Outsourcing Basics for Business: 5 Simple Tips (#4 Will Have You Laughing Out Loud!)

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outsourceYears ago, before starting my business, I remember watching Office Space and deeply identifying with Peter Gibbons’ dream of “doing nothing“.  Office Space is a hilarious movie and now has a cult following. There is a good reason for this.  The movie strikes a nerve with many because it reflects the reality of millions of people (in a somewhat exaggerated fashion of course!)  So many people hate, sometimes even dread going to work!  The politics, the co-workers, the unreasonable expectations leave many feeling that they are just a rat in a wheel- running running running, with a small reward that seldom increases!  Over a period of time, this type of environment will leave most people drained or even in a state of desperation- looking for a way out- perhaps even going to the extreme side where one dreams of “doing nothing” for the rest of their days!

When I first started researching “opportunities” both on and offline to “free me” from my job, I explored a lot of options (many of which I talked about in my free ebook which can be downloaded on this site).  Early on in exploring online income opportunities, I was introduced to the concept of “outsourcing”  This concept was presented to me something like this:

“Create an entire business at the push of a button!”

“Do absolutely NO work and make a full time income!”

“Our team (or software) will run your entire business on auto pilot”

“Outsource your entire business and grow it while you sleep” (or “while you lay on the beach” or “while you travel the world”

All the messages suggested a business could be created, run and grown with no direct involvement!  Although something in me knew this was too good to be true, it played into my deep desires for escape from the “normal life” and unfortunately cost me some money (buying courses that didn’t deliver, paying people to “build money making websites” that didn’t make a dime, investing in “opportunities” that turned out to be a waste of time etc)

This post is a “beginner’s guide” to outsourcing.  I consider myself somewhere between beginner and intermediate when it comes to outsourcing.  I’ve learned a thing or two, but don’t have it all figured out.  The most important thing I’ve learned though is this:

The idea that you can purchase a piece of software or hire a few people oversea and run your business on complete autopilot is a bit of a pipe-dream.  Some will argue that their businesses actually run this way, but I’m skeptical.  In my experience, it takes at least some active involvement for a business to thrive!

On the flip side, I saw first-hand what is possible with “outsourcing” when I worked as a pizza delivery driver.  All of us (cooks, drivers, managers) worked all night answering phones, taking orders, making food and delivering it to customers. At the end of the night, the shift manager would print out the sales numbers and fax them to the owner- who lived at least 3 hours from any of his stores.  I imagined him sitting and watching TV all day, or perhaps going and spending his days playing golf or spending time with friends or family and every night simply receiving a report of his profit!  What an amazing life I thought!  Now, on some level, I think it’s true that he had opportunities that those of us who were on a set schedule, working for him did not have.  He likely had more freedom, but looking back, I don’t think this was all there was to his involvement in the business.  In fact, on “customer appreciate day” where we would sell medium pizzas at $2.99 each, he would come in the store and help us make the pizzas, interact with us and get actively involved in the business.  He would also drop by at least once a month to check up on management, the employees and the overall morale of the store.  Furthermore, he was responsible for regularly “managing his managers.”  I assume he also made decisions in regards to advertising, food suppliers, customer feedback and countless other areas that I did not see behind the scenes.  Nonetheless, I still think this model shows what is possible when systems can be automated and outsourced.  Below are 5 simple tips when thinking of outsourcing parts of your business

#1. Do First, then Outsource

I cannot stress this enough!  It seems like such an attractive idea to simply hire someone with skills to “create a profitable business” for you, but trust me, it doesn’t work.  I once hired someone to build a fleet of “mini sites” for me that all promised to generate $2-$5 a day.  In reality, they generated exactly $0 and cost me over $800 when it was all said and done (websites, plus domains, plus monthly fees, plus backlinks, plus promotion, etc).  That was a painful and expensive lesson.  The best luck I’ve had with outsourcing has been learning a skill first, then teaching someone else to do it.  This has been true for packing and shipping, listing, scouting, inventory management, data entry and many other aspects of the business.  The best results come when you can teach someone what works for your business.  Even people who have done similar work before need to adjust their skills to make them work for your systems and strategies!

There are a few exceptions to this rule.  For instance, I have hired people to design graphics for me and have not “trained” them because I’m not a designer (I actually did a lot of my “design work” when I had no funds to hire others, but I’m a total hack.  I’m grateful to now be able to hire people that create actual eye-catching graphics!)  It also does not make sense to “learn first, then hire” in areas where you’re hiring professionals such as accounting or legal services.  For the most part though- for regular routines in your business, learn it first, then outsource it.  You’ll be glad you did!

