Outsourcing is a technique used by small businesses and industry giants alike to reduce costs and improve efficiency. This blog throws light on how.
But first…
What Is Outsourcing?
It is a process through which some business operations or tasks are handed over to a vendor. Some board (broad) categories of outsourcing include –
Considerations For Outsourcing
Some questions to ask yourself to understand if outsourcing is right for you are as follows:
- Are the available resources qualified to take on the new upcoming tasks?
- Do the available resources have the bandwidth to take on more tasks?
- If you answered no to the above question, then what would the cost of hiring new resources be?
- Is there enough time to hire new resources?
- Are all processes running smoothly and efficiently?
- Will outsourcing provide any operational cost benefits?
How Is Outsourcing Cost Effective?
A general rule of thumb is that in-house resources cost 2-2.5x times more than vendors’ charges. For example, in-house developers average out to $75,000/year while outsourcing it can cost around $10,000/year.
Some reputable companies that outsource work processes are Google, Apple & Facebook.
According to Bloomberg, in 2018 Google’s employees were outnumbered by their contract workers! During its development stage, Apple outsourced many of its projects to Indian IT service providers.
Some varied advantages of outsourcing include:
- Reduced training costs
- Reduced employee benefits costs due to lesse full-time equivalent hours
- More flexibility and time to pursue mergers and acquisitions
- Ability to invest in the development of the business instead of hiring resources
If these advantages have convinced you on how outsourcing can help your business grow, then set up a call with us and understand how we can customize our services to meet your specific needs!