What is outsourcing in business?

Running a small business on your own can be a lot of work. But you don’t need to do it alone. 

Outsourcing is an excellent option as it can reduce some of your responsibilities and increase efficiency. Plus, it lets you avoid taking on internal employees. 

If you’re not familiar with the term ‘outsourcing’, you may wonder what it is and if it’s worth trying. We can help you with those questions.  

This guide covers outsourcing for business, including:

• What is outsourcing in business?
• What can you outsource for your business?
• What are the best tips to get outsourcing right?

Outsourcing is when a business pays another company to provide services they would otherwise handle themself. You can outsource many aspects of your business, to reduce personal responsibility and save time. 

When you outsource parts of your business, it allows you to focus on offering the best possible products or services. It also helps you avoid overworking or spreading yourself too thin. 

On top of this, third-party companies provide expert knowledge. As you may not feel capable in every area of your business, these services let you strengthen them.

With that said, outsourced services aren’t free. They require an investment, which varies depending on what services you need. Still, outsourcing is more cost-efficient than hiring in-house employees, and it requires less commitment. 

You can outsource many things for business, but let’s go over a few that might prove useful for small companies.

Marketing is an essential part of growing your small business audience. But, it can also be time-consuming to create an impactful strategy. 

Outsourcing some or all of these tasks can allow you to focus on your operations while successfully reaching potential customers. Here are a few aspects of marketing you might outsource: 

• Marketing strategy
• Content marketing 
• Social media marketing 
• Marketing analytics 
• Search engine optimisation (SEO)
• Website design and development

See also: Should I outsource marketing for my business?

Managing your finances well helps keep your business afloat and remain tax compliant. 

But if you’re not knowledgeable about accounting or the prospect seems stressful, you might seek an accountant or bookkeeping service. 

Outsourcing these tasks helps you maintain accuracy and benefit from expert knowledge. Plus, an accountant can help you file taxes properly. 

See also: How much are bookkeeping services?

If you struggle to keep up with your daily schedule and tasks, you might pay a service to organise your projects or manage your clients effectively. 

This approach can save you time scheduling your time, improve your productivity, and make you look more professional.  

If you create products for your business, you may streamline the production process through outsourcing. Doing so increases your manufacturing capacity to sell more in a shorter period.  

Similarly, businesses that often ship products might hire a shipping service that streamlines the process. Dropshipping, for example, ships your products so you don’t need to store them and only end up paying for what you sell.  

See also: How to improve your shipping process. 

It’s crucial to know about your market and remain aware of your business performance. So, you might find a third-party company to track your business numbers and conduct research. 

For example, you could hire a service to track sales numbers or market research. 

Generating leads is crucial to growing your client base and increasing your business sales. Consider hiring a professional service to increase the effectiveness of your lead management. 

If outsourcing seems like a great choice to improve your business, you may wonder how to set it up. Let’s go over a few tips to make the most of it. 

The first step of outsourcing is to decide what area you need it in and which specific services you seek. Assess your current operations to spot areas you might improve or save time. 

For example, you may wish to spend less time on financial management and seek a bookkeeper. Or you could outsource marketing to improve its effectiveness. 

Next, decide how much you’re comfortable spending on outsourced services. Though these companies can help your business, they won’t do much good if you spend more than you can afford. 

You might spend more on services that will offer a return on the investment, such as marketing. But a service like bookkeeping may not directly increase sales, so make sure you have the available cash. 

Try getting quotes from several companies and negotiate a price that works for you. 

Once you know what to look for, begin your search for the right fit. You may seek online services or companies in your area. Or you could look for options that offer a particular niche and expertise. 

Compile a list of the best options and set up consultations to get to know these companies a bit. When you pick your company, you can create a clear contract that outlines expectations. 

To succeed with outsourcing, you and the third-party company must be on the same page. Make sure you maintain clear channels of communication and establish concrete deadlines. 

Though these services may take work off your hands, be sure not to forget about it entirely. Regularly checking in with your outsourcer will help you ensure the work supports your business. 

Now that you know what outsourcing is for business, you can determine if it’s the right approach. These services can simplify and strengthen your operations so you can grow. Just remember to: 

• Settle on what you wish to outsource
• Establish a realistic budget
• Research to find the right pick
• Prioritise communication to make it effective

Still, outsourcing is not the only way to streamline your small business duties. There are plenty of tools that can save you time. Next, consider checking out the must-have business apps for small business owners. 

Whether or not you choose to outsource aspects of your business or not, there are still tools that can help you organise your finances.

Countingup is the business current account and accounting software in one app. It automates time-consuming bookkeeping admin for thousands of self-employed people across the UK. 

Start your three-month free trial today.