I've been considering switching from full time employment to contracting, and I could potentially even keep my current employer as a just about full time client, while maintaining flexibility to take on other jobs. What administrative functions should I in turn contract for such as billing, a sales guy, office admin to answer the phone, etc...? I could potentially have 3 immediate clients and be ready to hire a jr admin to work with me in a support role if I get this properly organized. I have my thoughts on the issues of course, but what have you other contract admins found helpful? Are there particular companies that will just provide these types of services?

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  • This question is off-topic under current topicality rules. – HopelessN00b Jan 22 '15 at 5:57

I don't think you need a sales guy or office admin any time soon. Even if you plan on going large-scale, rather than a personal services consulting gig, you're better off handling your own sales for a while anyway, and office admin is just as easy to handle by giving people your mobile number and having a professional voicemail message.

If I ever go back into consulting again, the things I'll make sure I get are:

  1. An accountant

That's it, really. Most everything else you can handle yourself, but the amount of time and stress you can save by having someone who knows all that tax stuff set you up right to begin with is just phenomenal. That goes double if you're thinking of having anything to do with hiring anyone else.

I ignored everyone else saying this same thing when I started consulting lo those many years ago, and I'm regretting it even now.

  • yes for sure I will get an accountant. I understand I can do all the other stuff myself, but should I ? – Zak Nov 19 '09 at 20:54
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    Yes, I think you should. If you insulate yourself from your customers via a sales guy or office admin, you really are killing the best source of information you have on how to run your business. (This is even disregarding the fact that they're a massive cost to a small business, which kills the idea in and of itself for a singleish contractor, unless you're billing yourself out at $1000/hour or more) – womble Nov 19 '09 at 21:07
  • One of the things I was thinking was that it might be good to pay someone minimum wage to sit at the front desk, answer the phone for incoming calls for yellowpage ads, and make outbound calls to local businesses to see if they need general desktop support. Since I would have at least 1 jr admin that can do desktop support, billing him out at $35/hr on a consistent basis should be able to cover the cost of the minimum wage front desk person. You think no though on this? – Zak Nov 19 '09 at 22:42
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    @osij2is: If your accountant can't advise you on the relevant business-related legal issues, find a better accountant. If you do hit something the accountant isn't able to advise on, they can point you at a good lawyer. I completely agree on the need to diversify client base, but a sales guy will not do that for you as well as you think they will, not for a consultant. You get clients on your reputation, and salespeople can only sell an existing rep, they can't build one -- only the people at the sharp end can build a reputation. – womble Nov 20 '09 at 13:49
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    @Zak: Yellow pages and cold calling don't do squat for tech businesses. Every single company I've worked for or run has found those methods to be utterly useless. And as Evan said, $35/hour doesn't go far. Your accountant can give you more specifics, but the general rules I've been taught (and used to good effect) are: assume that any person being billed hourly can only knock out about 20 hours/week of billable time, and they cost the business twice whatever their salary/direct benefits are. I've never found those rules to be overly pessimistic in practice. – womble Nov 20 '09 at 13:52

I formed a consulting business with my two partners 5 and 1/2 years ago. We have no employees, no support staff, and only employ the services of an accountant with any regularity.

In the US, at least, having any employees is going to radically increase your administrative overhead and expense. Unless you're billing yourself out at a spectacular rate, having employees is a liability to you, rather than an asset. Contracting for a "junior admin" is a whole different ballgame (though something I wouldn't do, personally, either).

We use a hosted PBX solution, VirtualPBX that lets us receive calls from Customers at our home offices, our wireless phones, etc. I still marvel when a Customer (sometimes of several years) believes that they're calling me at "my office". >smile<

A good accountant can help you with being self-sufficient for those day-to-day tasks (billing, basic bookkeeping, etc), and will be invaluable in helping you select the proper corporate vehicle (LLC, subchapter S corporation, etc) for your business. I had a strong accounting background when starting my own company, so being self-sufficient for regular day-to-day and month-to-month bookkeeping wasn't a problem, but I'd never approach tax-related matters w/o help.

I enjoy handling my own billing, bank deposits, "sales", answering my phone, and all the other "admin" work. It keeps me close to the operations of the business and acutely aware of what the "bottom line" is looking like. It makes for many long days (and nights), but the work isn't so all-consuming that it gets in the way of my personal life or my ability to provide billable services.

Don't count on any of your prospective Customers until you have executed contracts with them. Don't go off committing to high-overhead services / facilities, etc, until you have some idea of what your income stream is going to be like. (Personally, I think things like "office space" are needless luxuries, but that's just me. Working as a strictly services-only contractor I've found that I haven't had need for office space, warehouse space for "inventory", etc.)

Take all that with a few grains of salt. We didn't start our business to "grow". We've talked about adding a partner from time to time, but the right person hasn't come along yet. We have no aspirations to make money from the labor of others (i.e. employees), and no plans to become "managers" who sit on the sidelines rather than being in the trenches. That's not how everybody wants to run their business, but it's worked well for us and, personally, I'm having a great time!

  • I was hoping you'd answer this question, excellent info.!!! – Ward Nov 20 '09 at 7:09
  • Awesome advice. – womble Nov 20 '09 at 13:53
  • I should have come to you for advice much earlier ;) – ewwhite Nov 10 '13 at 18:00
  • @ewwhite: >smile< Here we are, nearly 4 years after this comment, and our business is operating much the same way as I've described it in '09. (I do try to work a little less now, what w/ having our daughter this year.) I am still incredibly happy to be in a service-only business, even if I have "left money on the table" not reselling others' goods. I'm also equally happy to continue to have no employees. The market is changing (as more smaller-sized businesses outsource to off-site services) but the business is still working well for us. – Evan Anderson Nov 11 '13 at 3:46
  • We should discuss, as I suddenly seem to have a pretty decent consulting business... – ewwhite Nov 11 '13 at 3:50

"Should" depends on what you're good at. Have you ever run a small business before? Can you (more importantly, will you) do all the administrative functions? Do you want to be hands-on or -off when it comes to keeping the business going?

If you want to do it properly, there'll be some setup you need to do even if you're going to be a sole proprietorship and some ongoing admin to that. It'll be more if you want or need to incorporate.

You need to track all your expenses, you should track your time; tax laws wherever you are determine how much tracking you need to do. Here, if you're going to charge car expenses you have to maintain a log that shows how much business vs. pleasure use you do.

One possibility for some business services might be a "packaged office." I make use of a local company that receives mail, gives me a commercial-zoned address to have my business license at, can be a receptionist if I want, but I'm only dealing with a few clients so I don't need that.


The Accountant is very important but I think you should hire also a jr Admin with sort of a dual roll, Technician and Assistant...he will be helpful when you are MIA with a lot of work, he will be able to understand the requirements from the client and even help you with support. You will be molding him according to your needs and when he gets experienced enough he will become your right arm. My 2 cents....

Best of luck!

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