Entrepreneurship is a complex but rewarding journey. Without a nine-to-five job or unlimited amount of budget and resources, the odds would be continuously stacked against any new startup owner. One of the most critical mistakes entrepreneurs can commit during difficult times is sticking to traditional strategies and refusing to consider alternative and practical solutions such as outsourcing.
According to Statista, the global market size of outsourced services in 2019 has reached almost $100 billion, in areas such as human resources, customer care operations, back-office tasks, and digital services. Businesses around the world spent no less than $75 billion on outsourcing cybersecurity in 2020. Meanwhile, the overall value of outsourced IT services will be worth at least $400 billion by 2025. While 70% of enterprises rely on outsourcing to minimize costs, at least 54% of organizations use third-party support teams to connect with customers. Financial outsourcing solutions is a common option for 71% of finance executives and 24% of companies outsource to increase business efficiency. 78% of business owners feel positive about their outsourcing partners and 80% plan to continue outsourcing various business functions in 2022.
Regardless of business type or industry, any startup owner should ask: Do I want this done in-house or outsourced? Which of these options allows for improved efficiency, a more scalable operations, and greater growth? Evaluating whether your business should outsource – or which functions should be managed by third-party service providers – is a multifaceted consideration. But the truth remains: contracting out of business processes to external parties is not just for large firms or well-established companies and is not for cost reduction purposes only.
Need more convincing? Here are 5 reasons how outsourcing can be an effective solution for startups.
1. Access to global talent expertise
Budding entrepreneurs should be careful about being too confident when making decisions – something that can be buffered by BPO at the beginning of a venture. By outsourcing business functions to professionals or an expert team, this lowers the possibilities for failure or wrong estimations that could ruin the company in its early stage. Better yet, having a reliable outsourcing partner ensures you get access to world-class talent with a global knowledge base. They’re focused on offering a product or service in a niche area, without the distractions that often come from wider business operations.
2. Access to ready-made infrastructure
It isn’t just expert level work you will get but will also save your company the cost and headache of operating in-house since the outsourced company is already equipped with all the necessary tools and facilities. This also includes systems and certifications in quality management, employment compliance, and cloud operations as well as technology and infrastructure for implementing cybersecurity, data privacy, and information confidentiality.
3. Risk Mitigation
The market is oversaturated especially with bigger companies who may offer similar solutions like your products and services. Running a startup involves plenty of risks which can be very stressful if you don’t have knowledge in the specific market in the country you’re trying to penetrate.
4. Reduce employee turnover
Employee turnover can hurt any business so if you want to avoid hiring people for the same position multiple times a year, you need help from outsourced specialists who have experience with other companies facing similar challenges and are well-versed in strategies to find, train, and retain high-quality employees.
5. Avoid burnout
No matter how prepared you think you are or how strict you follow schedules, team members may end up doing too much which can result to burnout. Whatever is taking up too much of your time, remember that there’s an outsourcing option for virtually any task.
Business Areas to Outsource
1. Customer Service
Customer service is not just limited to voice calls. It can now be provided through email, social media, messenger apps, and other digital channels. Outsourced service providers can help you provide omnichannel customer service and efficiently integrate multiple platforms to make sure that your brand provides top-notch customer experience.
2. Human Resources
Poor management is often among the primary causes of a startup’s failure. Recruiting top talent and encouraging them to stay with your organization for the long term is no easy feat. When you outsource the HR function of your business, there is a guarantee that your startup company can find and recruit global top talents, and that compensation and benefits packages are tailored to improve employee engagement and employee retention.
3. Bookkeeping Services
While many startups and new businesses don’t need a full-time, in-house accountant or bookkeeper, you still need someone who is proficient in international accounting standards, will keep your books in order, and will take care of payroll and tax related concerns. Outsource your bookkeeping services to a third-party firm, and it will save you a lot of money.
4. Data Entry and Processing
It takes specially trained data entry professionals to efficiently sift through, sort, and analyze the data. Let professionals handle the complicated task of finding out what consumers want, where to reach your target market, how to increase brand loyalty, and other data-driven insights you can use to bring growth and success to your business.
5. Digital Marketing
Marketing your brand on your website, social media accounts, and other digital channels can take up a lot of your time because building a brand in an oversaturated market doesn’t happen overnight. Entrusting your digital marketing services to an outsourcing team with expertise in social media management, online PR, and digital marketing will ensure results you may otherwise find difficult to achieve on your own.
Startups and new businesses are always more prone to growing cybersecurity threats. You need a reliable outsourcing partner to implement secure and effective virtual-work environments, protect customer data and privacy, and onboard new tools and capabilities.
7. Cloud Computing
If your startup company doesn’t specialize in IT, there’s a good chance your IT team will either be overwhelmed by the tasks at hand or make mistakes along the way – that is, if you even have one to begin with. With an outsourcing cloud provider, you can increase your flexibility and competitiveness without spending a large chunk of your budget on on-site data centers or software related upgrades. Plus, they will ensure that systems are in place to prevent or quickly mitigate online breaches.
When done right, outsourcing sparks startup success, increase the chance for thriving, and clears the path toward sustainable and guaranteed growth. Let us help you find top talents in IT, technical support, digital marketing, and cloud services so you can leverage all the benefits of outsourcing in the new normal.