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Blog posts tagged outsourcing

Five reasons you need to outsource

December 10, 2013 by Guest Blogger

Five reasons you need to outsource /outsource{{}}For many reasons small and large businesses choose to outsource particular tasks or services to third parties and agencies. As outsourcing continues to evolve, so do the reasons for SMEs and bigger organisations to consider adopting those methods for the good of their business.

The primary reason for outsourcing and outsourcing immediately is to cut costs, because this is the main driver for many businesses that choose to outsource work. But let’s look beyond the pound signs and see some of the other popular reasons for outsourcing services in 2012 and beyond.

1 Saving internal resource

In demanding industries there are many instances where highly pressurised employees simply don’t have enough time to focus on core business functions that can drive long term growth.

Businesses need as many people as possible to be able to focus on the profit-driving areas of their organisation. By outsourcing certain tasks or services to third parties, companies can save valuable internal resource to devote towards moving the business forward.

2 Corporate tax rates

Some businesses choose to outsource particular services or divisions of their business overseas to take advantage of greatly reduced corporate tax rates. Countries such as Hong Kong, Taiwan, Singapore and closer to home, Ireland, all boast very low corporate tax fees that can significantly improve a company’s bottom line.

3 Enhanced service

There may be an area of your business that would require significant in-house and external training to get employees up to speed. Subsequently, it may be more cost-efficient to simply outsource the entire service to a third party or agency. It is quite possible they will add greater value than you even anticipate due to the skills and expertise they possess. Why spend time and money learning new services and skills if you can employ a professional to do it for half the cost?

4 Always available, always accessible

In some cases, businesses choose to outsource services or divisions of their organisation to make sure they appear constantly accessible and available. To create the impression of operating 24-hours without closing down it is possible to outsource to an overseas partner that can do important work overnight, while catching up on much-needed sleep!

5 Less contractual risk than employing full-time staff

Although reaching agreement with outsourcing contractors can be unsettling and protracted, outsourcing work carries significantly less contractual risk than employing a full-time member of staff. Contractual agreements can be created to offer protection for both parties, while removing any difficult human interaction that can occur when in-house employees are dismissed. Outsourcing firms can be held just as accountable for poor performance and poor quality of work as a full-time employee.

While outsourcing requirements will naturally differ from business to business, there is no getting away from the fact that outsourcing is becoming a key component to the day-to-day strategies of successful businesses.

Blog written by David Campbell of Pall Mall Estates, “one of the UK’s leading providers of affordable commercial space to rent”.

Secrets of growing your business from the kitchen

August 11, 2010 by Antonia Chitty

If you have a home business, how can you run it in an effective way, maximise your results and allow the enterprise to grow? Here are some tips on breaking through the barriers that could be holding your business back.

If you look at your business right now, who is involved in running it? What would happen if you took a day off, wanted a week away or were unexpectedly ill for several weeks? If you want to build a business income that your family can depend on it is important that the business does not just depend on you.

Do you ever feel the pressure of running your business is overwhelming? You can be required to cope with selecting new products or developing new services, pick and packing, promotion, marketing and accounts as well as being your own receptionist and tea lady.

There is a way to both make sure that your business can run without you AND ensure that the money continues to come in whether you are there or not:

Build a team for your business

Look at all the functions in your business. Make a list right now of all the things that you do. You might want to include:

  • Website management
  • Marketing through social media, blogging, newsletters
  • Public relations
  • Picking and packing
  • Arranging couriers or taking parcels to the post office
  • Customer services – answering queries by phone or email
  • Bookkeeping and end of year accounts and tax return

When you’ve made your list, put a tick by the things that you like doing and feel that you are good at. Then look at the other areas. Which one would you be really pleased to get off your hands? Who could help you with this? You might need the help of a:

  • Bookkeeper
  • Accountant
  • Lawyer
  • Public relations specialist
  • Marketer
  • Website manager

A virtual assistant can do many things for your business and different assistants have different areas of expertise. Some may be able to create emails and newsletters for you and upload items to your website. Others may offer call handling and be able to answer simple customer queries for you.

Or you might need someone local who can come in on an occasional and part time basis to help with packing and dispatch.

Having got this far, is there a little voice inside your head saying: “But my business can’t afford more help”? If so, push it aside for a moment or two. Think how much more effectively you could work on the tasks that you have a natural talent for if this one task or area of work was taken off your hands. Could you do more work to generate sales that would then pay for the support? Are there tasks that just aren’t getting done that are holding the business back? Getting extra specialist support could help you take the business to a new level.

Think about this over the next few days. Work out how much you would have to increase sales in order to pay for help – and conversely estimate how much sales are being held back because of the things you aren’t able to do or can’t do quickly and efficiently.

