Today’s Quote: The strength of the team is each individual member. The strength of each member is the team. – Phil Jackson
Welcome to another episode of the podcast that teaches you how to be a ridiculously good virtual assistant.
Today we are going to talk about whether your VA business is ready for subcontractors.
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Connect with Tracey D’Aviero, VA Coach and Trainer
Episode Notes:
Is it time for you to bring subcontractors in to your business?
There is a right time , and there is a wrong time.
And there is a right way to set yourself up for them, and a wrong way.
Let’s get started by talking about what leads up to you bringing in subcontractors.
It’s about your work load of course.
the best time to bring in subs is when your business has gotten so busy that you need help. That’s the simple answer.
As you bring in more and more clients, your attention will get divided – and you will have to work more.
Getting more clients is always good for business. You make more money, and you can help more people.
But being a very busy VA is not always great though. Sometimes our response times suffer, sometimes our turnaround times suffer, and sometimes we can get burned out because we have so many things to do.
That’s when getting help to get your client work done makes good sense.
Of course if you know your VA business is going to grow, that’s the best time to plan to bring in subcontractors.
The setup time for subs depends on what you are going to outsource to someone else. Getting a couple of things in place is easy – like a sub agreement, but getting your systems set up and raising your rates for your clients can take more time. So if you know that you want to run your business with subs, make sure you are doing that set up long before you need it and things will work out much better for you.
But most of the time we realize that we are working too much and need help – and that’s when we decide it’s time. And that’s okay too – like I said it’s the far more common way to do it, but you still want to prepare your business well.
Just quickly, when is the wrong time to bring in subs? Well, there are a few:
If you are not booked out, it’s not the right time.
If you haven’t set rates that allow you to pay out subs, it’s not the right time.
If you don’t know how to do the things your subs do, it’s not the right time.
I’ll elaborate on all of these as we talk about the right way – but these are really important, and worth mentioning.
So let’s talk about what you need to have in place before your bring in subs.
- You need to know exactly what you need help with. You can train subs but you need to define the tasks you need help with so you can get the best support. You don’t always want to train VAs with every little thing, so decide how much experience someone needs or how challenging the tasks are to figure out the skill level your subs need. I have worked as a sub with my expertise, and as an absolute newbie. What helped me be a good sub in both of those roles? The lead VA, their processes, and their ability to help me, their sub, get the work done as efficiently as possible. Also, decide how many subs you need. Sometimes it depends on what the tasks are – it also depends on the timing of those tasks, and the skill level too. You don’t always have to have just one sub doing everything.
- You need to set your sub payment rate, or the rate you are willing to pay to hire a sub. When you are paying out someone else, you need to retain both administrative money and profit from the money the client pays you. It makes no sense to pay a sub all of what your client pays you. You have to be sure that your rates are set up to retain profit and make your VA business money. When you are growing your team you need to also grow your business, don’t forget that. A lot of VAs will pay out 75% of their billable rate to their subcontractors. So for a $30 sub, you need to be charging your clients at least $40. Sometimes VAs will tell you how much their sub rate is – meaning they will work for you as a sub for X rate. I prefer to tell them what being on my team pays, but as long as the rates work out so that you are profitable, you can do whichever you like. Work within your budget, like we tell our clients to, and you will be fine.
- Track all time and tasks. Project management excellence is essential when you are working with subs. You need to make sure that you know what they are doing, and how much time that is taking. You will set a budget for each client and the sub VA needs to work within that. And of course since you are doing the admin, you want this info to be as easy to check in on as possible.
Use a project management system – whatever works for you is terrific – and make sure your team members all use it. Be sure that your VAs are keeping their time spent up to date so you can monitor your client budgets. - Communicate very clearly. When I work with a client, we have regular check in calls – weekly production calls I always called them – to quickly connect and talk about priorities for the week. I do recommend doing a team meeting once a week, they are very effective, and then the rest of the communication can and should take place in your project management system the remainder of each week. Your subs also need to communicate very well, no matter what they are doing for you. A lot of time can get wasted in the communication process if you aren’t doing it well. Setting a system for communication and making sure everyone uses it can really help the work between more seamless.
