Growing an online business requires free time, energy — and specialist expertise. So if you’re finding it difficult to manage your time, maintain high levels of productivity, or achieve your goals, then it might be time to outsource some of your tasks.
When To Outsource
In the new wave of “passive income” seekers, I sense that the topic of outsourcing divides opinion.
At one end of the spectrum there’s ‘hands-on’ business owners, taking on more work than they can manage on their own. At the other end there’s the workshy types, with airs and graces, looking to outsource just about anything — without any serious consideration to how it’ll impact profits.
Outsourcing requires a balance. Here’s how to tell when outsourcing is right for your small business:
1. Your Working Hours are Too Long
One of the biggest challenges you’ll face in self-employment is time management.
There’s occasions where you’ll feel bottle-necked; you’ve taken on too much work at once and you’re working extremely long hours. I’ve been there myself — one too many times. The result? Tiredness, a lack of focus, and a drop in overall productivity.
It’s a bit like going to the gym. If you overdo it by working out twice a day, then your body becomes physically tired. Your interest drops. Your sessions lose effectiveness without the much-needed downtime.
Thankfully business tasks, unlike fitness, can be outsourced to others! When done well it’ll enable you to become more agile within your projects. You’ll be able expand or take on new tasks more easily.
2. You Don’t Have the Expertise Required
Your success lies in the product or service you sell. So if you don’t have the skills to develop — or maintain — the end-product yourself, then you’ll require assistance.
For example, you might need:
- Graphic or product design
- Customer service
- Marketing & SEO
- Transportation of Goods
It’s unrealistic — and overly ambitious — to always take on everything yourself. In many cases outsourcing is necessary to get the job done.
But finding the right level of expertise for a reasonable price is however one of the biggest challenges for business owners. So where can you find skilled individuals?
My go-to sites for outsourcing:
A feedback-based site for hiring freelancers. I’ve found good translators, programmers and web developers using it. Some of them I still use today.
Great for odd tasks, such as logo creation or twitter promotions. Your expectations must realistic when the starting price is just $5 — but you’d be surprised how many great services you can get.
There’s a full list outsourcing sites here.
3. You Want to Focus on More Important Objectives
Outsourcing doesn’t need to directly produce a return on investment for it to be worthwhile. It can also free you (and your team) up enough time to focus on other important areas of the business where, in turn, you’ll reap the rewards.
Take expansions as an example. Growing your business with new services may require some temporary outsourcing. This would ideally provide you a time ‘buffer’ where you’re able to adapt to changes whilst continuing to maintain high standards for existing services in the meantime.
4. You Absolutely Detest Some of the Jobs You Need to Do
The point of working for yourself is that you have freedom, and the motivation, to work on what you enjoy. But the downside is that you might not enjoy each and every task you have to do.
So it makes sense that you’d choose to outsource some of those tasks. Not out of necessity — but because it would be detrimental to your attitude, and thereby your business, to continue doing them yourself.
Weaknesses In Outsourcing
I’ve touched on a few of the weaknesses already. So let’s address them one by one.
1. Increased Costs
The obvious one. Outsourcing isn’t free; it requires investment.
Keeping costs down in highly skilled, specialist fields — such as software development — is difficult. It’s very easy to overspend.
You need to thoroughly shop around and try work out what skill-sets and individuals can bring something to the table for a reasonable price.
2. Lack of Industry-specific Knowledge
Highly specific industry knowledge or experience might be too much to expect from a third party — such as a freelancer.
If your requirements are narrow, then you may have no choice but to take your chances on people with little or no understanding of your line of business (to start with). You’ll have to look for the best fit: versatile individuals, capable of thinking on their feet.
But be aware of the limitations. Outsourced employees will require education and time to tune into your industry, as well as the standards you uphold. Then there’s no telling how capable or enthusiastic they’ll be for innovating new ideas in your field going forward.
3. More Management
Outsourcing often doesn’t provide the freedom and flexibility you envisaged.
You’ve got people to pay, to instruct, and to oversee. You need to monitor the jobs carried out by third parties, and regularly “step in” to ensure everything is running the way you want.
Yet ironically, micro-managing your business is the opposite of what you want to achieve from outsourcing: more free time, and the ability to focus on other objectives.
4. Loss of Control
Outsourcing means trusting others to do what’s best for your company.
Even in the “perfect scenario”, where you’ve found talented staff that require very little hand-holding, there’s a risk of becoming detached from the “inner workings” of your business. Without knowing how everything slots together you stand to lose control and stability.
Therefore management has to be cautious not to become complacent or reliant on third parties who have no direct interest in the company’s long-term goals.
Alternatives To Outsourcing
Outsourcing isn’t the only way to increase productivity in your business. You can do the following:
1. Learn New Skills
You don’t need to outsource everything. There’s some areas of your business you can work on yourself, once you learn a few tricks.
The following skills are important for most startups:
- Search Engine Optimisation (SEO)
- Branding For Your Products Or Services (coming soon)
- Cost-effective Website Development (coming soon)
- Pay Per Click (PPC) Advertising
- Writing SEO-Friendly Content For Your Website
- Social Media Marketing
- Monetising Your Online Content
Learning these skills might put you in good stead for the future. It’ll certainly help to reduce outsourcing costs.
