4 Ways Outsourcing Can Increase the Value of Your Business
When you outsource work from your business, you have to pay someone outside of your structure to do that work. It sounds like an added expense, but smart use of off-site resources can actually help you reduce overall costs, increase production or revenue and positively impact the value of your business. Here are four ways outsourcing leads to greater value.
1. Outsourcing expands your access to resources.
For most businesses, the limitations on internal resources can be confining and strict. Expanding those resources takes time and money you don’t always have, and it’s not a sound business decision in every case anyway. Companies shouldn’t take on permanent staff to handle a single, specialized need, for example, and scaling up to meet some demands leaves you constantly scrambling to cover rising costs. Outsourcing lets you expand resource availability without the same commitment and spend associated with hiring staff. Consider some of these examples where outsourcing is a good path to resources.
- A small business needs legal advice. Instead of hiring a lawyer on staff, they work with a professional on a contract basis.
- A motel needs to ensure its grounds are well kept. Instead of putting that responsibility on a small and busy staff, the owner outsources the work to a local landscaping company.
- A manufacturing company sells direct via its website. It outsources customer-service phone calls regarding orders instead of creating an in-house call centre.
- A hotel wants increased exposure online. It works with a channel manager to expand digital branding without substantially increasing the work for in-house staff.
2. Outsourcing lets you work smarter.
Looking outside of your company to meet speciality or scaling needs doesn’t just connect you with additional resources. It also lets you work smarter with the resources you have in-house. If your staff isn’t working to answer every incoming phone call or handle data-entry tasks that could easily be delegated to outsourced workers, they can spend time on more valuable work. Outsourcing gives you more time to create new product and service lines, enhance customer experiences and work through revenue-generating tasks.
3. Reducing costs lets you invest in your business.
While outsourcing is an expense — people aren’t going to work for you for free, after all — it’s usually less expensive than paying someone in your organisation to do the same work. It’s important to conduct a strong cost-benefits analysis before you choose to outsource, since there are always exceptions. Some reasons certain work is less expensive to run via outsource staff include:
- You aren’t paying for the staff full-time; you only pay for the work that they do.
- Outsource staff are managed in part by those who run the outsourcing firm, so you have fewer expenses related to oversight.
- You aren’t obligated to provide benefits, time off or other perks for outsource staff.
4. Leveraging experts reduces your overall risk.
Finally, outsourcing certain work to experts reduces the risk within your organisation. For example, you’d never rely on untrained staff to evaluate your building for earthquake readiness and make appropriate building repairs, right? Whatever your business challenge is, you might be able to work with a company that handles that type of issue exclusively. Experts who keep up with all aspects of their niche tend to be able to solve problems faster and with less future repercussion. In short, outsourcing lets you handle specific matters without having to re-invent the wheel yourself.
All of these benefits of outsourcing help you increase the value of your business now and in the future. They also leave you free to build upon your brand and business while ensuring day-to-day operations are effectively managed.
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