What Is Your Buyback Rate, and Why Does It Decide What You Should Hand Off?

Your buyback rate is the line that tells you which tasks to give away. If you bill at $200 an hour, any task you could pay someone about $50 an hour to do is a task to hand off, so you can keep billing at $200 on the work only you can do.

What is the buyback rate in plain terms?

It is a line you draw once. On one side sit tasks you could pay someone about $50 an hour to do. On the other sit tasks that need your level of experience.

Anything under the line is a candidate to give away. Anything over the line is where your hours should go.

Grandfather Engineering never draws that line. It bills hours, and the founder ends up doing everything, from the design to the paperwork. Modern delivery values the output of the hour, so it hands off the cheap work and multiplies what the engineer produces.

Where does the $200 number come from?

For a seasoned engineer with around 10 years of experience, I think $200 an hour is a safe rate to assume. If you are overloaded with work and charging less, raising your rate is one of the easiest levers you have.

You can go from 140 to 200 just by saying a different number. If you do not bill by the hour, work out your own figure from what you earn in an average work week. I do not work an average week myself, but it is a good hedge.

Then the example is simple. If you bill that $200 consistently, with a full week booked, a task someone could do for $50 an hour is a great one to have other people doing while you keep billing.

What does a $30 task look like in real life?

My own example is mowing the lawn. Someone offers to do mine for $35. It takes me about an hour. I have a small lawn in North Texas, and yours may be bigger, closer to $100, and may take longer. At $35 for an hour of my time, that is a slam dunk for me.

The same trade shows up in the office. Here is what I said on the show:

• Invoicing. I do not like doing invoices, and you can hire a bookkeeper much cheaper than an engineer. I delegate it.
• Routine work. There are two types of it, and it is the first place I tell people to look.

In my view, once you start looking, you will find more of these. That part is my opinion, not a rule.

What if I actually enjoy the task?

Then keep it. I am not telling you to give away everything you like. My business coach loves to cook for others, and nobody should talk him out of that. If you love doing engineering, you may be happy working long days on it too.

The point is to choose on purpose. Tasks you already know drain you are the best ones to trade first. You get time back, and you also get mental capacity back.

One condition matters. This is a trade up, not a trade for free time. Swapping hours and then doing nothing productive with them is not a real trade. The game is to trade your time and work on better things.

Should you delete the task before you hand it off?

Ask first whether the task needs to exist at all. What are you doing that is not absolutely necessary to get the proposal or the deliverable done?

I used to carry three different notebooks. I came up with a system and consolidated them into one notebook in one spot, and my notes now live in a single system. It helped me zone in my focus.

The same question applies to the work itself. Are you overbuilding parts of a deliverable that nobody asked for? In my view, delegating a step that should not exist just moves waste to someone else.

How do you hand work off without it coming back broken?

Handoffs are where a lot of miscommunication starts. Two things have helped us.

1. Contracts with clearly defined scopes, so everyone knows what is and is not included.
2. Templates for handoff documents, such as moving a job from the sales team to the engineering team.

We keep improving that process, and it is helping slowly turn around the miscommunications we had.

This also matters if you plan to use AI or an assistant. Whoever does the task, person or software, needs to know where to go to get the data. That is a question about your actual business processes.

What to do next week

Here is what I would do. Write down your rate. Look at your last week and list every task you could pay someone about $50 an hour to do, if that is your rate range.

Pick the one you dislike most and hand it off, or delete it. Then think about what you will do with the hour you get back, and how you will measure that.

I do not want to undersell this. It may sound egotistical to say you can do things better, but doing better work with your hours is how you get to serve your clients better.