The process of outsourcing work, whether that be labor, expertise or consultancy, is a huge business. Year end statistics for 2017, aggregated by Statista showed that global outsourcing generated US$88.9bn. Clearly, there is money to be made in the industry. For both growing and established businesses, there stands to be a lot of money to be made – even from value demand.
Effective and precise cost cutting is an ongoing project for every business, big or small. Outsourcing can tick boxes, but it needs to be effective. When you’ve identified an area to outsource, there are a few key considerations to be made – and key benefits to be found.
Ideal cost cutting characteristics
When looking at your outsourcing opportunity, consider how many areas of your business the decision will affect. Costs may be cut, but will there be a knock on for service? Is the quality of outsourcing available? Does your business require specific expertise? Consider customer service outsourcing a cautionary tale; business mag Forbes have reported that many businesses have turned back, at great expense.
A great case study for good quality outsourcing is printing procurement and offsite reprographics. Employing wholesale enterprise printing services can remove overheads from a number of areas. Inventory, accommodation and postage can all be reduced, tying together a number of waste costs from the business. Furthermore, good quality technology means that the service will get better at competitive costs.
Hidden costs reduced
The costs of outsourcing are normally immediately visible from company books. Reduced inventory, maintenance, equipment and other associated costs vanish from the ledger over the course of contract, moving to a single arrangement for the costs of outsourcing. Consider as well the costs you don’t see, and the profit benefits. The international nature of outsourcing makes it easier to operate across different time zones, and the potential for lower labor costs in your home offices as workload is streamlined.
Building international networks
The outsourcing of a business process usually brings that aspect of your business into a different country. Obvious among the benefits are the aforementioned reduced costs, the ability to work across time zones and the freeing up of time as your business is managed remotely. Less commonly considered is the benefit on your business acumen. Michigan State University have outlined how international knowledge is crucial to business, especially in an increasingly globalized economic climate. Using outsourcing networks enables you to develop these, and your businesses’ skills, generating valuable expertise in the country used.
Outsourcing, when done right, can be a wonderful boon to the success of your business. With a little care and attention to detail, you can stand to profit.