The strong performance of today’s global economy is not only attributed to advanced innovation and technology but also outsourcing. For many start-up and small businesses, outsourcing begins with tasks such as accounting, payroll processing, distribution and other significant functions, when they reach a measure of success or volume demands it.
Building a budding business is a challenging task. It requires time, effort and money to be successful. Outsourcing ensures that you get specialised tasks completed by experts in that field to reduce stress while running your business.
However, many business owners do not have a thorough understanding of the benefits that come with outsourcing. Outsourcing often saves businesses money, but that is not the only reason to subcontract. From the outsourcing “obsession” carried out in the early 1990s, many companies discovered that relying solely on outsourcing can be as much a blunder to a company as not outsourcing any goods or services at all.
Nonetheless, wise outsourcing for a company can lead to the following long-term advantages:
When the tasks of a business’s back office are complex in nature and the company’s size prevents the staff (or lone entrepreneur) from completing them with reasonable cost, or sufficient time, then, outsourcing might be the right solution. Sometimes, the overhead costs required to perform a specific back office task are very high in-house and presents a good opportunity to subcontract those functions which can be moved easily.
Allocating some tasks to a third party can also help share the responsibilities of the company’s employees to ensure that you grow the internal task group and knowledge base. As outsourcing brings experienced individuals to add to the business expertise and help deliver more complex projects.
In every business environment, there exist risks relating to competition, financial situation, technology, markets, and government policies. These factors change rapidly, and an outsourcing partner can assume and take on the shared responsibility for the risks for you in case they happen. Fortunately, outsourcing providers know better how to prevent or avoid certain risks affecting their areas of proficiency.
Access to an increased talent pool
Generally, start-ups and small business owners can only access a small and local talent pool when hiring required employees. Which can mean you need to compromise. With outsourcing, you can access an increased talent pool from different parts of the county or world. For specialised help, simply expand your search to get the needed personnel.
Through an outsourced partnership, you can also reduce spend on recruiting and training employees in the traditional manner, which can be very costly and prohibitive in the start-up phase of business. Outsourcing providers help make sure that the outsourced staff and are well-taken care of.
When starting up a new business it can be very daunting to set up an office, there are a whole host of costs associated with rent, furniture, computers, insurance and more. When outsourcing you can reduce your initial outlay and a lot of time as your outsourced partner can supply a ready-made office environment, complete with IT support, security and comfy desks for your team, or you might hire home-based contracts who provide their own tools.
Focus on the core business activities
Usually, workload increases as non-core tasks increase too. This can lead entrepreneurs and small businesses to compromise on the quality of the core business activities as their company grows. In this situation, outsourcing the non-core tasks plays a significant role by making sure that the key resources of the company focus on the primary business functions as well as strategy to get to the next level.
Every company has limited resources. The company’s managers also have limited attention and time in running the business. Thus, outsourcing helps managers shift their attention from unimportant activities to the tasks that serve the company’s customers and ultimately determine the company’s success.
Run the business 24/7
Outsourcing, especially to a country that is in different time zone can help you run your company for 24 hours a day. This is very important when managing customers in different parts of the word, where you can hand over management of the business after the normal office hours in your country are over. Then your outsourced team members can perform and complete the critical tasks of the business and send it for you to review them the following day.
Give the business a competitive advantage
Strategic outsourcing not only provides your customers with high-quality services but also enhance your productivity as you manage your internal resources wisely. This helps you surpass your competitors to remain at the top of the game.
Boost service and lead to a happy customer
Outsourcers can utilise the skilled expertise of their extended team to produce superior deliverables quickly and this ensures that the customer receives their goods/services within a shorter timeframe. Exceptional services and on-time deliveries lead to a delighted customer. Therefore, through outsourcing, you can increase your customer satisfaction and create a larger number of loyal customers.
Initiate new projects faster
Outsourcing can provide the required resources to initiate a project immediately. Handling such a project internally can take more time because the company needs to employ the right personnel or re-direct the focus and energy of team members with alternative roles and responsibilities, and then train them as well as provide the needed support internally.
Reduced labour cost
Large companies are always devising ways to lower labour cost and outsourcing is one of the best ways to do so. However, it is not simply trading quality for the price; there is still an investment in time and training and locating the right outsourced team members and then working to retain them as well. But in busy times outsourcing allows you to scale quickly and the saved money is channelled to improve the business as well as better service to the customer.
With outsourcing, a company can realise a boost in the level of quality, customer loyalty, business value, productivity, and profits among others. So, if you are running a company, regardless of size and have not yet started outsourcing; then maybe right now is the time for you to begin enjoying the above benefits!