“Outsourcing is expensive. Your rate is too high. It’s cheaper to hire someone.”
You may have heard one of these objections before in regard to outsourcing . We get it. Many of us have felt the same way. On the face of it, rates may seem high. But you might be surprised what you find when you dig a little deeper.
In fact, we believe that outsourcing investment writing, especially your fund commentary, provides tremendous value for the money versus employing additional permanent staff. (And that’s before you even consider the added benefits of a flexible workforce with multiple specialities…but more to come on that.)
We know – that’s a big claim. Here are the facts and logic to back that up.
Day Rates, Apples and Oranges
Comparing hourly rates with employee salaries is like comparing apples and oranges. Many people would simply divide the base salary by the number of days worked. We’ve seen it before in our discussions with firms. But is that all that’s involved in an employee’s compensation? What about: bonus, retirement, health insurance, holiday pay, sick pay, real estate & office space costs, admin costs (IT, mail, security, cleaning etc), the time cost of the employee’s manager, tuition reimbursement…you get the point. So that employee making $80,000 base salary can actually cost $110,000 or more! And in some cases, this may mean you’re paying for more than you’re getting. Try it out for yourself – this is a good calculator.
The Life Cycle of a Writer
Unfortunately, the story gets much worse. Every investment writer has to be competent at the so-called three Rs – reading, writing and arithmetic. But every CMO should be mindful of another three Rs – recruitment, replacement and redundancy.
- Recruitment. Finding talent for any position can be difficult. Finding an experienced investment writer is like finding a needle in a haystack…IN a haystack. In many cases, HR groups look to a recruitment agency to help find individuals with such a niche skillset, and it isn’t cheap. Even if your firm has a deal in place with one, engaging a qualified firm commands fees of 20-25% of your new writer’s year-one salary.
- Replacement. People move on. Between older employees retiring and a very mobile millennial generation, you can expect your calls to HR and those recruitment agencies to become a regular occurrence.
- Redundancy, No one likes to think about this, but it’s very real: the asset management industry is cyclical. During downturns or reorganisations, a lot of great people can lose their jobs. And that costs money – just at the time when your finances are most stretched. As a result, the real cost of recruiting, managing and replacing an investment writer is likely to compound the cost of that employee well beyond their base salary…and more.
With an outsourced solution, those costs aren’t a factor…or even a concern
14 of the world’s 20 largest asset managers – and more than 60 asset managers globally – rely on Copylab’s expertise, experience and investment sophistication to produce high-volume, high-quality content. So what’s stopping you?
Want us to prove we can make your investment writing team more efficient? Ask us to audit your fund commentary function.