Ever since the world became aware of the COVID-19 virus almost a year ago, businesses have put mitigation strategies into place to keep their employees safe while also working to keep money coming in. As entrepreneurs grapple with the stress of this balancing act, there are some ways that they can drive business growth amid the pandemic.
One such way is to focus on lean operations, cutting costs everywhere possible to drive profitability. Although this can happen in myriad ways — including such areas as cutting back on business travel and creating a smaller real estate footprint — it can also be driven by outsourcing. While your company focuses on core revenue-building responsibilities, an outsourcing business can take care of the tasks that keep your business running smoothly. Consider these seven reasons why outsourcing can help you drive growth at your company, even amid the coronavirus pandemic.
Companies are slowly recovering from the period when they had to shut down, according to a September survey by the U.S. Chamber of Commerce. Entrepreneurs report that their businesses look different than they did in the past, with many having to pivot dramatically to keep sales afloat. Such measures as curbside delivery, digital sales and online business operations have been a great help for many of these companies.
As businesses focus their operational strategies on staying competitive in today’s changing landscape, many are turning to outsourcing to save money and to become more operationally lean. Some of the costliest functions that your business has in place could save you a significant amount of money. For example, financial managers earn an average salary of $147,530 a year, according to the government’s Bureau of Labor Statistics. For accountants, that number is $71,550 annually, and for HR managers it’s $116,720 a year.
On top of those salaries, think about the benefits you pay, as well as the office space you must maintain and the technology you have to buy so these staff members have all the tools necessary to do their jobs. Because these staff salaries can add up, outsourcing is significantly less expensive for most companies.
You can outsource such functions as HR, payroll, accounting, finance, tech services and recruiting, among others. You only have to pay for the services you actually use, so if you don’t require an accountant for more than a few hours a week, that’s all you have to pay for through the outsourcing firm.
This means that outsourcing will allow you to save considerable money during this period, when you may be working around the clock to conserve your cash flow. More cash on hand means more opportunities for growth, investments, inventory management and more, helping your business expand when other companies are having to pull back on expansion.
Have you ever calculated the amount of time you spend on tasks that don’t drive growth at your company? From payroll tax calculations and employee onboarding to paying invoices and managing your accounts receivables, you could probably fill a whole day just tackling the minutiae of your work.
For example, perhaps you have a daily standing meeting with your accounting team, or maybe you set aside every Tuesday to handle HR responsibilities, check in on any changing labor laws and regulations, and interview new potential employees. By outsourcing, you can leave these tasks to the third-party firm so you’ll have more time to focus on your priorities, which typically involve cultivating new sales opportunities, building great products and growing your business.
If you’re handling all of the business responsibilities yourself rather than delegating them to an in-house team, you may not realize how much time you’re spending on those tasks. Most entrepreneurs have more pressing things to do besides hanging on the phone to resolve things like sales tax discrepancies. By outsourcing that responsibility, the business owner knows it’s being handled appropriately while spending their time on sales, marketing, R&D, product development and every other core task that contributes to the business’ growth.
There’s a reason that the saying “time is money” has endured for decades. Your time is one of the most valuable assets on your side, so don’t squander even an hour of your day. Instead, maximize every minute by using your time to focus on revenue-generating responsibilities while someone else handles your essential business services.
As a business owner, you most likely consider yourself an expert in a particular topic. After all, you probably wouldn’t have launched a business around a subject if you didn’t consider yourself to be well-versed in it.
However, most business owners can’t say they have expert-level skills in everything from international tax compliance to HR regulations. That’s where outsourced companies can be of great assistance. They find the experts in these areas who can help guide you to the right decisions in their areas of expertise. They can do this quickly and correctly because their staff members each maintain focus in just one area. Whereas an issue with an employee benefits detail might take you all day to rectify, the outsourced company could handle it within minutes because they know the vertical inside and out.
In addition, these experts will be on your side, so if you or your customers ever have a question about a particular topic that the outsourced firm handles, you can get answers in the click of a button or via a phone call, rather than having to research the topic for days on end.
They’ll also ensure that you’re compliant with all federal, state and local laws and regulations that surround the particular area of expertise they’re representing. From tax regulations to labor laws, you’ll always be on the right side of the law because the outsourcing firm will be well versed in these areas.
Some days it can be hard to see a future without the pandemic happening around us, but the reality is that the COVID-19 virus will eventually subside, and your business will be back on track to fulfilling its goals again. When that happens, your needs in the areas of accounting, tax compliance, HR, staffing, accounts payable and finance will likely grow as well. The outsourced company will be able to provide additional hours or even more people to meet your growing business’ needs, with no lag time. If you require three hours’ worth of HR help on Monday but you realize you’ll need ten hours’ worth by Wednesday, that can happen in just one phone call, rather than negotiating with staff members and putting out recruiting ads.
This also means that when your business expands, you won’t need to spend time hiring additional payroll, HR, accounting and finance staff members. You’ll instead just let the outsourcing firm know that your needs have changed, and they will scale up your operations accordingly to ensure that they accommodate all of your requirements.
Entrepreneurs dread getting sick, because taking a day off can mean that your employees go without payroll, since you’re the one handling it. Having an outsourced company in place will ensure continuity of service no matter what happens at your company, and you’ll be able to maintain that whether you’re on vacation, out sick or handling other needs.
This is also helpful if your business needs fewer hours. During situations like the coronavirus pandemic, when some businesses have had to scale back operations significantly, the outsourced company can take on fewer tasks and then quickly scale back up when business bounces back. You and your customers won’t notice any difference because the outsourced firm has provided continuous, high-level service throughout the period.
If your business is like most, you’ve got a tremendous amount of personal information stored on your computers, from employees’ Social Security Numbers and salaries to your tax data. Not only that, but many businesses have customers’ private information on hand, from credit card data to invoicing details and beyond. Small businesses sometimes find themselves working overtime to deploy high-level security programs to keep this information well protected, and even then, they may miss a security update that exposes this data to the public.
If you work with an outsourcing firm, you won’t face this issue, because the outsourced company will put cybersecurity programs in place to ensure that your data is protected, encrypted and secure. If you ever need access to your documents, you’ll be able to find them on shared servers or the cloud, but it will take place over a secure connection so it can’t be breached.
If the pandemic has taught business owners anything, it’s that they weren’t operating as efficiently or as lean as they should have been. The virus has taught us all to slow down, address operational efficiencies that we can employ, and to find fresh ways to be productive.
An outsourced expert can review your operations and determine whether you might benefit from adding efficiencies to your programs. Perhaps you’re too focused on one big customer and they want you to spread your sales team to other realms to boost efficiency. Or maybe they can see an area that can be automated, freeing up staff time to do more thought-intensive work. Outsourced experts are able to take an outsider’s view, which gives them an unbiased look at how your business is running and how you can benefit from tweaking things.
Take Your Growth to New Levels
Once you deploy an outsourcing strategy, you’ll be able to take your company’s growth to new levels. By freeing up your time to focus on sales-generating opportunities, you’ll be able to trigger expansion while also knowing that your company is in excellent hands.