outsourcing real estate

The Cost of Outsourcing

Scott Costello All, Blog, Featured 10 Comments

I’ve been getting really frustrated lately with my lack of time and resources (money!).  There are a ton of things I want to get accomplished like creating a web version of SI Lead Manager, building up my online marketing for lead generation and getting someone to handle incoming phone calls and mailings.  The problem is I do not have the time to do these things myself or the money to hire these things out.

The only thing I can do is do as I’ve been doing and SLOWLY (and i mean slowly) get things done.  I thought about trying to find a money partner for things such as my application, but I’m not sure I am ready to do that yet.

The Cost and Time Break Down

SI Lead Manager Web Application Development

On Monday I posted a job listing on ELance.com outlining what I wanted to have done.   If you don’t know what ELance.com is, it’s a community where you can hire freelancers to do jobs for you.    I was unprepared for the amount of responses I got in less then 24 hours….32!!   Needless to say it took me a few days to get through them all.

outsourcing real estate

For each of the offers I checked the following…

  • Number of Jobs they have done on Elance
  • Comments left by clients
  • Their Rating
  • Examples of their previous works
  • Their Profiles

The offers ranged from $700 all the way up to $13,500.  Many of the bids also included no amount because they only give estimates after talking with you, which was fine.   I could go more indepth with each type of offer, but to make a long story short….you get what you pay for.

I’m currently in talks with a few of the freelancers that I feel good about to try and work out a deal, though I don’t think we will come to common ground.  As a developer I can understand the costs of a project this size and commend the freelancers who say and I quote one of them

“…Your budget couldn’t even buy the gas to get me to where I want to go…”

He said it in a very nice way so I hold no hard feelings.  He was just being honest and I appreciate that.

If I were to talk this project myself (which I might because I’ve always wanted to learn webdevelopment) it could take me years.  I have very little experience creating web applications, and what experience I do have is from years back.  This means I would have to learn newest technology and then apply it to what I want to do.   I basically had to do that with the Desktop version of SI Lead Manager and it has taken me 3 years to get to Beta 6.  I would say that would be a good time frame for this endouvor as well.

Cost of Outsourcing – $5,000 to $15,000
Time Cost – 3 Years

Resources: There are 3 major freelancer portals where you can go and find people to outsource your work too.  I have yet to hire out any of my work just yet, but many good friends have used these

websites with much success.  Just be careful and use common sense when hiring a freelancer.  Do your do-diligence!

 

Search Engine Optimization – SEO

For me this is one of the most important things I need to get done.  If my current deal goes through I may pump the profits into SEO for my websites.   I have researched a few ways to go with hiring SEO work out and found a service called All For You by David Corbaley.   He gave a webinar where you went through his entire process of building up his “SEO power”.  He even gave us his blueprint by way of a mind map which was awesome!

Sure, I could do everything on his blueprint.  He even laid out what you need to do each week, step by step.  It is a massive undertaking to say the least, almost a full time job.  Knowing what I know about SEO already, this stuff is legit.

This is the perfect thing to hire out.

For me to undertake this myself, I would have to spend at least 10 hours a week doing this.  Just think, writing articles, registering your company with different sites, building sister pages to link back to your main site, social networking and on and on and then repeat repeat and repeat.   I’d love to do it all, but when you only have about 6 to 8 hours a week to do everything (mailers, seo, developement, learning, networking), it’s impossible!

Cost of Outsourcing – $500 / mo ($6,000 /yr)
Time Cost – 40 hrs to 50 hrs / mo

Resources: You can also higher a freelancer/Virtual Assistant for SEO work as well but you’ll have to do some level of interviewing to make sure you feel comfortable with their knowledge and skill set.   A couple of additional places to find VA are…

 

Paying Someone to Stuff Envelopes

Generating these direct mail pieces is priority number one for me and what I spend most of my 6 to 8 hours of free time on during the week.   To put 100 letters together probably takes me about 2 hours.   That includes printing and stuffing.  Stuffing and stamping probably takes me about 1 hour 20 minutes of that 2 hours.

