1920 is not the celebration of a centennial.
But what follows is probably the most important article you’d read today.
So pay attention.
Most businesses operate between 9am to 6pm on weekdays.
As an executive, it is safe to assume that you’ll be working during those hours, with an hour lunch break. That equates to 8 hours every week day.
Multiply that number by 5 gives you the total number of work hours in a week.
Then multiply that by 4 weeks in a month and 12 months in a year.
The final answer—1,920 hours.
I’m pretty certain you work more hours than that. But I digress.
To hire an executive at an hourly rate would seem like an insult.
Yet, that’s the reality.
Given that an executive works 1,920 hours a year, with an annual remuneration of $154,000, that works out to about $80 an hour.
Trading time for money
Now, for a freelancer to earn the same amount as the executive above, our friend would need to charge at least $80 an hour.
Of course he’ll need to charge more than that. But let’s keep it simple here.
Given the conventional way of trading time for money as a freelancer, if he wants to earn more, there are two options available to him.
- Charge a higher hourly rate. Want some tips? Listen to Ramit Sethi with Chase Jarvis on doubling your rates.
- Get more clients. Learn how to get more clients via Chris Do.
By charging a higher rate, you inevitably price yourself out of certain markets. This can be a great way of alienating those who aren’t your ideal clients.
That said, I would argue this may not be feasible for most, especially if they are a one-person business.
Getting more clients is another great way. However, that can quickly max out when you have more clients than you can handle.
A new paradigm
Therefore, to achieve the goal of building a one-person, $1M business, we would need a new way to do business.