Outsourcing is a great way to improve your company’s productivity and efficiency while reducing costs. Outsourcing allows you to focus on what matters most or even work on multiple projects at once without hiring more staff members, adding responsibilities for existing employees, or expanding the business in any other way.
While outsourcing has become a hot topic in the United States, many companies still don’t know how it could benefit them. When you outsource, you are allowing another business to take care of your most painful tasks so that you can focus on what you love to do best.
Here are a few reasons why outsourcing could benefit your business.
1. Save Money
Outsourcing is much less expensive than adding new positions to your company’s payroll. And, because companies that outsource typically pay for results instead of time spent working, you can reduce costs even more as the hours decrease as tasks become automated and streamlined.
For example, suppose an employee earns $15 per hour and works 40 hours per week with two weeks’ vacation annually. In that case, the annual operating cost for this single employee equals $31,200(assuming an average five-day workweek).
However, if there was a way to increase their productivity by 10% without increasing their salary or hourly rate, the operating costs would fall by $3120 per year (10% of 40 hours per week = 4 hours x $15 hourly rate).
2. Focus on Business Growth
When you reduce costs through outsourcing, you can focus on growing your business instead of basic expenses that will just get passed along to your company’s clients.
You can even hire out specific business functions so that you won’t have to expand your full-time staff at all! If the company’s needs grow beyond what one part-time employee can handle, then simply add more employees or subcontractors to meet the demand for expansion.
3. Get Projects Complete More Quickly
Outsourcing allows you to bring in experts who are trained in their field and can complete tasks quickly and efficiently while meeting deadlines because they are experts too.
For example, if you need a couple of additional hours to complete your project, but they can complete it in just one hour, then outsourcing is your best choice. They will get the job done right, and they won’t cost you any more than what is necessary.
4. Improve Company Productivity
Companies that outsource typically see an improvement in their productivity because employees can focus on tasks that most energize them instead of concentrating on labor-intensive tasks like data entry.
When employees are doing the work they were hired for — the work they love — then there is less turnover and absenteeism, which leads to better company morale as well as higher productivity results!
5. Access New Skillsets
Many companies only hire employees who have the exact qualifications needed for every available job. However, when they outsource, hiring managers can access skillsets that might otherwise be unavailable in their own geographic location.
This allows for a more diverse workforce that can bring unique perspectives to the table, which helps drive innovative ideas that are beneficial to the company’s bottom line.
6. Work on Multiple Projects at Once
When you outsource your work to another company, there are more opportunities available because you are not limited by geography or time zones!
You will no longer need to turn down projects or clients because you don’t have any employees available when an opportunity arises with a client in China at 2 am — simply subcontract them and get it done right instead of losing the business opportunity altogether.
7. Gain Access to Expertise You Might Not Have Available in-House
If your company doesn’t have anyone with expertise in a particular area, then outsource that job instead of adding it to your full-time payroll.
For example, if you own a hotel business, it is better to outsource the laundry to a laundry pickup and delivery company. This allows you to focus on your core business instead of spending time and money training employees in an area that they might not even want to work in.
This article discussed seven reasons why companies may want to outsource certain functions instead of adding full-time staff members — possibly the best option for some if they take the time to find another reputable company or person to do the job!
We hope this article has helped answer some questions about why companies might want to consider outsourcing their tasks instead of dealing with them internally and it could be one of the best decisions you ever make for your bottom line!