#2. Only Outsource After Running the Numbers!

The last thing you want is to outsource tasks that cost more than they are worth!  When you feel you have a handle on running the regular tasks for your business, be sure to run the numbers to be sure it makes sense to outsource a task before moving forward!  If your business is making $500 in profit a month and it costs $9.00 per hour for 20 hours per week to hire someone for customer service, you’ll probably want to think about handling the customer service yourself for a while longer while your business continues to grow!  Don’t be in a rush to outsource and end up sinking your business!

#3. Set it, But Don’t Forget it

The age of automatic software and global outsourcing is wonderful to live in!  Programs have been created to do a lot of the hard work for you, and real people with real skills are available at the click of the mouse but the software doesn’t replace an intelligent human mind and even an intelligent human mind across the globe still needs some guidance to correctly perform a task for your business!

Software like Longtail Pro is amazing for finding great keywords, uncovering niches and helping your website rank in Google or even on Amazon or Ebay, but it’s not going to pick the best keywords for your business, choose a relevant products, buy them, list them and sell them!

I use Channelmax to manage my inventory and price competitively, but it still requires going in every week or two, manually setting prices for new inventory items, tweaking existing prices, looking at reports, and making decisions for the business.  In addition to this, I’ve also hired a contractor to go in and make changes and liquidate non-selling items on a fairly regular basis, but he still runs the data by me from time to time!  No automated software is going to have the capability to reason and make tough judgement calls (software will rely on rules only, which may or may not be effective in any given situation) and no contractor will make the judgement that makes sense for your business without proper training and occasional guidance!  Always stay involved even when “automating” and “outsourcing” the processes!

#4. Weed Out the Bad Ones Quickly!

When hiring, and training and ultimately trusting someone to perform a task for your business, what are the most important qualities this person must have?  For me, without a doubt, it is the ability to follow instructions and perform the task requested.  When hiring in the past, I would become overwhelmed by the number of applicants I received and would find it very difficult to go through each profile, narrow it down, set up interviews and pick the best person for the job.  A few months ago, I was given a tip from my friend Kent McCorkle (you can find out more about what Kent is up to at stepstopassiveincome.com)  This tip has literally saved me hours and it’s so simple!

When writing your job description on the outsourcing site, include this line:

When responding, please include the phrase “applying for the customer service position” at the beginning of your proposal to demonstrate that you follow directions well

You can replace “customer service position” with whatever you are hiring for.  You will be absolutely astonished at the number of applicants who fail to do this!  It’s quite comical actually! The applicants who fail to do this get deleted immediately!  This is an instant way to weed out those who do not follow directions well!  I like to include this line somewhere in the middle of the description.

Outsource as Much as Possible, But Not Everything

The “do nothing” model is attractive, but the reality is, if you are not involved in your business on some level, the business has no need for you!  It could easily be hijacked or copied by an employee, contractor or competitor and the truth is, without you, the business is not going to be as good as it could be because nobody else on the planet will care about your business as much as you do!  The main thing that makes your business unique and makes your business thrive is you.  My goal by the end of this year is to outsource everything I possibly can, but there are some areas that I do not plan to outsource.  I would like to stay actively involved in brand creation, wholesale sourcing, and stay involved, at least in part, in advertising, marketing and the development of my business image.  There are a variety of tasks, however, I’ve already outsourced and/or automated including:

-inventory management

-product review requests

-collecting emails from customers

-website creation and maintenence

-processing, sending back, and reselling returns

-Ebay and Amazon listing creation

- Order fulfillment

-Arbitrage inventory sourcing

-packing and shipping inventory to FBA

I have been spending a great deal of time the last couple of months writing a brand new ebook based on numerous questions I’ve received about outsourcing, and shipping inventory directly from suppliers to FBA.  I’m pleased to offer this new ebook “Invisible Inventory” for free to purchasers of “Six Step Six Figure System!  The ebook goes into great detail on setting up and running your business without actually touching inventory.  This will unfortunately not allow you to reach the goal of “doing nothing” for the rest of your life, but it will provide a strategy to allow you to work from anywhere at any time with nothing but an internet connection!  This will be a giant step forward for those of you who are fulfilling orders yourself and even for those of you who are packing and shipping inventory to Amazon FBA!  I hope you find it helpful!

There is a link to download this book within the book “Six Step Six Figure System.”  You can get started for free by downloading my ebook “System Start-up” below” immediately!  This will get you going, Six Step Six Figure System will go into great depth and Invisible inventory will expand even more on the concepts of outsourcing and automation!.  To begin, go ahead and sign up below. Enjoy!

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