5 Reasons to Outsource

Oct 15, 2018 | Management, PEO

There are many reasons why a company would outsource certain business functions.  Outsourcing is a great way to improve your competitive advantage while controlling costs.

What is Outsourcing?

Outsourcing is contracting with a third-party to handle functions that are not core to the business.  Partnering with an outsourced provider is advantageous for several reasons.  Let’s look at a few.

Top 5 Reasons to Outsource

  1. Control costs – using outside resources allows you to reduce expenses such as headcount, overhead, office space, software licenses, phones, and other costs.
  2. Expertise – you gain expert knowledge from subject-matter professionals.
  3. Time savings – allow someone else to handle tasks that would take you twice as long.
  4. Increase efficiency – experts can get the job done faster and more efficiently.
  5. Flexibility – in times of ebbs and flows you can adjust production without adjusting internal resources.


Outsourced functions can range from those done only occasionally, to tasks done on a daily, weekly or another regular basis.  If the function is not core to your business, it can probably be outsourced.  Some functions viable for outsourcing include:

IT services                                         Call centers

Accounting                                        Marketing

Payroll                                              Lead generation

Recruiting                                          Human resources

Warehousing                                    Distribution

Set Goals

Successful outsourcing starts with clear goals and objectives.  Once the business requirements are established, be diligent in vendor selection.

Understand the vendor’s capabilities, bandwidth, and expectations.  Review the vendor contract for proper structure and clear deliverables.

Careful planning and implementation of outsourcing can reap long-term benefits.

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