Pay Time

Most professional service providers, small business owners and entrepreneurs understand the difference between billable time and non-billable time. Billable time is the time that your customer pays for when you’re meeting his needs and non-billable is when you’re doing “work” stuff that you have to do, but can’t charge for, like billing, cleaning your office, making prospecting calls, selling to new customers, getting supplies, ordering stock, paying the business bills or employees.

Today I read a great article on clutter and was reminded of another time concept. Pay time vs non-pay time. Obviously, Ariane is dealing with personal clutter, so it’s not billable, not pay time, it’s personal time. But, if she were dealing with business clutter, whether she was dealing with it on Sunday, a holiday, or the middle of a business day it would be non-pay time. Pay time in my mind is time that is put to activities that are or lead to being billable. Non-pay time activities may be necessary, but should usually be done secondarily.

Here are some examples.

1.) Calling or meeting with prospects, customers, clients, referrals looking to increase sales, good will, or check on service is a pay time activity and gets primary placement in your schedule.

2.) Billable time is a pay time activity and gets primary placement on your schedule.

3.) Working on your website, placing a help wanted ad, doing payroll, cleaning your desk space, picking paint for your office, meeting with a disgruntled employee or your employer are non-pay time activities and should not happen during pay time.

4.) Golf with prospects or clients is pay time. A lesson so you won’t embarass yourself is not.

5.) Lunch with a client is pay time. Lunch at your desk reading a trade magazine is not.

You may need a website, but if your business is a breakfast restaurant, it’s pretty easy to see that you don’t won’t to work on your website while your customers are waiting for their pancakes. Nor would you want your pancake batter salesperson to be bothering you while the place is full of hungry customers.

Sometimes billable time can be moved around. If a lawyer needs to depose a witness from 9-11 am, that needs to take priority over calling prospective clients. However, if a web designer is getting paid to design a website, he may very well be able to be billable between 11 pm and 2 am which turns the overnight into pay time. Obviously, the more billable time you have, the more money you’re gonna make, and the more pay time you have, the more money making activities you’ll be able to perform.

These are some specific personal examples for me.

Notice that I typically write in my blog early morning or late evening. It’s a non-paytime activity for me.

My #1 pay-time is talking to people. So, from 7 am to 7 pm I’m on the phone, in a meeting, at an event where there’s people for me to talk with. Yesterday, I had a staff meeting at Burkinshaw Law. Absolutely important…non pay time activity. I’d prefer to teleconference at 9 pm. My associates won’t go for it. So, I have to give up pay time to do non-pay time stuff (meet with them). Today, I’ll be meeting with the guys at DKA to start the development project for Steve. Absolutely essential, but I’ll have to give up “talking to people” time because the guys at DKA want to see their families tonight. One other example. You know I use email a lot. Mostly early morning or late evening, because from 7 am to 7 pm, I want to be talking to people. Rainmakers do the stuff that grows their business first and email, letters, research, etc. happens when pay time can’t happen.

If you have specific activities that you’d like to ask about, feel free to use the comment link to ask.

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7 thoughts on “Pay Time

  1. Great blog Rick! Is it okay to do non paytime activities once you’ve achieved your daily goals for pay time activities? If I hit my daily goal of 20 cold calls can I treat myself to reading that magazine, rearranging my desk clutter etc or does one press on and try and make 30, 40 calls?

  2. You are the boss of you!

    Really, we’re at the end of May. If your plan says (for instance) 20 calls/day for two demos yields one sale for $1,000. We’re at the end of the 5th month, if you’ve made 1,000 calls and 100 demos, closed 50 of them for a total of $50K, do you really need permission to take the rest of the month off? You’re done! You did it! Unless…..the bar is set too low. I’m not an advocate of the “do as much as you can mentality”. I believe in setting goals, attaining them and setting higher goals, and attaining them and setting higher goals….However, my friend, Linda Cohan preaches balance in all things. I know several very successful people who have been through very messy divorces. I know many happily married people who don’t have two nickels to rub together. Sadly, I know successful people who shouldn’t be parents. It’s difficult to live by other people’s standards, so if 20 calls provides the standard of living that you want for your family, go home and play catch with your kids. If 20 calls isn’t enough, contact me and let’s see if I can make it enough.I hope this helps.

  3. I received this comment off line but had to share it because it exemplifies the struggle that we deal all with daily. Ariane, the blogger that prompted my blog today replied offline with, “………For me, I find clearing my own clutter a critical part of my business…if I don’t do it myself, I feel like a fraud helping others do it and that comes through. It also inspires me to write…which in turn is getting me closer and closer to my book and making more passive income. So in a way clutter clearing for me is Pay Time!'” So, honestly I don’t know enough about Ariane’s business, clients, income to know whether she’s avoiding “productive work” by clearing her clutter or not. Here’s what I’m thinking might be an anology. I absolutely want my lawyer to have read every article that was in Lawyers’ Weekly, but #1 I don’t want to pay him to do it, so it’s not billable. #2 should he be doing it when he could be talking to clients, fixing his clients’ problems, talking to judges, appearing in court, or other things that couldn’t be done, when he could be, in fact, reading Lawyers’ Weekly? So, you decide and tell Ariane using this link………Should Ariane be uncluttering her office during “pay time hours” or should she be talking to existing or prospective clients or even writing her book?

  4. I can see that you are an expert in this field! I am launching a website soon, and this information is very useful for me. Thanks for all your help and wishing you all the success in your business.

  5. I like your style, the fact that your site is a little bit different makes it so interesting, I get fed up of seeing same-old-same-old all of the time. I’ve just stumbled this page for you 😀

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