegate versus a task that would win you billable hours. Right? And so the story that I told and one that’s available on my blog, I will link it in the show notes. You can find all the show notes in the description or over at [streamlined.fm/456].

But the story I told was about the time, the last time I mowed my lawn. It was, I think, probably 2001. It was during the pandemic. It could have been 2020. So it was during the pandemic. I wasn’t working a whole lot, because my wife was a nurse. If you are a long-time listener, you already know all of this.

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And so I wasn’t mowing the lawn on weekends. I was working on weekends, and we got a lot of rain that summer. And so I went about 3 weeks without mowing the lawn because I was working on weekends and, we were getting a lot of rain and then we had gone on vacation. And so when we got back, our grass was very tall. Right? It was, and it was we have kids. There are things growing in it and I had to take a day that a weekday that my wife was off to go and mow the lawn. 

So, I’m already trading a work day to mow the lawn, but I have the crappiest lawnmower on the planet. Right? We don’t have a lot of land and, so I didn’t really need like,a super good expensive lawnmower under normal circumstances.

But the grass was long. It was still wet. I had to weed whack. The hedges were overgrown, so I had to trim the hedges. I needed gas for the lawnmower. I needed oil for the lawnmower. I had to stop because the lawnmower kept getting clogged, and the weed whacker needed re-threading, I think is the term. 

So all in, I started this around 11 o’clock, and I wasn’t done until about 5-6 hours, it took me to mow the lawn soup to nuts because of all the times I had to stop. I had to go out and get gas because we were out of gas. I think I had oil on hand, which was good, but it took a very long time.

And I did the Math. Right? If I had charged, let’s say, conservatively, $100 an hour, but really my billable time is closer to $200 an hour. It would have cost me $600. Let’s say 600 to $900 that I lost that day because I had to mow the lawn. 

So then I decided that opportunity cost was not good enough. I don’t even like mowing the lawn. Like, it used to be right? Because I wrote this in my newsletter. Somebody wrote back and said, hey. I love mowing the lawn. It’s like just time to myself. I totally get that. I used to like it too. Right? I would go out. I would mow the lawn. I would smoke a cigar while I did it.

But then I realized I could just smoke a cigar. Like I don’t need to mow the lawn to smoke a cigar. And mowing the lawn became a chore because I had the crappy equipment. I didn’t really want to invest in good equipment. 

And so we looked for somebody to mow the lawn for us, and they charge now. They charged less when we hired them a a few years ago. They charge $37 per week from April to mid-November. So it costs me around $1,000 for them to mow my lawn for the entire spring and summer versus $900 I lost in one day if I was doing billable work. Right? 

I can hear some of the objections like, well, that’s assuming that you do billable work, but you wanna optimize your systems so that all you do is billable work. Right? I know that’s nearly impossible. Right? But you want to optimize for doing billable work as much as possible. This was a lesson in part that I learned when I was working my last agency job at Crowd Favorite. Right? They told me that I needed to have at least 35. I think it was 32 or 35 billable hours per week. And I told them, if you want me to do project management and team management and also development and sit in on meetings, then we better make all of those things billable hours.

And that’s not me. That’s not my job. Right? My job was to run the Front-end Development Team. My job was not to negotiate the contracts. And so if we’re giving them free project management or we’re not charging them hourly for project management, there’s no way I’ll be able to hit 32 hours, billable hours per week.

So automating and delegating helps you get closer to the billable hour stuff. And the other thing I’ll say here is if you’re listening to this, maybe you sell products, maybe you sell services that aren’t exactly billable hours, but you probably have an hourly rate in mind. Right? A rate where it is worth it for you to do the work. Right? Because you could say, well, you know, all of my projects cost $2,000. But if you end up spending 2,000 hours on a project, is $10 an hour really worth it to you? No. You’re gonna have some safeguard in place to make sure that you don’t take a bath on those projects. 

So, you know, I don’t normally make my, I don’t normally say it’s not normally a line item in my proposal that it’s like hourly rate. Right? Because the value I provide may be higher than that, or it just, it may not be like a one-to-one thing, but I know in my head about how long something takes me and how much I’d like to get per hour for it to be worth it for me.

So just keep that in mind. If you want, let me know at [streamlinefeedback.com]. If you want me to do an episode on pricing or hourly rate, or figuring that stuff out is something I’ve thought about since I was 14 years old. And so I have a lot of thoughts on this. 

But when it comes to opportunity cost, right, the whole point of this, right, is I didn’t wanna mow the lawn, and that one experience cost me just about the same amount of money in billable hours as it would have cost me to have my lawn mowed for the entire summer. 

So, like, again, going back to hourly rate, I don’t care if it takes them 10 minutes to mow my lawn, which it does about. And I don’t pay them for that. I pay them so I never have to think about mowing the lawn. So that I don’t because it wouldn’t take me 10 minutes. It on a normal day, it might take me 30 to 60 minutes depending on how long the grass is and how much I need to fix my lawnmower and all that. 

And so I don’t think of it that way. I think of it as I don’t have to do this task. I never even have to think about this task. They just show up and my lawn is mowed. 

