Outsourcing and your small business

With so much going on every day, it is hard enough to run your small business. Why not delegate some of the non-core operations from the internal production out to an external entity that specializes in that operation of business.

The decision to outsourcer is often made in the interest of lowering firm costs, and redirecting or conserving energy directed at the competencies of a particular business, or to make use of worldwide labor, capital, technologies and resources.

You are already specializing in the field of your small business. Why make it more difficult by trying to do it all.

For example:

Using an outsourced payroll company will free up hours that you can use to get more business, improve your companies service, and fine-tune your business operations. It may be better to leave the payroll up to professionals; in addition to leaving them to cover, the mistakes if any are made. These services would be outsourced.

• Processing payroll


• Cutting and distributing paychecks


• Calculating and paying withholding and employment taxes


• Preparing and distributing W-2s and 1099s at year-end


• Handling employee payroll inquiries

Before jumping into the payroll service pool, get a few quotes. Compare apples with apples - know what functions each provider handles and what you need them to do. Go with the best deal - and re-evaluate often.

The phones are ringing. You are all working over time. In addition, you are still thinking about outsourcing and if it is right for your small business.

Once you have decided to outsource, and you choose the right vendor. Remember to keep your eye on the ball. Since you cannot just walk down the hall to oversee the quality and timelines of outsource work. Keep an eye on all the functions you outsource. Arrange to have regular reporting set up.

Some functions in your business require only part-time work. Why hire someone to work part time and have to follow through with all the benefits and responsibilities of that client.

For example:

This might be a bookkeeper. If your needs add up to only a few hours a day a few days a week in bookkeeping, then consider outsourcing.

Outsourcing's advantages will vary with the services, the kind of business you run and, of course, the quality of your provider. It's worth your while to move slowly and commit little by little. Don't sign two-year contracts before testing performance and the relationship.

Watch out for hidden costs:

These may include paying layoff-related expenses, overtime costs for remaining employees who may now have more work to do, and telecommunications costs for remote workers. Just outsourcing the work that is not needed to be done by your core group can negate these costs.

One criticism of outsourcing is that product quality suffers. But the organization outsourcing a business process has the freedom to resume management control and/or decision making for that business process if quality is adversely affected. If you are tired and over worked then you will probably not do as high quality regardless.

The main thing to remember is that outsourcing is here to stay. In addition, it should be something you entertain for your business. Concentrate on the key aspects of your small business, what keeps your customers happy? If you keep this focus, you will be positioned for rapid growth and success.