The job market is tight, wages are rising, and small business owners are having a tough time recruiting and retaining good workers. That in turn, could ultimately hurt the ability to grow and thrive.
One way to get around hiring shortages is to outsource non-essential tasks. It’s understandable that you want to control all aspects of your business, but if outsourcing invoicing or technology means fewer full-time employees on the payroll and more time to run operations, your business could an overall benefit.
Small businesses are embracing outsourcing at a growing rate. As it stands, more than one-third of business owners outsource business processes. Last year that was projected to increase to 52% of small businesses. They're outsourcing accounting, IT services, and digital marketing among other things in a quest to improve efficiency and gain expertise.
Some aspects of a business's operations are better suited to outsourcing than others. Consider these four business functions, where outsourcing could help improve efficiency and lower costs.
1. Finance and Accounting
Most people don’t go into business to spend hours balancing the books. They want to sell products or services, grow their business, or develop new offerings. By outsourcing payroll and bookkeeping, visionary business owners can help free up their time to achieve their larger goals. It can also shore up the business' data security, especially for cash-strapped small business owners who may not have expertise in digital security.
How To Do It: Outsourcing payroll and accounting is made easy thanks to several cloud-based providers that cater to small businesses. Many charge a flat rate each month, providing a bevy of services including bookkeeping, generating financial reports, and digitally reconciling expenses. Business customers can pay extra for additional services including tax planning and filing. Other online services match small business owners with accountants for hire on a consultant basis.
Unless you’re running a tech business, most small business owners aren’t experts in networks and data storage. Growth at small businesses is often slowed because of the time spent trying to fix or expand IT resources. And hiring full-time IT staff can be costly; it’s often more cost-effective to outsource some or all of it.
How To Do It: From techs on call to software that lives on the cloud, there are all several ways to outsource IT. Thanks to innovations in cloud storage, all of your data and applications could be accessible anywhere. You have the potential to purchase as much or as little server space as you need, scaling up and down as you go along. IT support via a managed service provider is also a way to keep costs down. Through a third-party IT support service, you can access help when you need it and tap a wide network of experts.
3. Customer Service
If you are inundated with calls and questions from customers, it may be time to consider outsourcing some of that work. Outsourcing customer service can save you time and money and if done right, enhance the relationship with customers. It can also enable you to speed up the time it takes to deal with complaints and streamline repetitive tasks.
While there are a lot of benefits, it can’t come at the expense of the quality of customer service. If the third party you choose doesn't provide the same level of service you do, it could hurt customer retention. The last thing you want is customer service to suffer because you outsourced it.
How To Do It: From using a call center to employing chatbots, there are a variety of ways to get help with customer support. If you need help answering calls, a call center will make a lot of sense. Make sure to do your due diligence before deciding on a third party. One call center may excel in high volume, repetitive work, while others are better at tackling more complex problems.
For online communication with customers, especially for frequently asked questions or requests, you may consider using a chatbot. A chatbot is a computer program that uses artificial intelligence and machine learning to have natural language conversations with customers over a messaging or live chat platform. A recent study from Oracle found that by the end of 2020, 80% of businesses will use chatbots in some form. You can use chatbots to answer frequently asked questions, make product recommendations, set up appointments with sales teams, and facilitate purchases and payments.
4. Digital Marketing
Time-crunched small business owners can be well-served outsourcing marketing, particularly if they aren’t savvy with social media. With billions of people using Facebook each month, small businesses that aren’t marketing online could be missing a critical opportunity. Hiring a third party or a freelancer to handle your online marketing is quick, easy and often cheaper. You pay on a need-to basis, freeing up time to focus on growing the business.
How To Do It: Services to help your business are readily available for every price point. But before you choose one, consider your current marketing strategy and pinpoint your search to where it’s lacking. Most digital agencies charge based on the project but they tend to specialize in different areas. One may be strong in placing digital ads while another may excel at brand building on social media. The company should be easy to communicate with, readily available and understands your business and audience.
Taking costs out of the business and freeing time to focus on growing operations is the goal of business owners. That can be achieved by outsourcing certain operations. When deciding which business functions to leave to third parties, consider focusing on the most costly and most time-consuming. Chances are you won’t miss them when they are off your to-do list.