Grow Your Business by Outsourcing: How and Why
by Khristal Asoque • November 16, 2022
Multiple strategies are used by different companies of all industries to aid their business or operations. Defined as acquiring third-party resources, get to know how outsourcing can help with business growth.
Outsourcing comes with great benefits if you choose an outsourcing partner that meets all your needs. Furthermore, the third-party resources should be qualified and be able to provide all services presented to you upon agreement. In a nutshell, outsourcing works wherein you outsource an individual, department, or entire business function for operations traditionally done internally.
In addition, outsourcing is available to many industries. The areas that companies outsource the most are human resources, accounting, marketing, sales, IT, administration, customer service, and many others. Furthermore, outsourcing is the perfect solution to increase profit margins as well as cut costs for small to big companies worldwide.
Furthermore, outsourcing is different from offshoring—a familiar term for companies availing third-party services. We’ve already stated that outsourcing entrusts a part of their business tasks to an outside vendor. Meanwhile, offshoring refers to production operations performed in other countries.
Why do companies outsource?
Outsourcing allows businesses to focus on core business operations without having to take more energy toward back-office tasks, for example. Here are a few more reasons why companies lean toward outsourcing:
- Cuts operation costs
Companies are looking for ways to cut back operational costs while increasing their value margin. With this, outsourcing can become a cost-efficient solution as there is no need to pay for staff training. Furthermore, businesses can save up on office space and other utility expenses.
- Taps into a global pool of experts
Remote resources have the advantage of having the skills needed in their chosen fields. Whether design or web development like RipeConcepts, people are already equipped with the skillset. So, by outsourcing, there would be no need to train talents to do a particular task.
- Focuses on core business activities
Business owners would not have to worry about administrative tasks and pour more attention into scaling their companies. Therefore, outsourcing allows the business key resources more time and energy to work on more core-related functions.
- Increases work efficiency
By utilizing outsourcing, companies would have more work done compared to the traditional in-house workflow. Outsourced experts that deliver certain projects with fully equipped knowledge led to an increase in productivity and efficiency.
- Makes use of time zone differential
When outsourced professionals come from another country, companies can take advantage of the different time zones. Businesses can benefit from round-the-clock operations while getting the job done quickly.
Let these statistics speak up for themselves:
- Around 66% of US companies with 50 or more employees outsource (Zippia)
- 78% of companies that outsource work have good attitudes towards their outsourcing partners (Deloitte)
- 68% of major consumer products corporations in the US outsource some of their workforce (PrincewaterhouseCoopers Retail & Consumer Industry Practice Report)
- Common functions in outsourcing human resources include employee training initiatives (58%) and the recruitment function (38%)
Considering outsourcing? Here are steps to outsource successfully:
- Outline outsourcing goals
Be clear on the services you want to be outsourced up to the tiniest detail. This includes your vision, goals, and objectives for business growth.
- Manage outsourcing costs
It’s good to settle the budget you are willing to spend when outsourcing professionals. The cost should depend on the type of work you are buying in line with their skill level and the location of the outsourcing provider.
- Evaluate outsourcing partner
Assuming you have found an outsourcing provider that is qualified and has the capacity to take care of your needs, this portion of the process would then become the make-or-break agreement. If you find the projects exemplary, then you can eventually transition to a fixed-cost retainer.
Here are a few things to take note of when looking for an outsourcing company:
- Length of service of the outsourcing company
The relevant experience of the chosen outsourcing company determines its credibility. They should have a strong knowledge of the services they offer.
- Feedback from clients
Testimonials are a great thing to know if the outsourcing company is the perfect one for you. Referrals also work the same. Furthermore, the more satisfied customers they have, the more the company is trustworthy in handling your business needs.
- Corporate values
When choosing an outsourcing company, it is vital that your goals are in line with what the firm stands by. All your business factors from metrics to goals should be united with your outsourcing provider.
Common mistakes you want to avoid when outsourcing:
Like any business deal, you must be thorough in what you are getting into with outsourcing.
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You should avoid availing of services without a detailed plan and jumping in too quickly.
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Avoid not providing proper guidance to your outsourced team. They would need to be aware of your processes and workflow to a continuous system.
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Steer clear from prioritizing cut costs instead of quality. Always put quality first as this brings revenue in and solidifies your branding.
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Not measuring team performance is another no-no in outsourcing. This is needed to boost performance and collaboration among the team members.
Overall, outsourcing has a lot of perks and processes that any business owner must consider. At the end of the day, relying on an outsourcing provider can take some of the workloads off your shoulders. Work on prioritizing core business functions with the help of outsourcing.
When looking for a team of experts, you can rely on RipeConcepts through connect@ripeconcepts.com.
Employee-leasing, Outsourcing
