When To Delegate Client Delivery
If you're the bottleneck in client delivery you're going to have a difficult time growing.
In today's video, I want to share a story and break down the math from a conversation I had with one of our coaching clients who was leaving $40k on the table...
...all because he thought it would be "cheaper" for him to do the work.
Boy was he wrong!
Unfortunately, most agency owners reach a point where they say things like:
◉ I can't afford to hire help
◉ I've tried hiring help but it's faster if I just do it myself
If that's you, watch this video and learn when to hire your first employee and how it's already costing you more than you think...
Transcript / MP3
Are you drowning in client fulfillment? If that's the case in this video, I'm going to break down when you should actually delegate client delivery work. Let's get what's going on, guys. Greg Hickman here with all agency at all, agency.com and this video I want to talk about when you should delegate client delivery work. Now this topic comes from a conversation I was having with one of our new clients, and he basically said that he has $40,000 of opportunity in his pipeline right now that he can not close.... And that's because he is the only one doing the delivery work. So each and every day, there are multiple clients ready to give him money up to the value of $40,000 that he is not taking on because he's already stuck inside a fulfillment because he doesn't have any more hours in his day and or his week to actually serve those clients and still deliver them the results that they came to him for and get this he's already working well over 40 hours a week.
He's working on weekends and he hasn't taken a vacation. So there's a problem here, right? He needs to make more money, but he doesn't have any more time. And he's the one stuck doing the fulfillment. And I said, well, why don't you just hire help? And he said, well, I can't afford help. And I actually said, well, how can you afford not to get help? And he didn't really understand how he could look at and justify hiring someone on the fulfillment side, on the client delivery side to help him get the clients the results so he could take on that new capacity. So that's what I want to talk about today. Now, if you're new on this channel and you haven't yet subscribed, go ahead and click that subscribe button and the notification bell, because we release a new video each and every Thursday. So here's what we talked about. And I asked them a question. I said, Hey, for the sake of the story, I'm going to call him Dan. I said, Dan, what's your hourly rate right now? And he said, his hourly rate right
Now is 150.
And I said, you know, describe what it is you do. And he talked about, you know, just for the sake of the example, he's working on messaging and helping build out a website. And I said, okay, well, do you think you can hire someone to do exactly what you do or at least 80% as good and be able to pay them 50 bucks an hour? And he goes, yeah, absolutely. So I said, okay, cool. So you could, what you're saying is you can hire someone and you can pay someone $50 an hour, which is a good hourly rate for bringing someone on at least to get started. And they'd be able to do the exact same thing, or at least get about 80% close with the appropriate training. And he said, yeah, absolutely. I said, okay, so let's figure this out. How many hours a week do you have right now dedicated to fulfillment?
Or how many can you dedicate? And so the number of hours that he's dedicating a month was about 80 so 20 hours. And just for the sake of this example, I'm keeping the numbers simple. It was a little more complex than this, but 20 hours a week, 40 hours a month. All right. Now, if you were just to build those hours that, and that's out to 12 K of billable hours. Now, if you were to get help at $50 an hour and person can come on and give them 40 hours a week, they have doubled the capacity and it's going to cost him eight K a month, $50 an hour though, 160 hours, eight K a month. So if you were simply just to continue charging one 50 an hour, but delegate the workout for 50, he's going to get a bump here of 33%.
Okay. So my question to him was then if you charge 150 an hour, but you can get someone equally as good for less than that. And for the example, let's say 50, but if you want, let's say a hundred, you bill 150, you can pay someone a hundred and or less, right? Why are you continuing to pay someone 150 an hour for work that you can delegate to someone for less than that? And I don't know if you just had a light bulb moment, but Dan shore did. And many of our other clients that were on this call also did because you sit here and you justify that you can't afford help, but if you're the one doing it and you can pay someone less than you're already paying more than you should in order to deliver that work. And that's the starting point, that's the trigger point for you to figure out, okay, how do I go get help?
Now the problem is you're probably in a lot of pain because you're stuck in fulfillment and bringing someone on and training them is going to be a little bit challenging, but that's because historically you've always looked to hire part-time people and specialists. And so they cost a lot of money and you don't have a process for them to hop into your creative workflow or your delivery workflow for them to actually be really effective as quickly as possible. So long-term, this person is going to be able to double your capacity as to what you're able to do. And in most cases do it at half the rate that you are charging. Now I'm not recommending you charge by the hour, and we've done many videos. Why you should not do that. But when you are looking at your costs and you're using the argument that I can't afford to hire help, yet your hourly rate is higher than what someone else's would be for you to get that same help.
You are spending more than you have to in order to get the help that you need. And that was a big realization for him, many of our clients, and should be for you to start offloading your fulfillment. Is there going to be an upfront cost in bringing them on to train them? Yes. This is going to take some of your time. Yes, but what's the alternative continuing to not make as much money and be completely burned out by working extra hours, because you're not willing to give up some of the work and get some help. Like your business won't be around long enough for you to be complaining. So if you can offload that work for less than you would pay yourself to do it, it makes sense for you to delegate and to go look for someone. And if you can bring someone on that is going to be an employee, or at least full-time dedicated to you in your process, you're going to likely be able to get a great value.
Because now you're bringing on someone that is, you know, has a job and a career and you can help groom them. And that they can get excited about this opportunity as well, versus always having to kind of find freelancers and subcontractors that are available. Because if you're trying to play that game and grow a real business, and your business is dependent upon the schedules of the different subcontractors that you use here and there on different projects, this is going to be the roller coaster that you will always be in until you make a change. Now, one key important tip here, when you get that person onboard, say at 50 an hour or a hundred an hour, and you get, say, even 20 hours of your capacity back, all you need to do now is spend that new time on activities that will generate more than it costs to pay that person.
So if you go and spend those 20 hours that you just got back by offloading, half of that in fulfillment, and you can go generate one new client or two new clients a month, it's going to be well worth the time that you just bought back by bringing on this person. So you have to fill that new time that you get back with activities that will generate income above and beyond what your expense is to get that time back. So hopefully that makes sense. If you enjoyed this tip and you're looking to kind of take your freelance business into a real business owner, then I want to invite you into our free Facebook group, all agency.com forward slash group. You can check that out below, and I want to know what you just learned from this exercise. How much time could you buy back and how much extra are you paying for fulfillment? Because you're still doing drop that in the comments below. And in the meantime, then I want you to check out this other video of how you can escape selling your time for money, because that's the next step to exponentially increasing your income without words, more hours.