I haven’t asked anyone specifically how much they would charge me to do the stuffing and stamping, but the going rate from what I’ve heard other investors say is about 10 to 25 cent per letter.  So $10 to $25 per 100. That is fair I think.

Cost of Outsourcing – $50 to $125 / mo ($600 to $1,500 /yr)
Time Cost – ~ 6.5  hrs / mo

 

Live Phone Service

Even with two people working together it is very hard to answer all the incoming calls you’ll get from your marketing campaigns.   Plus there is a lot of wasted time dealing with tire kickers, angry people and others that are just taking up your valuable time.  It is very important to answer as many of your calls as you can, and one way to ensure that happens is with a phone service that can do your pre-screening for you.  You give them a script of questions that they will follow and record the answers.  From there you can easily pick out the motivated people and just call them back, saving you tons of time.   I know a few fellow investors in my area who are very very pleased with this setup.

Cost of Outsourcing – $100 / mo ($1,200 /yr)
Time Cost – 10+ minutes per call

Resources: These services aren’t cheap, they usually charge you a base price per month and then charge you additionally on a per minute basis.  I’ve researched this a little bit in the past and here are some of the more recommended sites out there.

 

Additional Outsourcing Resources

Here are some additional Articles about Outsourcing that really have helped me learn about what to do…

  1. All About Virtual Assitants and Outsourcing by Pat Flynn
  2. Outsourcing Series of Posts by Sharon Vornholt
  3. Chris Ducker’s Blog

Does anyone else have any great resources to share?

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Scott Costello

Scott is a part time wholesaler, but full time real estate investing addict! As his family grows and his free time shrinks,He has been slowing building his wholesaling business over the past 7 years in between life events.Drive, dedication and never giving up are his strengths.
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Comments 10

  1. I use Callfire.com. It offers many services including call forwarding, voicemail, mass text and voice messaging, etc. $1/line and $0.05/min. I use a voice recording to help screen callers. Those that leave messages are usually motivated or angry. Also, the services tracks everything so you can have 1 line per prospect type.

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  2. We should totally talk about SEO…I do organic SEO that totally gets the job done and is quite less expensive than what you’ve got listed!

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  3. Hi Scott, nice informative post. I agree with you on SEO being a good thing to hire out. It’s one if those things that is best left for someone who has the time/knowledge/resources to do it well and cost-effectively.

    Is there a reason you couldn’t just create a solid voicemail message a manage your calls? If money is tight, this might be a lot cheaper than outsourcing (and it would weed out a lot of your unmotivated sellers as well). I’ve done this for years and it has worked pretty well.

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      Hey Seth, glad to see you found your way to my blog!

      My partner and I do have a dedicated google voice number for our marketing that has a specific voice mail message. It works for right now, but I feel having the live answering service will definitely take us up a notch and allow us to get a few more deals we might have missed on.

      I know from me personally, I hate leaving messages on voicemails. There is also that theory that the lead is never more motivated then when they make that call. You know what I mean?

      1. Yeah man, I know exactly what you mean. I generally don’t leave messages either unless I REALLY care about what I’m asking for.

        I can totally see the arguments behind both approaches. I guess it kind of depends on whether you have the money to pay for good outsourcing, and how valuable each of those leads are to you. If your lead volume is few and far between (or if you paid a lot for each lead) – then I suppose each one is worth more in the long run. On the other hand if you have more leads than you can handle (and you didn’t really pay anything for them) – then it may not be as big of a deal if you lose one here or there.

        Either way, I’m interested to hear how it ends up going for you!

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  4. Scott, I think outsourcing live phone service is still cheap you don’t need to setup your in-house call center. Also you can outsource job to professional so i think outsourcing live phone answering is a good solution

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