A thought popped into my head recently, which I call ‘Chunk Value’. (The idea, not my head.)
Your Chunk Value is the smallest unit of money you feel good about working for. It’s the minimum amount you’d consider for a given project or job of work without feeling slightly resentful. It’s the get-out-of-bed-without-grumbling fee.
For a coffee shop owner, chunk value is low – £2 or so, the price of a latte. For a car dealer, chunk value is higher – £10K or more (or £1K or more if you look at profit margins rather than sale price.) For a venture capitalist, chunk value may well be £10m and up.
Deciding on a business’s Chunk Value (even better, determining it) can be useful, because it gives you a solid indicator of which projects to take on and which to turn down. For example, I never work for family businesses or private individuals… and doing a few quick calculations from the past, I notice those projects are ALWAYS the ones that carried low/zero profit, providing a concrete justification for something that, until now, has been just a personal preference.
I prefer to have a few solid clients rather than a writhing mass of them, so my ‘Chunk Value’ is quite high – £2000. That’s the value of project where I start to actively chase and ‘want’ it, the point where I start feeling good about what I do, rather than just being a worker ant.
The Chunk Value Theory also part-resolves a business problem I have right now: growing my biz beyond an upper limit (I hit what appeared to be an earnings limit a year back, so I’ve spent the last few months re-evaluating the way I work.) For years I’ve been selling days, when I should have been selling chunks.
Recontextualised, it defines a longterm goal: complete a chunk a day!