Recently I conducted a survey of entrepreneurs who expressed interest in virtual teams and asked, “What is your single greatest challenge with building a virtual team?
Over 64% answered, “Knowing how to pay for a team.”
The funny thing is I never questioned whether or not I could afford to hire someone. That feels like a limiting question. A more powerful question is, “What do I need to do to cover this cost in my business?”
When I conducted the five interviews for the Virtual Team Building Secrets, Alexandria Brown shares how scary it was to hire her first assistant, Liz Murphy. But somewhere deep inside, Ali new that the ONLY way to achieve her bigger dream was to surround herself with people who could help her. When she hired Liz, in her mind she knew all she had to do was take on one extra client to cover her monthly bill. Within a short period of time, Ali had doubled her return on investment and she’s never looked back. (I believe she has over 10 contractors on her team now!)
So what is the formula to know how to pay for your team? It’s very simple. Let’s start with a basic premise that one client is worth $350 per month to you and that you will outsource your bookkeeping at a rate of $35/hour for 10 hours a month.
• One coaching client = $350/month
• 10 hours freed up on bookkeeping for $350/month
• With those 10 hours, how many new clients could you handle?
• One client = break even
• Two clients = double your Return on Investment
The trick is to know what you will do with your time. For some, you will need to focus on generating new business. For others, you will want to use your new found freedom for fun things like spending time with your family or traveling. But if cash flow is critical, you must focus on filling it with revenue generating opportunities!
If you already have a team and you want to determine if you should grow it, the question becomes, what will my return on investment be?
Will my new team member be directly generating sales, creating new revenue generating opportunities (marketing), or support freeing up more of my time so I can focus on high payoff opportunities.
It literally boils down to 6th grade math! Figure out what it will take to make sense to your bottom line. My guess is…the cost of doing it yourself is much greater than the cost to outsource and delegate.
Melanie Benson Strick, The Entrepreneur’s Success Coach, teaches entrepreneurs how to stop feeling overwhelmed so they can create more money and more freedom. If you’re ready to stop working in your business and start working on your business, go to www.virtualteambuildingsecrets.com