Outsourcing Business Activities and Its Advantages

outsourcing business activities advantages

Outsourcing of business activities is not a new phenomenon. In fact it has always been an integral part of business strategies adopted around the world. But till recently, it has always remained exclusive to large corporations and blue chip companies. This is because they have the resources to parcel out certain activities to experts round the globe and the financial means to closely monitor the progress made in this regard.

Outsourcing Business Activities

Today, with the advent of the Internet, the world is a huge global village with instant communication between countries at a fraction of the previous cost. This has made it easy for all businesses irrespective of their size to take advantage of the benefits of outsourcing. A 2012 Australian BPO Report points out that up to 65% of Australian businesses outsource such key components of their operations like accounting, online marketing, CRM and finance and other administrative functions such as HR.

Outsourcing is also a cost effective way to take advantage of the many tools and technological innovations being developed globally and putting it to good use within the country. It is therefore small wonder that businesses big and small are consistently gaining by outsourcing a part of their activities. This is more so for small businesses and start-ups that can ill afford to hire manpower at high salaries to look after their daily operations. Outsourcing is therefore a much better option for them.

How does outsourcing help in the long run?

  • Eliminating Focus on Non-Essentials – Every business comprises of two important aspects – activities that directly help to boost growth and development and those that gives background support like administrative tasks. Too much focus on the latter will result in stagnating growth and slow down in expansion. It is therefore advisable that the owner concentrate on business expansion and farm out other activities to companies or consultants who specialise in that field. It also frees up resources used in running non-essentials and enables owners to give more attention to devising successful business growth strategies.

This method also helps businesses and professionals emphasize on core activities. For example, a doctor will do well to only aim at providing quality patient care in which he has professional expertise. Marketing, publicity and maintenance of accounts can be outsourced to those who are regulars in this field.

  • Having Control over Operations – Small businesses and start-ups have to initially adopt expenditure reducing measures if they are to quickly break even. One of the main areas that drain resources is administrative functions, especially salaries for experts since the promoter and CEO will usually not have the technical expertise in all areas. Handling the primary task of business growth and development while outsourcing other areas will give him more time to do so and not tie him down to tasks that are not directly connected to business expansion.
  • Taking Pressure off Seasonal Activities – There are some businesses that experience heavy seasonal rush. Examples are retail outlets during festive periods and accountant firms during tax season. In these cases, it is not financially feasible to hire extra hands for a short period. Retail outlets can consolidate their workers to focus only on sales and outsource marketing and publicity. Similarly, the extra work during tax season can be farmed out to consultants.

Hence outsourcing is just ideal for tasks that are temporary or once-in-a-year in nature.

  • Quickly Scaling up Operations – Expansion of business has a cascading effect on many parameters such as requirement for more staff, office space and production facilities. Putting the right infrastructure in place and hiring staff and training them to take care of increased business can be a time taking process. During this gestation period, no customer will wait for deliverables and one has to move speedily to cash in on new business opportunities.

Outsourcing the job of hiring and training additional hands will be much quicker and less troublesome. For small businesses, outsourcing product manufacturing to take care of a sudden surge in fresh orders is a better option than investment in new plant and machinery. Customer needs can also me met faster this way.

  • Cost Savings – By outsourcing certain business operations, businesses can tap into updated technologies and skill levels. Setting up the same infrastructure in-house and hiring similar trained personnel will not only be more costly, it would also be a time consuming process. Outsourcing of parallel functions and business activities can be done at a fraction of the cost of doing it on the own. Lower expenditure means higher profitability and ROI.
  • Offering a competitive edge – This is crucial in the modern cutting edge business environment. By opening up windows to the world, small businesses can outsource their critical tasks and get the best talents and tools to work for them. This will give them an edge over their competitors tied down to traditional business methods and outdated knowledge. Globalisation of business is now a permanent phenomenon irrespective of the country of origin.

One of the key areas where outsourcing has made the greatest impact is online marketing. Australian businesses have realised this and are increasingly depending on digital online marketing companies to reach out to customers. One Stop Media is one of the market leaders in this field and we have helped many customers widen their market reach by increasing their online presence. It is no secret that more and more clients are searching the Internet before arriving at a purchasing decision and we ensure that your business is at the top of search pages on major search engines, thereby increasing your online visibility.

To know more, call us at 1300 305 619

Leave a Reply

Your email address will not be published. Required fields are marked *