How to start outsourcing.

We all know that there is plenty of our workload that could, and probably should be done by somebody else. But is it really as easy as just finding a VA or other service provider and just handing it all over? If you haven’t outsourced before it can be hard to know where to start.

It isn’t unusual to feel a little overwhelmed when considering outsourcing especially when your business is still growing or for those of us who might feel the need to keep hold of everything. Let me talk you through why outsourcing can save you money and increase revenue. We’ll consider how much it costs your business to have you focusing on everything and trying to be the expert in all areas, then we will look at ways to identify areas that you MUST do yourself and which areas you really MUST take off your desk to allow you to continue to grow. 

Its easy to see how small business owners and early career entrepreneurs find themselves doing everything in their business. It is equally easy to understand how we convince ourselves that we are saving our business money by doing all of these tasks. Few businesses can afford to appoint a whole team of support from the outset and so the hard work begins until we find ourselves working 60, 80, 100 hour weeks buried in our business. Its easy to see how so many entrepreneurs find themselves burned out or with clients beginning to feel neglected.

Before we go any further into how to outsource ask yourself two questions – do you know your value? And What is your hour or day rate? If you don’t know your numbers, then you are at risk of continuing to believe that it is cheaper and more cost effective to keep on trying to get everything done yourself. Once you value yourself and know what that value looks like in monetary terms then you can quickly see how outsourcing will save your business money and free up your time to focus on building the business and increasing the revenue building activity that you can undertake.

If you don’t know your numbers yet then you really need to fix that, we have a guest blog coming later in the month with an excellent accountancy friend of mine who will help you to start to work this out. 

Let’s assume that you understand and respect your value and you are clear on what your hourly and/or day rate is. Now think about how much time you spend on tasks that don’t require your specialist knowledge and understanding. You will have to be modest and honest about this. How much time do you ‘waste’ each day on emails, social media, HR, bookkeeping, accountancy, invoicing, design, writing, or any other areas. You might like to add in to that customer onboarding, customer care and complaints. It is likely that this is several hours or more every single day – is it any wonder you feel like you never see the end of your to do list? Remember to include the quick check of your emails in front of the TV, the interruptions to family time over the weekend, the habits that have crept into life so you find that you are never really switching off from work.

The number of hours you are losing to these tasks is likely to be significant, don’t be too concerned though, as Michael Gerber outlined in his book the E-Myth many ‘would be’ entrepreneurs fall into this pattern in the adolescence of their business. You have most likely become what Gerber refers to as a Technician. You have likely walked away from a career, left behind the benefits and security of a job looking for flexibility, challenges and greater freedom only to find that you have actually created your very own JOB only this one probably has less security and benefits than the one you walked away from. 

All is not lost, if you can step back and really identify the areas of your business that require you to undertake them and then begin to outsource everything else then you can get back to being an entrepreneur, build your business and see the revenue streams increase. 

If you are still thinking that this sounds too expensive and your business can’t afford the added expense, then let’s go back to the numbers. If your business were to pay you, at your agreed hourly rate, for the hours or days that you are spending undertaking administration and other tasks that are not your specialism what would it cost each week, each month? That’s a pretty big number right? A big cost to your business that is most likely stopping you from earning any money whilst you do it and which might also be preventing you from pursuing other lucrative income streams because there simply are not enough hours in the day. Now work out how much more work or how many more clients you could take on if you had those ‘admin’ hours back and could invest the time differently?   That’s also likely to be a pretty big number. If we consider that the average hourly rate across the VA sector is around ￡30 per hour, some charge more and some charge less either way they are often charging less per hour than you charge your own clients. Now it isn’t as simple as just multiplying the hours you are currently spending on admin by ￡25 you must also consider that bringing in an administrative expert means that the tasks will be completed in the most efficient ways possible so you are likely to find the tasks take considerably less time and quickly start to happen behind the scenes with no involvement from you.

Example:

If you are spending 1 day per week, 8 hours on administrative tasks and other areas that do not specifically require your input and your hourly rate is ￡50. Your involvement in these tasks is costing your business ￡400 a week/￡1600 a month that’s almost ￡20k per year. Its also an entire day a week or up to 52 days a year when you are not focused on revenue generation, client contact or business growth.

Even if we assume that you find yourself outsourcing a full day of work every week at ￡30 an hour that’s a saving of ￡160 per week/￡640 per month and almost ￡8.5k every year. So, whilst it is still costing your business money you suddenly have an extra day per week to work with clients and generate money. Suddenly you have the potential to earn an extra ￡400 every week if you invest the time well.

Seems pretty obvious when we break it down doesn’t it! Let’s get down to the real business then, how do we identify what we could/should outsource. With my clients I always suggest that we start with a list or two – what can I say? I’m a Virtual Assistant I love a good list. Take a blank piece of paper and begin to list all of the tasks that you do – this is everything you get involved with specialist and non-specialist duties. It is an interesting exercise to start this list in the back of your diary or in the notes on your phone and add to it periodically over time. It’s a huge list and you will be forgiven for wondering how you fit it all in.

Now grab a highlighter and revisit that list, clearly mark the specialist tasks with a coloured spot in the margin. We’re nearly there, back through the list again, this time I want you to highlight all of the revenue generating tasks so they stand right out at you. Brian Tracy tells us in ‘Eat that frog’ that three core tasks that you perform contain most of the value that you contribute to your business’  Not 30 or 300 just 3! You may not have it whittled down to 3 just yet but here they are, standing out front and centre on your list, the tasks that you should be focusing the most time and effort on.  This is where your expertise lies and this is how you grow. 

Now there will still be some areas that you marked as requiring your expertise which are not highlighted as revenue generating reconsider these for a moment and ensure they genuinely need your input and that only you can deliver on these. Not everything you do will be revenue generating, however you do want to ensure that it mostly is.

What about the non-highlighted tasks, that’s simple these make up your list of duties to be outsourced in the first instance. You might want to break them down into the tasks that are the biggest drain on your time, the areas that you are least able to undertake efficiently yourself and the areas that you enjoy the least. You might however be ready to hand everything over.

Let’s recap, if you are working harder than ever and not reaping the benefits you need to ensure that you know your value and you know your hour/day rate. Then you must reflect on what you are doing each day and ensure that as much of your time as possible is spent on income generation rather than mundane, essential yet non-specialist tasks. If you don’t have a clear list of the tasks you only you can undertake and another list of tasks that need to happen but don’t need your knowledge and expertise, then I suggest you start one soon.

If you are ready to outsource or are curious to consider the opportunity of outsourcing in more detail then I would love to speak to you. Here at Freedom from Tedium we have a team of expert and professional administrators ready to make life easier for you. Book your free initial consultation now: Call Anita 01792 625789 or email me using [email protected]. We look forward to doing business with you.