Choose a mentor if you want the following question answered well: “How do you build a profitable extra income?” That is question that many people ask. If you are already working a full job, it is difficult to imagine where you will get the other hours to devote to building another income, but it is possible. To keep it easy, I am not going to go into the details of the product or service that you are going to use to build the second income, but rather about the principles involved.
Calculate the number of customers that you need:
I am going to use rands here, but the principles will work in any currency. Let me use an income target that is applicable to me now and you can then apply that to yourself. I want to improve my current income by R50 000 per month. I know that the profit per month per active customer is about R20 per month. To calculate the number of customers I need, I take 50 000 and divide that by R20. This amounts to 2 500 customers that I and my team must add.
Calculate the size of the team that you need:
How many customers should my team members have on average? Let us assume (because I do not know) that this figure is 20 customers. We need a total of 2500 customers. So we will need 2500 divided by 20 which is 125 team members in the team.
What will a team member earn per month?
This will depend on how much product or how many services an individual customer will require, but on average the income will be about four times higher than that of the team leader. You could expect this to be R80 per customer. For 20 customers the earnings would then be R1600 per month on average. If a team member is looking for more income he would have to increase the number of customers or the amount of products or services that the customer would require. An income requirement of R5000 per month will require roughly 63 customers every month. Some team members will be happy with an extra R1600 per month but others may require more.
How many people do I need to talk to to get one team member?
There is a set formula or ratio that you could calculate to see how many people you need to talk to. In the beginning you do not know how many people this should be, A guess would be to say that one out of five people that you talk to may join your team. In my case I am looking for 125 team members which means that I will have to 625 people and get them to consider joining my team. If I want to do this is a year, it means that I need to talk to 2 people a day where they will consider joining my team.
Initially my ratio may be 1 out of ten but as I get better and more confident this ratio may change to one out of three. Keeping accurate records will help to calculate this ratios. As you get better you will get to one out of three eventually.
Work with a mentor or coach
Once you have done these numbers it is vital that you start working with a mentor or a coach. His job is to guide you to the right approach and system to use and to help you to stay focused. One of the most important things the coach will help you to uncover is the reasons why you want to do this. If the why is strong the plan and the execution of the plan will follow.
To summarize what you need to do to build an extra income:
Calculate how much extra you want.
Calculate how big your team should be.
Calculate how many people you need to talk to.
Keep accurate records when you have started talking to people.
Get a mentor and start with a practical plan.
