Outsourcing As A Small Business: Pros And Cons

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Small businesses aren’t just a critical part of a country’s economy they are also huge providers of jobs. Often people fall into the trap of thinking that a small business is insignificant, however, this just isn’t the case. Although managing a small business may seem easy, it can often be complex and the owners tend to wear many hats.  Not only this but small businesses are often competing in a highly competitive market. This can sometimes mean that a small business can struggle to grow as it’s time is spread too thinly. One of the most popular and proven ways to achieve higher efficiency is to turn to use outsourcing.

Over the last few years, outsourcing has become an extremely popular way to help grow a business. Outsourcing is simply using outside resources to complete tasks that can take up big chunks of time or need professional skills that take valuable time to learn. Some of the areas you can outsource include: 

  • Accountancy
  • HR
  • Virtual Secretary – Such as Ivy answering service
  • Social Media Management
  • Content Creating 
  • Data Entry 

These are just a few of many. A lot of business processes, if not all, can be done remotely, from anywhere in the world. You could hire people from all around the world, which gives you a second to none resource pool to choose from. 

There is no shame in outsourcing. Ample small businesses have already chosen to use this method, especially with everyday operations. Outsourcing, however, like all business concepts, comes with both pros and cons meaning careful consideration needs to be taken when using it. It needs to make sense and work for each business. Just because another chooses to outsource their marketing doesn’t necessarily mean that it will work for you.

Before jumping into the conclusion that outsourcing will be good for your business, it is much smarter to first make a plan and have discussions about the way to move forward. 

Have a look below at some of the pros and cons of outsourcing as a small business: 

Outsourcing Pros

Time – There are a fair few pros to outsourcing your work, one of the main reasons is because of the amount of valuable time it frees up for you especially if you’re the only person running the business currently It can at times be very hard to give tasks to others when you have nurtured the business from the start and it can feel as though you’re losing the control. You will, however, still have ultimate control over all aspects. In the long-run, you are going to benefit from the extra focus you can now commit to strategy building, business development, and work-life balance. 

Costs- Not only do you free up time, but you also have lower working costs which will mean higher profits. There are a lot of good professionals around the entire world that are ready to complete a task set, for much less money than your time is worth. Outsourcing whole departments like HR and accountancy will save you both time and money. You can even outsource single jobs such as your end of year taxes or recruitment. 

Avoid Unnecessary Recruitment – It can be too easy for a small business that is eager to grow to recruit when it’s far too early or recruitment too many people too soon. It can be detrimental to a company or mean they’re having to let people go. If you use outsourcing for entire departments you can avoid recruiting too early and only pay for what you need. Often you will find that only a few hours work may be needed therefore it’s better to use outsourcing than searching and recruiting someone for a minimal task. 

Added Protection- When working with a contractor or freelancer you have an extra level of protection for any work completed. This applies even more if you’re using the service of a professional as they tend to have qualifications. You’re able to transfer obligations and trust into a professional service, popular areas include HR, Legal requirements and Accountancy. 

Increased Quality And Speed – When outsourcing to a professional, you will normally find that they’re quicker and the quality is better than if you were to fumble through it yourself. If your competent in an area then you don’t need to outsource these areas however, you should consider outsourcing your weaknesses. 

Outsourcing Cons

Outsourcing, is by no means a perfect concept. Often what is seen as an advantage can quickly turn in to a disadvantage. 

Increased Quality And Speed – This is always labeled as a pro for outsourcing, and in the majority of cases it is. It can, however, be a con. Finding the right contractor or freelancer to do certain tasks can sometimes be a difficult task. After all, you want them to understand the value of your business and be able to complete the task to hand before you ask them to do anything. 

Pointless Spending Of Cash- There is no guarantee that the services you received will be of the quality that you want or are expecting. Sometimes you want to recieve what you want consistently and this means your spending cash in a pointless way and this becomes a bad investment. 

Losing Control – Ok, so you probably won’t lose complete control but on occasions, the control can be lost in areas just as social media. You may ask a freelancer to look after your Instagram or website to later find they have misunderstood your values and you now need to undo everything. It’s best to make sure you’re still keeping a watchful eye on anyone your recruit via outsourcing. 

Communication Issues- There can quite often be communication issues when it comes to outsourcing, people don’t always reply quickly when they’re dealing with more than one client and this means you’re left waiting for a response rather than being able to contact an employee immediately during working hours. 

Hopefully, this short outlook on the pros and cons of outsourcing will help you to decide if outsourcing is right for your business. Do you have any others that you can share in the comments section below? 

(Photo source: Pixabay from Pexels)

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About Author

Larry

Larry is the father of 5 wonderful kids. He has his normal "offline" job but has also been running an online business for over 15 years. When he is not working on websites or blogging, he enjoys video gaming and watching sports.

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