Hiring people is one of the largest fixed costs to any small business. It’s not just salary that needs to be considered, but recruitment, superannuation, workers compensation, training and infrastructure.
Even more expensive is when a new hire doesn’t work out. A survey by The Australian estimated that a bad hire will cost you two and a half times the employee's salary, a figure which goes up even more for high-level positions.
To put that in perspective, if you pay a new employee $70,000 a year and they turn out to be a bad fit for the role, you could find yourself out of pocket by $175,000.
Outsourcing some or all of the administrative functions in your financial advice firm can make sense and offer many financial benefits, including:
• Ensuring investment is focused on staff who will add the most value to your clients and your business.
• Enabling you to focus on managing your clients and running your business, rather than working for it.
• Supporting flexibility as your needs change and the workload ebbs and flows. You can use it to scale up your business as it grows without the fixed costs.
• Paying by set task, hourly rates or fixed monthly costs, depending on your needs. This greater efficiency and flexibility can improve cash flow.
Of course, it's not all about the money, it's about ensuring high-quality service and compliance standards, and enabling you and your staff to spend your time and energy on the really important things.
Want to get a better understanding of the potential savings your advice firm could make by outsourcing some of your core activities? Use our online savings calculator and find out now.
It's part of our FREE outsourcing info pack - complete with eBook, on-demand webinar and savings calculator.