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Guide To Outsourcing

Linda Whitney has seven top tips to help you get it right Guide To Outsourcing

Outsourcing is about getting someone else to do the tasks you don’t have the skills or time to do.

Typically, that might include bookkeeping, IT, recruitment, admin or marketing. Whatever tasks you’re considering outsourcing, there are some points you should always consider:

What tasks do i want to outsource?

First choice might be those where getting it wrong could mean legal or financial penalties. This means tax, recruitment or human resources issues.

Here you need not only to find a supplier, but ensure they are properly qualified and regulated before you even contact them. Check the websites of potential suppliers to ensure they have the essential qualifications and belong to relevant professional bodies.

Shelly Smit, marketing executive at Great Elm Bookkeepers, which provides small businesses with bookkeeping and management information services, says: “When you’re choosing a supplier, it’s important to be sure they are qualified to do the job.

“For example, anyone can call themselves a bookkeeper, so ensure the bookkeeper you select is both qualified and has the right experience.”

Also consider outsourcing those tasks you don’t enjoy, not good at or are eating into your time to the extent they are distracting you from growing your business.

Calculate how much time or money it could save

If, for instance, doing your admin is keeping you from making sales, try to work out how much income you’re losing and then find out if you can save money by outsourcing the work. This is easier if you supply a service that’s charged by the hour.

Berkeley Harris, franchisee with Sandler Training, supplies small and medium-sized enterprises with training, as well as outsourcing some of his tasks himself.

He says: “The first task I outsourced was dealing with my social media marketing. I had played around with various platforms and became average at it, but in social media you need to be good, preferably very good.

“I’m happy to place my trust in an expert, who spends time with me understanding my message and does the work for me. It saves me an hour a day, which is great.”

Work out exactly what you want a supplier to do

Shelly says: “You should have a good idea what you want from a supplier.

“Most people looking for a bookkeeper know what they want to achieve, but a few don’t have a clear vision. Outsourcing often fails due to unclear or unreasonable objectives.”

Choose a few potential suppliers

The best place to start is personal recommendation.

Shelly says: “People will not usually recommend somebody who will not do a good job. Failing recommendations, check for testimonials on the supplier’s website and talk to the person who gave the testimonial.”

Look for examples of their work. Google them - do they appear as a supplier on sites relating to their industry? Have they won any awards?

Aim to get quotes from several suppliers, but ensure they’re all given the same brief, so you can compare them easily. Get written details of the services they can supply and make notes of what all of them say.

Meet potential suppliers in person. Ask them questions about what they can do for you, but equally check they are making efforts to get to know your business too.

Suzie McCafferty, managing director of recruitment consultancy Select Appointments, says: “When it comes to recruitment, ensure recruiters take time to get to know your business inside out. Only then can they find candidates who will fit into your culture.

“Ineffective recruitment is expensive. You don’t want to invest months training someone, who ultimately leaves because they weren’t compatible in the first place.”

Sort out the business terms

How much do they charge and how do they bill you? If they charge by the hour, do they supply time sheets? When will they bill you and what are their payment terms?

Is it worth negotiating prices and terms? Shelly says: “It’s always worth negotiating, but remember that your supplier needs to make a profit to ensure they stay in business and are being paid enough to do a good job.”

Research typical rates in their industry before you start.

Once you’re sure they understand your business and requirements, that your business cultures are compatible and you’re satisfied with their terms and charges, sign a contract. Consider making it short-term at first, with an option to extend it if the relationship is successful.

Monitor performance and benefits

Once under way, monitor their performance and your benefits regularly. Try to ensure the outsourcing is paying for itself in terms of time saved and return on investment.

Berkeley says: “I expect a return on expenditure. I share my ideal outcomes with suppliers in advance and ask them to help me measure the return on investment - though I maintain a bit of flexibility, as it’s not a perfect world.”

But he cautions: “Understand that no one will be as good as you. No one better understands your desires than you, but if they achieve 90 per cent of what you wanted, I consider that good. We need to take some small leaps of faith from time to time.”

Remember that saving time and money by outsourcing is not just the responsibility of the supplier - ensure you use the time outsourcing saves you to grow your business and increase profits.

Think outside the box

Could you swap services? Outsourcing need not always be about suppliers delivering a service for a monetary fee.

Berkeley Harris, franchisee with Sandler Training, says: “Another option with suppliers is to trade services. Do I have something they may need?

“In my world of sales training and leadership coaching, I can often trade services and the company that does my social media is doing exactly that.” Read more like this

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