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How Fractional Executive/Operators Save You Money

Writer's picture: Nick DurmNick Durm

So you've come to the conclusion that you need Executive-level help, but you're not sure you can afford it. The kind of person you're looking for has put decades into developing the skill sets, experience, and intangibles you're looking for. That's going to be expensive, right?


One one hand, that's true. A typical salary for an Executive-level leader in a small to mid-sized business in 2024 in the Midwest can range from $120k to over $250k per year.


But what most business owners are really looking for is not a certain number of hours per week. It's access to someone who is professional, dependable, and trustworthy - with decades of lessons learned, real world experience, top-tier skill sets and expertise. Business owners are looking for the peace of mind to know that the right person is just a phone call or email away. That usually doesn't take 40+ hours per week... at least not in this next stage.


What if you could afford to bring on the expertise, skill set, and intangibles you're looking for a lot sooner than you thought you could afford it?


One innovative approach gaining traction is the concept of fractional executives. By hiring these experienced professionals on a part-time or project-based basis, businesses can access top-tier talent without the overhead of a full-time employee.  


But salary isn't the only way that hiring a fractional Executive/Operator saves your business money...


The Financial Benefits of Fractional Executives

Hiring a fractional executive can offer significant cost savings compared to traditional full-time employment. Here are some specific ways:


  1. Elimination of Overhead Costs: Fractional executives typically work remotely, eliminating the need for office space, equipment, and administrative support. This can result in substantial savings on overhead expenses.

  2. Reduced Benefits Costs: Traditional employees often require a comprehensive benefits package, including health insurance, retirement plans, and paid time off. Fractional executives typically do not receive these benefits, leading to significant cost reductions.

  3. Flexible Staffing: Fractional executives can be hired on an as-needed basis, allowing businesses to adjust their staffing levels based on fluctuating workloads or project requirements. This flexibility can prevent overstaffing and reduce unnecessary labor costs.

  4. Avoidance of Hiring and Onboarding Costs: The process of hiring and onboarding a full-time employee can be time-consuming and expensive. Fractional executives can be engaged quickly, reducing the recruitment and onboarding costs.

  5. Reduced Risk of Mishire: Hiring a fractional executive on a temporary basis mitigates the risk associated with long-term employment commitments. If the relationship doesn't work out, the business can easily terminate the arrangement without incurring significant costs.


Conclusion

Hiring a fractional executive can be a strategic decision that offers significant cost savings without compromising quality or expertise - making the next addition your team needs accesible a lot sooner than you thought. By carefully considering your organization's needs and selecting the right professional, you can leverage the benefits of top-tier talent while reducing overhead costs and mitigating risks.


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