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The pros and cons of outsourcing and how to use it to grow your agency (Podcast) Click To Tweet

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Background: [0:00 – 12:40]

I always have a blast talking with David Judge. He has a colorful history that includes running a small goods manufacturer, opening up an internet cafe, and even a brief stint in jail (yes, you read that right). Today, David’s main focus is his outsourcing agency, Affordable Staff.

We’ve all heard (or even experienced) horror stories of outsourcing. When David first got into the field, reliability was a huge problem. Over the years, he has built methods to overcome these issues and provide his clients with a reliable and nearly seamless experience.

At Affordable Staff, David has helped dozens of clients, including many digital agency owners, outsource to accelerate the growth of their business. Today he shares how you can do the same.

Takeaways:

Three steps to ensuring quality results from outsourcing [12:40 – 26:00]

1. Understand your business before you even think about outsourcing

If you can’t explain a process in detail and don’t know how it fits into the rest of your business, then you simply won’t be able to get the results you want from outsourcing. Before you get started, establish a clear process outlining how to do the work you want to outsource.

Before you think about #outsourcing, you need to understand your business and processes very well Click To Tweet

2. Know your motivations for outsourcing

Not only do you need to understand what you are outsourcing, you need to know why you are outsourcing it. What is your ultimate goal? Is it to grow your team so you can take on more work, or do you simply want to replace yourself in the business so you can spend your time focusing on something else? Knowing your goal helps you determine what tasks to outsource, as well as the type of people you need to look for to do the job.

3. Establish an infrastructure that allows your team to be productive

In certain areas of the world, the infrastructure just isn’t that reliable. While it may be fine at certain hours of the day, at other hours there may be no power or Internet at all. For jobs that are integral to your business, outsourcing agencies like Affordable Staff, which have a physical office with consistent power and Internet, may be the best solution. Beyond the physical infrastructure, make sure you have procedures in place to ensure good communication across your remote team. Without communication, remote work is guaranteed to fail.

What tasks can be outsourced for the most growth [28:30 – 41:30]

The obvious ROI from outsourcing comes when you are able to charge a client $X for a job, and have to pay <$X to get that job completed. However, that isn’t where your greatest outsourcing gains will come from. By outsourcing some of your repetitive tasks, you can start spending more time on the high ROI work like maintaining relationships with your clients and prospecting for new ones. This might not give you an immediate profit, but by freeing up your own time you can start focusing on your business instead of just working in it.

Outsourcing lets you free up your own time, so you can focus on growing your business Click To Tweet

Take a step back and think of what a typical day looks like for you. How many of the tasks you work on actually put more money in your pocket? How many of those tasks need to be done by you? If it feels like you are too stuck in the weeds to grow your business, outsourcing some of that busy work might be just what your business needs to get ahead.

How an outsourcing agency can save you money [45:30 – 52:00]

Affordable Staff has around 50 employees that support 42 clients, and the team has gotten very good at delivering the services their clients need. While the “sticker price” of a solo freelancer will be cheaper than the price you’d get from an agency, you can’t just look at the hourly rate to determine how much something will cost you to outsource.

While David’s clients span a wide range of industries, many of the tasks that they are outsourcing are similar, and David has been able to develop repeatable processes to improve the efficiency and success of his team on these tasks. Hubstaff plays a large role in this by allowing him to see how long each team member spends on a specific task. He can then use this data to identify the high performers and work with them to develop better processes and train the rest of the team, raising everybody’s performance.

If you don’t have other employees to compare work to, how will you know if your freelancer is actually completing the task in a reasonable amount of time? If they are in fact being slow, who can they learn from to improve?

On top of that, the project management role that comes along with outsourcing (which you need to fill if you do this on your own) can add significant costs to outsourcing, especially when you only are working with 1 or 2 contractors. At many agencies, project managers are included in your quoted price, which saves you time and gives you the benefit of working with somebody who has done this before.

Parting advice [55:00]

David left us with three pieces of parting advice:

  1. Establish the foundation (know what you are going to do before you do it) first, because you need to understand your business before you can expect somebody else to.
  2. Communicate consistently with your employees.
  3. Integrate with technology like Hubstaff and Podio to be as efficient as possible.

If you want to hear more from David about how you can use outsourcing to jump start your agency, you can find him at AffordableStaff.com.au or you can email him directly at David@AffordableStaff.com.au

Resources Mentioned:

Affordable Staff
80/20 Sales and Marketing by Perry Marshall
Steli Efti

Thanks for listening!

Have you tried outsourcing before? I know a ton of agencies do it successfully every day, but I also know there are just as many horror stories, so I would love to hear how it went for you in the comments below.