| Are your employees costing you more than you think? | | | | you in a year. You have lost opportunities forever |
| Do you ever feel like you are working for your | | | | when you're dealing with back office tasks that don't |
| employees, instead of them working for you? That's | | | | need to be done. |
| because in most small businesses, the owner has no | | | | Or what about the time you have to spend every day |
| idea of the true cost of employees and it is one of the | | | | managing or 'interacting', as they say now a day at |
| biggest reasons we suffer poor cash flow. | | | | MBA school? How much does that wasted time cost? |
| For example... | | | | Here is how to determine the 'burden rate' of an |
| If you pay your bookkeeper $15 an hour, he/she can | | | | employee. Go to your Profit and Loss statement and |
| be costing your company $75,000 a year. When I bring | | | | look under payroll. Move the owner's payroll to |
| this up I get a shocked response from business | | | | overhead, because you are management, and that is |
| owners, they say "NO WAY, I only pay her 15.00 an | | | | where it belongs (in overhead). Now divide the total |
| hour plus 7% in employee taxes - no way | | | | gross payroll into your total overhead and here is what |
| bookkeeping costs me $75,000 a year." | | | | you are going to find. That for every 1.00 you pay your |
| We underestimate our true cost or burden rate and | | | | employees, your cost is actually $2.40 to $2.60. |
| the locked in expense kills our cash flow if our | | | | So that $15.00 an hour bookkeeper is actually costing |
| business ever takes a down turn. Costs like medical | | | | you 36.00 an hour at the low end and and up to 39.00 |
| insurance, phones, rent, computers, software, training, | | | | if your office is a little nicer or your benefits above |
| hiring, sick days and the 100 other little costs that add | | | | average. That's 39.00 an hour if you have work to do |
| up. But those costs are chump change for a small | | | | or not. That is $39.00 you are paying out every day |
| business compared to the real expense. | | | | and that is plum nuts for a small business owner. |
| The big cost is the owners' time. Your time MUST be | | | | If you want to improve your cash flow, look for jobs |
| spent looking for new and better customers. Any time | | | | that do not affect the customer experience. |
| you are dealing with a bookkeeper, you are losing | | | | Bookkeeping is one of the first to go. On this web |
| sales to your competitor. The cost of finding a new | | | | page you'll find local accountants that can take that |
| employee and getting them trained on how you want | | | | $75,000 burden rate, and cut it down to $15,000 to |
| things done can take up $5,000 to $15,000 of your | | | | $25,000 a year. Plus - give you better numbers every |
| time. That number never shows up on your Profit and | | | | morning and advice on how to run a better business. |
| Loss, it's hidden. But that is lost time - losing customers | | | | Outsource your bookkeeping today, and start rounding |
| that won't buy today, and they won't be buying from | | | | up more cash cows. |