As an IT business owner, you're probably used to putting in long hours, hustling to land your next client, and kissing your social life goodbye. While you can go pretty far with an entrepreneurial spirit and a dash of moxie, the reality is you can only accomplish so much in a day.
Plus, working yourself to the bone can be bad for business, especially if things start slipping through the cracks. You might…
- Miss a deadline.
- Goof up on your taxes.
- Nod off while behind the wheel.
- Forget to make a reservation for your anniversary.
While you may not be able to afford additional staff, it is possible to regain some balance (and get out of the dog house at home) by hiring contractors to help shoulder the workload.
Here are four signs that your tech business should consider outsourcing.
1. Repetitive Tasks Take Up Too Much Time
If there are simple, low-level tasks taking a big chunk of time out of your day, ask yourself if it’s something you need to do yourself, or if you could pay someone else to do it for you.
Vadim Vladimirskiy (@vadimvl),
CEO of the streaming IT service company
(@GetNerdio), says his business found that outsourcing some of their simplest marketing tasks freed up employees to focus on more big-picture projects.
“Our marketing team was overwhelmed with a lot of one-time tasks,” says Vladimirskiy. “Outsourcing was a perfect fit to get the jobs done without adding employees.”
Other tasks that need to be done on the regular, but not necessarily by you, are also good opportunities to consider outsourcing.
“Areas like payroll and accounting, while necessary for running your business, are not only complicated, but extremely time-consuming,” says
Chase Garbarino (@cgarb),
(@VentureApp). “It may make sense to outsource these early on to protect yourself from financial risk and free up substantial time to focus on your business goals instead.”
2. You Struggle to Manage Your Business’s Growth
One major benefit of outsourcing? It gives you the flexibility to scale your business up or down.
For example, Vladimirskiy says Nerdio needed a new website, but didn’t want to hire new staff or overwhelm the current team, so it took a combo approach.
“We tasked our designer with the design of the site while tapping a project-based freelancer for the actual development,” says Vladimirskiy.
Be aware that a contractor could potentially be considered an employee, depending on the laws in your state. If your outsourcing is strictly limited to hiring other companies to handle things like accounting or office cleaning, you’re probably in the clear. But a contractor might be considered an employee if they perform work clients pay you to do, such as…
- Installing a computer network.
- Configuring a firewall.
- Designing a website.
Once you start hiring contractors, it’s probably a good idea to talk to your insurance agent to make sure you have adequate protection for all your workers, both employees and contractors.
You probably already have General Liability Insurance and Professional Liability Insurance. But once you start bringing on contractors, you may need to update your Workers’ Compensation Insurance coverage unless you only hire people with their own contractor liability insurance.
Check out our article “Do Your Subs Need IT Contractor Insurance? (Hint: Probably)” for more on contractor insurance.
3. You Realized Paying Someone Else to Do Your Work Can Actually Save You Money
Take a hard look at how much billable time you lose to tasks you could pay someone else to do. It could be a wake-up call that you're losing money by not outsourcing.
“I don’t do my own bookkeeping,” says
Carrie Simpson (@coldcallcarrie),
Managed Sales Pro
(@sales_pro), a company dedicated to lead generation in the IT industry. “Sure, I might save myself $1,500 a month, but I’m actually LOSING $6,000 in billable time or time that could be spent building my business.”
In addition to tasks like accounting, outsourcing your own work – either internally or by hiring contractors – can make financial sense, too.
“I bill out my consulting time at $300 an hour,” says Simpson. “Even if I take the thing I am absolutely best at – cold-call prospecting – it still wouldn’t make sense for me to do that myself when I can pay someone else to do it for me. Instead, I can take the best of those leads and follow up on them personally.”
4. You’ve Realized You Aren’t the Expert in Everything
Remember, people hire you because they aren’t IT experts – you are. But you probably don’t know everything about accounting, creating legal documents, etc. That’s when it makes sense to hire folks who do that for a living.
“IT businesses should understand better than other businesses the value of outsourcing tasks that they aren’t experts in – that’s their entire value proposition,” says Simpson.
Simpson mentions that while she does occasionally use contract templates, she prefers to pay someone with a professional legal background to write or review any contracts her business needs.
“What’s the cost to my company of opening us up to liability, or potentially not getting paid because my amateur eye missed something?” says Simpson. “I’m a cold-calling expert, not a lawyer.”
If you goof on something important like bookkeeping, taxes, contracts, etc., it could have some pretty serious repercussions for your business. As much as you may want to do it all, some things are better left to the experts.
Read our article “3 Things You Should Always Outsource when Starting an IT Business” for more outsourcing tips.
About the Contributors
For more than a decade,Chase Garbarino has focused on leveraging technology to build networks and communities that help startups and small businesses. As co-founder and CEO of VentureApp, Chase is focused on building a marketplace to help startups procure their business services, saving them time, resources, and money, at scale. Prior to VentureApp, Chase founded Streetwise Media, which was acquired in 2012 by the American City Business Journals. He’s also an active angel investor.
Carrie Simpson has 20 years of inside and field sales experience. She is the founder of Cold Calls Lead Generation, a business-to-business sales appointment setting firm. Carrie spent two years building the Managed Services lead generation program at The Eureka Project before founding Managed Sales Pros, a sales cycle acceleration firm that focuses exclusively on the managed services ecosystem. She was named by MSPMentor as one of the Top 250 experts in the technology channel for 2013 and 2014, and named by The Var Guy as one of the Top 50 Channel Influencers in the world in 2015.
A creative technologist with a mind for business, Vadim Vladimirskiy is the head honcho at Adar. Vadim is the brains behind the evolution of Nerdio, bringing streaming IT to the masses – that is, small- and medium-sized organizations. When he’s not continually pushing the IT envelope, Vadim’s at home with his loving wife and four boisterous kids.