Yay Or Nay? 6 Pros And Cons Of Outsourcing For Small Business Owners
by Arina Smith Business 11 June 2021
Small business owners need all the help they can get, and for many, outsourcing is a viable solution. Once limited to large companies that can afford to collaborate with other businesses worldwide, outsourcing has become more accessible than ever thanks to the internet.
Digital connectivity has made it easy to find eager and experienced freelance workers prepared to help with everything from writing and programming to marketing and small business IT support. However, if you’re considering outsourcing your labor, it’s essential to do your research. Get started by understanding the following six pros and cons of outsourcing for your business:
1. Pro: Access to a Larger Talent Pool
Hiring employees in your local area might be the safest path for most small businesses to expand, but there’s no denying that this approach has its fair share of limitations. Outsourcing allows you to gain access to a vast pool of professional talent from all around the world.
For example, perhaps your community doesn’t have many experienced programmers or copywriters, but outsourcing makes it easy to work with the exact professionals you need, no matter where in the world they are.
2. Con: Lack of Control
You’re able to have a more precise level of control over employees working under your direct supervision. This security is absent when outsourcing. When you hire professionals from outside your organization, it’s far more challenging to influence the direction of the final product.
That means outsourcing might not be the best choice for jobs that require detailed supervision and many iterations. Indeed, many people can tell you horror stories of outsourcing gone wrong when it just wasn’t the best approach for a project.
3. Pro: Lower Cost For Labor
Labor isn’t cheap, and while it’s always nice to hire people in your area, it doesn’t take long for expenses to add up. That’s why business owners who need to cut costs often turn to outsourced solutions, which can provide a similar quality service for a far lower price.
4. Con: Hidden Fees
Outsourced labor might have a low price tag upfront, but sometimes, hidden fees can emerge. It is all too common for outsourced workers to spring additional fees on you. These can be based on everything from the time it takes to complete the project to the costs of required materials. Thankfully, you can mitigate this issue by working with an outsourcer you trust, though it may take some trial and error to find one.
5. Pro: Improved Flexibility
In-house employees are great, but when you’re paying them salaries, you don’t have much flexibility in your expenses. You may be paying employees even when business is slow, and they’re not working much.
Outsourcing, by contrast, helps you reduce your overheads by being exceptionally flexible. It’s easy to get help from an outsourced team when you’re busy, while it’s just as simple to stop working with them whenever their services are no longer needed.
6. Con: Security Issues
The nature of outsourced work poses a handful of critical security concerns. Since you cannot monitor outside workers closely, it’s easier for security breaches to occur. It’s not unheard of for outsourced workers to mishandle sensitive information, creating significant liabilities for your company. Once again, your selection process can mitigate these sorts of risks.
There are plenty of benefits to outsourcing, but at the same time, there are major risks that you should keep in mind. If you’re wondering whether you should seek outside help for your company, be sure to weigh these pros and cons to make the right decision for you.