February 9, 2012

In Episode 9 of the AFP, we get into the nitty-gritty of minimizing your workload by outsourcing to Virtual Assistants in the Philippines.  In owning and a running an outsourcing company right here in Davao City, we thought we’d bring a unique perspective on how to find, manage, and work with your VA’s that seems to be lacking with some of the people that often talk about offshoring.

Everyone hears about how cheap and great outsourcing to the Philippines can be, but should you REALLY hire a VA right now?  Where do you go to find a great VA?  What are the actual costs of an agent in the Philippines?  How do you make sure they’re going to be successful?  What do you do if it’s not working out?  These questions and more are covered in this slightly longer episode.  We give personal examples from our experience in running a company here since 2007 and our living here for over two years that will allow you take action as you expand your team through offshore outsourcing.

 

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We’re hoping you got a ton out of this week’s episode.  If you liked it, please consider giving us a review on iTunes! Here’s the link to the podcast on iTunes.  Thank you for listening!

Podcast Transcripts (Click Show to View)

[spoiler]

Justin:
Welcome to Episode 9 of the AdSense Flippers Podcast. I’m your host Justin Cooke and I’ve got with me my business partner extraordinaire Joe Magnotti. What’s going on, buddy?

Joe:
Hello, everybody. Almost in double digits.

Justin:
Almost in double digits next week. So we’ve got a great episode lined up for you this week. We’re going to get into outsourcing with VAs in the Philippines, specifically how you can minimize your workload and not suck at it. We’ve got a great intro. We want to go over some updates, news and information we want to cover and then we will get into our ninja marketing tips, tricks and our plans for the future. So let’s get right into it, man.

So the first thing we want to cover is we’ve got 2 new five-star reviews on iTunes. Really stoked about that. We’ve got Dave here who says, “I want to thank you for the honest and straightforward information you guys provide. It’s very generous for the two of you to give out so much free info that’s actually useful.” Well, thank you, Dave. I hope you find this podcast just as useful as our previous ones and we will get into some really good information here later.

Second one is from Brandon Patrick who said, “The short and sweet is that it’s a great podcast. Thank you, guys. Pat and Spencer led me to your site but it was you two that really brought it down to a level that made it approachable and not magical.”

Joe:
Yeah, Brandon. I really appreciate the fact that you find our advice actionable. I like the idea that we are making you money here in the short term.

Justin:
And we’re not magical either, man. No fairies and pixie dust. It takes a lot of hard work, elbow grease and internet marketing.

Joe:
No wizard of Oz here.

Justin:
I know. It sucks, man. I wish there were like the get-rich-quick schemes. I wish that stuff was real but I just never found that it worked. I mean everyone I’ve talked to has never just magically had money drop in their pocket unfortunately.

Joe:
If it sounds too good to be true, it probably is.

Justin:
Talk about money though. We did have a damn good month this month, dude. Almost $45,000.

Joe:
Well, we did have a huge sale of 72 sites for almost 20K.

Justin:
I know, dude. That guy really turned it around for us. We were like, “Oh, we might be able to beat Pay Flynn this month.” It’s kind of a little joke with us and we were teasing a little bit on Twitter but he killed it, man. He got like 62,000 this month so congrats to him and hopefully we can have another decent month this month although it looks a little worse off starting here early in February.

Joe:
Well, we had some inventory problems but I think we’re going to solve that here pretty shortly. So look for the Buy Our Sites page to be updated. We will have some more sites up there probably the next week or so.

Justin:
Another thing we want to talk about is here in Davao City, we started a new mastermind group. We’ve got some of the internet marketers together here, some of the expats that are running businesses or they’re outsourcing businesses and that kind of thing and decided to get together every other week for a sit-down and to actually discussing business, going over business problems and things that are going well in our businesses and putting someone in the hot seat which is basically where we beat them up with an idea or a problem they have and try to give them alternative solutions they might not have thought of. I think it’s going really well. We had our first meeting. It was really exciting. We sat down for some Thai food and had a great time.
So if you’re thinking about relocating your business whether you’re in the Philippines or you’re thinking about coming to the Philippines, I would really recommend you come down to Davao City. Take a look and see if this is a place for you.

Right now, we’re getting people to come down here and just kind of end up staying. It’s pretty cool.

Joe:
Yeah. I like it. I think the meeting is good. It’s useful. You learn by teaching and you learn by just getting the thoughts and organizational ideas from other people.

Justin:
Last Friday, we joined the American Chamber of Commerce here in Davao. I guess they were actually looking or talking about shutting it down and we end up going there with another expat that we know here who’s an American and met the …

Joe:
Consul General.

Justin:
Yeah, Consul General for the Philippines from the US, great guy. Got to talk with him a little bit and I think it’s something we can help out with especially when it comes to like startups, internet marketing companies, that kind of thing. I think we can now bring some value there.

Joe:
Yeah. They definitely need some more Americans and glad to see we’re meeting with some of the premier guys there in Davao chapter.

Justin:
Yeah. Also we want to say thanks to everyone who purchased our sites here last January and our team, we want to thank you too. We ended up taking them out for a kickass videoke or karaoke night and they all enjoyed it.

You know, the funny thing is, is like even our team – we have people who have been with us several years now but they’re a little nervous when the night starts off, right? They’re a little timid and they’re looking at the food and wondering if it’s time to go get the food and they start kicking off especially when Rose sang Like a Virgin, started shaking her hips. Dude, that was insane, right?

Joe:
Yeah.

Justin:
Everyone was up laughing and smiling. So, thank you, Rose, and thank you team for having such a great night and taking a part of it. Thanks for getting everything done.

****The AdSense Flippers Podcast****

Justin:
So let’s get right into the heart of this week’s episode which is all about outsourcing your work and minimizing your workload through VAs in the Philippines. Now before we can get started, we have 11 points we want to cover but before we get started with that, I just kind of want to point out that we’re not the best outsourcers. There are people that know it better than us and everything but we actually own an outsourcing company here in the Philippines. We live here. We’re in Davao City. I live in Ecoland.

Joe:
I’ve been on the ground since 2009. We’ve been doing some sort of outsourcing at some levels since 2006. So we have direct experience with people and virtual assistants for a long time.

