The Anatomy of an Effective Outsourcing Plan
Best Practices: Are you too busy with work to even think about growing your business?
When you decided to become an independent exercise entrepreneur, you had a core focus and a vision of how you would help your clients. But overnight you also became the accountant, janitor, customer service department, blog writer, fitness manager and CEO—all rolled into one.
“Are there things you do that keep you ‘busy’ but aren’t helping you get ahead?” asks Vito La Fata, owner of Fitness Evolution (a training club in Laguna Hills, California) and creator of the consulting firm Fitness Profit Systems. “If so, you may have a great opportunity to hand off some of that ‘busy’ work and get back to growing your business and profits.” In other words, it may be time to outsource certain tasks to part-time, nonemployee freelance workers and regain control of your valuable time.
Outside OpportunitiesThe value of outsourcing lies in the dollar value of your time versus the cost of paying someone to assist you (known in economics as opportunity cost). Let’s say you make $50 per hour training clients. If you forgo one client time slot to hand out promotional fliers instead, you’re giving up $50 to perform a task you could pay a student $10 to do. Outsourcing, in this instance, pockets you $40 (i.e., $50 training revenue earned minus $10 paid out for a nontraining task).
“What do you do now that you can eliminate from your plate?” asks La Fata. If there are things that need to be done, but you can pay someone else less than your hourly rate to do them, then it’s time to outsource.
Outsource or Keep In-House?
To begin, consider the following points, says Barry Klein, an industry consultant and speaker and co-owner of Elevations Health Club in Scotrun, Pennsylvania.
- Quality. Can someone else do it better?
- Speed. Can someone else do it faster?
- Cost. Can someone else do it cheaper?
- Business benefit. Is your business better served by outsourcing it?
- Hassle factor. What's the bigger hassle: outsourcing it or doing it yourself?
Don’t confuse delegating with outsourcing: You delegate to an employee, but you outsource to a freelance worker or an outside firm on an as-needed basis.
It’s typical to contract out legal, accounting and Web-related responsibilities (hello, year-end taxes!). It’s also common to use outside workers for cleaning services, bookkeeping, graphic layout work, payroll, public relations and IT support. Here are more ideas for out-of-house options.
You’ll need high-quality, search-engine-optimized (i.e., “findable”) online content. “You can write all that content yourself, tag all the keywords yourself, blog it all yourself, index it and submit it to online e-zines and resources yourself. Or, you can have someone help you,” says La Fata.
A ghostwriter—an uncredited, professional scribe—can craft customized blog posts or articles under your name. A cyber marketing expert can help boost your organic search ranking online. (To find such resources, see the sidebar “Online and Overseas Options.”)
Billing and Collections
Before they started outsourcing the collection of monthly client fees, Klein’s team “had to get updated credit card information from members whose cards had expired, and there were times when banks would replace all of their customers' ATM cards at once,” he reports. “Following up on bounced payments was onerous.”
Klein notes that outsourcing these tasks to fitness industry–oriented firms such as ABC Financial, Twin Oaks or Motionsoft improves revenue, record-keeping and reliability. “Now, we can grow our business without being in the collections business,” he says.
La Fata advises that constantly scrambling for new marketing ideas and then testing them in the real world is very time-consuming and does not necessarily produce results. “Way too many trainers try to come up with everything from scratch, and that's not cost-effective.” To service this concern, he creates prepackaged marketing campaigns (http://fitnessprofitsystems.com) that fitness pros can rebrand as their own. Other professionals who offer similar prepackaged marketing/promotional event systems are Sherri McMillan, MSc (www.nwpersonaltraining.com); Trina Gray for Corporate Fitness (www.corporatefitchallenge.com); and Todd Durkin, MA, who sells a “Biggest Winner” concept (www.fitnessquest10.com).
Although it’s time-consuming, training businesses must have a regularly updated social media presence, Klein says. He advises caution when you’re considering outsourcing these tasks, because being authentic and social via a third party can be challenging. Klein advocates hiring a specialist, rather than “a kid who has free time," to ensure quality and consistency of results and voice or tone. (For help finding such a specialist, see the sidebar “Online and Overseas Options.”)
