Should you be working smarter & join the outsourcing revolution?.
By Phil Ellerby
More and more businesses are turning to outsourcing because of the benefits it can bring.
Not only does it allow you to access as much or as little expert support as you need, it can also free up time so you can focus on the things you’re good at – or the ones which are most profitable!
Hiring people from outside your company to do a specific project or process (which may not be a core function of the business) can also reduce the need to take on full-time employees. Securing outside help in this way can often be more efficient and cost-effective because the people doing the task are usually specialists – meaning they can complete it quicker and better than you ever could.
But how do you know if outsourcing is right for you?
What can you outsource (easily)?
Let’s be honest, there’s no way you can do a task better than someone who’s been doing it for years as their day-to-day profession.
For this reason, trivial tasks which take you away from your core strengths and skills are perfect for outsourcing.
But before doing so, 3 main factors should be considered:
- Your skills – What are you good at?
- Your willingness – Do you like doing the task?
- Costs – What can you afford?
Most owners of SMEs know it’s important to update their company blog on a regular basis but coming up with new ideas and writing the articles can take hours. Hiring a freelance writer or PR company could speed up the process and let you focus on more important tasks.
Temporary or cyclical tasks, which are only carried out a couple of times a month, are also ideal for outsourcing. This could include things such as IT maintenance, payroll or ‘back-office’ functions which support the running of your business.
Advances in technology mean that we now provide a ‘virtual’ finance team for many different businesses here at Northern Accountants, using cloud accounting solutions like Xero to complete routine tasks like invoicing, filing annual accounts and tax returns.
Typical services which businesses can outsource include:
- Accounting and payroll
- Preparation of management accounts
- VAT return preparation
- Cash flow forecasts and budgeting
- Marketing and PR
- Web design, SEO and maintenance
- IT set-up and maintenance
- Phones and communications
Is outsourcing worth it?
Working out the cost efficiency of outsourcing is easy – and basically depends on how much you can potentially earn per hour.
If a task can be outsourced for less money than you’ll earn, it’s a no-brainer. Let someone else do it and earn more money by sticking to your main line of work.
If the cost of outsourcing is more expensive than doing it yourself, it may not be worth doing it. But before making the decision to ‘do it yourself’, weigh up other factors like the wasted energy and negativity you might feel when doing something you dislike.
Compare this to the cost of hiring a contractor and the savings you’ll make compared to paying a full-time employee (salary, national insurance, payroll taxes and benefits, etc.) and it could still prove a worthwhile investment.
Weigh up what’s best for you!
Whilst outsourcing is used in a wide variety of sectors and by a significant number of UK companies (large and small), it isn’t for everyone.
It’s perfect for companies that are looking to grow, or who’ve taken on a workload which is quickly becoming unmanageable. Outside contractors are also great for freeing up your time and letting you focus your energy on the tasks you do the best.
But if you’re worried that outsourcing part of your operations might result in cultural conflicts, poor performance or cause morale to suffer in the remaining workforce, it may not be right for you.
At Northern Accountants, our highly-trained team conduct administrative tasks like outsourcing payroll and book-keeping on behalf of various clients. If you need help with this or advice about any other aspect of outsourcing, please get in touch – we’ll be happy to assist.
Ultimately, the final decision should be taken after weighing up all the implications and based upon what’s best for you and your business.