From payroll to IT, marketing to credit control, for small business owners, finding time to juggle your varied responsibilities can present a significant challenge.
With only 24 hours in the day, there is often more work to carry out than time to complete it, and this is just one of the reasons why business owners are increasingly turning to outsourcing for their key business functions. In fact, it is so widely utilised by businesses across the globe that the outsourcing market is currently worth an estimated $85.6 billion.
Providing outsourced services is the very nature of what we do here at Moneypenny, so we’ve put together a guide to take you through the entire process, from identifying when and what you should outsource through to choosing your ideal outsourced partner.
When thinking about outsourcing, make sure that it is for the right reasons.
The main goal when you outsource is to improve efficiencies, increase resources and improve your business’ profitability, but we understand that small business owners may find it difficult to relinquish control of certain functions to a third party. To help with your decision, ask yourself the following questions:
Time is precious in the business world, and certain business responsibilities will take away this valuable time. If you find yourself or members of your team spending an inordinate amount of time on certain tasks, or being regularly distracted, taking you away from core business responsibilities, outsourcing can provide an invaluable platform to gain this time back.
Whilst it may not form part of your core business, many functions (such as accounting or marketing) play an integral role in running and growing your business. As a result, struggling to complete these tasks will not only add to your stress levels, but also take up your time that could be better spent focusing on other areas of your business. Outsourcing will provide you with a team of experts that have the right skills, qualifications and experience to handle your requirements, therefore improving efficiencies within your business.
Unless it makes clear financial sense to outsource a function of your business, then it is simply not worth doing it. However, if your business’ profitability is being impacted because you are unable to complete tasks to the standard necessary, then certainly take outsourcing into consideration. This could remove the necessity to hire someone and take on all of the overhead costs associated with employment, (i.e. holiday pay, sick pay, training, equipment, etc.).
Advances in technology have made it relatively simple to outsource via remote access, and therefore the options of which functions to outsource are endless.
Deciding which tasks to outsource depends entirely on your answers to the questions mentioned above. Unless there’s a real need, you could risk spending unnecessary cash on outsourcing that you simply don’t need. However, when an informed decision has been made, spending on outsourcing key functions will allow you to focus on growing your company.
Now comes the tricky part; you’ve identified the area that you should outsource but how do you decide on a partner?
Detailing your precise requirements to your partner is essential. Your brief should specify the length of the contract, the details of their role, what your expectations are (experience, skills, client base, etc.), when you want to begin, your goals, some background on your company and, of course, why you are looking to outsource.
One of the biggest mistakes any small business could make when it comes to outsourcing is choosing the first and only provider they contact. Whilst they may sound great on paper, until you compare a provider’s skills and experience to their competitors, you run the risk of choosing the wrong partner and not achieving your desired results.
Communication is the key to a successful outsourcing relationship, so ensure that your partner has a dedicated contact within your business who they can approach with any queries they may have, and vice versa. Regular meetings or phone calls will also ensure that both parties are continually working towards the same goals.
Outsourcing is an effective tool utilised by countless businesses, both large and small, to keep the business profitable, efficient and competitive. However, it is not a decision that should be taken lightly. In order to gain the most out of outsourcing, business owners must weigh up their situation, assess the viability of outsourcing and carefully choose the right partner.
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