- Create and use procedures and checklists. If there is one thing I can tell you will help your subs do the work you need done in the way you need it done, it is procedures and checklists. You can either create the procedures, or have your subs create them when they come on your team. And then all you have to do it walk through the procedure to ensure that the work is being done to your expectations. It doesn’t matter how they think it should be done- you are the one who dictates it all for your business. And in terms of checklists, these will always ensure that no steps are missed, and that you can see that the VA is verifying they have done every step in a checklist when you look in on their work. Remember when you are working with team members, your rates will be higher – and that means your clients are paying you a premium to have high quality work done. In my experience, VAs who use checklists do a better job than those who don’t. Make your subs use them, or they don’t get to work on your team.
- Pay your subs the same amount you would charge your clients. This is something that some VAs don’t do, so I need to mention it. When you are working with your clients, you have some idea how long a task should take. You need to tell your VAs how long any task should take, and they need to work within that billable time. For example, if you were doing the work for a client newsletter and it was taking you 2 hours every time, then the sub needs to do the work in 2 hours as well. You can’t let your VAs chip away at your time because you are eating into your profit. So even though you are paying them less than you charge, you can’t let someone take 3 hours (or longer) to do the same work you would do in 2. Tell them how long they have to complete a task – give them the written procedures – and if they can’t do the work in the time, assess why (are you just really fast? or are they really slow?). Match up their time with your billable time to the client. I once had a sub who spent 6 hours on a research project that I was only charging the client 2 hours for. You can’t have that happen. If I know the estimate is 2 hours I have to tell the sub it needs to get done in 2 hours.
- Know how to do what your subs will do. I know many VAs who think they can get people in do tasks that they don’t know how to do – these are not subs. These are associates -and unless you have a lot of experience as a VA, I don’t recommend starting this way. Use your subs to do your work – to take over for you – so that you can keep an eye on their work and deliver the same quality to your clients. Later you can think about being an agency, but when you are building a team, and you are the one responsible to the client, you need to be able to cover for everyone on the team. And if you don’t know how to do something and your sub flakes out, your clients will lose confidence in your ability. Your business is always the most important part of the people you have doing the work for you. Prioritize it and you will build an amazing team.
- Use a contract and even an application process if possible. You need to let your subs know that the work they do is really important and a contract helps them do that. They aren’t just helping you or doing things that are not that important. They are producing their best work for you – their client, essentially – and it needs to be top notch. If you use an application process you can make a better decision about who can join your team. I have seen many people have a quick Facebook group interaction with someone saying ‘PM me, I need someone’. I am sincerely hoping they go through a vetting process after that so they can make sure the sub they are choosing is the right one. I always looked for long term subs – just like long term clients.
These are all pretty simple things but they are very often not taken into consideration by VAs who want to work with subs.
Properly planned and managed, working with subcontractors is an excellent way to scale your business growth.
By planning your communication, project management and making sure your rates are maintaining your profit level, you can build a much bigger business than just you!
And when you are organized and can manage both your client’s and your sub’s expectations, you can keep everyone happy.
Oh yes speaking of those clients, it’s essential that you let them know that your business has grown to use others to do their work. You may even need to update your own contract with them. Never let someone else access your client files and systems without advising your client beforehand.
And know that your business insurance won’t cover your subs – they need to have their own insurance for their own business, that covers them.
Need Some Help?
If you need some help with setting up your VA business for subcontractors, reach out to me at tracey@yourvamentor.com. I’ve helped hundreds of VAs through their challenges and got them on their way to the next thing. I’d love to do the same for you. I do private coaching, and registration for my new mastermind group The Virtual Circle is open now. Maybe one of those is right for you!
That’s all I’ve got for you this week, thanks for tuning in to learn to become a ridiculously good Virtual Assistant.