Measuring the True Cost

Each and everyday we decide whether to do tasks ourselves or hire them to be provided from someone else. Think about it, even choosing to bring your lunch from home compared to going to a restaurant is a choice. Whether in our personal lives or in our business, we must determine if the cost of that convenience is worth the value it brings to us.

One critical element we often overlook is the value of our time. If you’re considering hiring someone to help your business, you can more easily but a monetary value on this. After all, don’t we all exchange our time for money? Perhaps you work for someone else and are paid hourly, you’re clearly trading time (and skill) for money. If you are a business owner, you’re either selling a product or service. Either takes time and in exchange, you receive money for said product or service.

Let’s consider a simple example. Maybe you clean your own office. Let’s say it takes you 1 hour per week. Consider what productivity you’re losing during that hour. That is 52 hours per year! What is the value of that time? Now decide if it would be more cost effective to hire someone else to clean your office. It’s likely that a professional cleaning company would spend less time than you because they are more efficient in a job they do every day. Just as you are more effective in your position than something you don’t regularly do.

Another great example is changing the oil in your car. We know that many people are mechanically inclined and can change their own oil. They still need to buy the oil, filter, and maybe some tools. Once you factor in the time it takes, it could very well be more cost effective to take your car to the dealership or an instant oil change type of business. They have the proper tools and can likely have you on your way quickly. This example is pretty obvious if you are one of the individuals who are not mechanically inclined and would need to spend half the day on Youtube trying to sort out where the oil goes. (You know who you are.)

We come across these situation often when people try doing their own taxes, bookkeeping, even payroll. If this isn’t your area of expertise there is a chance you are spending too much time on the task and could make costly mistakes. Maybe you’ve been doing your own taxes for years. How much time is it taking? Are you spending hours researching the recent changes in tax law? Are you constantly investing in new software? We understand! Firms like Purk and Associates are constantly investing in new software, programs, and continuing our education to ensure we are offering the best possible service to our clients. When you hire a professional, you should expect this type of dedication and commitment to excellence.

Regardless of what service you’re contemplating doing yourself, consider the time you’re spending and compare it to hiring a professional. Don’t be afraid to do some research. You might surprise yourself.

As always, feel free to reach out to Purk and Associates! We would be happy to answer your questions.

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