The best and simplest way to figure the cost of your time is to figure out how much it would cost to hire someone else to do the same task.

For example, you may think that if you work at home, you should also do the housekeeping. How much would it cost to hire a housekeeper? Would it cost $7 per hour? Could you use the time to make $10 per hour, yielding you a net profit of $3 per hour?

What about assembling products such as books? How much would it cost to have someone assemble the books? If you hired a teenager and paid her $5 an hour and she worked five hours and assembled 100 books, then it costs you 25 cents per book to have her do the job. If, during the same five hours, you can assemble 400 books, then your cost per book drops to seven cents per book and you are replacing yourself for $20/hour.

If you are working in your small business alone, you get to do all of the tasks: make invoices, fill orders, answer the phone, develop product, accounting, marketing, and run errands. You may consider much of your work unimportant and think that you could be inexpensively replaced.

However, due to the very diversity of tasks, your replacement would have to be a quick-learner. The employee would also have to be flexible, self-motivated and willing to stay with the business long enough to master a diversity of tasks. Help like that is usually expensive.

It is cheaper to increase efficiency by automating than it is to hire another person. For the cost of one employee, you can purchase every personal computer, software, fax machine and other labor-saving device know to man, sooner or later. Automation is not a luxury, it's a necessity. For the small business owner there are many temptations to waste time. If you are moving to your own business from a regular job, the initial freedom to waste time can make you dizzy. Here are my top time wasters:

• Food. With no clock to punch and no reason to follow a normal meal pattern, now is the perfect time to put on weight. If you are at home, the refrigerator is extremely handy.
• Friends and family. Friends and family do not understand working for yourself, especially if you have a home-office business. To most of them, if you don't have a job, you are available. Lunches with friends, classes for the children, a quick game of golf, church volunteer work -- the list of distractions from friends and family grows and grows. You may have to repeat "I am working," enough times to convince yourself.
• Personal. Reading the newspaper front to back, sleeping till 10, having the house remodeled, watching just one TV show every day, finally getting to all of those projects you stored up, committing to a daily workout schedule: the list of activities is as endless as the summer which may pass while you "take off from work".
• Junk mail. Once you have registered the business, the name spreads like wildfire from one mailing list to another. If you are a coupon queen or a flea market junkie, you may find yourself actually reading all that junk mail looking for bargains.
• Great ideas that aren't going to make any money. This includes the millions of products and services that you are capable of bringing to the market but know you never will. Do something valuable with these ideas. Give them to a business associate who can use them and create goodwill for the business you do have.

   

Some small business experts tell you to keep regular business hours, even if you are working for yourself. I hear that and I ask myself, why did you bother committing to your own business if not to control your own schedule?

What I recommend is that you decide to devote X number of hours to the business each week and be strict about doing that. Replace the letter X with a number that represents what you know the business requires to succeed. Plan accordingly.

The problem with just letting the business happen is that most of us fall into a pattern of working too little or too much. Owning your own business is different from working for someone else in that you are not rewarded for you work for at least three to six months. By sacrificing your business, you are sacrificing next quarter's earnings, but your bank account won't reflect that until next quarter.

The flip side of working too little is working too much. Some business owners start out or become workaholics. "Will Work for the Sake of It" is not a joke. It can ruin your personal life and the lives of those you love, can make you terribly inefficient and eventually reduce the business earnings because you are working less intelligently. No business will thrive with a business owner who doesn't back off from the business enough to keep a balanced perspective.

Schedule your week to take advantage of the control you now have over your time. You know that increased production is partially a result of efficient workers. You are your best worker. Increase your production by scheduling your activities around your own productivity cycles. The following categories of work must be scheduled:

• Sales. You must be available to answer the phone, meet with distributors and handle publicity during standard business hours, between 9 a.m. and 5 p.m. Your schedule should include some standard business hours during the week.
• Creative work that moves the business forward. Schedule this for your "gung-ho" time of day. If you find yourself on a creative roll, don't quit unless you have to. If possible, schedule your creative time to take advantage of getting on a roll. Then take more time off the next day to recuperate. If the creative hard work facing you is dreadful, schedule it in measured doses.
• Routine, non-people-oriented work which maintains the business. Entering receipts, printing mailing lists, filling orders, writing mundane business letters -- these tasks all fit this category. This work can be done anytime, even when you are feeling less than efficient, such as evenings, weekends or on quasi-sick days. Personally, I wait until a friend has a juicy topic for discussion. Then I set up my receipts to data enter and go to work gossiping!
• Errands. It is most efficient to schedule visits to retail outlets when other people are at work, particularly Tuesdays, which is Senior Citizen discount day because it is so slow. In addition, reduce errands as much as possible. Inquire about delivery services and use them to the hilt. Wait a few days and people will come to you. Buy priority stamps and use priority mail instead of overnight, to save yourself a trip to the post office.
• Meeting with clients. If it's up to you, schedule this for your most sociable hours. Don't worry about avoiding the crowds. If Friday lunch hour is your favorite time to get out, go for it. The point here is to put your best foot forward.

   

The first few months of owning your own business are the most difficult when it comes to scheduling time. Some days you may find yourself unable to function because you just don't know which task is most important. If panic attacks, take a walk.

One way to prioritize tasks is to play this mind game. Ask yourself, "If I was not going to be able to work in one month, which tasks would I wish I had completed or at least made significant progress on?". The answer are your priority tasks.

You need an organization system for keeping track of ongoing tasks so that you can get to priority tasks without too much thought.