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January 12, 2022
Derek Sullivan

Is it the Right Time To Hire or Outsource to Grow Your Business?

At some point in your journey as a seller, you think about outsourcing. It becomes more stressful (and frustrating and exhausting) to keep doing everything yourself than it is to hire someone else. Enlisting outside help to relieve some of that pressure will even accelerate your growth.

How to figure out when it’s the right time for expansion?

Isaac Kuhlman, co-founder of REAL Coaching, an agency that provides business coaching services for FBA sellers, agrees. As an entrepreneur, your time is money and you need to allocate it wisely, he believes. “The biggest sign that someone needs to expand is that they are spending too much time on tasks that don’t grow their business,” says Kuhlman. “It doesn’t matter if you are making $500 from your business in a month or $5,000. If you can’t focus on the high-impact growth tasks, then you are bottlenecking your business from where you want it to go.”

Outsourcing to a specialist vs. hiring an employee

Kuhlman says it comes down to how much you understand about the job to be done: “Don’t only hire people to perform tasks that you don’t really know how to do. Consultants are great for fulfilling responsibilities outside of your expertise. However, long term you probably want to find an internal solution to those problems.”

You want to make sure the tasks you’re offloading are actually value-adds or that they free you up to go after those value-adds. And since you likely won’t have an unlimited budget for assistance, you need to prioritize what duties to outsource in terms of potential ROI.

You’ve probably heard of the Pareto Principle, which broadly holds that 80% of consequences come from 20% of causes. Also called the 80/20 rule, it’s often translated to business as the maxim that 80% of revenue comes from 20% of clients or customers. For you, there is likely 20% of day-to-day work in your business that drives 80% of results. Start your investigation into expansion there.

Removing yourself as a single point of failure in the business, however, doesn’t necessarily mandate hiring an army of underlings. It’s about making strategic decisions that leverage outside resources to solve problems and smooth the path to success.

How do I define metrics for success?

Whether it’s additional revenue created, costs, or hours saved, you can’t manage what you can’t measure. What does success look like in a newly-created role or in an engagement with an outside contractor? What are the results you’re looking to see in 30, 60, 90 days? Have you clearly spelled out and communicated your expectations? It’s okay to be picky; it’s not okay to be vague or disorganized. Not only do you want this arrangement to benefit your business, you want it to be a win for whoever you’re working with as well.

Final thoughts:

You are your business’s most valuable asset, so any effort to scale needs to be geared toward giving you more time to devote to those key growth opportunities.

Even if conducting performance reviews and managing payroll isn’t something you’re interested in taking on right now or you’re not in the market for outsourced professional services, there are other ways to creatively clear your plate.

Think broadly and holistically about how you’re spending your time and where you can optimize the non-essentials to-dos that fill your days. From dog walking to meal prep services to house cleaning help, freeing up time for more focus could also mean outsourcing routine, daily chores, and eliminating time-burning distractions.