SMEs and the Benefits of Outsourcing

Many entrepreneurs struggle starting their own small businesses. There are too many things they have to take care of and too many things to organise. But maybe it doesn't need to be as tough as it seems when you decide to outsource part of your services. Outsourcing is the practice of using outside firms to handle the work usually performed within the company. Probably the biggest advantage of outsourcing is that SMEs can entirely focus on their core activities. For example, if you are running a small marketing agency, you don't need to employ an IT expert, you can easily outsource your IT which not only will make your life easier but also can significantly lower your costs.

One of the latest reports present a few examples of small entrepreneurs who highly benefitted from outsourcing their services. The managing director of a six-person marketing agency said that moving from a regular office to a serviced one revolutionised her working life. "They supply all the office infrastructure, telephone lines, stationery, etc. We don't need to invest in reception staff or capital equipment (... ) It makes things much easier and you don't need to worry about business rates or furniture or anything", she added.

The joint managing director of a research consultancy company, admits that her business benefits from various outsourced services, as she claims that: "If someone else can do it, then they should. If it's not building an asset for the business, then you should outsource it". Her team of five have moved recently to serviced office, she also outsources IT support and book-keeping services.

One market research consultant employs a book-keeper on an hourly rate to work for a half a day once a fortnight to do the administration. He also outsources his IT services because he believes that: 'IT and book-keeping are two of the most-consuming things if you don't know how to do them. I'm a huge supporter of doing only the things that I need to do. Some people are completely unable to let someone else to anything, in which case they will gently grind to a halt."

A life coach admits that outsourcing is very convenient. He had a lot of administration work to do but couldn't afford employing a full-time worker so he 'hired' a virtual assistant. Basically, he dictates his reports and speeches and sends email voice files or scanned documents to his virtual assistant who does the whole typing work. He pays for the service in ten-hour blocks.

Various businesses discovered the power of outsourcing in the early 1990s, but many of them lacking the understanding of this practice. The key is to outsource wisely, as a random and mindless outsourcing can be harmful. Once you get it right, your company can benefit from numerous long-term benefits. Outsourcing can level SMEs with large companies by giving them access to the same economy of scale and expertise.

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