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This week, I want to hammer home a critical priority: capturing every single hour of your time as an owner. A recent conversation with a consulting client reminded me how often we overlook this or, worse, concede time for free.

If you’re running a 1- to 3-person operation, your time is your most limited resource. Each year, you only have so many hours available to not just invoice, but also cover overhead, profit, taxes, inefficiencies, and everything else that comes with running a business. In the leanest setup, as a solo operator, you likely have around 1,600 hours a year of true billable time. Sure, you can aim for 2,000 hours (40 hours per week, 50 weeks per year), but without a team or administrative support, there’s no way to hit that without working yourself into the ground, closer to 3,000 hours to produce 2,000.

From a client optics standpoint, most won’t pay your rate for time not spent directly on their project. Try charging for picking up materials every morning and you’ll get pushback. Right or wrong, I’ve always found it smoother to only invoice for time actually spent swinging a hammer. But that leaves a big question: how do you cover everything else? Downtime, inefficiencies, paperwork, meetings, travel?

As a solo operator, this has to be baked into your rate or overhead. The hard truth? We often don’t charge for this. Our jobs consume us, we let hours slip by unpaid, and we end up working 3,000 hours a year trying to make 2,000 hours’ worth of wages. That’s a dead end, for your business, your health, and the broader market.

The smaller your company, the harder it is to capture your true cost of labor, downtime, and overhead. You’re amortizing all those costs across just one person. In my experience, this is the biggest struggle for small contractors: we either don’t realize how to account for these costs, don’t know how, or we worry that pricing ourselves correctly will scare away clients. The result? We face constant pricing objections because, at our small scale, we lack the economies that bigger companies have.

So, what are your options?

• You can keep working for free, grinding 60-80 hours a week just to survive.

• You can add employees to increase output and margin, assuming you’re ready for that.

• Or you can keep scratching your head trying to justify your “high” prices to price-driven clients.

None of these paths offer a truly sustainable business or lifestyle.

Here’s what I recommend:

1. Know your numbers. Understand your overhead, salary, taxes, and true cost of doing business. Then calculate how many realistic billable hours you have each year. For me, I’ve accepted that 1,600 hours of on-site, hammer-swinging work is my limit for a balanced life.

2. Adjust your rate. When I calculate my hourly rate, I don’t just factor in my on-site hours, I include the 8+ hours per week I spend running the business. I have to recover that cost. I wish I could bill clients directly for that time, but optics matter. Instead, I build it into my rate. I don’t waste time explaining this to clients, it’s simply part of my number. I have to figure out how to market and sell that rate. 

3. Find the right clients. Not every client values what I offer. Even wealthy clients have budgets. So I market toward specific clients and project types that do support my rate.

4. Prioritize efficiency. I stay lean to boost profit, not to offer lower prices. I have systems to stay ultra-efficient on-site: no supply runs mid-job, no wasted motion, always prepared. When I’m on the clock, I’m fully focused.

At the end of the day, 1,600 hours isn’t a lot of time to cover your wage, overhead, and margin. There’s little room for error, mistakes, or redos. My projects have to be dialed in: seamless, on schedule, and on budget. I must capture every hour of my time, or I won’t make what I need to make. This model takes discipline and time to perfect. It’s not for everyone, but it works for me. It gives me a sustainable, profitable business that supports my lifestyle and priorities, not the other way around.

If I want to scale, I can add a few employees (2-3 max) and replicate the same client/project model. But at this stage of my life, my business is a means to support my other passions and commitments. I capture every hour, charge a premium, and protect my time. My business is sustainable, profitable, and most importantly, not overwhelmingly complex or all-consuming.

For me, that’s the secret sauce.