Why Outsource Back Office Services?
Today, companies of all sizes work to become more efficient by paying an outsourcing company to handle a part of their operations, specifically their back-office functions.
We often hear about outsourcing and how companies have come to embrace it when it comes to running their business. Not to over-romanticize it, but outsourcing allows people from all over the world to work together to achieve a specific objective.
While giant companies like Nike and Toyota have always outsourced much of their labor, it was the data processing sector that first hired third-party companies to perform administrative tasks. With more management teams realizing the full benefits of outsourcing services, more companies begin to outsource services, such as call centers, tele-messaging, help desk, and many others.
What is back-office outsourcing?
Back-office operations are the backbone of a business, making it just as important as any other part of an enterprise. However, it continues to be a burden for both small and large companies because they would rather focus their efforts on value-added tasks than spend time on mounds of paperwork. It naturally causes frustration.
Frustration is just one part of it. It is in the bottom line of these companies where it hits the hardest. Inefficient back-office processes cost companies an estimated $480 billion annually. Taking steps to limit these losses is crucial, and hiring back-office outsourcing companies is one solution to this costly problem.
Back office outsourcing is an agreement entered into by a business with a third party. This practice helps businesses grow by saving money in terms of bringing down the cost of services. Outsourcing companies have highly specialized professionals who get continuous training, providing their clients with high-quality results. This can lower labor costs and improve efficiency.
Summing it up, the true power of outsourcing is that it allows a company to focus its efforts and resources on what it does best.
Why outsource your operations?
Outsourcing provides benefits that could mean success to companies, not to mention their survival in this dog-eat-dog world of business. The most obvious benefit to this approach would be the cost-cutting effect it can provide.
Outsourcing back-office tasks to Business Process Outsourcing companies such as data entry, accounting, order processing, market research, customer service, data collection, recruiting, HR, and many more, can literally save a business’ life. These days, there are outsourcing services available for almost any specific task you need.
Manufacturing businesses, like automobile or other machinery types, directly import ready-made parts, and just assemble them. It decreases their costs of production, and also the accumulated interest when procuring raw materials. Aside from that, outsourcing also results in cost restructuring when it transforms variable costs into variable fixed costs.
Alongside enjoying reduced costs of production, outsourcing can also translate into faster production. Compare having to establish lines on a blank sheet of paper to make graphs to already having graphing paper fixed and only having to input points and lines and bars, and you can see in simple terms how using established systems can help many companies be more productive than ever.
Outsourcing lets you reinvest in your business
More than just the cost savings, outsourcing allows you to reinvest your time and capital into other strategic priorities. If you feel like it is time to scale your business, outsourcing can help you establish the financial foundations. Third-party companies take the load off your team, and with time freed up, you can now focus on your business goals while reinvesting your budget to achieve them.
For example, you can outsource your I.T. needs to an outsourcing company so you do not have to handle cybersecurity, cloud services, etc. Just do what you do best and let others worry about the rest.
Back-office functions you can outsource
1. Data entry
Data entry is very tedious, yet it is an important part of any business. However, you will be better off outsourcing data entry than managing it yourself. You can just outsource data entry to an efficient outsourcing partner that you can rely on.
2. Payroll processing
You can free up your valuable time and resources by outsourcing your payroll and accounting. Whether you are a large company or a small one, you can benefit from outsourcing your payroll needs to a third party.
3. Digital marketing
Marketing is a very important task in all businesses. You cannot produce products and expect them to sell without investing money, time, and effort. And with most consumers using the internet, digital marketing is the most logical way to tell the public about what you offer.
However, digital marketing is not easy to learn. It will take lots of training to master. Fortunately, there are many agencies you can tap to handle your marketing campaigns.
4. I.T. support
It is a fact that almost all companies use the internet for their business. These days, businesses can no longer run without an I.T. infrastructure. Hiring managed I.T. will make sure your infrastructure will run smoothly 24/7 without having to spend on hiring, training, and maintaining an I.T. team.
5. Bookkeeping and taxation
Bookkeeping and taxation are crucial for any business. It is time-consuming and very tedious because you need to be 100% accurate. There is no room for error when it comes to compliance with regulations. It is a good thing that you can outsource these tasks to third party companies who have a team of accountants using the latest accounting software.
Conclusion
Outsourcing is a remarkably low-cost alternative to get a company’s work done. It can also free up the company’s resources and allows founders to concentrate more on the company vision and even expansion.
With outsourcing, you can get the job done and make your business and its resources concentrate more on essential matters. Just be sure that the outsourcing company you bring in is qualified and employs capable professionals to get the best quality. Get references and ensure that the companies you partner with are experienced in your field.