RUNNING a business is one of the most rewarding, but challenging things to do. There are a lot of uncertainties and long hours involved as business owners juggle many roles. However, with the current economic climate, it seems entrepreneurs and freelancers face an even more daunting task of finding stability as production costs skyrocket, while consumers and investors become more cautious. With this, outsourcing has become a necessity in recent years — especially during a looming recession.
Here are some reasons why small businesses should consider outsourcing during this turbulent time:
1. Lower costs
Generally, outsourcing lets businesses cut down on labor costs by hiring a third party to handle staff’s pay, benefits and training. But more than this, one also won’t have to worry about investing in equipment, technologies and facilities needed to perform these tasks.
Take for example office spaces. Renting a physical space in a central business district can get pricey and is one of the biggest fixed expenses a business may have. Outsourcing a virtual office allows entrepreneurs to cut out this cost and divert cash flow toward other core business activities instead. Companies like MyOffice offer flexible options, letting one build a virtual office that suits the business best. They even have fully furnished private areas and meeting rooms that one can rent when needed and on-demand receptionist support services to help with daily administrative tasks! With this level of flexibility, business owners only pay for what they need, resulting in more cost savings.
Another area where outsourcing helps save costs would be when it comes to purchasing applications needed to do certain work such as marketing and graphic design. Subscriptions to design applications such as Adobe Photoshop or Adobe Illustrator can be costly, and these expenses are still on top of the labor costs when hiring a full-time graphic designer. Online platforms like Canva are free and readily available, with optional premium subscription packs that still cost less than other traditional programs. The platform is also easy enough to understand and use even for the most technologically challenged with its drag-and-drop features, and roll out constant updates to ensure that marketing collateral looks fresh every time.
2. Improve efficiency
As mentioned, small business owners often take on multiple roles to keep a closer eye on things and cut down on costs. While this may seem like a surefire way to save money, this can get costly when it comes to time and effort. Doing tasks one is not an expert, it also makes the job more susceptible to error, leading to more time, effort and resources wasted.
Business registration and gathering permits are one of the most crucial, yet intimidating tasks here in the Philippines. There are many government offices to visit, permits to gather and documents to fill out. Because of this, it’s not unusual for business owners to miss something and have to start again. By outsourcing business registration companies like Permitly, one is assured that every step is done quickly and accomplished correctly — without having to go to the various government offices yourself!
Apart from business registration, it is also crucial to be mindful of ongoing required business compliances like taxes. Hiring an in-house accountant or bookkeeper may seem ideal, but this recurring expense may be tricky to manage during a recession. Online accounting platforms such as Taxumo or JuanTax allow businesses to address their tax compliance and accounting needs without having to manage the long-term commitments full-time hires require.
3. Gain expertise
In relation to the previous point, outsourcing for non-core activities allows business owners to gain expert advice at a fraction of the cost while saving time and preventing mishaps. Working with outsourcing companies or freelancers also grants entrepreneurs access to market insights and industry secrets that they may not have been privy to before.
One of the most common aspects of a business that is outsourced is social media marketing. Outsourcing a social media manager from websites like UpWork or Fiverr would be ideal with how quickly online platforms change, develop and update. These social media managers spend hours honing their craft and combing through sites to search for the latest trends and most creative ways to do social media marketing. By doing so, they ensure that the service they provide is relevant and up to date. Instead of busying yourself with keeping up with trends, you as the business owner can focus on your long-term goals.
At the end of the day, the decision to outsource lies with you and the goals you have for your business. Sit down, do an internal review and try to identify which parts of your business would be most beneficial to outsource so you can focus on strategies to either grow or stabilize your company — regardless of the state of the global economy.
Georgianna Carlos is a serial entrepreneur managing many brands. She is the marketing director of CJ Management Group Inc., a company that helps entrepreneurs and freelancers start their own businesses through its brands MyOffice and Permitly. She is also the founder of Fetch! Naturals, a local brand of natural, pet care products. Through her work, she has garnered awards and recognition including Forbes 30 Under 30 for Retail and E-commerce, and is an honoree of Tatler Asia’s Generation T. She is also quite active in the local startup scene, giving talks to schools and organizations, including Management Association of the Philippines’ International CEO Conference in 2019.