Finding Freelancers: Face-to-Face or Far Away?
For time-swallowing daily minutiae like picking up laundry, booking travel and answering emails, consider hiring a personal assistant (PA), says La Fata. For complex, skill-specific tasks, a virtual assistant may be your best bet.
To find a PA, look for a trusted stay-at-home mom, a college student or a client who may want to pick up extra work, says La Fata. Potential sources for finding a PA could include your current client base or the online career postings at a local college.
A virtual assistant (VA), whom you may never meet, helps with projects that can be handled remotely and online. Assignments for this person can include filtering emails, posting blog entries, doing market research and making follow-up client phone calls, says Rick Kaselj, MS, a Surrey, British Columbia–based and ACE-certified kinesiologist and the creator of ExercisesForInjuries.com. For several years now, he has been hiring VAs to take on various online and customer support roles in his Web-based fitness business.
VAs operate on a per-project or hourly basis, and many of them offer specialized skills cultivated in previous career trajectories (think advanced administrative expertise, exceptional website wizardry or professional-level writing). Hourly fees range from $5 to $10 for foreign VAs and from $15 to $25+ domestically, says Kaselj.
VA agencies from India and the Philippines—two countries where English is widely spoken and the costs of hiring remain low—are increasingly popular. However, compared to their U.S. counterparts, overseas VAs may take longer to get up to speed and may require more oversight, La Fata cautions.
When Not to Outsource
There are times when outsourcing does not make sense, even for relatively simple tasks. Take the winter chore of plowing the snowy parking lots of Klein’s facility—a task he has opted to keep in-house. The inconvenience of not outsourcing the work is significant, he says, but he also prefers not to pay someone else $80 per hour to do it.
Klein believes there are many less-than-glamorous tasks that you can save incredible amounts of money on if you keep them in-house. “You can shampoo your own carpets with a rented device and buy your own toiletries at Costco. If such things are too much of a hassle for you to do yourself, that's okay, but you're going to pay for the privilege of having someone else do it for you,” he says.
Creating Room to Grow
In summary, to boost your bottom line you must free up valuable big-picture management time by offloading tasks that don’t directly affect profits, says La Fata.
“You running errands doesn’t generate revenue,” he observes. “You learning how to create a flier in Publisher is not your best use of time. The more time-freedom you have to go out and attract, sell and retain more clients, the more your business can grow.” Exercise your option to outsource, and bring your focus back to your business’s fiscal fitness.
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SIDEBAR: Online and Overseas Options
Today’s online world offers outsourcing options at the click of a button.
Freelance workers, including specialized experts such as writers, online marketing pros and graphic artists, can be found at Elance.com, Guru.com, oDesk.com and vWorker.com. These websites offer for-a-fee forums to connect job-posters with job-seekers. Online entrepreneur and fitness pro Rick Kaselj has this advice: When hiring from such sites, start with a small assignment and use it to assess the freelancer’s ability to follow instructions, produce quality work and communicate.
Internationally curious entrepreneurs can hire a VA from India, the Philippines or another cost-effective locale through agencies such as GetFriday.com, AskSunday.com and BrickworkIndia.com. For Canadian and U.S. options, check out the Canadian Virtual Assistant Connection (www.cvac.ca) or the International Virtual Assistants Association (www.ivaa.org).
A caveat: When managing remote workers, says Kaselj, provide extremely clear instructions. For his freelancers, he breaks tasks down into bullet points and makes explanatory screen-capture videos with the free online tool Jing® (www.techsmith.com/jing.html).
For more detailed (if somewhat humorous) how-to tips on hiring and managing remote workers, read The 4-Hour Work Week by Timothy Ferris (Crown 2007). Strategies for mistake-proofing your email communications with VAs—and other wish-I’d-known-beforehand ideas—can be found at www.fourhourworkweek.com/blog (find “outsourcing life” in the topics list).
© 2012 by IDEA Health & Fitness Inc. All rights reserved. Reproduction without permission is strictly prohibited.
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