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How to Make Your Business More Efficient by Outsourcing

How to make your more efficient by outsourcing less important and repetitive tasks? That is what we are going to look into in this post. I also have some calculations on what you can use to determine, what tasks you should outsource and if the task is even worth doing.

Sometimes, the task at hand is not bringing as much value to your business as it costs you in time or money. Let’s dive right into it.

Use the 80/20 rule to determine what to outsource

What is the 80/20 rule? In short, it means that 80% of the results come from 20% of the effort. I have a dedicated post about how you can benefit from this in your business, you can read it here.

So, since the top 20% of the tasks are the ones that have the most impact on your business, you want to focus on them yourself. Or, if not yourself, at least supervise the person doing them for you closely.

That 80% on the other hand, has some things that could be outsourced. That might, for example, be customer service or handling some smaller customers.

If your customer service is taking up a lot of your time, you might want to hire someone to do that job. Another option is to outsource your customer service to a company that offers that kind of service.

Handling smaller customers can be one thing that also takes a lot of time, but only brings a tiny portion of your business’ income. Let’s say every customer you have needs the same amount of work. Customer A brings in 50% of your sales and Customer B brings in 5% of the sales.

It might be better to focus your energy completely on the bigger customer and try to maximize their sales and make them happy, instead of focusing the same amount of energy on a customer that only brings in 5% of your sales. Have someone else fight with the customer that brings in 5% or have them eliminated. More about eliminating tasks on below.

Determine if outsourcing or eliminating the task is better

There might be tasks in your business that are just hanging on from the early days of your business. Things that don’t really bring that much value these days, but you just keep on doing them because you always have.

These things might be useless payments, subscriptions, or customers. Let’s take the customer example again.

If you eliminated Customer B that takes as much time as Customer A, but only brings 1/10 of the sales, you could increase the sales of Customer A. When you focus the time and resources freed from no longer dedicating time to Customer B to the right place, your businesses sales and efficiency overall might increase significantly.

When you can focus on serving your best customers the best way you can, I would say it is not impossible to increase revenue from them by 10 or 20%. Even if the sales to them didn’t increase, at least they will get better service and be more likely to continue working with you.

Learn or outsource?

There are things you have to learn and know how to do when you run a business. However, you don’t have to master them all. You don’t have to know how to build a computer from scratch. You can have someone to do it for you.

You don’t have to build your own office for your business either. You can rent one that is already built. Using the expertise of others to make your business more efficient can save you a lot of money and time.

If you need a logo for your business, you could learn it yourself. However, chances are you only need to design a logo for your business once or twice during its lifetime. By outsourcing it to someone who has already plenty of experience, you would not only save time, but also probably end up with a better result.

Calculate how much your time is worth

Let’s say you value your time at 20$ per hour. If you learned to design the logo yourself, it would take you 10 hours plus one hour to make the logo. If we convert the time spent learning to design somehow plus the work to do the actual logo, you will end up with a 220$ bill.

Of course, you don’t have to pay for that, since you’ve used your time. However, if you outsourced the logo design process to someone, who does it for 30$, you would have saved a lot of time.

If you spent the time you freed by not learning to do it, by improving your business or selling your product or with a 20$ hourly rate, you would save 190$. This is just an example. Hopefully you get the point here.

Another thing is setting up your website or renovating your new pizzeria. There are people that are already more experienced in the things you need. You don’t have to learn to do everything yourself, focus on the things you are good at, and outsource tasks that others can do better.

Final words

I think there is room for improvement even in a business that might seem perfect. Outsourcing can sometimes be a useful thing to do, to save you time and money.

Depending on the things you will outsource, it might be someone local, for example renovating the pizzeria, or you could get someone from Fiverr or Upwork to design you the logo for your business and save you the time doing so.

On top of that, the logo designers also have experience on making the logos, so chances are, even if you learned to do the logo yourself, you would get better one when you bought one from an expert.

Other business-related topics can be found here.

Hopefully this was helpful to you, have a nice day.