Justin:
We’ve directly hired more than 100 Filipinos. We’ve had countless contractors and we meet with these people and we meet with them on a regular basis. So if you hear a lot of gurus that talk about what it’s like to outsource to the Philippines, well, we’re here and we’re hoping we can provide a unique perspective and really help you in your search for a VA that knows what they’re doing with the experience we’ve had here in outsourcing. So let’s get right into our 11 points. The first one is, “Why the Philippines?”

Joe:
Yeah. I would say very simply native English. If you’ve ever done customer service before with a bank or something like that, like Citibank used to have their customer service in India. You know how hard it is to speak to people from India.

Justin:
Yeah, and that really makes a difference when you need to talk to your outsourcer, when you need to communicate back and forth especially if it’s something you need them to do that’s very specific or that needs to be done a certain way. It can be confusing with the language barrier and the Philippines is the second largest English-speaking country in the world.

Joe:
Right and they also have broad skill sets here. So anything from programming to design, all the way to the more basic data entry, transcription stuff. Everything can be done.

Justin:
Not just that but there’s also great value. I mean you can get a comparable employee for about one-tenth of the cost in the US. Now there are some benefits and some negatives that come with that which we will get into a bit later but overall, the value here is fantastic.

Joe:
And then the similar cultures. I mean they still have the whole Catholic-Christian mentality and that makes it very similar for you coming from the West. It aligns your cultural differences and makes it a bit easier to understand where they’re coming from.

Justin:
Yeah. Not something like Thailand or Vietnam for example which may be a bit more difficult to understand culturally plus I would say the Philippines specifically is more aligned specifically to the US, right? So there’s a connection between the United States and the Philippines that a lot of other countries don’t have.

Joe:
And generally Filipinos are pro-America.

Justin:
Here’s the other thing too. How do you know if you should get a VA or not? I mean a lot of people were like, “Oh, I think I should get a VA,” right? And then they have nothing for that virtual assistant to do. So what’s a good time for someone to actually get a VA, Joe?

Joe:
Well first, I would say cost benefit analysis, right? Do you have a task that can be done cheaper offshore than it can be done onshore?

Justin:
Yeah, and it’s an actual task that you’re doing on a regular basis, right? So you need to look at whether they’re going to do as good of a job and you need to see if it’s going to save you money.

Second thing is scalability. Let’s say you have something that’s working that seems to be making money but it’s you just churning away, right? That’s something that you can definitely outsource to the Philippines. Take some of those easier tasks and push them offshore first.

Joe:
Yeah, or if you have one employee in the US doing it and now you want to expand to five but you just don’t have the money to do that, that’s a perfect time to hire a little crew.

Justin:
But here’s the thing. Don’t hire a crew until you have documentation ready to go.

Joe:
Yeah. You want it to be really good, strong documentation. We will talk a little bit more about it later but think screencast, screenshots, that kind of thing.

Justin:
Our third point here is, “What should you know before hiring a VA?” Well the first thing you can do – and this specifically is related to niche sites. You can’t say, “Hey, create me a site and I would like it to make money.” I’ve actually seen people on oDesk that put this out there. They say, “Hey, I want to give you 1000 bucks. You’re going to create me a site that makes $500 a month. Go.”

Joe:
Yeah. I love this one Justin. Because look, if they can do that, why would they need you? They would just make it for themselves.

Justin:
Absolutely. And we get this with outsourcing companies too. They say, “OK. Well here’s generally what our company does. We would like you guys to do that.” Right? No documentation of the process, no explanation of how they do it. Just go for it. Please make it work and make us some money. Well that just simply doesn’t work.

Joe:
Yeah, and then also I think you got to watch out for the yes, yes, yes to every question when you’re interviewing outsourcers or potential virtual assistants. That is something you will run into a lot. Can you do this? Yes, sir. Can you do this? Yes, sir. And you think everything is all right and then when it comes down to do the task, you find out that maybe they’re not as skilled as you thought.

Justin:
Yeah. It’s not even like they’re trying to like trick you just to get the job. There may be some of that but generally it’s a cultural thing. They don’t want to tell you no, right? It’s rude to tell someone no here directly to their face. So they will say yes, they can do it. Yes, they’re thinking, “I think I can do that,” but the truth is, they really don’t know. They just don’t want to offend you.

Joe:
Yeah. So that’s why I think it’s more important to look for trustworthiness and a value fit. If you don’t have a lot of experience interviewing, Justin and I managed some teams back in the US. We had some experience with that so it made it a little bit easier when we wanted to build a team here. But if you don’t have experience, you will know talking to people whether they’re going to be a good fit with you working everyday. Take that slow. Take a lot of time. Make sure you interview the right people.

Justin:
If you have interviewed people before, you know you have that gut feeling, when you start talking to someone, on whether you think that person is trustworthy and you will notice there are things. They might complain about their old boss. They may worry too much about the pay or their hours. Those types of things where they seem like they might be complaining or just it doesn’t seem like a good fit, it probably isn’t. You should hire someone that’s aligned well with your values and someone that you trust.

Joe:
Right. And then on the same merits, don’t expect a startup team roundtable discussion here. OK? Virtual assistants that you’re hiring are probably going to be more task-oriented.

Justin:
Yeah, that’s one of the things we came here and other outsourcers have done the same thing where they came here and they said, “OK, we’re going to sit down at a roundtable. Everyone is equal. Let’s throw out ideas and try to like really put this together as a team,” and unfortunately, it just doesn’t work that way. I’ve been a part of teams like that in the US and it just didn’t work. They expect a more hierarchical approach here in the Philippines and so if you don’t run it that way, then they won’t respect it and they won’t get you as much good as if you did it from a top-down approach.

Joe:
Where can I find a great VA?

Justin:
Well, there are a bunch of virtual assistants in the Philippines on oDesk, right? But the problem with oDesk is like trying to find a needle in a haystack. There’s a ton of people. It’s almost like Flippa. We have to dig through all the auctions and all the sites that are out there and try to find a good one. It can suck, right?

Joe:
Yeah. I mean that said, oDesk is good for like short term projects that you need to get done. When you just have one thing, you know how many hours it’s going to take and you just need it done once, oDesk is a great solution.

Justin:
Yeah. I like contract work because you can get a real specialist.

Joe:
Right. But if you’re looking for a fulltime VA, you’re better off posting on job sites directly like OnlineJobs.ph, Craigslist, Sulit.com.ph, JobStreet.com.ph. We will put all those links in the show notes but yeah, you really want to start posting as if it is a fulltime job because that’s what it is.

