The idea of outsourcing can appear counterproductive at first. Just because hiring the services of a third party to outsource seems risky. When you look deeper, outsourcing appears to be a smart move. It has become one of the popular business models for small and medium plus big organizations. When you look at the international market, the outsourcing market is worth about 90 billion dollars. And more than 50% of companies across the globe use outsourcing services to connect with their customer base.
Companies opt to hire third parties as their outsourcing partner for various reasons. The main reason to outsource the work is to focus on their core competencies and increase revenue growth. The major motives for outsourcing are:
- Simplify growth
- Save time and cost
- Increase profitability
- Access to global talent
The main aim of a company is to increase revenue and profitability. Hiring a third party to outsource work can help businesses to increase their profitability. Companies outsource the operations like customer support, chat support, and sales to focus on core competencies.
The customer-centric companies outsource their work to contact centres located in different countries. The wage rate in these countries is low compared to the parent company. To cut short, the business can increase its workforce at a much lower rate.
Save Time and Cost
According to a survey, the average cost to onboard a new employee cost 4150 dollars. Companies looking to grow fast always look upon cost savings. A salary of more than four thousand dollars is alarming for mid-level companies. By outsourcing their work, companies can save up to 20 of their cost. Small and medium-level companies use this amount of marketing to boost their market share. Outsourcing companies are accountable for winning customer loyalty. Meeting the set targets is another goal.
According to a study in the US, the initial five years of a newly built company are vital. There are only 50% of companies survive after five years. Furthermore, companies that are growing at a pace of 20% per year still have a 90% chance of failure.
The only solution is faster growth. Business needs to be more competitive to be successful. It may require more than an idea – it needs people, infrastructure and money to upkeep the growth. Outsourcing the work is the best solution. Outsourcing can help to speed up the hiring and training process. It certainly helps in pacing the growth in a short span of time.
Access to Global Talent
Outsourcing the work enables you to get access to global talent. What does a company want? A pool of talented people on affordable wages, with a diverse group of talented people a company can complete the projects faster. Access to global talent can be a smart strategic move for companies looking to improve their bottom line.