The Benefits of Outsourcing for Small Business Growth (and When You Shouldn't)
When you should and shouldn't outsource, and how to find the right provider.
By Rachel Beider, CEO of PRESS Modern Massage, an award-winning group of massage studios, and the founder of Wellness Business Consulting.
Outsourcing is a great way to pursue small business growth. It can help you save money, increase efficiency and gain access to a wider pool of talent. But what exactly are the benefits of outsourcing and how can you do it effectively?
The Benefits
Cost: When you outsource certain tasks or services, you don't have to pay the same wages or benefits as you would if you had hired an in-house employee. This can significantly reduce your overhead costs and help your business grow. Plus, since you are only paying for the work that's done, you don't have to worry about extra costs associated with having an in-house employee, such as taxes, insurance and other workplace expenses.
Efficiency: By outsourcing, you can free up your team to focus on more important areas of your business. This allows them to be more productive and get more done in less time.
Talent: Outsourcing can be especially beneficial if you need specialized skills or expertise that aren't readily available in your area or country. A few of my favorite websites to look for talent include Upwork.com, 99Designs.com and Fiverr.com
Scalability: If you have access to a larger pool of talent and resources than what's locally available, your business can scale up quickly without having to worry about hiring additional employees or taking on additional overhead expenses like office space and equipment rental fees.
What To Outsource (and What To Keep in House)
Here's a list of 10 tasks that I outsourced when I was growing my small business:
Accounting and bookkeeping: Outsourcing accounting and bookkeeping services can help small businesses save time, manage cash flow more efficiently, make better business decisions and comply with tax regulations.
Human resources: Outsourcing HR services can be a more cost-effective solution for small businesses that need to hire and manage employees.
Payroll: Outsourcing payroll services can help small businesses save time and money by eliminating the need to close books or run reports after every payroll cycle.
Information technology: Outsourcing IT services can be beneficial for small businesses that need access to technical expertise without the overhead costs associated with hiring in-house IT staff.
Customer support: Outsourcing customer support services can help small businesses provide better customer service without having to hire additional staff or invest in expensive technology solutions.
Legal services: Outsourcing legal services can be a cost-effective way for small businesses to gain access to legal expertise without the overhead of hiring an in-house attorney or law firm.
Marketing: Outsourcing marketing services can be beneficial for small businesses that need help creating and executing marketing plans, running campaigns and tracking results.
Web design and development: Outsourcing web design and development services can provide cost savings for small businesses that need a website but don't have the resources or budget to build one from scratch in-house.
Data entry: Outsourcing data entry services can help small businesses save time and money by eliminating the need to manually enter data into spreadsheets or databases.
Virtual assistance: Virtual assistants are remote workers who provide administrative support, such as by scheduling appointments, managing emails, making travel arrangements and more--allowing small business owners to focus on running their business instead of getting bogged down with mundane tasks.
There are a few things that small businesses should not outsource, especially in the beginning. Tasks that are best to keep in house include anything involving confidential or secure information about your employees or clients, as well as higher-level customer service tasks. You should handle issues in those areas internally.
How to choose the right provider
When looking for the right fit, consider the provider's specific industry experience and how it aligns with your budget. Choose providers who have great references and who are excellent communicators. If you have an urgent project, you might consider hiring two different providers to start the project and continuing with the provider who's excelling. This is a simple and efficient way to audition your potential providers if you're in a rush.
There are many benefits that small businesses can experience from outsourcing. It can be cost-effective and efficient and provide access to a larger pool of talent than what's available locally, which can help with scalability as well as provide specialized skills when you need them. So why not give it a try? You may just find that it's the best thing for your small business.
Original Article posted in Inc Magazine