One of the hardest tasks for small businesses is making sure it has the skills and equipment on board to allow it to compete with other larger companies in the same field. Securing the funds to fill skills and equipment gaps can be especially difficult in the current market, with financial institutions still reluctant to lend. Over in the UK, many small businesses are undoubtedly thinking hard about the viability of employing extra staff before legislation that forces employment contributions to pensions comes into force.
One way of adding skills, resource and knowledge to a business of any size is through outsourcing. Outsourcing continues to be a business strategy employed by companies large and small and with careful research and the aid of competent partners it can add a lot of value to a business. Here we discuss three of the main sectors where outsourcing is sought by SME’s.
HR
When a small business first starts out, it’s often easy enough to handle the basics of hiring, firing, paying and training staff yourself, but as it expands legislation generally necessitates that you need a HR-savvy person to manage these activities for a growing team. Outsourcing some or all of your HR requirements not only removes the commitment and cost of employing a full-time person or team for the role, it also covers the cost of software and training. Firms like ADP in the US and Moorepay in the UK provide HR software and training and take over responsibility relating to updates and adherence to changing legislation. In the UK this is particularly relevant at the moment as HR departments manage the implementation of RTI PAYE.
IT
IT is an area that has long been outsourced within firms of all sizes, though recent reports suggest that it outsourcing in this area is not as prevalent as it once was. This is in part due to the constantly-changing nature of the IT landscape and the expense of training and employing staff compared to the ability to tap into skills via outsourcing. Whether you choose to select IT partners to service your IT needs and software or to provide equipment too, outsourcing IT can allow you to stay up-to-date with software and services for less. Be sure to check your IT outsource partner has the relevant insurances in place in order to protect you should they accidentally damage your IT systems and remember to review your requirements regularly to make sure outsourcing still represents the best deal for you and your company’s growth.
Marketing
From telesales to social media, once you move beyond the world of marketing your small business with leaflet drops and promotional pens it can be necessary to bring the experts on board. This may mean paying a specialist agency or individual a retainer for handling the full spectrum of marketing for your business, or bringing them in at key growth times to help expand the business and source clients. Telesales departments in particular are regularly outsourced and providing partners have sufficient knowledge of your business and you get access to people with the correct skills, outsourcing in this area can be a valuable investment.
Lucy Watson is an experienced marketer who has worked in specialist and integrated digital marketing agencies. She loves nothing more than talking about online strategy over a cup of tea and slice of cake.
Image courtesy Philip Taylor PT
This is great, Lucy. Business owners would know where to start their outsourcing journey. I would have to say that outsourcing sales and marketing would be the best thing to do first, because business won’t run if there are no customers. And since “marketing” is considered as the “lifeblood of a business,” I think that’s the function entrepreneurs should focus more on. Outsourcing is a great way to boost its performance. I hope you agree with me. :)
Well this is true. Outsourcing is a booming industry and also being abused nowadays because of fraudulent outsourcing agencies. You need to really weigh and study your resources before getting into an outsourcing contract.
You have mentioned some excellent points. Outsourcing helps the business to grow. I didn’t know that IT sector is also being outsourced for a long time. But it makes sense technologies changes rapidly and providing training to employees could be expense instead hires a professional company who will deal with technology update.
Great advice. There are many opportunities to outsource those tasks that draw from the core needs of a small business owner. Taking advantage of expertise by partnering with an outsourced expert can make a huge difference in profitability of a small business.
Outsourcing can be an excellent way to save money, but like someone else pointed out, be careful who you outsource too, esp. when it comes to content creation.
Though the outsourcing industry is more than this, I must admit that these three sectors: HR, IT and Marketing, are critical to any small business success. Getting the right outsourcing partner will give any SME a competitive edge.
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One of the hardest tasks for small businesses is making sure it has the skills and equipment on board to allow it to compete with other larger companies in the same field. In this blog, the 3 main sector are discussed where outsourcing is sought after.
Accounting and bookkeeping in business can be outsourced to save money when needed it.
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