Profits are Better than Wages
In September 2008, Jim Rohn spoke to me from the cd player in my car.
I had just started my new business, and my sponsor had recommended one of Jim’s audio CD’s “Building your Network Marketing Business”. As I listened, I was enthralled by Jim’s charisma, has passion, and the way he told magical stories to illustrate his points.
I loved his philosophies…
- “Work harder on yourself than you do on your job”
- “For things to change, you have to change”
- “It’s not what happens to you that determines your future, it’s what you do about what happens to you”
Profits are Better than Wages
One phrase in particular struck a chord with me. Jim said “Profits are Better than Wages”.
I liked the sound of that. It felt like the sort of thing that a business, an entrepreneur, or a mentor would say. So I waited for Jim to expand.
… but he didn’t.
I wanted to know more. Why are Profits better than wages? I know it sounds right, and my gut feel was good, but I needed to be able to understand why.
I kept reading more and more of Jim’s works, listening to recordings of his seminars and conferences, but never really heard any more to explain what he meant.
Then, finally, many years later, I was just listening to that original cd, just in the background, not really thinking about it, and suddenly a light-bulb went on in my head.
I suddenly had an understanding of WHY Profits are Better than Wages.
This is my reasoning…
You are paid a wage for the hours you work. Jim says you are paid for the value you bring to the market, but it takes time to bring that value, and if you are in a job, you get paid an hourly rate.
That could be £5 an hour, £10 an hour, £50 an hour, £100 an hour.
However – there is a limit to what you can earn on a wage, because you can only work so many hours a week. Maybe 40 hours a week. So the maximum you can earn is 40 times your hourly wage, per week.
If you want to you could take another job, maybe then you would be paid for 60 hours a week. But you can’t make any more hours in the week.
Profits are different.
You make a profit by selling something, a product, for more than you paid for it.
Let’s say you have a product that costs you £20 wholesale, and you sell it for £25. So you make £5 profit on each item you sell.
Now at the beginning you might only sell one or two a day, as you grow your business.
But if you are smart, and you use the internet to help with your selling, or you have a team of people who are selling for you, then you could sell 5 a day, or 10 a day, or 100 a day, or 1000 a day, or 10,000 a day.
… and you make a profit on each one you sell. So there is no limit to your profit. You can earn far far more.
10,000 x £5 profit a day is a lot more than 40 x £5 per day in wages.
That is why Profits are Better than Wages.
If you would like to start building a business, and earning profits instead of wages, then we can help. Just click here for a Free Information Pack.
Chris and Sarah Smith
Tel: 01425 470558 or 07956 327327