Outsourcing: The Key to Efficiency

October 27, 2014

Are you one of the many small business owners who feel like it’s up to you to take care of every inch of your business, from day-to-day activities to bigger strategic initiatives?

My business used to be run like that. One part of you realizes cash flow is king, and so you watch every penny. Beyond the expense, there’s another issue top of mind: your business is your baby. You care. You want to see it be a success. So you immerse yourself – in everything.

Unfortunately, that’s often to your own detriment. Trying to do it all means you have less time to focus on where you can have the most impact, like the direction your business is headed in and growing sales. As my business grew, I knew something had to give. Gradually over the years, I’ve come to realize that there are certain areas we are far better off outsourcing, and which are easiest to outsource. Here are my top three recommendations for what to outsource as soon as possible:

  1. Design

  2. Disregard this if you design for a living. But for the rest of us, designing a logo, small graphic, display ad, or website simply doesn’t come naturally. And even if we do struggle and manage to accomplish a do-it-yourself design, we’ll probably be disappointed with the results. And we’ll spend far more hours on our amateur efforts than a pro would.

    Don’t assume that hiring a freelance designer is out of your budget. There are a surprising number of affordable options these days. Here are some that have worked for us:

    • Hire a college student who’s affordable and eager to build his portfolio. We’ve done this for special images needed to accompany articles. A design student can take a stock image and “remix” it for something unique.
    • Hire a freelancer from a public marketplace. Crowdsourcing design sites like 99Designs.com can bring you multiple design options to choose from, for one price. Or try Freelancer.com. Fiverr.com is another option. Many design gigs cost more than the five dollars the site advertises, due to add-ons. But even the $20 to $40 it might cost for a simple, small graphic is well worth it. Imagine how many hours you’d have to spend on something a professional can do in an hour or a few hours.
    • Try an online design service. DesignPax.com is a resource for designing banner ads, small icons, and other purposes. It’s a self-serve website service. For under $100 you can get a nice package of professional banner advertisements created in a few days.
    • Negotiate with a designer for bulk work, such as your logo, website, and brochures.

    The online world is far more visual today. Design isn’t an area you can afford to skimp on, so let the results guide what you spend. Otherwise, going with the lowest price option may result in shoddy work.

  3. Accounting and taxes

  4. In the beginning, your finances and taxes are simple, and you may be able to handle your own accounting for a while. But as your business grows, you will add employees and increase your clients and customers. Your finances start to get more complex. You have to ask yourself: do you want to be the bookkeeper or the CEO?

    Sloppy procedures and recordkeeping for accounting, accounts receivable, and taxes can cost real dollars in tax penalties, losses due to poor invoicing and collection, and inability to budget cash flow properly.

    You may not need to hire a full-time accountant or bookkeeper. At the very least, hire a professional to help:

    • Set up your accounting software for your business. This includes setting up proper line items to place expenses and income items in. This is essential for calculating your profit margins, keeping records for tax purposes, and running proper P&Ls and budgets.
    • File your taxes every year. As a business owner, even a sole proprietor, your taxes gradually become more complex. In addition to your personal return, at a minimum you’ll also have a Schedule C to file. On top of that, you must make quarterly estimated tax payments, and send out W2s and 1099s at year end. Having good help lets you take advantage of lawful tax savings and keeps you from incurring costly penalties.
    • Manage payroll. Payroll can be complex, and as you grow it is easy to outsource to a professional service. If your employees truly are the lifeblood of your business, you don’t want to mess this up.

    One final thought: set up as many automated electronic payments and electronic invoices as possible. With most accounting software packages you can download transactions from credit card and bank accounts, avoiding keying in transactions manually. This saves time; it’s like “outsourcing” the manual entry and check-writing tasks via automation.

  5. Marketing

  6. I know what you’re thinking. You believe that with social media, email marketing software, pay-per-click advertising, and other options, this is something you can do in-house. Yes and no.

    Remember that marketing done well drives sales. Many small business owners attempt to handle their own marketing, only to be disappointed with results. The truth is: if you don’t have time to manage it consistently (read: pretty much daily), at some point, your sales will plateau.

    Marketing today is much more complex than ever before. You also have to be part geek, in order to learn and effectively use many marketing tools. Do you have the time or inclination to do that? Instead:

    • Work with an agency that can provide you marketing services for a monthly fee. For cost effectiveness, go with small agencies, especially those just getting started. They will be motivated to do the best possible job in order to build up clients who will give them good references.
    • Outsource distinct activities that are time consuming. For example, it is relatively easy to hire a writer to handle your blog content. It’s also easy to outsource creation of your customer newsletter. And you can easily hire talent to write website copy.
    • Hire a virtual assistant (VA) to help with updating social media accounts. There are VAs who specialize in this. You may still want internal staff involved, but some of the more repetitive activities are easy to outsource.
    • Outsource activities that require extensive expertise. One example is managing pay-per-click advertising campaigns. There is a lot to know in this area to do advertising well, and this activity is easy to carve out. Ask yourself if you can really afford to spend the time yourself or train an expert internally, or whether it’s really cheaper and more effective to outsource that activity because of the learning curve.

Once you outsource these (and other) tasks, you’ll free yourself up to focus on running your business successfully. You’ll wonder why you didn’t do it sooner.

This article originally appeared on www.inc.com/comcast.

Are you one of the many small business owners who feel like it’s up to you to take care of every inch of your business, from day-to-day activities to bigger strategic initiatives?

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