The pros & cons of process outsourcing for SMEs

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When your business grows, it’s inevitable that the number of processes that your business has in place will grow too.

To make sure business operations remain streamlined, whilst keeping costs down and also still providing the best possible service for customers, many SMEs choose to outsource as their operations expand.

But is this the right option for your business? Let’s take a closer look.

What is Outsourcing?

According to this definition by The Balance, outsourcing is a common business practice that can help companies to reduce costs or improve their levels of efficiency. They do this by temporarily contracting off-site third parties for certain tasks, functions and operations.

Here are some of the pros and cons of outsourcing your company processes:

The Pros of Outsourcing

One of the main benefits of outsourcing is that you don’t have to hire extra full-time employees (and all the costs associated with recruitment, benefits and salaries). What’s more, it can free up your existing employees to focus on their main jobs rather than taking on extra tasks that can be easily passed on to temporary staff.

As outsourcing can be temporary, you have access to freelancers and contractors, who form a larger pool of talent. Not only does this give your business added value, it can also help your business improve efficiency, as the flexibility of their contract allows you to plan for times of high demand.

As a result of these streamlined operations, you can save your business money as well as helping to improve efficiency and as a result, the high-quality service you provide to your customers.

The Cons of Outsourcing

Some business-owners don’t enjoy outsourcing their functions as it means they’ll have less control over how things are done if it’s given to an external third-party. It makes it difficult to ensure quality, however this can be solved with some careful planning.

Choose a company with a good reputation when you decide to outsource business processes and maintain a good relationship.

Plus, make sure you set up strong communication channels between both parties so you both know your expectations when it comes to quality of service and deadlines.

If your company is growing and you want to make sure you keep the high-quality products and service that your company has established during the expansion period, you could consider process outsourcing for certain business functions.

With some careful planning, you can turn the cons of outsourcing into pros. Outsourcing gives you the opportunity to form strong industry relationships and introduce new talent and ideas to the table to improve your business.