Are you getting this whole subcontracting thing right?
As you know, I hang out in a lot of VA Facebook groups, along with the lovely Virtually Yours members. I read, and I listen. One thing I’ve seen popping up a lot lately is the topic of subcontracting. And with more VAs growing their business to become a successful multi-VA business, I wanted to raise something that was a little concerning to see. A rate of $25 per hour (inclusive of GST) was being offered to a subcontractor. If you compare this to a full-time employee with at least 3 year’s experience in office administration, the rate is about right. The award wage is about $22.50 per hour (more for weekends and public holidays – up to $56 per hour), and of course, doesn’t factor in GST.
The differences between and employee and contractor are huge
So, if you look at these factors, offering the same rate per hour is a bit ridiculous.
You’re more than just a ‘work-from-home’ mum
Unfortunately, VAs are often seen as the work-from-home mum just after some extra cash who operates with few overheads.
Well an employee has NO overheads and isn’t being treated like they are running a lemonade stand out on the street.
When you start running your VA business, you’ll quickly realise it’s not exactly as cheap as you may have thought. To run a professional office, you still need to maintain all electronic equipment, manage your business administration and accounting, advertising, insurance, networking, software and membership/association costs. That can really add up. If you’re looking for a subbie, and you find a VA who is happy to accept low rates of pay, ask yourself: Will they be in business long? How are they paying their bills after they pay business expenses? Are they contributing to their ongoing learning? Are they insured? What happens if they go AWOL or stuff something up in my business?”
A subcontractor must work as hard as the VA who hires them
Subbies are expected to deliver and meet deadlines just like anyone else. They’re NO DIFFERENT to any other professional VA unless they aren’t taking their business seriously – in which case, why are you hiring them? Rather than offering a measly rate, why aren’t you looking at whether you are benefiting anyone by having a team, other than just yourself? If you are not charging enough yourself to offer a reasonable rate to a subcontractor, you shouldn’t look at hiring a subcontractor. What you need to do is look at how having a team would add value to your clients. How would you providing them with more support help them? How will you implement and ensure these benefits?
You need to have a contingency plan if you want a team
If you’re thinking about building a team, you always need to have back up plans in place. What happens if they’re unable to work? What happens if they stuff up? What happens if the job scope changes? How will you ensure your subcontractors stick with you? Hint: a low hourly rate won’t help!
- If you can’t step up and deliver the extra support a multi-VA business should be offering, then don’t do it
- If you won’t charge your clients more to ensure your team are supported, then don’t do it
- If you can’t see and communicate how your clients get more value from your multi-VA team, then don’t do it
- If you have a strong strategy around building your team and adding value and reliability to your clients, get onto it
- If your clients are excited about having the support of your crew with you manning the wheel, then get onto it
- If you can build a team of VAs who are excited to be working with you and want to be a part of this team vision, get onto it.
Where does your VA business stand with subcontracting?
Where do you fit in with the above? Are you hiring support without considering the consequences? Or are you going to grow strong and do it right? I’d love for you to share your subcontracting stories in the comments below.