So, think about the opportunity cost. If you wanna mow your lawn and it’s something that relaxes you, then by all means, do it. But when you think about your business, you need to think about where you’re investing your time and your money because it is more than just about what comes out of your wallet. Right?

I think that a lot of people, if we look at the lawn mowing again, right, they don’t see the opportunity cost. They just see the cost. In their head, mowing the lawn costs them nothing because no money came out of their bank account. 

Just like with the concert, most people look at the cost but not the opportunity cost of, well, I skipped a shift of work and that’s lost income. That money is not coming out of their wallet, so it’s not concrete yet. That’s why opportunity cost is a great concept. Right? So the people who do see the opportunity cost, they realize that where they spend their time is directly related to how their business grows and they start to earn more. Right? 

Warren Buffett once said that time is the only thing you can’t buy, which means that we need to win our time back. And we can do that through automation and delegation. You don’t need to do everything for your business. Right? 

And that’s the thing I’ll end with here. Right? Is I promise that I’ll give you a rule of thumb for automation, but we need to think about taking risks. Right? Hiring a VA for a couple of months is a pretty low risk to see if you can take enough off of your plate to do more billable hours or just take time off. Maybe you’re happy with the amount of money you’re making, but you want the freedom to spend time with your family. Maybe you’re starting to feel burnt out and you don’t wanna feel that burnout anymore. Is $50 a week for a VA to do a few tasks worth it for you to not burn out? 

So, I think automation delegation is about the smaller risk. I’ll also say here that I gave a version of this talk last summer, and someone said I’d rather copy and paste than have, like, endless subscription fatigue. 

And this was very obviously someone who didn’t value their time. Because yeah. Sure. When someone, you know, books a discovery call with me, I can take that information from the email and copy and paste it into my CRM in Notion. But that requires me to stop doing what I’m doing, copy and paste, and then get back into what I’m doing. Context switching is a productivity killer, and automation is something that prevents you from having to context switch so much among other things. 

So, yeah. I happily pay make.com $11 a month and zapier.com $20 a month so that I don’t have to context switch. So that I know these things are getting done without me forgetting that they’re going that they need to get done. So it’s about taking risks.

Okay. So let’s end with this, the rule of thumb for automation. My toxic trait is over-engineering. I like to see if I can automate something right off the bat, but you, when you’re thinking about what you should automate, if you do something once it’s not worth the time to automate, or if it’s like a simple task that you have to perform every 6 months. It’s probably not worth the effort of automating. But if it’s something that you have to do regularly that you have to remember to do, or if it’s a complicated process that you don’t have to do very often, then it is worth automating.

So usually, they say, if you have to do something if you regularly have to do something, let’s say, more than 

if you’ve had to do a task more than 3 times, it’s probably worth looking into automation. And doing the task is important because if you don’t do the task, then you don’t really know, like, what the inputs are and what the outputs are, and what it’s supposed to look like. So you’re gonna have to do the task at least once to see.

I think a really good example of this is I shared on LinkedIn recently, an automation I built, to email my garbage collection company because they very frustratingly our township switched garbage collection companies and we are, they offer bulk trash day the last day of the month. The old company would just come and pick up the bulk trash. The new company requires us to tell them we have bulk trash. And if we don’t tell them, they’re not going to pick anything up. 

And so I set up an automation to email them every month saying, hey, we have bulk trash. But going through this process the first time, this is not something you should have automated yet. Right? Because going through this process, the first time they asked what the item was. So like already, this is not something I can automate because I’m not going to know ahead of time what it was. And then the thing I told them I wanted to remove they consider an electric. It’s a Casio keyboard. So like we can’t take electronic devices, large electronic devices. We need a picture. So like this is already a whole dumb ordeal. Right? But I had never performed the task and I thought, well, just emailing them would be good enough when it wasn’t. So this was a task. Maybe I shouldn’t have automated or should have tried a couple of times.

Now, if my goal is to be a pain in the neck, right, then the automation is fine and I kind of want to be a pain in the neck. I want to make a point that if this is a service, the township is offering and I’m paying taxes for this service, then, you know, the burden shouldn’t be on me to make sure it happens. The burden should be on the service company. 

But if I’m just trying to improve my processes and make sure I don’t forget like a reminder. Right? Or maybe, my friend Scott said, like, maybe generate a draft email and then that’ll be a reminder to send it if I have something because then I can fill in this is what I have. So your rule of thumb. 

Let’s recap really quickly. Right? Opportunity cost is the cost of doing one activity versus another. Classic high school example, go to a concert versus a shift at work. The most recent, well, not the most recent, but the most prescient example for me is mowing the lawn. You need to think of something that you’re doing that you probably don’t need to do. Think about taking risks because these are small risks that could pay big dividends. Right? Think about where you’re investing your time and money and consider hiring a VA on a trial basis to see if it works out. It doesn’t have to be super expensive. And the rule of thumb for automation, if you’ve done something more than 3 times, it’s really repetitive, then it’s worth automating. 

So that’s it for this episode. I hope you enjoyed it. 

If you have questions or feedback, you can send that over to streamlined with the ‘d’ [streamlinedfeedback.com]. It’ll all be in the description and in the show notes, which are over at [streamlined.fm/456]. 

Thanks so much for listening, and until next time. I’ll see you out there.