By Lauren Fenthum <--- To save/view this infographic please
CLICK HERE “Outsourcing” is the word on everyone’s lips that are involved with big businesses, from corporate giants to that of global insurance companies. A reason for this could come down to the fact that many small business owners are making the assumption that outsourcing is not something they necessarily need to be thinking about. However, this is should not be the case. When it comes to the advantages that outsourcing can bring, it becomes clear that the value it adds to one's business is not just reserved for the players in the big league, and could be seen as even more vital for a small-businesses’ long-term viability to consider outsourcing.
Essentially, a business should look at outsourcing any function that resonates with the core of what you do. For example, look at what fields you are not an expert in and what could be done by someone better, with the necessary skills needed to complete that specific task, this will save you time as you are not thinking of tasks that are irrelevant in completing the task at hand. If you ask anyone about what they gain from outsourcing, almost everyone will go back to the statement of “not having to think about.” This is a valid point as outsourcing means that you have the ability to focus your attention fully on what you do best. Outsourcing gives you the access to specialists you would otherwise not have at your disposal. This is also giving you access to a surplus of knowledge, skills and expertise, why make do with what you can find when you can utilize the most experienced brains in the business.
You can save your business money on a number of different levels, when outsourcing non-core activities, and thus make use of outsourced resources more efficiently. You can further break the cost savings into three main areas:
Salary Costs- making use of an external provider using hourly services, and only making use of the skills when needed is cheaper than paying somebody full time.
Employee Costs- because you are outsourcing employees, you will not be paying the costs of insurance, pensions schemes or that of benefits. If your employees are sourced from an external provider you will not be put in the position of having to develop employee benefit packages, as they are not full-time. This not only saves your business money but also can land up saving valuable time as well, as the people that you are outsourcing are for a specific reason and therefore have the abilities to execute a task as desired because that is what they are skilled in.
Indirect Costs- once again, by outsourcing you land up saving money as you do not have to worry about all the excess costs that you might run into, such as utilities, office space, hiring costs as well as that of administration. You are only paying for what you need when you need it, instead of on a fixed basis.
By taking the above factors into consideration, it becomes clear that big businesses are not the only ones who should be looking more closely at outsourcing. Specifically for smaller businesses that are just starting out, capital is everything, so be clever with how that money is spent. After all cash flow is king and business efficiency can mean the difference between a thriving outfit and another failed start-up.
