Can you really save money by hiring a virtual assistant? According to virtual assistants’ websites, the answer is a resounding yes. As a matter of fact, money-saving is usually listed as one of the most important benefits of working with a VA.
Check out a virtual assistant’s website and chances are you will find calculations pitting costs of hiring an employee against those of working with a VA. In this battle of cost-effectiveness a virtual assistant always wins, frequently by tens of thousands of dollars.
But what if your business is not at the stage where you need a full-time or even a part-time in-house or virtual employee? What if you only need help for a few hours each week? Wouldn’t it be less expensive to do it all by yourself instead?
This, of course, is the issue of cash-flow and financial security. You might be thinking that since you only need assistance for a few hours a month that there is no point in bringing in qualified help.
Sure, you work long hours, but that’s because you’re still in the “paying your dues” stage. You might even be considering getting help just as soon as you sign up another client or reach certain sales volume. In the meantime, you’ll simply suck it up and forget about any time off for the next few months.
But let’s look at the situation from a slightly different angle. One of the reasons you started a business was to follow your passion, create the workplace and lifestyle that you have always dreamed of, and ultimately to make money. You did not plan on myopically focusing on daily tasks at the expense of the big picture. To make money, your business needs to run efficiently. If you have boxed yourself into a corner with overwhelming to-do lists and seeming unshoulderable burdens you are probably not enjoying your new business and not making the money that your vision demands.
All other tasks your business requires – bookkeeping, website maintenance, submitting press releases online – costs you money. This is true whether you do this work yourself or hire someone. It is true regardless of the size of your business, the number of clients or the sales volume. Understanding this is absolutely critical to successfully growing a profitable business.
Therefore, the real question is would having a virtual assistant work on these tasks will cost you less than if you do it yourself. Here is how to find out.
Figure out your true hourly rate
Begin by keeping track for a week or so of the hours you spend on bookkeeping, website or blog maintenance, social media marketing, research, article writing, data entry and other maintenance tasks. This includes time it takes you to learn how to do each task, open appropriate software, and mentally switch from whatever else you were doing. I suggest that you sign up for a free 30 day trial account at ClientSpot which is the client management software that we use to track tasks and hours. You will be astonished at the hours that you spend on tasks that could and should be outsourced to a highly technically savvy virtual assistant.
Now add these hours to the time you spend doing paid work or business development and networking. You’ve arrived at the total hours you work on your business. To arrive at your true hourly rate, simply divide your weekly income by the total work hours.
You might find out that your true hourly rate is much lower than what you expected. Remember, it’s those easy-to-delegate tasks that drag your rate (and your real income) down.
Consider opportunity costs
Operating a business is always about setting priorities, but especially so if you do all the work yourself. Naturally, paid work comes first. Then – maintenance. Unfortunately, business development and networking take the back-burner for many DIY entrepreneurs.
For example, you know that a newsletter is an important customer relations tool. Yet you are too busy to design a template and write content. You get so wrapped up following up on outstanding invoices that you forget to connect with prospective clients. You are too exhausted after yet another 14-hour day to write even a short maintenance post for your business blog. You are frustrated to miss yet another networking event but it’s either that or another night of working until midnight.
Every time you forget, delay or cancel you hand the opportunity to your competitors to connect with your existing and future clients. Even if you achieve short-term savings by doing all the work yourself, you end up sacrificing your long-term profits, not to mention draining the creative spark that propelled you into entrepreneurship to begin with.
Most businesses, regardless of size and revenue, can benefit from delegating work even if it’s only a few hours a week. Being a small business owner doesn’t mean you have to do all the work yourself. Instead, realize that many tasks cost money regardless of who does them. Delegate them to a virtual assistant and concentrate on money-making tasks like networking or building joint ventures.