Top 5 benefits outsourcing can bring to your business

Top 5 benefits outsourcing can bring to your business
Natalie Toniotti
AUTHOR
Natalie Toniotti
    6 minute read

Outsourcing allows businesses to sustainably scale and grow, while also reducing costs and improving efficiencies. The global business process outsourcing (BPO) market is expected to increase by $40.16 billion from 2020 to 2025, growing at a compound annual growth rate (CAGR) of 4%. The leading driver for this growth is the 59% share of businesses that use outsourcing services to cut costs.

Outsourcing can help businesses navigate market changes, sudden increases in demand and offer the support required to deliver on success goals. As a low-cost resourcing alternative, companies can receive the same output as hiring locally to grow their business as they see fit.

While each business has its own individual reasons for choosing to outsource, in this blog, we will discuss the top five benefits most businesses experience when they engage in outsourcing.

  1. Cost savings

    For many business owners, there aren’t enough hours in the day. The reality is if they want to grow their business, they need to increase their head count. However, labour costs can be prohibitively high.

    More employees can also increase the need for bigger office spaces, more IT equipment and other associated overheads, which will increase fixed costs. Even if you consider remote work, there may still be a need to invest in data security measures or provide technology to facilitate a work-from-home model. These additional staffing costs can be crippling and quickly outweigh the increased sales or revenue that having additional employees may generate.

    Outsourcing allows additional work to be completed, at significantly reduced costs, especially when outsourcing offshore to a lower-cost economy, such as the Philippines, where employment costs are up to 70% less.

    Want to see outsourced cost savings in action? Check out our accounting firm case study.
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  2. Expert support

    Outsourcing specialists are highly trained professionals who can offer insights, advice and add value to each stage of the outsourcing journey. The process involves recruitment, onboarding, training and ongoing management.

    The entire concept of outsourcing is to help to deliver efficiencies in your business. When preparing for an offshore staff member, there are many steps that need to be taken before your business is offshore ready. Part of this is implementing best practices around communications, technology, managing output and work in progress.

    The support you receive from your outsourcing specialists will ensure you make the right decisions throughout your entire outsourcing journey. This allows businesses to hire people with diverse backgrounds, experience and education, allowing businesses to source the best talent to help take their business to the next level.

    IN ACTION: Expert support benefits

    A website development company wanted to scale and grow quickly and cost-effectively to meet the growing demands of an increasing customer base. Since outsourcing, they have expanded their team to include a WordPress team leader, senior web developer, WordPress and UX/UI designers and an executive assistant with marketing skills. Due to the specialist nature of these roles coupled with demand, it can be difficult to source locally, but partnering with an outsourcing expert allowed the company access to a greater talent pool.

    Since implementing an offshore team, the company saw a 72% increase in customer acquisition. The offshore team has also improved design turnaround times, leading to a vastly improved customer experience and providing capacity for the business to take on more work.

  3. Business growth

    One of the many reasons businesses struggle to grow is a lack of funds to invest in additional resources to support growth objectives. Businesses often don't have the time to recruit new employees to leverage potential growth opportunities. On top of this, there are businesses that go through peak periods where there is too much work and then times when it isn’t as much. Outsourcing provides scalability during these times.

    There is often a very short lead time to hiring offshore, providing a further advantage in that it can be very quick to scale up a business, depending on the role type. Outsourcing can also free up funds that can be used to reinvest back into the growth of your business. With the additional support of outsourced team member(s), you can increase the capacity for your business to take on more work.

    Can outsourcing support rapid business growth? This case study shows it can.
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  4. Improve business flexibility and availability

    Outsourcing can provide businesses with the flexibility to meet changing resourcing requirements in response to fluctuating customer or market demands. Hiring offshore staff can help businesses manage seasonal and cyclical changes easily as outsourcing providers can have an outsourced team member or team ready to go in as little as six to eight weeks.

    This flexibility can help your business navigate risks, support sustainable business growth and plan for peak periods where additional support may be required. An additional bonus is removing the costs associated with lengthy recruitment drives or setting up contact centres suddenly. Outsourcing providers are experts at both - all you need to do is communicate your needs and let them take care of the rest.

    Outsourcing in low-cost economies can also help many businesses extend their hours beyond 9-5 pm, 5 days a week and potentially support 24/7 operations in key areas such as customer service or IT support.

    Roles such as administration support, sales support, technical support and customer service are easy for many businesses to outsource to support your customers in an ‘always on’ landscape, thereby improving customer experience, retention and most importantly, your bottom line.

    IN ACTION: Improve business flexibility and availability

    Due to exponential growth, a small tech startup company required additional resources to help support its existing client base. Hiring an offshore systems administrator allowed the business to move its focus away from the day-to-day customer interactions and onto developing strategic partnerships and growing the business. The systems administrator also helped them maintain excellent customer support metrics.

    In their first quarter, the offshore systems administrator achieved a 53-minute first response median on support tickets, compared to the 18.3 hours benchmark for IT Services businesses with 1-9 employees. In addition to this, all support staff scored 100% CSAT during the same quarter. In less than six months, the newly hired offshore systems administrator had also quickly upskilled to identify cost-savings opportunities for customers through his support role.

  5. Improved staff satisfaction rates

    Outsourcing can help you to identify roles and tasks that would be best suited to send to an offshore employee. That way, your local team can focus on what they do best and what motivates them, improving job satisfaction for employees in the long run.

    Hiring offshore team members can help relieve any unnecessary stress felt by your local team through the provision of additional support. Your staff will appreciate this, job satisfaction will increase and attrition will decrease.

    What results can outsourcing have on staff productivity? A 104% increase in lead generation over 12 months.
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What are the benefits of outsourcing to the Philippines?

Managing a business can be a tough job; having to control costs without compromising quality is a constant. Businesses are always looking for strategies to help find the ideal balance. To achieve this, many hire quality employees in different parts of the world in specific labour markets that offer highly skilled, well-educated workers without sacrificing quality. This is known as outsourcing or offshoring. Why engage in outsourcing? To hire quality employees in lower-cost economies to leverage these cost efficiencies.

The Philippines is one of the fastest-growing economies in Southeast Asia with companies all over the world viewing the country to be one of the best outsourcing locations. In the Philippines, the outsourcing industry is worth AU $38.7 billion and anticipated to grow 6% in 2022, and is also responsible for employing over 1.2 million people.

Discover the 7 reasons why businesses are outsourcing to the Philippines today.
Read more

Updated 27/10/2022

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