Build your network of support for your business and it can really allow your business to take off. Network on and offline and ask for recommendations to help you find your essential support people.

Be clear about the tasks you want to delegate. If you are nervous start by passing on small tasks and build up as your confidence grows. Develop ongoing relationships and set up systems that work and you will get to the stage where your business can succeed even when you aren’t there.

Antonia Chitty of Family Friendly Working

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Mumpreneurs and money

June 16, 2010 by Antonia Chitty

Most mums with businesses are serious and committed, but don’t always find it easy to turn this commitment into big bucks.

Many women need to change the way they think about money and how they feel asking for money. Research has shown that women are less comfortable to ‘name their price’ than men, and women in ‘helping’ professions are less comfortable than, say, women working in IT. Say how much you want for your service out loud: are you comfortable saying this or do you feel a bit apologetic? I know I do.

When I run courses the majority of women attendees are in business to HELP in some way. You can only be truly effective as a helper if your business is strong and making a profit will allow your business to grow and help more people.

If you are in the position of running a business that doesn’t make enough profit you could:

  • Pay close attention to where the money comes from. Which clients/product lines bring in most profit? What can you do to maximise these?
  • Look at your outgoings. Could you source more cheaply, alter suppliers to ones with bigger discounts or buy in bulk?
  • Work out which jobs you should outsource to allow you to work more effectively. Pick tasks that you struggle with which someone else could do more efficiently.
  • Ask clients and customers about the value your business offers. Collect their feedback and spontaneous thanks to help build your confidence in what you offer.
  • Work out what motivates you to earn through the business. Is it the feeling of independence, the need to put food on the table or the ability to pay for treats? Remember this when it is time to chase for payments.

Follow these tips, stay in control of your finances and you will see your business grow.

Antonia Chitty of Family Friendly Working

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1,233 miles, 18 home businesses and five clear trends

October 02, 2009 by Emma Jones

Enterprise Nation, the home business website, has been on a roadtrip. Starting in Scotland, the touring team travelled south to meet and film home-based businesses in what will become a mini documentary charting the rise of this modern way of working. While out and about, a few trends became apparent.

Now is a great time to start
The mood throughout the week was incredibly upbeat. One moment that will stick in my mind is when Patrick Elliott, CEO of Business Link in London, opened an event with one key question to the audience: ‘Do you think this is a good time to start a business?’ A ripple from the 200 people gathered quickly turned into a resounding ‘Yes’.

Throughout the week, we met people who are starting up while holding down a day job, as well as others who have come out of redundancy to realise their business ambitions. We met a wide cross-section of businesses and there was nothing but positive chat from them all.

Technology means trade
All of the businesses we filmed are making the most of technology, whether it be Stuart Mills, who is applying the web to the pub world, or Malcolm Gallagher, who is communicating his business message through online videos, produced cost-effectively from a home studio.

Many of the craft businesses are using sites such as Etsy.com to sell their products to a national – and international – audience. Technology is clearly broadening the trade and partnering horizons of many a small business.

Freedom and control are key motivators
We stopped counting the number of times these words were used in interviews. Having started up, home-based business owners are finding greater freedom and flexibility in their working lives and they are relishing being in control of their creativity, working environment and earnings.

The importance of being ethical
Every business owner we interviewed is doing something ‘good’ by being in business, whether it be: Clare Nicolson, who believes in giving work to the people in her neighbourhood; Emma Henderson, who sources fair trade fabrics from India; or Emma Warren, who offers time and business experience to a charity. They would not refer to themselves as ‘ethical entrepreneurs’ as such, but these business owners are having a positive impact in many a varied way.

Growth through outsourcing
The old adage – ‘Do what you do best and outsource the rest’ – is being taken seriously by the home businesses we met. Companies are partnering up and work is being outsourced to professionals. In the case of BodieandFou, Karine Kong outsourced the design and build of her website to an expert she has yet to meet. Technology tools such as Skype, email and project-management software means there’s no need to be in the same place, but for others, physical networks are important places to meet business partners – as well as just to have a social chat.

It was a crammed and fascinating week that showed just how bright and vibrant the start up sector is. The documentary will be aired for the first time on Home Enterprise Day – Friday 20th November – when home business owners will be travelling to us.

  • Emma Jones is Founder of Enterprise Nation and author of ‘Spare Room Start Up – how to start a business from home’
  • The home business roadtrip took place in the week commencing 14th September and was sponsored by Orange.

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Outsourcing makes sense in a downturn because...

June 22, 2009 by Andy Dickens

Outsourcing makes sense in a downturn because…

No company can escape the current financial downturn that’s affecting the global economy. Europe has slipped into a recession and the United Kingdom may shortly follow suit. In order to make the most of these tough times, many companies are looking to outsourcing specialists to provide much needed specialist support to maximise their efficiency and ensure their long-term survival?

