How to Make Outsourcing Work on a Tight Budget
As someone who constantly champions the benefits of outsourcing, I’ve heard all the excuses in the book. (And then some!)
The one that surfaces more often than all the others combined?
“I just can’t afford to delegate to contractors! My budget is waaaaaay too small.”
I never push back on the budget-size part of this argument; hundreds of entrepreneurs run their amazing businesses on blood, sweat, tears, and absolutely minuscule amounts of money.
The part about not being able to afford outsourcing? That one I challenge, because believing that when you do it all yourself you’re saving money is short-sighted.
When you get bogged down handling the day-to-day administrative work necessary to keep your business humming along, you never get to plan. You’re so focused on staying afloat that you keep yourself from dreaming bigger, plotting your next steps, putting your energy toward swimming strong instead of treading water. So when business owners tell me they can’t afford to hire contractors, I point out that it’s more likely they can’t afford NOT to!
Still wary and worried that your shoestring budget can’t handle the burden of outsourcing? Here are four easy ways to make sure you can afford to delegate:
You might have a list as long as your arm filled with tasks you’re dying to assign out, but you’re better off easing into outsourcing. Try hiring someone for just a few hours each month and strategically get tasks off your plate that you either avoid, loathe, or both. Pick work that can be done by anyone (like bookkeeping or invoicing) but that ties up your time and sucks up energy you could be putting toward important projects that will help grow your business.
It may not sound like much, but starting with just four hours per month is a great, manageable way to get a feel for outsourcing. Hire a virtual assistant on a trial basis for a few months to see if delegating that work impacts your overall stress level, and work your way up to hiring someone to handle more tasks.
It’s hard to let go of the money you work so hard to earn, but if you can do some simple return-on-investment calculations you’ll see it’s money well spent! Think about what you could accomplish in the hours you’re now spending in the weeds of your business. For example, if you hire a VA for 10 hours per month, and use your now-empty 10 hours to create a product you sell for $200, you’ve just covered the cost of your virtual assistant (VA) with a single sale.
This earlier post gives detailed instructions for calculating outsourcing ROI, but here’s a quick summary:
Start by picking a task set (like publicizing your blog posts on social media) and total up how much time per month you spend doing it yourself right now.
If you don’t already know your ideal hourly rate, use this calculator to find it.
Multiply hours per month x hourly rate, and the resulting figure will tell you how much it’s costing you to handle this task set yourself. Assume you can hire a VA for $50/hour or less. Would it be more cost-efficient to outsource?
NOW analyze the task set to see if it actually, actively makes you money. (For instance, how many sales did you make last year that can be traced to blog posts?)
Ideally, you want to outsource tasks that bring in revenue, but remember that assigning admin work to contractors means YOU are freed up to focus on money-centric work.
Weigh the data, and decide if paying a VA to handle this task set is worth the investment.
Consider Hiring a Less-experienced Contractor
VAs with decades of experience can (and should!) charge more. Newer freelancers will have lower hourly rates, which makes them more affordable. Naturally, the tradeoff will be that less-experienced VAs will need more training. But if you’re on a tiny budget and currently have more time than money, it can be a win-win for everyone. And being among the first to help a new freelancer get situated means you can shape his or her work habits and processes!
Assign a Portion of Your Income to Outsourcing
When you look at your income and budget, it can be tough to see any wiggle-room. A simple work-around is to dedicate a certain percentage of your business income to outsourcing. For instance use 20% of your website affiliate income to cover contractor costs, or 50% of book sales each month. Parsing your incoming money in this way makes it feel less burdensome to add another line-item to your monthly budget!
So why would you pay someone else to do work you can do yourself for free? Because the work you do is NOT free! Your time is valuable, and should be put toward projects that will either bring in revenue or allow your business to expand. And even if your budget is painfully tight, you can find ways to make room for outsourcing!
Here’s the thing. The key to getting a great ROI on your outsourcing budget is knowing what projects to delegate that will actually bring in money. Inside my Goddess Boss Academy, I have dozens of project plans you can hand off either on a one-time or recurring basis, and they’re all designed to add $$$ to your bottom line. Check it out right here –> www.GoddessBossAcademy.com