Economic downturns, recessions, pandemics, inflation…they can all cause business owners to struggle. What you might not know, however, is that they also offer opportunities.
While it is tempting to cut costs and reign in marketing and other expenses when money is tight, a better exercise is prioritise what operations are essential to keep running during this time. If you think of it this way, you can then identify a better, potentially cheaper way of doing things, without stopping them altogether.
For example, one such opportunity during economic downturns is outsourcing your finances. Yes, Outsourcing is an untapped opportunity for your business during tough times, and here we explain why and how.
What is outsourcing?
In business, outsourcing is contracting with a third party to provide services or products typically performed by in-house staff. During an economic recession, businesses may outsource tasks such as customer service, marketing, accountancy or finances to reduce costs.
Note: it is important to remember to choose a reputable and reliable outsourcing partner!
Why a recession is the best time to outsource
Outsourcing can be controversial, but when done correctly, it can help companies weather the economic downturn and come out stronger on the other side.
There are many benefits of outsourcing, the most important ones being:
- Cost savings:
Outsourcing is more cost-effective than paying for full-time, in-house staff. Why? Because you pay a fixed amount for the projects or work completed, and you don´t have to worry about salaries, training costs, sick pay, holiday pay, or other benefits that in-house staff are entitled to.
- Access to skilled labour:
When you outsource, you can access a pool of skilled workers that you may not be able to find amongst your in-house staff. Better skills translate into better job delivery, and this can help improve your brand, services or production giving you access to bigger markets. This comes at no extra cost to your company too!
- Increased efficiency:
Layoffs are inevitable during a recession. These layoffs will normally cause your remaining employees to worry about added responsibility, work stress or even job loss. When you outsource, you can shift this burden to the third party and keep the focus and morale of your in-house staff intact. This often increases the efficiency of your company, and ensures that certain operations are continuing.
- Improved quality:
When you outsource, you can often improve the quality of your products or services. This is because the company you outsourced to will be focusing primarily on the task at hand and delivering high-quality work.
How do you outsource effectively?
When it comes to outsourcing, there are a few things you need to keep in mind in order to do it effectively.
- First, you need to know what tasks can be outsourced and what tasks should be kept in-house. There is no point in outsourcing if it costs you more in the long run.
- Second, you need to find a reputable and reliable outsourcing partner. Do your research and make sure they have a good track record.
- Finally, you need to manage the process and communication effectively. Make sure everyone is on the same page and that deadlines are being met.
In today’s competitive market, businesses must think strategically about how best to manage their resources; outsourcing is one way of doing this. By taking the time to research potential service providers, you will be able to find the right fit for your needs to get the most out of any economic downturn.
With careful planning and consideration, you can use a recession as an opportunity for growth through outsourcing. Get in touch with us today to see how.
Want to outsource your finances?
If you want to outsource your Bookkeeping or Finance Department, we can help take this burden off your hands.
Please do get in touch today and we can talk about how we can help you.