Justin:
Yeah. The cool thing about those job sites is there’s a lot more Filipinos looking for jobs than there are people offering so you’re going to get a ton of applicants and I don’t know why that is. I don’t know why all the job seekers are there but not the employers but that’s a great place to go to pick up some great people.

Joe:
Yeah, another type of solution is Virtual Staff Finder.

Justin:
Yeah, so this is an offer from Chris Tucker where basically virtual staff finder will find you the qualified people for your particular skill set and then put together the resumes and set up the interviews for you. So if you’re short on time, you don’t have a lot of extra time to dig through the job boards, Virtual Staff Finder is a great solution. We’re an outsourcing company, right? And we wanted to use them because we want to see if we thought it would be good value for our readers, for our listeners. So, we tried it out too even though we could find staff ourselves. They found some of those force in Davao to do our keyword research and she’s fantastic. We picked her up fulltime and we’ve been using her ever since.

Joe:
Yeah, a very good experience over there and I would say that goes hand in hand with trying to get as many applicants as possible from as many different sources as you can and then after that, what you want to do is put up road blocks so you don’t waste your time with a lot of interviewing.

Justin:
Here’s an actual example. Go to OnlineJobs.ph, right? Put the job out there. Put it on several of the job boards we mentioned earlier and we will mention in the show notes but you’re going to get a ton of applications in. What you want to do is on the job information sheet, you want to put something like, “Put this blurb in the email.” >“Make sure you mention this in the email,” and then dump everything that doesn’t have that. It means they did not pay attention to directions. If they can’t pay attention to directions to get the job, they’re going to be terrible when you bring them onboard.

Joe:
Exactly. Then I would also say try to use some sort of objective test after the email. We use a grammar test that we know over time if they score higher than 80 percent on this particular grammar test – which we will share with everyone in the show notes – that they’re pretty much going to have good English. It’s going to be good enough to communicate with them on a regular basis.

Justin:
Yeah. We’ve got over 100 people in the US that have taken this grammar test and we’ve got probably about that here in the Philippines that have taken this grammar test as well. So we know if it’s not 75 or better, generally their English would be pretty poor. 80% or better and it’s really good. So that will give you a good example of whether or not you can actually talk to them and what you don’t want to do is you don’t want to have all these resumes and first start digging through them to determine who you think is better.

Give them this grammar test as a road block. If they don’t complete the grammar test, great. That makes your decision really easy. If they suck at the grammar test, great again, right? Because now you know you’re not going to hire them.

So it really weeds down the applicants to a nice – kind of like – the same thing we do with keyword research.

Joe:
Yeah. I mean if you have a better test, if you want to use your own test with your own questions, go ahead and do that but the key thing is make it objective. Make it something you can assign a score with that over time, you will be able to provide a baseline of who you should talk to and who you shouldn’t.

Justin:
And do it before you spend any time working on any of those resumes or applications. That way you’re not wasting your time on people that you wouldn’t have hired anyway.

So our fifth question here is, “How much should I pay my VA?” Well, that’s a really tough question to answer, right? It depends on what their skill set is, where they’re located in the Philippines. I mean just for example, if you want a basic VA that can handle most admin tasks, that kind of thing, in Manila on average you’re going to pay about 20,000 pesos or about $440. In Cebu, you’re going to pay about 15,000 pesos. In Davao, you’re going to pay about 10,000 pesos or about $220, $230.

Joe:
Yeah, but I would expect to pay more for a specific or technical skill sets, programming, voice work like telemarketing and stuff like that, bookkeeping, legal. You’re going to pay a little extra.

Justin:
Yeah, and that’s in the industry that you’re in. I mean you can get a good technical programmer here in Davao for 25,000, 30,000 or you’re looking at probably 45,000 or 50,000 or up in Manila. The reason for that is a lot of people will leave the province or even leave cities like Cebu or Davao because Manila is where the money is at. So you have a lot of people that go there for the money. Some people actually end up coming back here to places like Davao or back home. They will take less money working online from their home city but it’s worth it because they can be close to their families.

Joe:
Yeah, and workers here generally in the Philippines respect steady pay over commissions. I would generally stay away from any bonus type of scenario or scenario where they’re commission-only, that kind of thing. What they’re looking for is steady, regular paycheck.

Justin:
I will give you an example. We had a job where we were looking at paying 8000 as a salary plus commission and so with their commission, they would make generally anywhere from 12,000 to 15,000 pesos a month. They preferred a 10,000 flat fee. Ten thousand flat fee was better for them because they knew it was steady and they were worried about it being less than that. So it’s odd but it is something that they would prefer the steady paycheck than any kind of commission or per piece type thing.

Joe:
And that’s generally because the economies of scale here are so small that they need that money to stay in their families. Thirteenth month pay is generally accepted as a standard in the Philippines. That means a full 13th month for every 12 months they’re hired.

Justin:
Yeah. So if you hire someone in the middle of the year and you’re paying them for six months, you’re going to owe them for half a month at the end of the year. This is usually paid – well, it’s supposed to be paid before December 20th but normally we pay it like in the first or second week of December. This isn’t a Christmas bonus. This is an extra. This is an absolute requirement here in the Philippines.

Now if they’re off the books and they’re not a technical employee for you, you don’t have to do it but I would suggest it’s definitely something that’s expected here.

Joe:
Yeah, fulltime here is going to be a lot better than part-time, half-time or hourly work. I really suggest even if you’re anywhere near close to getting a 40-hour employee, round up the 40 hours and find them something to do so that they don’t have a situation where they’re trying to have another job at night or another time.

Justin:
Yeah, man. You see this all the time. We had an employee or a potential employee come in and say she was working nine hours on the night shift and said, “Oh, that’s fine. I can come in and work another nine hours for you during the day,” right? No problem. I can work 18-hour days every week.

Joe:
Yeah, that didn’t work out very well.

Justin:
Yeah. That’s not going to happen. So a lot of times, you want to make sure that they are fulltime with you and you alone. So it’s worth paying a little extra to make sure that you have all of their time. You don’t want them moonlighting. We also had problems where people would work night shift with us and try to work during the day and they would be sleeping. They would be sleeping at their desks, those types of things and you run into problems because they’re doing the best they can to make the most money for their families and for themselves as possible. But you’re just – everyone has a breaking point and two fulltime shifts just isn’t going to happen.

