In the small business world, business owners wear many hats.
But far too often, they wear too many hats for far too long. Not being able to delegate fully or hire the right person to do the job, they continue to do it all themselves.
What they need to do, both to expand their business and to not work themselves into the ground, is to put a cost or value on their time.
They should focus on tasks that grow their business and profitability – instead of tasks that should be outsourced or completed by a paid employee who has the correct skill set.
In the real estate industry, many small to medium-sized operators are guilty of this. They are running their business, not leading and managing their team. They get stuck on back office tasks when really they should be out listing and selling or providing lead generation to the sales team, creating value and growing income.
The bookkeeping position is the classic anchor to the business owner. If you’re thinking of hiring an in-house bookkeeper, two important questions are: How much will this process cost? How much is your time worth?
Figuring out the cost of the process might look something like this:
Place ad for bookkeeper = $200
Sift through CVs = your time
Interview Candidates = your time
The total cost to employ an in-house bookkeeper = your time + $200
Then, you might have to do it all again in three months when you realise you’ve employed the wrong person!
So what’s your time worth? Well, if you’re a selling principal and you could have possibly listed or sold a property in the same time, your time, based on a sample sale price below, is worth:
House = $480,000
Commission = 2.2% (this might be light on, some locations will be higher and others lower)
Total commission in dollar terms = $10,560
Comparing these figures, it’s a no brainer. Work to your strengths, outsource your bookkeeping to a bookkeeping professional (with real estate experience) and enjoy a more profitable and productive business.
However, don’t wish your responsibilities away. You or someone in your business still has to be responsible for authorising bills and handling the movement of money from bank accounts. Your bookkeeper will give you the who, what and when, but you or the person you delegate still needs to press OK.
To find out more about outsourcing your bookkeeping, contact us at firstname.lastname@example.org.