Small Business: How to Set Limits on Giving
I’ve personally learned to set limits on giving over the years, and approach each relationship as a business investment. Some people may think it’s a horrible approach, but I learned from my mistakes in life. This is why I don’t regret what I’ve done, which is definitely a good thing.
One holiday year in my early 20’s my former partner and I had actually purchased over 100 gifts, which made no sense since we put it on credit cards (my credit cards). After years of struggling and working up to 3 jobs, I got it paid off finally and was debt free for a while. Unfortunately when I got into my second relationship, I chose to help rebuild my partner’s credit but therefore put a huge strain on my own. I’m again in the process of rebuilding my own again. What can I say ‘“ I’m a caregiver by nature which I inherit from my mother who’s a nurse by profession.
As a small business owner, I’ve learned a lot in setting limits on giving too. There were clients that I would go to the moon for, but as far as the amount of money I made from them was nominal, compared to those who made up the lion’s share. I’ve also obtained two clients who are nonprofits, and in order to feel I needed to sell myself, I offered a discount on services. Yes it did help me with a great feeling of ‘œdoing good where I could’ in the beginning but financially it hasn’t. All told, over 20% of my sales income this year will be expensed off as discounts for their work; a rather huge number for a relatively new small business owner struggling.
I have learned to look at everything from a business outlook now in my life, whether it’s personal or just business, and I ask myself the same questions before, during, and after:
1. What financial benefits will there be should I choose to pursue this avenue and is it the most profitable?
2. What emotional benefits will be reaped should I choose to pursue this avenue and is it the most profitable?
3. Will it benefit me in the long-term or is it only a short-term solution to a long-term problem?
4. Will the relationship benefit the other side?
5. Do I have options should I need to get out of the situation?
Everyone talks about impulse buying and how it’s extremely wrong for you, especially in the economic state we’re in now. However, no one talks about the issue of impulse relationships and the lengths we go towards giving, ultimately for the feeling of validation, which everyone seeks on some level.
You have to ask yourself, is it worth it in the long run? How much are you willing to give until a Return On Investment? Do we simply need basic validation? Ask yourself these questions next time when you’re presented with an opportunity and find out if it’s really worth it. You’ll thank yourself for doing so.
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Dwayne J. Briscoe, Owner
Bookkeeping-Results, LLC
Dwayne@bookkeeping-results.com
Photo credit: stock.xchng.
Dwayne: Welcome to Queercents. We look forward to you sharing your perspective. One of our other writers, Paula G. has echoed this advice a few times. Readers that can appreciate this post, might also like what she outlines in her post: Are You Putting Yourself on Sale?
I’m curious what your view is on bartering, since it seems like small business owners are often asked to trade services. Is this type of “giving” worth it to you? And if so, what are you typically willing to barter for?
Great first post, Dwayne. It’s so important for people to charge what they’re worth. I think this is really hard for women in particular, because we’ve been socialized to believe that our work is less valuable.
Hi Nina, from a tax standpoint, it’s based on the following type of scenario, I offer bookkeeping services to a computer tech, who offers to fix my computer, for generally the same value, and then we are to provide a 1099-B to the IRS.
When it comes to something personal, I am less likely to be interested in doing something along those lines. I have spoken to people about bartering before, but they’ve always been gun shy simply because they’ve had a bad experience from it so we never explored it further. If it’s something that would benefit me personally though, I would be less inclined because I would be putting my professional reputation on the line if I didn’t have a written agreement in place and also the liability would be at a greater risk because I would not be acting in a professional capacity and my insurance likely wouldn’t cover it. I hope this answers your question.
Love the thought on “impulse relationships”. It is so easy in the heat of the moment to want to compromise or to give consulting away for free or offer someone a big discount on your business’ services only to regret it later. You need to take care of yourself on all levels, including financially, if you want to be able to give freely and joyfully to others….
Thanks for writing for us!