What is Outsourcing?

What is Outsourcing?

If you’re a business owner and you’re not outsourcing something, then you’re doing something wrong. Being able to effectively delegate and outsource correctly can be key to having a successful business in today’s super competitive market.

I’m very familiar with Outsourcing but we all have to start somewhere, so figured I’d do a quick breakdown.

Outsourcing is obviously a process of using an outside source to perform a service with the intention of trying to reduce costs. It’s referred to in many different terms like “contracting out” and can apply in a whole range of situations. Technically, if you call a plumber over to fix your toilet you’re already outsourcing.

In the business world, there is a slew of categories but primarily they all fall under what is called Business Process Outsourcing (BPO). Many call centers in the Philippines and India are known as BPO’s and handle a variety of tasks for companies abroad. My very own company, SupportNinja, is exactly just that.

There’s also KPO or Knowledge Process Outsourcing where you might outsource specific research required for your end-user or product. There’s even LPO or Legal Process Outsourcing which can be used by some law firms and legal departments to handle the most tedious parts of a legal case.

In the case of most small business owners though, you’ll like use outsourcing for some of the following scenarios

  •     Web Design and Web Development
  •     Back-Office or Administrative Support
  •     Accounting and Human Resource (HR)
  •     Sales & Marketing Assistance
  •     Level 1-2 Customer Support Inquiries

Why Outsource?

The primary job of outsourcing is to reduce overall costs. That can be done by reducing your liability (i.e number of people you have to hire as employees) and/or reducing overhead (recurring cost to run your business).

Many businesses, no matter how small or large, will outsource to some degree. You might use Upwork.com to outsource to a freelance developer to help modify your website, or you might hire a company like mine to actually handle an entire department, like customer support for your customers.

In short, you essentially give away some of your business tasks to another entity or person to handle. It’s important to make sure that you setup the right Business Systems to direct them properly, but it can often make life much easier, faster and save you and your business a whole lot of money in the process.

What are you waiting for?

There’s never been a better time to start outsourcing, and as somebody who’s been outsourcing since I was 17, I know a thing or two about it. Feel free to reach out to me personally and I’ll be glad to help out with any questions.

 

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