Outsourcing is not a new phenomenon; it’s a tried and tested model. In the early part of this decade there was an economic slow down. During this time, outsourcing companies found more than ever that they were able to assist and support other businesses in times of trouble. Some companies are cautious about outsourcing in the current financial climate, mistakenly assuming it means an additional expense, but there are many reasons why outsourcing makes sense in a downturn, and here’s 10 of them:

ONE: You can cut costs without cutting corners. Outsourcing allows you to provide the same level of provision to your customers or clients without having to compromise or cut back on the quality of experience/service they receive. At the same time, because some core costs are reduced such as equipment, advertising and recruitment – you maintain your standards whilst reducing your costs. This will have a positive effect on your bottom line. If you’re in danger of dropping the level or standard of service that you offer your clients, you are in danger of losing those clients to your competition. Don’t even consider cutting corners – you can’t bounce back from this without the support of your clients/customers.

TWO: You can focus on your core concerns, the things that you are best at. Outsourcing is not just about saving financial cost implications, but also saving time and allowing you to focus on your core business issues. If the downturn has made you feel that there are no longer enough hours in the day, (were there ever?) then you’ll know that outsourcing could free up more time for you and your staff to spend on the central and fundamental concerns of the business. Decide upon which activities require your greatest focus and efforts, and free up your time by outsourcing the rest.

THREE: You may need to lose staff, but you don’t have to lose your shirt! There may be a need for redundancy, or saying goodbye to casual, temporary or part time workers. Outsourcing can cost you less than the cost of retaining those non-business critical staff/employees. You are doing this to safeguard your present full time employees, but it may be frustrating to see them go because you don’t know what’s around the next corner. When you outsource, your business remains effective, despite the reduction in numbers. If you’re ever to return your business to its pre-credit crunch glory, you may need to outsource to secure your current employee’s future.

FOUR: You can more efficiently manage your Human Resources. During this downturn, you may need 100 telemarketers for one campaign but only 10 for the next. Regularly, you’d have your remaining staff draining your budget. When you outsource, you can add or reduce your staff as and when you need them. By reducing some of your fixed operating costs you can deliver greater economic freedom to your company. With completely flexible staff numbers you can increase or decrease the workforce to whatever size you need to meet your current challenges.

FIVE: You can change horses midstream. When you outsource your needs, you can make amendments immediately, make a decision, change your mind, improve equipment, increase staff, decrease equipment – do whatever it takes, whenever necessary to keep your business afloat. Your outsourcing contract should be flexible enough to make a decision immediately in order to respond to necessary demands.

SIX: You can outsource many more services than you realise. Payroll, Sales, Marketing, Secretarial, Reception, IT, Lead Generation, Telesales and Telemarketing are among the many services that could all help you cut your short to medium term costs in a downturn. Telemarketing and Sales are particularly important. To effectively see your way through this economic nightmare, you need to bring in business – whether it is from new or existing customers/clients, you must increase sales and reduce costs in order to sail safely through this financial storm. Outsourcing can be used to achieve both of these goals.

SEVEN: Outsourcing is targeted professional activity. You can only go on losing money for so long before your business will start to collapse, so take action now! Whatever cuts you are going to make, you need to make them with the full knowledge that they are best for the future of the company. Outsourcing allows businesses to take proactive steps to maintain their status and trading capacity during difficult times.

EIGHT: Outsourcing can protect your company culture and staff morale. You shouldn’t force your existing staff to do more work for the same wages but without outsourcing, you may have to do it. It’s bound to happen if you have to reduce your staff numbers. As your workforce decreases, you still need the same tasks completed. Asking your current staff to take on these additional roles and tasks may cause problems in the workplace. You should expect an increase in the number of sick days, a decrease in general morale and this can affect your company’s productivity at a time when it matters most. Outsource before you drive your staff into early retirement.

NINE: Outsourcing helps you do more of what you do well. If your business isn’t badly affected by the downturn, you need to make hay while the sun shines! You’re lucky, you’re in one of those areas that people cannot do without, you’re a niche or a necessity, and perhaps you’re making even more money. Outsourcing can help you respond to the increased need for your product or service and allow you the room to do this without increasing your fixed operating costs.

TEN: Model other successful organisations. As the credit crunch takes a bite out of British commerce and despite the evident slow down in the economy and the threat of recession, billions of pounds in outsourcing deals are being agreed in the UK. If other companies are taking advantage of the benefits of outsourcing, then your business should be considering it too. Don’t be the last to realise that outsourcing solutions could save your business before it’s too late.

For expert advice on outsourcing your business needs, speak to a representative at VSL, the downturn doesn’t have to be a disaster for your business.

Follow Andy on Twitter! http://www.twitter.com/andydickens

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