2. Use Software
If you’re able to use technology to shorten a task, it might transform it into something that doesn’t require outsourcing or other form of extra labour.
Where you can, automate and streamline as many repetitive tasks as possible. For example, you might use automated accounting software for your bookkeeping, and a content management system (like WordPress) to easily manage your website.
3. Outsource Outside of the Business
You don’t have to outsource within the business. You can instead adapt your lifestyle to accommodate it.
For example you might decide to outsource household tasks, such as:
- Cleaning (the car included)
- Laundry & ironing
- Painting & decorating
- Walking the dog
- Grocery shopping
The aim here is to reduce jobs you don’t need — or want — to do yourself, in order to save some time for your business. It might be more cost-effective or enjoyable that way.
My Views On Outsourcing
I personally take the approach of starting small, getting my hands dirty in several aspects of the business, and building out from there.
In the case of starting an Amazon FBA business, I’ll have a hand in the branding, website design, sourcing, packaging, managing inventory, reconciling sales, and customer service. To begin with, anyway.
I take this approach in all projects where I already have the relevant skills required.
Why Get ‘Stuck In’? Why Not Outsource it All?
1. To Fully appreciate And Understand all nuances of the business.
Just about everyone’s had a boss with absolutely no idea how the business really works. Without precise knowledge, they’re clueless — and incapable — of making improvements.
Being clueless with your own interests are stake isn’t wise. So I like to understand each process, and iron out all areas of the business with a view to outsource later on.
2. I don’t believe that passion and innovation are easily passed on.
It’s your vision, not someone else’s. So no matter how much of a motivator you are, you can’t always align someone to the ideas and belief you have for the business.
Granted, passion and innovation aren’t impossible to achieve through outsourcing. Longstanding businesses have trusted advisers, for example. It’s just difficult to achieve that from the outset, on a limited budget. It commands a premium.
3. many new businesses require industry knowledge & Experience.
Out-of-the-box, one-size-fits-all solutions won’t suffice when you’re attempting something new or unique.
For many projects, contributors require a high level of background knowledge on the industry to be able to think independently. Hence freelancers and temporary staff can’t always deliver the goods.
The relevant knowledge often comes directly from the business owner — the one that understands the industry. But translating experiences, preferences — your line of thinking — to someone else, is a tricky and time-consuming task.
Basically, it requires input (and the right personnel) for outsourcing to be effective.
These are generalisations, of course.
Essentially, what I’m getting at is that there’s no set formula at the start of an entirely new business. And until there’s a proven formula that works, I’m reluctant to pay for services that aren’t already fine-tuned to what I’m aiming for.
That’s not to say I don’t get help. Throughout any project I constantly seek second opinions, collaborate, trade jobs with others — image editing in exchange for writing, for example. I’ll look at what competitors are doing better than I am, and then criticise and adapt what I’m doing myself.
Downsides to Being Too ‘Hands On’
Whilst it cuts down costs, the hands-on approach is hard to manage.
With each area of the project requiring some sort of input, it often feels like there are several spinning plates to keep moving before they eventually all fall down and crash. This can be detrimental to growth, and it isn’t sustainable.
I try to tackle this problem by identifying repetitive tasks — such as outreach, re-posting old content on social media, general research and customer service. I assess if its economical to outsource those tasks. If it is, I will. The business should become easier to manage — more “passive” as a result.
However, I should add that I’ve never found any project to be passive in during the early stages! Getting ‘stuck in’ has been unavoidable.
Outsourcing — A Summary
The Need for Outsourcing
It doesn’t matter what the industry is, there’s always more work to do than time to do it. This means that there is always something lacking, always more work to be done, and new companies are always falling behind their expectations and deadlines.
According to business coach Michael Hyatt, 45% of entrepreneurs are stressed. There’s a genuine need for outsourcing.
Hard Work Still Has a Place
I feel there’s a tendency amongst young business owners to frown upon others doing hands-on work in their business, as if they’ve somehow fallen into a “trap”. They’ve became their own employee. They’ve victimised themselves.
Over-working might be a digital-age business taboo. But I don’t entirely agree with the message it sends out. Why so?
It’s simple: the projects i truly applied myself to were the most successful ones. It was in my own hands to make it work, and it did. I have no reason to believe that I fell into a trap. I did what had to be done by any means. And I had a choice.
Furthermore, the dream of outsourcing everything and sitting back isn’t as idyllic as it may appear. It takes time, effort and skill to identify and manage the most eligible individuals to delegate your work to. That’s the crux of the successful entrepreneur — the ability to piece together each part of the jigsaw.
And importantly, not every task has to be eliminated entirely for a business to work at peak performance.
There’s outsourcing because it’s economical to do so. There’s outsourcing because constraints have dictated that approach. Then there’s outsourcing simply to avoid getting your hands dirty. The latter shouldn’t be passed-off as good business practice, because its a lifestyle choice.
For instance, you might choose to earn slightly less in order to refrain from working yourself to the bone. You may value your time more than the business. It’s perfectly understandable — but a lifestyle choice, nonetheless.
This distinction is important to make and it might help you weigh up the pros and cons to outsourcing your business operations, and hopefully strike the optimal work/play balance.
So what can outsourcing offer you? What can it offer your business?