Joe:
Yeah, and that’s why I would say if you pay a good standard wage, get them for 40 hours a week. You probably will avoid that problem

Justin:
So our sixth point here, cultural differences when working with a VA in the Philippines.

Joe:
We already talked about a little bit about this. Family trumps work. That’s good and bad that comes with that but family definitely comes first.

Justin:
Yeah. I mean I can appreciate that especially being here. I can see how people are so close to their families and they have really extended families but it’s kind of communal where everyone will make money and kind of contribute to the family money. So the problem though is obviously for employee – and it’s my cultural difference, right? Americans generally, you work, right? Work and you get paid. Like, who you are is sometimes determined by what you do, right?

So it was difficult for me I would say the first few months to really kind of get over that. I think it’s still something I struggle with a bit but you have to remember that family is going to trump work. So if something comes up with their family, they probably are going to leave. They’re going to not be there for the day. That’s going to happen.

Joe:
Yeah. The other thing that drives me a little crazy is the Filipino time as we like to call it here. Punctuality is not as revered as it is in the West.

Justin:
It’s terrible. I’m falling into the Filipino time thing where like, yeah, I will show up a little late. It’s not that big of a deal and especially if I’m talking to Americans or whoever back home. I’m 15 minutes late for our conversation. Like what the hell are you doing, man? But it’s the way it is and I think it’s specifically that way here in Davao where it’s kind of a slower city anyway, right?

Joe:
Yeah. It’s a little more laidback.

Justin:
Yeah. I will get there. It’s no problem. For us, for interviews, that’s a no-go. I mean I would expect it to be the same thing for you if you’re hiring. If you’re hiring and they’re late to the interview or try to postpone or reschedule, thanks but no thanks. There are plenty of people available.

Joe:
Yeah, be firm but be a little bit understanding that there is that cultural difference. If they know they’re working with Americans, generally they do try to be on time.

Justin:
One of the other problems is borrowing against future earnings. We’ve had this come up a couple of times in the past where someone wants to borrow on their next paycheck. You have to understand that everyone is living here and trying their best to make it work but that’s not always easy to pay it back the next time so you don’t want to cause yourself any problems in the future, any resentment where they’re always working to pay you back for the money they owe you.

Joe:
Yeah, I would avoid the borrowing for future earnings if possible at all costs.

Justin:
We had a similar situation where at one point, a supervisor of ours was borrowing for her employees, borrowing for other employees in the company and it caused us a huge problem where she owed all this money, couldn’t pay it back. We resolved that pretty quickly but yeah, it was bad. So be careful loaning any money on future earnings. It’s just not a good policy.

Joe:
The Philippines culture here is a very respectful society. Expect you’re going to get a lot of, “Please, sir,” “Please, ma’am.” We’re looking out for your interests as their employer.

Justin:
That’s one of the things I really love. Like for example, our content managers, right? When they took over the content management, we’re ordering from these people or whatever, they were more militant about looking out for our business and our niche sites than we were. We might have been because we were overloaded but they really put a lot of love and care into making sure it works because it’s important to them and they can empathize well with your business and understand where you’re coming from. So they really want to help you out which is the cultural thing of the Philippines that I love.

Joe:
Yeah. Look, treat them well. Pay on time and you will find dedicated and extremely honest and loyal workers. I mean we have had multiple instances of very honest people coming forth here when mistakes were made in their favor. We had a guy just last week sign a new contract. The contract was 5000 pesos more than it was supposed to be paid. It was a misprint on the contract and he insisted that it was wrong and we reached and said, “Yeah, you’re right. This is incorrect,” and we corrected it.

Justin:
And those are guys we love to hire. Thank you for being so honest. In fact, we will make sure that we make it up to him in the future for being such a cool guy about it.

Joe:
Yeah. Another incident was one of our employees got a transfer that wasn’t meant for her.

Justin:
Yeah, way too much money.

Joe:
Yeah, almost half a month’s pay, 8000 pesos, and she came back with the money, owned up to it and said, “Yeah, I got this money. It’s not mine,” and gave it back. We really believe the reason why that is, is because we treat our workers with respect and we make sure to pay them on time every time.

Justin:
So our seventh point, “What kind of things can a VA do for me or not do for me?”

Joe:
I love this question because we get it so often from our outsourcing side of the house. People email us with all kinds of stuff.

Justin:
Yeah, it’s best to start off with a task-based approach. So you want to have screencast, screenshots and a very documented process to walk them through step by step what they need to do. You may want to explain the grand scheme at first but when it comes down to the work, you want a nice documented, step one, step two, step three kind of process.

Joe:
Yeah. I think we’ve gone into this before, Justin, but it’s important that you’re familiar with the process. If you’re trying to outsource something that’s just an idea in your head and you’re going to find a bunch of VAs to just do all the work for you, that generally doesn’t work.

Justin:
Yeah. I see this a lot too especially with internet marketers. They go, “OK, I want to hire my first VA. But I don’t have enough of this particular task to give them 40 hours a week. Maybe only 15. So let’s say I want them to do some content writing for me 15 hours a week. With the rest of their time, I would like them to set up websites. I was hoping they could do a little programming for me. I would like them to do some voice work and call some ex-clients and see if we can get a little more money out of them.” No, that’s not going to work. The multitask approach, having one person that does a bunch of different things is a really bad idea. Take someone who has skill in one particular area and they may have some side abilities or tasks they can do but use them for that one task.

Joe:
Yeah, and I think that goes hand in hand with saying that you shouldn’t try to throw someone into a management or supervisor position without learning the process first. Make sure they go through the entire production line of learning your process and being at least very familiar with how things work on a day to day basis before having them manage the team. Promote from within. Take your best people and put those people in charge of small teams.

Justin:
Yeah. We’re doing that right now. We need a couple more content managers because we’re seeing that we’re falling a little bit behind in that area. We’ve talked to our head of content management team and what he’s going to do right now is we’re going to find a couple of writers and we’re going to have them local and we’re going to have them start off writing some content for us. They’re going to beat them up a little bit, tell them what kind of content they need and depending on how well they do, promote them to the content management position where they’re then ordering and editing and uploading the content to our sites.

So our eighth point here is reporting and tracking your VA’s work. This is really important because you want to make sure you know how many hours they’re using in a day, what they’re doing with those hours, how many tasks they’re able to complete and this is going to be really important for you for future planning purposes.

