If you’re a small business then you’d understand that managing everything in-house is a bit of a challenge, especially when you don’t have the required resources handy. We haven’t even talked about all the precious time wasted in managing these services and coordinating them. It is wise to outsource some operations so you can concentrate on growing your business.
How do you know if you need to outsource some of your work? If you’re feeling rushed off your feet and struggling to keep yourself together and still missing deadlines, then it’s time to outsource some of your workloads. Maybe you feel the need to do everything in-house like you did when you’d just started out. However, as the business grows, it’s not possible to do everything yourself or manage things in-house. For efficiency, outsource the work and just concentrate on the key aspects of your business rather than the operations.
So what are the operations you definitely should outsource? Even though businesses differ in their operations, here are a few things you must consider.
1. Information Technology
A Deloitte survey done in 2014 discovered that when small businesses outsource their IT work, they can save costs up to as high as 40%. 53% of companies already outsource their work and 26% are planning to do so. This study is proof that one person or business mustn’t try to do everything in-house. Outsource your IT from IT companies who have experienced employees. They are flexible and would do your work much better than you could if you tried to do it in-house. Hiring experienced IT personnel means a lot of expense in salaries and infrastructure.
2. Accounting and finance
Accounting, bookkeeping, payrolls are always a tedious process and most companies prefer to do these themselves. However, it is better to outsource these not only to save time but also to avoid making any errors. According to Fred Wallace from Sandhurst Consultancy Accounting, keeping accurate accounting records is essential in making sure you don’t pay more than you owe. Experienced accountants who manage this work daily are more than equipped to handle this requirement for you. It is also cost effective because you save on the cost of salaries and infrastructure.
Small businesses that outsource their accounting save 18% more than the businesses that don’t. The annual costs that small businesses incur are around $22,000 and about 24 work days. Imagine how much more you could have done with all this money and time.
Chances are that if you’re a small business, the work inflow isn’t consistent. Hiring salaries employees is a major loss to your business if you don’t have the work to back up the hire. Hire freelancers instead. One-third of the US population is making its way into freelancing, so there are a lot of experienced professionals who can take care of your work for you. In fact, when you outsource your work from freelancers, your company can make the use of talent that you may otherwise not have been able to afford. Ensure that your accountants are making note of all the money transactions that go into intermittent services to avoid scrutiny from the IRS.
Marketing is probably the most difficult for small businesses. It costs a lot and as a business owner, you may be at sea about how to go about it. Do you hire an in-house team or do you outsource your marketing too? You can do both but choose the one that is cost effective because as you know marketing is the most expensive part of running a good business too. The answer is that you must definitely outsource your marketing to other advertising and marketing agencies. Marketing professionals are expensive to hire and they work best in a team. Keeping this in mind, hire an agency instead. Marketing is also time-consuming. Small business owners typically spend 33 hours a week on marketing which is a whopping number of hours.
If you are a small business of retail, you will have a lot of small things to take care of from procurement of individual shipments to accounting. If you are talking about warehousing and office spaces, it is better to rent rather than buy. As your business grows, you might need to change your location and your scale of operations. Unless you’re an established company with assured longevity of the business, don’t buy your own warehouse. There are warehouses and shipping companies who give stellar packages for bulk orders. Make use of these so you can concentrate on your own business operations rather than the intricacies of logistics.
Skilled logistics personnel can handle bulk shipments and paperwork more effectively than you. Your expertise is in your industry. Outsourcing is more efficient and cost-effective. Everything that you need would be taken care of. You don’t have to micromanage anything, as is the case with logistics.
6. Customer support
This is perhaps most small business owners’ Achilles heel – customer support. Effectively managing your customer relations is an art and not everyone’s cup of tea. Big businesses can afford to hire a customer relations team but for a small business, this falls on the shoulders of the owner. Customer support includes maintaining customer satisfaction as well as acquiring new customers. Whoever is directly in contact with the customers is representing the entire company. It’s a big responsibility and it’s much better to outsource than to try to do it yourself, at least initially.
Outsourcing to call centers and experienced trained personnel gives you a better company representation as well as immediate service. Do note that is imperative to note down your company needs in this respect. When you hire call centers for customer support, you’d need to ask them the relevant questions. Each one will give you different results due to the nature of the human resource, hence, it is important to assess the level of employees of every call center you’d consider.
The most teething problems that a business faces is when it is at its nascent stages. Once it grows and has all its operations streamlined, there are fewer problems. Even though outsourcing poses some problems of its own, it could also be more rewarding in the long run.