Business

5 Signs Your Business Needs to Start Outsourcing

If you are an entrepreneur, you know that running a business can eat up a lot of your time. It’s quite common to do multiple things at the same time in order to meet the various demands of your business. In the beginning, multitasking can become an advantage as it gives you and your core staff the ability to be on top of everything. You can tightly control what’s happening right under your nose, making management much easier.

However, as your business grows, the demand also increases. It becomes impossible for you to juggle everything and chances are, the more you try to squeeze yourself and your team, the more unproductive and less focused everyone becomes.

The quickest and most efficient solution to boost your productivity is to outsource some of your business functions. Outsourcing is an important strategy to build a better business. It allows your business to grow and scale without being burdened with high operational costs. It can effectively free up your time so you can stop dwelling on the small stuff and start focusing on what really matters.

Many business owners realise too late that they needed to outsource. More often than not, they are already overwhelmed with work, missing client requests or having a stagnant revenue. These situations can easily be avoided by immediately recognising the cues that indicate you need to start outsourcing.

Here are 5 tell-tale signs that say it’s time to outsource some of your work.

 

You’re Missing Deadlines

Are you always running behind on your projects, failing to complete them on time? Is there not enough time in the day to realistically finish all the work on your plate?

Whether it’s about dealing with your accounting work, posting regularly on your company blog or always cramming everything during the last five minutes, the pressure can be stressful and can greatly affect the quality of your output.

Outsourcing employees can solve this problem because you immediately get extra manpower hours to dedicate to your work. It helps you get your project going and completed on time because as the cliché goes, two heads are better than one.

Getting an outsourced employee is also more expedient especially when you’re facing a tight deadline. Hiring full-time can be a long process that can take several weeks. The best employees usually have existing jobs and you would usually need to wait for them give their employers their resignation, serve their notice period, transition into the new job, and undergo employee training before you can fully maximise their skills.

On the other hand, if you choose to outsource, you can select people who are ready to go without you having to commit long-term. 

You’re Struggling to Meet Customer Demands

If your business is growing more than you’ve anticipated, this is obviously a good thing. However, if you have not planned for this unexpected upsurge, you can find yourself unable to accept new business, deliver on orders or produce more products due to the lack of resources.

This is especially true for companies who experience a sudden marketing boost. Newbie Amazon sellers are a great example of this. When their products start thriving online, they are often unprepared to fulfil all the work involved especially in logistics, packaging and shipping their products. This often causes delays that can lead to customer dissatisfaction, complaints and can taint their reputation. It can even influence buyers to stop ordering from the Amazon platform itself.

This is why Amazon introduced a Fulfilled By Amazon Program or FBA wherein sellers can outsource inventory storage and shipping to Amazon by only paying Amazon FBA Fees. In this structure, sellers do not need to worry about shipping concerns, which is not usually their forte. At the same time, Amazon gets to protect its platform by satisfying its customers.

Your Staff Is Stressed and Overworked

If you only have a small number of employees and all of them already have dedicated responsibilities, having an additional influx of tasks can make the workload unbearable for you and your team. Although you know that you need more people, recruiting full-time employees worries you as it impacts greatly on your operational costs.

However, keeping your staff overloaded can be detrimental because tired and unhappy employees tend to become unproductive. Instead of getting more work done, the quality of work can likely go downhill.

It’s easy to identify dissatisfied employees. Being always tardy, absent, looking physically weary and stressed are just some of the signs you need to look for. When this happens, you need to take action and unburden the load.

Outsourcing some of the tasks will not only get the work done faster but also show your staff that you recognise that they need an extra set of hands.

You Cannot Fulfil a Specialised Task

When you are faced with a project that requires a special set of skills, there are different options you can take. First, you can spend time training yourself or an employee to perfect that skill; second, you can hire a full-time employee who is proficient in that skill. Or third, you can outsource.

When you try to do it yourself or assign it to an employee who is not really an expert in this task, one advantage is that your company is gaining a new skill set without the expense of hiring. However, this can also take a lot of time and there is no guarantee that the quality of work can meet your clients’ demands.

Hiring a new full-time employee is also another option but this is only a good idea if you know that you will be requiring the specialised service for a long period of time. It is not smart to hire a separate employee for every specialised task as the returns may not justify a full-time employment. Some tasks are very rare, unexpected or short-term so in these instances, it is wiser to outsource.

Here’s an example that happens to a lot of companies:

How many times have you asked your IT guys to fix the printer that stopped working? Although they are probably experts in computer networking or installing security software on your systems, they are not printer specialists – so it can take them hours, if not days, to detect and resolve the issue. This can cause long downtimes wherein your daily work is affected. Invoices, contracts and other pertinent documents are suddenly on hold because of this problem.

Hiring a separate employee just to fix your printer is of course illogical as your printer does not break down every single day. You wouldn’t want this new employee to just sit and do nothing for the rest of the days while receiving a full salary.

However, if you outsource this issue by calling a printer repair company or by using remote diagnostics services, their specialised skill in fixing the issue will get your printer working in the least time possible. In this scenario, you might think it’s more cost-efficient to depend on an existing resource, but in fact, it can actually cost you more time and money in the long run because of the lost productivity caused by the delay.

You Can’t Focus on The Business

Trying to do it all is a common mistake that most entrepreneurs commit. Working hard does not necessarily equate to working smart. When you are tied up in many day-to-day tasks that take you away from your main job, that means you have less time to focus on the big picture.

You and your senior team should be focusing on strategic functions that help your business, not on tasks that can easily be done through outsourcing. For example, instead of spending hours trying to master how to post on Twitter and struggling on what to write, outsourcing this task to a social media marketer who is already an expert frees up your schedule and at the same time affords you the expertise you probably can’t learn in a day.

 

The Key to Effective Outsourcing

In order to grow your business and remain competitive, you need to utilise outsourcing practises and take advantage of the global expertise already available through technology. It is not always easy to find the right outsourcing partners and you may face different outsourcing challenges along the way.

So, when you decide that it’s the time for you to outsource, you need to ensure that you look for people who are experts with a proven track record. Ask for referrals before committing to a long-term contract. In dealing with your partners, be clear about your expectations regarding their required output. At the same time, gain their trust by giving reasonable timelines and honouring financial obligations. This way, you can build a valuable relationship that is critical to your success.

 

Author Bio

Nathan Sharpe is the entrepreneur behind business blog Biznas. He knows that the life of an SME isn’t easy, and you have to wear many different hats in order for your business to be a success. He helps others achieve this success by sharing everything he knows over on his blog, as well as any new lessons he learns along the way!

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