Difference Between Investments and Expenses

TweetTry to pry that dollar out of my hand.  Go ahead — try it.  Punk.  :)

I don’t spend a dime on my business if I don’t think that it is going to come back to me in some way —- otherwise, why spend it?  If I buy a printer cartridge, it is so that I can print invoices or directions to a potential clients place of business.

But some things we spend our money on as business owners have a direct (or more direct) ROI than others and we should think of them in that way.

Perhaps, we should take more time in measuring the return we get from these costs.  Perhaps we should not make a decision to purchase/not purchase these items based solely on cost.

Developing a website, for example, is an investment.  If you spend $2000.00 on a website, you expect that you will make at least that much back in sales revenues directly from that website.

But don’t think of these expenses…

• Building a website
• Attending a sales training course
• Joining a prestigious industry organization
• Paying dues to a Mastermind group

the same way you think of these expenses…

• Pens and Pencils
• Laptop purchase
• Postage
• Office cleaning

Think of the former as more of an investment than the latter— this means that you must monitor the RETURN you are getting from these expenses.

Are you spending hours and hours with your Mastermind group with little to show for it? — this can be expensive.

Is your website helping to fuel your sales pipeline?  — you need to measure to find out.

Did that sales training course pay off in the end?  — if so, the expense is justified.

When you measure, you may find that these expenses are much more or much less expensive than their sticker price.

What are your thoughts?  What kinds of expenses do you think of as investments?  Why do I have a picture of Clint Eastwood on this post?  :)