Deciding when to outsource: your options


Outsourcing is a word on the lips of many business leaders around the world at the moment, and it’s easy to see why.

The practice of outsourcing is one that can save a firm a ton of cash: whether it’s appointing someone external to write your site’s marketing copy or procuring the services of a law firm who can help you stay on the right side of the rules, there are many times in which an outsourced professional can be just the ticket.

It’s not always the right option though, as this article will go on to explain. Sometimes it can even be damaging for your firm, especially if geographical location is an issue and causes communication or language barriers to spring up. However, by thinking it through and finding as many different potential outsourced providers as possible, you can hopefully dodge bullets. This blog post will explain some of the main scenarios in which outsourcing is a viable option for a firm. 

Cheaper services

The reality of the modern economy is that some services are cheaper when they are outsourced than when they are carried out by a staff member on payroll. This has become especially true since the advance of the internet.

These days, it’s often the case that core services can be provided over the web by an outsourced professional either in the same country or abroad. This reduces overheads for a business leader, as it means they don’t have to pay pension or National Insurance contributions – and they can free up a precious desk in the physical office too.

Often, services such as marketing fall into this category. If you’re a business leader, it’s not likely that you – or indeed any of your core product staff – have enough specialist knowledge to carry out marketing tasks to maximum effect. Often staffing budgets don’t seem to stretch far enough to hire a marketing team either.

That’s where outsourced services are often most popular. A decent enough service can often be provided at a cost significantly cheaper than a permanent staff member.

Location, location, location

Before committing to an outsourced service though, it’s worth thinking through the geographical side of things. There are plenty of websites out there which match up freelancers who are willing to provide services to clients like you, and many such freelancers are based outside of Western Europe and North America. On the plus side, this means they’re likely to charge cheaper rates given that they are operating in parts of the world – such as India, or the Philippines – in which the cost of living is lower.

There’s a potential challenge here too though. If you need to get in touch with your freelancer urgently, perhaps if there’s a communications crisis, you might find that they are not available because they’re in a different time zone or because their margins are so small that they have to have many clients.

Alternatively, you may also find there’s a quality decrease or a communication barrier, especially if the person isn’t quite as fluent in English as staff back home would be. So, before you decide to take the plunge and hire a freelancer abroad, it makes sense to think it through from all angles first.

Complex regulation

However, there are also some scenarios in which outsourcing may make sense on another level – not necessarily just a financial one. When running a business, specialist help is often required. Decisions with a legal dimension, of course, should always be outsourced to a lawyer or solicitor.

If you’re expanding into a new market, help with abiding by a new regulatory framework is also often required. Tasks ranging from Chinese medical device registration to Australian financial services approval can be more complex than they might seem at first glance, so it’s worth getting some outsourced help if you’re uncertain.

Outsourcing sometimes gets a bit of a bad rep, and it’s not uncommon to hear suggestions that it’s risky – or that quality drops can occur by outsourcing abroad in particular. While it’s definitely important to ensure that you’re getting value for money when you outsource, it’s also important to be sure that you don’t lose sight of the fact that outsourcing is one of the main ways for firms to slash overheads. As this article has shown, a strategic outsourcing programme executed at the right time for your business can truly turn your balance sheet around.