Joe:
Yeah. We’re making it more complex than it really sounds. I mean all you got to do is have a spreadsheet. On the spreadsheet, they report how many hours they worked. They need to report the number of tasks that they did over that time and then you can simply roll up those reports and know over time averages of how many tasks they can do per hour and that’s great for establishing a baseline, seeing who’s better than who and knowing how many you’re going to be able to do if you scale this process up.

Justin:
I will give you a real life example of this right now. We’re adding about 40 sites a week to our spreadsheet but they’re not keeping up, right? If I don’t know who’s able to do how many of this per hour, I’m not going to be able to tell where the gap is or the hole is. So right now over the last four, five weeks or so, we’ve been tracking every single person and the hours they’re putting in and how many primary pieces of content they can order, secondary pieces of content they can order.

Now, we’re going to go back and do a little bit of math and figure out with the current staff we have and the hours they’re putting in. We find out the content management team is able to do 34.6 sites per week. We found out our link building team is able to do 27.8 sites per week and so we’re able to get kind of a good average and then we know exactly how many we need from each team if we want to do 50 sites per week, if we want to do 80 sites per week. I can say we need to add this many people. We need to add this many people.

Joe:
And we will share our spreadsheets with you. Well, at least the headers with you so you guys will have a good idea exactly what we’re talking about and how to track that information. It’s also good to have an idea week to week what kind of improvement or decline you’re getting.

Justin:
Yeah. So we get a rolled-up report each week from every supervisor. So we have a good idea on kind of what they’re doing, what’s going on and like which team is falling behind.

The ninth point I want to talk about is problem resolution with a VA. If something comes up, how do you get that fixed?

Joe:
Well, buddy, you’ve really got to set yourself up well from the beginning here. I mean anyone who has employees back in the States or manage people back in the States will know that. If you have clear expectations upfront and everything is well laid-out, you tend to avoid problems.

Justin:
Yeah, avoid the cancer in the first place, right? That’s one of the most important points and it’s an easy one, right? Oh, yeah, well of course but it’s true. If you let the cancer in, it’s more likely to spread and cause you problems.

Joe:
Yeah. Make sure the problem doesn’t stem from you either. I mean have you really trained them well? Did you really give them the tools to get the job done? Do they understand the process? Did they check their work? Were you tracking everything? I mean these are things that if you’re not doing, you have to be honest with yourself. If a problem arises, it’s probably your fault.

Justin:
I come back to that whole thing where hey, build me a site that makes me money. When they don’t build you a site that makes you enough money, you can’t blame them. I mean that’s ridiculous. You have to understand that that is your problem and not theirs.

Joe:
OK. So if a problem does happen and it is their fault, you should address it directly but try not to hold their feet to the fire too much. It will cause shame, loss of face, which is a big cultural issue here in the Philippines and you don’t want them to quit over something that may be relatively minor.

Justin:
I have this problem a bit especially when someone like screws up or I think might intentionally screws up or causes problems or whatever. I tend to want to address that and hammer that point home. Well unfortunately, that just doesn’t work here. It’s not going to be effective. You don’t get anything more out of them and they’re not going to do any better work for you. So you have to make sure that you address it but kind of either let it go or let them go.

Joe:
Yeah. And then once you’ve addressed it, I would say retrain them. Let them know that you trust them to fix the problem and put measures in place to make sure it doesn’t happen again.

Justin:
Yeah. If you weren’t tracking their numbers before, start tracking their numbers. If you didn’t have the training tools in place they need to learn how to do what they need to do, make sure you have that the next time around.

Joe:
Yeah. A good example of this was we missed a whole bunch of sites. Remember this, Justin, when we missed a whole bunch of sites? We didn’t put Google Analytics on.

Justin:
Yeah.

Joe:
Yeah. And so what we did was I approached the website supervisor. I asked him what was going on. He said they made a mistake. They missed it. We put a new process in place so that’s double-checked and that won’t happen again. But instead of making a minor problem into a big issue, we addressed it, we fixed it and we set up a process so it doesn’t happen again.

Justin:
So here’s another thing. Do I need to hire a direct VA or do I want to go through an outsourcing company? We get this a lot where someone in our opinion should hire a VA directly and not use our outsourcing company and then there are other situations where they should. So we will cover that a bit for you.

Joe:
Yeah. I would say singular tasks. You know you can manage it well. Maybe it’s only one or two people, a small project. That’s just going to be ideal for a single VA.

Justin:
Or if you need your project to be rock bottom cheap. Like you absolutely have to have the lowest cost stuff and quality and coordination is not that important. You can hire a direct VA.

Joe:
Yeah. Your margins are really low. Maybe you’re dealing with just a small amount of niche sites. I would say that’s a good way to go directly with your VA hire.

Justin:
Yeah. People have asked us a lot. Can we set up a niche team for them? I’ve seen some other people are starting to get that started. Unfortunately, our problem is that we don’t see enough margin in it for us and if we do put enough margin in it, we don’t see enough profit for you. So our problem has been we’re not able to charge you enough to make it worthwhile and if we do, we’re ripping you off basically.

Joe:
Yeah. Usually for our outsourcing company, we say project requires at least four agents working in coordination.

Justin:
Let’s say for example you need someone to work during the day and you need another team to pick up from where they left off at night, right? That’s a good process or project for an outsourcing company. If you need multiple projects or multiple tasks run in tandem where they communicate back and forth, have a good management structure in place, that’s a situation you need an outsourcing company and not just VAs.

Joe:
Or if you’re planning to scale to the future. I mean if you’re planning to take 4 to 10 to 15, I wouldn’t try to hire those people directly. Go through an outsourcing company to coordinate everything for you.

Justin:
That’s where we can really get enough value-add I think to make Try BPO worth it when there’s a more coordinated project. You and I for example are heavily involved generally on the frontend and we make our money on the backend. And that’s why you and I, we only take on projects we know we can be successful with because otherwise, we end up losing, right? We put a lot of time on the front and they cancel in two or three months. That’s why we don’t take projects like that anymore.

Joe:
Right. And I will also say that if you’re looking to hire 15 to 20 people right off the bat, you might want to consider setting up your own capture center here in the Philippines. You could probably get one off the ground for $15,000 to $20,000.

Justin:
I will explain what a capture center is. Basically everything is yours. You have the management team. You make decisions on the hiring. The office is yours. It’s your lights, everything, but the company is set up through a company that’s already established in the Philippines.

