The Hidden Costs of Employees: Why Virtual Assistants Are the Smart Choice for Small Businesses

If you research the merits of hiring a virtual assistant, one of the key benefits highlighted will generally be the cost of a virtual assistant. But with a higher hourly rate, how can a virtual assistant save you money?

(*Disclaimer: This article is to discuss the merits of hiring a VA, not to encourage anyone to get rid of existing staff! But if finances are a consideration when deciding where to get extra help, this may be the information you need!)

Here are 6 ways that a virtual assistant should be a serious consideration for small businesses:

1. Reduced overhead expenses – As virtual assistants are based remotely, your company does not need to incur the cost of desks, computers, or office supplies.

2. Pay only for the work done – Virtual assistants allow flexibility, with different packages and the opportunity to pay per hour or per project. You’re not committed to a salary regardless of workload.

3. No employee benefits required – The competitive employment market requires that employees be offered such benefits as health, paid leave, and pension contributions, to name a few. None of this applies to a VA as an independent contractor.

4. Minimal training and onboarding costs – You choose a VA based on the skill set they offer; therefore, they’ll be able to hit the ground running, and there will be minimal time sacrificed from your working week to train them.

5. Flexibility and scalability – It is easy to scale the workload according to your business needs throughout the year. Seasonal workloads or specific projects can be handled without the long-term commitments you’d need to give an employee.

6. Lower overall costs – Considering the combination of factors: salaries, benefits, overheads, and training, some businesses have reported saving up to 60% in labor costs by opting for virtual assistants over full-time employees.

Let's give some actual figures to bring the point home.

See below for an example of the comparison between Mary, the full-time admin assistant, and hiring a VA.

Expense Category	Mary the Employee	Virtual Assistant
Base Salary	£25,699	N/A
Employer NI	£3,548	N/A
Pension Contributions	£771	N/A
Office & Equipment	£6,000	N/A
Recruitment & Training	£3,000	N/A
Total Annual Cost	£39,018	£12,000

Mary the Employee (Full-Time Administrative Assistant)

Base Salary: £25,699 per year (average in London)

Additional Costs:

• Employer National Insurance Contributions: Approximately 13.8% of salary: £3,548

• Pension Contributions: Assuming 3% employer contribution: £771

• Office Space & Equipment: Estimated at £6,000 annually

• Recruitment & Training: Estimated at £3,000

Total Annual Cost: £25,699 (salary) + £3,548 (NI) + £771 (pension) + £6,000 (office) + £3,000 (recruitment) = £39,018

Virtual Assistant (VA)

Hourly Rate: £25 (average for UK-based VAs)

Monthly Hours: Assuming 40 hours per month

Annual Hours: 40 hours/month × 12 months = 480 hours

Total Annual Cost: 480 hours × £25/hour = £12,000

Additional Costs: Typically none, as VAs are self-employed and cover their own equipment and training.

There are other considerations to be made when deciding on staff vs. a contractor for your business. But if costs are a significant factor, think about whether the flexibility and expertise a virtual assistant could provide your business would be worth exploring.