The Small Business Argument for Outsourcing Business Functions

The Small Business Argument for Outsourcing Business Functions  

When the economy suffers, small business suffers along with it. As the owner of a small business, it may seem prudent to reduce costs by trying to do everything in-house, when in fact, outsourcing may be the more economical choice. Instead of spreading your workforce thin trying to save on certain business activities, focus on your company’s core strengths and outsource departments or activities that don’t fall in your realm of expertise. Below are a few ideas to consider when deciding whether or not to outsource:

  • Outsource non-core functions.  Outsourcing can reduce operating costs. It allows your business to access the knowledge of the outsourcing company and frees up time and resources to focus on your specific business goals and strategy.
  • Areas that might serve better as outsourced. If accounting doesn’t fall into your core competency, outsourcing your bookkeeping and accounting functions makes sense economically and operationally. This is also true for IT, payroll, marketing, public relations, logistics, maintenance and more.
  • Change fixed costs. Do you only need your HR department to function three days a week, or your bookkeeping four days a week?  Consider opting out of that position as salaried and consider outsourcing it instead – making this a variable cost instead of a fixed cost.

 

Remember: Out of sight does not mean out of mind. Always ask for monthly reports, maintain communication and continue to manage your outsourcing vendor in order to keep them accountable and effective. But, the true bottom line is outsourcing functions that don’t bring value to your customers. Your customers should be your real focus.

 

While outsourcing is not right for every small business in every situation, it is definitely something to consider. And you may find that it frees up more time, resources and money to concentrate on what your business provides, rather than what makes your business run.
What other areas have you outsourced and why?  Please leave your comments below.

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Brian Sutter

Brian Sutter

Director of Marketing at Wasp Barcode
Brian Sutter is the Director of Marketing at Wasp, responsible for the development and execution of the company’s marketing strategy. His role encompasses brand management, direct and channel marketing, public relations, advertising, and social media. He also writes and speaks on topics related to helping small business owners grow their business and improve operational efficiency.
Brian Sutter
Brian Sutter