So we’re doing this now for clients where they come to us and say, “We want it to be all our stuff, all of our people, everything. We would rather just use your licensing and your name and we will give you an override,” and it’s an effective way to get your business up and running. We know it’s probably a midterm solution, maybe 6 months to 18 months, and they will probably set up their own company if it’s successful.

Joe:
So let’s talk about the last point here, when and how to let your VA go. Hopefully this never happens but it’s something you should know about.

Justin:
Well, if you have multiple VAs and you have your reporting in place, you’re able to see – let’s say they’re able to do on average 15 of X – whatever X is – per hour and you have an agent that’s way below and you’ve worked with them, try to find out what the problem is. If they simply can’t keep up, it’s not working out, buddy.

Joe:
Yeah, or if they continuously fail to follow directions, don’t have any attention to detail even after retraining them, going over things with them. You don’t have to spend so much time with this but I would say two weeks of working with the person. They’re making errors all the time. It just seems like they’re not paying attention. That’s definitely time to consider letting them go.

Justin:
And the worst – this is obvious but if they’re dishonest, they’re untrustworthy, or you’ve caught them, let’s say, fudging the numbers and their weekly reports, their dailies, they’re putting in different numbers than they’re actually doing, that’s someone that you do not want in your team. That’s not an honest person.

Joe:
Yeah. I would say retraining or giving them a second chance is not even worth it. Just get rid of that person as quickly as possible.

Justin:
So Joe, how do you get rid of those people?

Joe:
Well, I would say you take the soft approach in the beginning especially for people that are just underperforming. Unlike the US where you might approach them directly, sit down and have an HR talk, say, “We’re letting you go,” yada, yada, yada, what I would do is I would limit their hours. I would say, “Unfortunately, there’s no work for you this week. Contact me next week and let me know.”

Justin:
Yeah. Make them redundant. Hire another. Get that person trained.

Joe:
Right.

Justin:
And they no longer have as much work to do. So you simply cut back on their hours until they’re redundant basically.

Joe:
And they will naturally find another job. So they will find something else to do and you won’t even have to have a confrontational fire.

Justin:
Now, the confrontational fire does have to, I think, come into play when they’re dishonest, untrustworthy or fudging their numbers, right? So one of the things you’re going to want to make sure you do is you have to lock them out right away. Any passwords, anything they’ve got access to, change all that right away before you even have that conversation.

Joe:
Exactly. And I love Google Apps for this because with Google Apps, you can have everybody under one domain. We have TryBPO.com. Everyone has an email address to TryBPO.com. So once we let them go, we simply change their password at their Try BPO email address and that means anything that they’ve signed up for or connected to under the Try BPO email address, we now all have control over.

Justin:
Exactly. So we’ve gone over some rock star outsourcing tips. Let’s get right into our ninja marketing tips, tricks and our plans for the future.

****The AdSense Flippers Podcast continues****

Justin:
So the first ninja tip we have for you is HiveDesk. Let’s talk about HiveDesk a little bit, buddy.

Joe:
Love HiveDesk. It’s not the most feature-rich program for what it does but because of its simplicity, I love it.

It tracks not only the hours that people work but also their screenshots and activity. So you have a virtual assistant. Obviously he’s all the way on the other side of the earth. You don’t know what he’s doing all day. HiveDesk runs a little program on his computer and takes screenshots every 7 to 13 minutes or you can set the interval level and automatically stores those in the cloud for you to access and evaluate in order for you to know how much to pay your VA.

Justin:
Yeah. So it’s a great tool for us too when we deduct from the time where they have screenshots of Skype conversations there with other people outside the company, when they’re looking at Facebook or they’re doing something they’re not supposed to be doing. We have something that goes through that and deducts. So we use it here in the Philippines and we’re here. So working from the US, I absolutely would use HiveDesk. Funny note on this is we actually started with them when they were in beta. So before they were even public, we started using them. We found out after the fact that the guy who originally created it sold it to some other guys, right?

Joe:
Yeah, for $3000.

Justin:
Oh, dude. We would have bought that so quickly. Love the program. Anyway, we’ve had a great experience with HiveDesk. They’re fantastic. They’ve added a lot of tips. Remember when it only took screenshots every five minutes exactly?

Joe:
Yeah.

Justin:
And so our team started knowing, OK, better hide the Facebook, right? The five minutes is coming up. Then they randomized it for us so it’s a lot better now.

Joe:
Yeah, and they’re small enough still where they take feature requests like that. They offer a free trial, 15 bucks a month for two workers, $35 a month for up to five workers. So it’s very reasonably-priced. Like I said, some of the advanced features may not be there that are in some of the other similar programs out there but good enough for tracking virtual assistants.

Justin:
Yeah. For value, it’s fantastic. Definitely check out HiveDesk.com. Second one we want to talk about is transferring money. So if you’re going to send money to your VA in the Philippines, what’s the best way to do that?

Joe:
Yeah, Remithome.com is who I have to recommend over Xoom or Western Union. Those are probably the two more popular ways. That’s how VAs are going to be asked to be paid here in the Philippines but Remithome gets you a better dollar to peso conversion which means it will actually cost you less money to transfer the same amount.

Justin:
Often used by OFWs or overseas foreign workers and it’s a great way for them to send money back to their families and they have multiple ways you can send that money to the VAs to get paid.

Joe:
Yeah. You can do it by cash pick-up. You can do it – so the VA can just go to the mall and pick the cash up directly or go down to the bank and get it in their account. They could also load it onto a cash card. They have all kinds of ways of paying people.

Justin:
Another thing that we’ve used – well, especially if you need to show your VA some screencast or actually share screens – is one you can do without downloading any software.

Joe:
Yeah. So Skype does have some screen sharing ability but you can’t control the other person’s computer. Sometimes you need to enter a password or you can use some other secure information. So we like a system called Join.me. It’s a free system. It doesn’t require any download, no sign-up. Great.

Justin:
Yeah. Free, buddy. You can’t beat that. Love that shit. Well, that’s it for episode nine of the AdSense Flippers Podcast. Thanks for sticking with us. Hope you like our tips and the heart of this week’s episode over outsourcing.

We want to make sure you got a chance to check us out on Twitter. I’m on there regularly, @AdSenseFlippers, or you can check us out on Facebook where we’re going to start doing a bit more, offer some offers, maybe free giveaways. That’s Facebook.com/AdSenseFlippers.

