Wednesday, September 2, 2009

How to Know When to Outsource

My friend Bill Davis pointed out this formula to me to know when to outsource instead of doing a task yourself. I've included numbers but make up your own.

Yield per hour
Target income ($100,ooo)

Number of weeks of work per year (40)
Number of hours of work per week (35)

= 1,400 hours per year

$100,000 / 1,400 = $71.43/hour

That is the number you need to earn to make achieve your desired lifestyle. If you can pay less per hour for a task (personal or business) and it can be outsourced, a great case can be made that it should be outsourced.

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