We could spend all day telling you the reasons why hiring a virtual employee is a great idea.
But, if you're anything like us at HireSmart, you want to know what specific benefits you get with virtual employees versus in-house employees.
So, we thought it'd be interesting to walk you through a life cycle cost analysis and highlight the labor savings benefit in particular.
What is a Life Cycle Cost Analysis?
An employee life cycle cost analysis (LCCA) is a financial analysis that considers all of the costs associated with an employee from the beginning of their employment through the end.
This includes not only the initial cost but also ongoing costs like training, replacement, and raises.
Applying LCCA to Virtual Employees
When it comes to virtual employees, the life cycle cost analysis includes costs for recruiting, hiring, training, managing, and supporting remote workers.
Let's break down each of these categories and see how they compare to traditional in-house employees.
Recruiting:
Recruiting costs for virtual employees are lower than those for traditional in-house employees.
With virtual employees, you don't pay for job postings, recruiting events, or travel expenses.
Instead, you pay an initial fee to a staffing company like HireSmart that covers all those expenses at a very low cost.
Hiring:
Hiring costs for virtual employees are also lower than those for traditional in-house employees.
You don't need to provide office space or all of the equipment, so you save money there.
You just need to make sure that your virtual employees have access to the necessary tools and software.
Training:
You might think that training costs for virtual employees would be higher than for in-house employees.
And you might be right, depending on what employment agency you choose.
At HireSmart, we provide a full 40 hours of basic skills training for every employee our client selects.
All that's left for you is to train them in your company policies, procedures, and culture (which, of course, we help you with).
Managing and supporting costs:
With virtual employees, there's really no on-site management, so you save a bundle there.
Instead, you use online communication tools (many of which are free) to manage virtual employees.
Also, you don't pay for any of the associated benefits you would pay with in-house employees, like benefits, vacation, unemployment, and social security.
And we don't even need to mention (but we will) the lower wage scale for virtual employees.
A life cycle cost analysis is really just another way to show what we've been proving at HireSmart for years.
Virtual employees save you significant money in labor costs for every employee.
HireSmart saves our clients approximately $27,000 per year per employee and oftentimes even more than that!
When you're ready to save serious money straight to your bottom line, click here for a free consultation.