Joe:
Yeah. We’re trying to build up the Facebook peeps so check us out.

Justin:
Yeah. We will send you some free stuff. You can get some giveaways that we will be having over the next month or two. Anyway, thanks a lot guys and we will see you next week.

Joe:
Bye-bye, everybody.

[/spoiler]

Topics Discussed Include:

  • When you need to hire a VA…and why the Philippines is a great option
  • The best places and sources for quality VA’s in the Philippines
  • Breaking through cultural barriers with Filipino VA’s
  • Limitations on work – What your agent can and can’t do
  • How to resolve problems with your VA and how to let them go
  • The difference between a VA and an outsourcing company and when to use each
  • The BEST way to track your agent’s work and send money to your Virtual Assistant

Mentions:

  • AFP 5 Star Reviews on iTunes!
  • AdSense Flippers on Facebook – Join us to see our latest pictures and to follow our latest specials and giveaways!
  • OnlineJobs.ph, Craiglist for the Philippines, Sulit.com.ph, Jobstreet.com.ph - Some of the best job boards for hiring in the Philippines.
  • Virtual Staff Finder – Saves a bunch of time.  Don’t have to dig through resumes and job applications, they find the hires for you.
  • Grammar Test – We use this to weed out job applicants.  If they can’t take the test and send us results or score less than a 75% (Over 80% is great!) we won’t bother reviewing or interviewing.
  • 13th Month Pay – I know, I know…where’s OUR 13th month pay?!?!  It’s a nice benefit for employees here in the Philippines.
  • Example Employee Report with Roll-Ups – Just an example spreadsheet showing you how we track hours for employees with fake stats.
  • HiveDesk – Fantastic option for monitoring your VA’s work with random screenshots.  Very affordable.
  • RemitHome – Great way to transfer money to the Philippines for cheap and with less $$ lost on currency conversion.
  • Join.Me – Screenshare software that doesn’t require any downloads…and free!
Got something to add?  Please let us know in the comments below.


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Discussion

Leave a comment
  1. PhilJensen says:

    Looks like a good podcast. Haven’t listened yet, but I think I’ll download for the ride to work tomorrow.

    Great pictures on your facebook page….water looked warm!

    Phil

    • JustinWCooke says:

      Thanks, man! Definitely let us know what you thought about the episode. We thought it was pretty good…outsourcing’s a great subject for us, I think.

  2. Nice podcast, as usual.

    I’m currently using oDesk to find my VAs. It’s quite convenient for finding them, paying them, monitoring them, and firing them. I wish the interface was a bit cleaner, though.

  3. dano says:

    Just did the test, would you hire me? ;)

    Level 2: 8 out of 9 (89%)
    Level 3: 9 out of 10 (90%)
    Level 4: 12 out of 12 (100%)
    Level 5: 8 out of 9 (89%)
    Level 6: 11 out of 14 (79%)
    Level 7: 10 out of 11 (91%)
    Level 8: 10 out of 14 (71%)
    Level 9: 16 out of 17 (94%)
    Level 10: 9 out of 10 (90%)
    Level 11: 7 out of 8 (88%)
    Level 12: 4 out of 8 (50%)
    Level 13: 6 out of 10 (60%)
    Level 14: 5 out of 5 (100%)
    Level 15: 3 out of 3 (100%)

  4. David says:

    Thanks for another great podcast.

    You talk about your Team…. How many do you have on your team and what type of positions ?

    • JustinWCooke says:

      We currently have:

      2 KW researchers (1 in-house and the other’s a contractor)
      3 Site Creation agents
      3 Content Managers
      1 Linkbuilder

      We’ll be expanding all of these in the near future, but that’s the current staff.

  5. steve says:

    Great Show Guys

    Your really settling into this now each one gets better.

    A TON of solid useable info in this one!

    Love it.

    • JustinWCooke says:

      Thanks, Steve…appreciate it! I know you read and listen to quite a bit of content…I see you around the interwebs often. To hear this from you means a lot!

      • Steve says:

        Only the good stuff :-)

        It helps to have multiple Notebooks and Multiple screens running :-) mean i get some work done as well :-)

        Heres to a great Feburary.

        regards

  6. Anshul says:

    Justin, while majority of the outsourcing emphasis is on the Philippines, I do find that when it comes to certain tasks like SEO and link building, there are some great agencies in countries like India and Pakistan who have some amazingly skilled people.

    I have personally worked with two agencies in Pakistan and was totally blown away by the professionalism and quality of VA’s and work they can output. So, always worth considering those regions for more hands on technical work:)

    • JustinWCooke says:

      Anshul, you make an excellent point. There are plenty of other countries you can outsource to that can be extremely effective. Our focus on outsourcing to the Philippines specifically is due to the fact that we live here and run a company from here as well, so we’re best suited to talk about the Philippines, specifically.

  7. Ryanmccamy2 says:

    Loved The Show! Thanks for a great episode, and I am going through VSF right now, and this was very timely. One question though. The password interface you all use in conjunction with Google Apps to be able to control passwords, is called what? I could not understand what is was called and listened many times, and could not make it out. If you could let me know than that would be awesome! Thanks!

    -CMC

    • Not sure what you mean here. I am just talking about the normal Google Apps administrative controls. When someone leaves you organization, you can reset their password and access their account.

  8. Andre Garde says:

    Great show guys.

    For those interested trying out a VA, Flippa has a deal right now with oDesk where you can get $100 free credit if you hire a VA on an hourly contract. I just did that a few days ago and trained a VA to do all my backlinking. :) The guys that I hired is a BEAST and I’m actually running out of work for him, lol.

    Check flippa.com/deals and there should be a box at the top right for the oDesk link. This is not an affiliate link by the way.

    Andre

  9. Another good one guys… I posted a job on odesk a few days ago for someone who could customize a theme 24 replies, 23 didn’t include what i asked them to include and the one who did hasn’t replied in 2 days after i asked to interview him!!

    Outsourcing can be fraught with frustrations!

    • Yeah, you really need to sort through the BS on oDesk to find a real gem. They are there but it’s tough.

    • dano says:

      Having the same thing here, asked for review writers at an IM forum and replied to them to send me an e-mail to my e-mail adress instead of using the PM function, I got 10 pm’s and none e-mailed, though there was one person that sended me like 5pm’s and I asked 3 times already, the last time I said to him: “Are you fucking blind??? I asked you 3 times to e-mail me”. Then he started to email me, well too late. What a tards.

