Top 3 Outsourcing Practices For Small Business Success 

Using good small business outsourcing practices, you can add efficiency, cross-industry skills, and infrastructure to boost company growth.
small business outsourcing practices

Deloitte’s outsourcing statistics show the top reason for outsourcing is to reduce costs and save money at 59%. And an estimated 57% of businesses outsource to pay more attention to core functions, according to Capital Counselor. An increasing number of companies outsource non-essential and core business functions to enhance efficiency and boost productivity while keeping operational costs low. Interestingly, small business outsourcing practices aren’t limited to large enterprises only, but small businesses can also benefit from outsourcing.

However, hiring third-party companies to handle IT, human resources, accounting, marketing, and administrative tasks comes with a set of challenges. Fortunately, there are outsourcing practices for small business success you can implement to avoid pitfalls. Check out the tips below to increase your chances of working successfully with outsourced teams.

Define Your Goals For Outsourcing

Understanding why you should outsource business functions is vital for successful outcomes. So, before you can start searching for service providers, justify that your venture needs outsourcing. For instance, if you’re looking to develop a strategic financial plan for a short-term project and lack accounting or finance skills, then you’ll need to outsource an experienced accountant.

Once you have identified your reasons for outsourcing, define what you want to achieve. Chances are you want to outsource to improve company focus, reduce operational costs, enhance customer service, or free resources for core business functions. This step is critical for small business outsourcing practices as it helps you determine if you’ll benefit from collaborating with outsourced vendors.

Choose The Right Service Provider

In addition to improving service delivery and cutting costs, outsourcing provides business continuity during a crisis. Whether your business is facing an internal or external crisis, outsourcing allows you to continue operating. Let’s say your human resource manager is on sick leave, and her assistance is leaving for a new venture. Outsourcing HR functions enables your company to remain functional while your manager is absent. But to enjoy this benefit, you must select the right service provider.

Choosing the ideal outsourcing partner isn’t as difficult as most entrepreneurs assume. All you need to do is come up with a viable selection criterion based on your business goals. When hiring a vendor, make sure they possess skills and experience in areas you need assistance. They should also guarantee fast turnaround time, follow the right business practices, and conduct thorough quality testing.  

Don’t Hire Based on Price

Many small business owners assume hiring the lowest bidder is cost-efficient. However, it can be expensive in the long run because cheap vendors offer low-quality services. On the other hand, the highest bidder might not offer the expected results. To ensure your project is a success, choose a vendor that offers a perfect balance of satisfactory results and good value. That’s why you should negotiate the terms of the contract with potential vendors during the hiring process. Also, factor in the hidden cost of outsourcing to get a clear picture of how much you’ll be spending.

Outsourced teams provide efficiency, cross-industry skills, and tech infrastructure you need to focus on core organizational functions and boost growth. However, for your business to benefit, you must follow the right outsourcing practices. Make sure to define your outsourcing goals, look for the right vendors, choose the right engagement model, and maintain effective communication.

Today's Free Templates

One Page Marketing Plan Outline to Generate Qualified Leads

This one page marketing plan outline is a checklist of specific marketing activities that generate leads. It includes tactics that will increase your visible footprint and compel prospects to seek your services. Download for easy editing in Microsoft Word.

Website Design Proposal Template

Copy/paste this website design proposal template to create one for your clients. Use it to generate more business for your web design company.

Affiliate Disclosure

This post may contain affiliate links to help us pay for running the website. See our affiliate disclosure for details. Thanks!

Free Marketing Plan

Download our free marketing plan example to create a detailed plan for your business. Includes sample text, charts and tables.

Download Now