    • It really is like sifting for gold. Once I find a good outsourcer I hang on to them tight!

  10. tracy says:

    I am curious, how do you monitor someone taking the grammar test. Do you watch them or have them email the results through the program? Or some other way?

    • We don’t. They forward us an email of the results. While this could be tampered with, we’ll know immediately if they lied because their English won’t be good enough during the interview. This would be yet another way to exclude applicants.

      In all the years I have been giving the test, I cannot once say we caught anyone cheating.

  11. Steve A says:

    Hi guys, thanks for the awesome episode!

    I just had to leave you an iTunes review after this one, so much great info packed into one show (although I don’t know if you can see Aussie reviews).

    This has come just at the right time for me as my niche sites are starting to get a bit out of hand, I really need to shift some of this work offshore!

    For those of us who have never hired a VA before, I wondered if you have any information or data on what a benchmark quantity of work might be for a particular type of VA.

    For example, I might happen to be happy (through lack of knowledge) to employ a full time article writer who can produce 2 1000-word articles per day. Buy how do I know that that is an acceptable amount of work? How do I know everyone else isn’t producing 4 articles per day?

    Or if I agree to employ a link builder who will spin and submit 20 articles per day to UAW, how do I know that everyone else isn’t able to do 40? Or that 20 is too many and she will be overstretched every day?

    I know this will come with experience after working with VA’s for some time (and the above literally are just examples), but for my first appointment, how do I know what is an acceptable amount of work to expect from a VA? Because I see this as potentially a different thing to how much a VA might actually commit to (as per not wanting to say no to their employer).

    Thanks again!

    • JustinWCooke says:

      Hey Steve…thanks!

      This is why we highly recommend doing all of the work yourself first. If you take a couple of days writing articles you’ll have a pretty good idea as to how many you can complete in a X hour timeframe. You can then put those same requirements (maybe a bit less?) on your VA, knowing it can confidently be done. The same goes for backlinks, ordering/editing content, setting up sites, etc.

      Also…it’s good to point out again that some VA’s will be good at one thing and not good at another. It’s unrealistic to think that with one VA you’ll get a linkbuilder/writer/sitebuilder/editor…that kind of thing…probably not going to happen. You’re better of breaking the tasks into different skillsets and pushing that work to VA’s that are good in that particular area.

      Just for your reference:
      When we were first hiring writers, we found that a good writer (for us) could write 6-7 500-word articles in an 8 hour period as long as they could borrow ideas from other articles…basically re-writing the “spirit” of an article from somewhere else. A good writer could write 2.5-3 500-word articles that were completely unique and came from them only.

      Now, we don’t have any writers on staff…they’re all Content Managers and order/edit the content for us from other outsourcers and contractors.

      • Steve A says:

        Thanks so much for your reply Justin, it’s really helpful.

        I’m currently trying to figure out if the $160 I’m spending per week on 10×800 word articles on The Content Authority would be better spent on a full time writer. Someone who could output 2000 words a day would be worth hiring, 3000 words per day and i’d be doubling my content.

        Based on your comments it looks like I’m in the right ball-park :)

        Cheers

      • Konstantin & Julia says:

        Hi Justin!
        This blog is awesome! We just came across it and we can`t get out of here!!! :D
        Thank you for so valuable information!

        You commented that when you first hired writers they were doing 6-7 500word articles in 8 hour period… What was their pay rate? Did you pay them per hour, per article or you employed them for full time?

        Thanks in advance

  12. Where’s the next podcast, guys??? :-)

    • JustinWCooke says:

      We’re editing now, man…will be out in the next 24 hours. It’s all about our failures through different businesses and what we’ve learned from them.

  13. Really great show. Outsourcing can be difficult but this show really broke down the process into simple easy steps. I had never heard any of the outsourcing “gurus” mention the 13 month pay.
    I’ve been thinking about hiring a VA for a while and I now think I have enough information to at least get started.

    • JustinWCooke says:

      Glad to hear it, Keith!

      Weird nobody mentions 13th month pay. Here’s how it works…if the employee works for you the entire 12 months, you give them a full month’s pay…an average of what they’ve received over the year. If they’ve worked for you 6 months, they get 50% of the average.

      Technically, having a company here and actually employing these agents…we’re actually supposed to pay people that are no longer associated with the company. While that’s a requirement for us, I wouldn’t say that’s something a foreign employer needs to do for a home-based VA.

  14. Hey guys, great show. I included it in my latest issue of Freelancing Weekly (http://freelancingweekly.com/issue-14)

    Maybe not your target market but I definitely think there’s stuff folks can learn.

  15. Mark says:

    I’ve listened but seem to have missed the sites to hire on?

  16. How do you guys handle paid leave for your full timers? Do they get any?

    • JustinWCooke says:

      Hey Robert,

      They get paid leave, sick days, etc. We have a Philippines corp so they are on the books, get full benefits, etc. We work a US schedule, so they get all national holidays in the US and get paid overtime for national and local holidays here. (Of which there seem to be MANY!) :-)

      • They seem to be very lucky ;-) Do you know how other entrepreneurs who are not based in the Philippines handle paid leave for their VAs?

        • JustinWCooke says:

          Most don’t, I believe. (And are wrong for it, I’d add) Many just send a set salary over to their VA and expect the work to be done. Quite a few VA’s (if they can swing it) will take on 2 or even 3 FT jobs and try to juggle them for the extra cash.

          The best way to do it, we think, is to be very generous with your 13th month pay, vacation days, overtime, etc. but be VERY strict on the quantity and quality of their work. Track all of their progress through HiveDesk, make sure they’re working for YOU during the hours they’re supposed to work, etc.

  17. Its a very important guideline for the Outsourcing. With the help of it we can minimize our workload. The post is very nice and useful for the people.

  18. Jeff Raymon says:

    Hey guys, there is not link for the “Example Employee Report with Roll-Ups” Can you please provide? Or just likst the headers you use?.

  19. […] Justin Cooke, Empire Flippers Podcast - AFP 9: Ultimate Guide To Outsourcing […]

  20. Sudheer Yadav says:

    Nice article this will help my blog http://www.guruofmovie.blogspot.in/

  21. […] EFP 9: Ultimate Guide to Outsourcing […]

  22. […] EFP 9: Ultimate Guide to Outsourcing […]

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