Outsourcing is a strategic move for businesses experiencing rapid growth or requiring extra support. Outsourcing involves bringing in outside resources like a firm or independent contractor to help with various business functions, day-to-day tasks, or other essential services.
The most common outsourcing business examples include:
- Marketing and advertising
- Customer service
- Human resources
- Manufacturing
- Business development and sales
- Shipping and logistics
- Accounting
- Information technology (IT)
Outsourcing is beneficial when a business needs to fill talent gaps, scale up production, or reduce costs. Outsourcing is also common among firms seeking global expansion that need help navigating the complexities of international hiring.
This guide details common examples of outsourcing, outsourcing benefits, and how it can help propel business growth.
8 Common Outsourcing Examples in Business
Outsourcing is possible to use for various business functions. We dive deeper into some of the most common outsourcing business examples below.
1. Marketing and Advertising
Delegating marketing tasks to an agency is a common outsourcing example. A marketing agency is well-versed in what it takes to get noticed and build credibility.
A marketing firm takes on efforts like brand awareness, market research, competitor analysis, content strategy and copywriting, search engine marketing, social media, and more.
How it helps: Marketing agencies are experts in their field and offer a cost-effective solution for helping you reach your marketing goals. While you focus on creating a great product or service, a marketing firm works alongside you to help build your brand value.
2. Customer Service
A customer service agency acts as a liaison between your company and your customers. Outsourcing a third party for customer service allows you the flexibility to hand off lower-priority customer requests so you can focus on those that need immediate attention.
Typical customer service outsourcing tasks include handling phone calls, live chat, email, and social media messaging support. A customer service agency often hires representatives worldwide or uses AI technology to handle more requests and provide support in different time zones.
How it helps: A customer service agency takes tasks like customer communication and conflict mediation off your plate so you can focus on core goals and reduce labor costs while maintaining confidence that your customers are cared for.
3. Human Resources
Human resources is a core part of any business, as they perform tasks that help the company function and thrive. While business leaders might prefer to focus on meeting deadlines and generating profit rather than talent management, HR management outsourcing can step in to make sure human resources tasks are taken care of.
The main responsibilities of HR include:
- Talent management
- Workplace safety
- Payroll administration
- Culture creation
- Benefits planning and administration
- Compliance
Organizations building distributed teams can outsource global talent management to an employer of record (EOR), which handles tasks like hiring, payroll, and benefits administration for international talent.
Organizations with international staff can think of an EOR as an extension of their HR team: An EOR makes it simple to hire, pay, and support talent on an international scale.
How it helps: Outsourcing talent management tasks like hiring, payroll, and benefits administration gives in-house HR staff more time to focus on refining talent training programs, company culture development, conflict resolution, and talent retention strategies.
4. Manufacturing
Manufacturing in-house can be timely and costly for small businesses and startups. Instead, these organizations often outsource manufacturing to improve speed-to-market. Manufacturing partners have the facilities and expertise to help you quickly produce high-quality products that meet your specifications.
How it helps: By outsourcing manufacturing, you can scale operations and get your products to market faster while re-investing that time and money back into your business.
5. Business Development and Sales
Outsourcing business development and sales is helpful if you have a small sales team or if your sales pipeline is often full. Business development and sales firms can conduct business research about which prospects are most likely to convert, reducing the amount of time your internal sales or development team spends pitching potential customers.
How it helps: A firm devoted to business development and sales can help organizations with time-consuming tasks like researching new markets. It can also help push more prospects through the funnel and ultimately generate more business growth.
6. Shipping and Logistics
Logistics companies have the expertise and experience to handle all aspects of fulfillment, shipping, and delivery management. A shipping and logistics partner handles all fulfillment tasks, from packing to shipping and tracking your product to customers.
An outsourced logistics service has established infrastructure to ship your products anywhere worldwide, and they can negotiate better rates with carriers. They also ensure the products arrive safely and on time, taking care to update and manage inventory so you don’t oversell.
How it helps: When you outsource shipping and fulfillment, you can focus more on selling. Like many other outsourced services, shipping and logistics help you scale production while saving costs and ensuring your customers receive the same value each time.
7. Accounting
Accounting is one of the most critical business tasks—and often the most outsourced. An accounting firm performs tasks like financial auditing and reporting, tax preparation and planning, bookkeeping, and other advisory services.
How it helps: Hiring a dedicated accounting team takes essential financial tasks off your plate while providing peace of mind that all financial transactions are accurate and legal and any sensitive financial data is safe.
8. Information Technology (IT)
More organizations are outsourcing IT amid the mass adoption of remote work. By outsourcing IT, companies save on expensive in-house software costs and receive flexible solutions from IT outsourcing firms that know how to adapt to and solve critical technology and security problems.
How it helps: An outsourced IT partner can improve the performance and security of your existing IT processes to streamline your operations and improve efficiency.
Advantages of Outsourcing in Business
There are many benefits to outsourcing that allow you to maximize the performance of your workforce so you can focus on key responsibilities.
Reduce Costs
Outsourcing reduces or eliminates the costs related to hiring full-time staff in-house, such as salaries, benefits, onboarding, and training. Outsourcing also reduces the need for additional infrastructure, work equipment, and technology. Most third-party firms only charge for the work required, adding more flexibility to your budget and financial goals.
Increase Efficiency
A third-party firm or contractor brings expertise, experience, and new ideas to your business. An outsourced partner already has the skills required to fulfill the tasks you need help with, so you can focus on hiring talent where you need it most. Allowing the experts to step in improves business functions, increases productivity, and boosts efficiency in your operations.
Access a Broader Talent Pool
Attracting and retaining talent is more challenging than ever as companies compete within the global marketplace for skilled workers. Outsourcing helps fill in the gaps until you can make permanent hires in-house. It also allows you to tap into a broader talent pool that specializes in the skills you need.
Focus on Top Priorities
Outsourcing allows you to let the experts handle time-consuming administrative tasks so you can focus on your top priorities. With an outsourced partner, your employees spend more time on meaningful business operations, and you can focus on growing your business and reaching your core goals.
Learn more: How Global Outsourcing Helps Businesses Gain More Market Share
Considerations Before Outsourcing
While outsourcing has many benefits, it’s critical to do your homework before hiring an outsourced firm or individual to handle any of your business needs.
Ensure your partner has the relevant experience and credentials to complete the specialized tasks. Evaluate the authenticity and credibility of the third-party provider, including their expertise, experiences, and certifications.
You must also review their business methods and establish a communication system that works well for both of you to ensure a symbiotic, productive, and efficient relationship.
Consider the following vetting questions when evaluating a third-party partner:
- Do they know your industry/clientele/area of focus?
- Do they understand your business?
- Are they transparent about pricing?
- How responsive and communicative are they?
- Do they have a proven track record of success?
- Does this partner provide other business/workforce solutions?
- Are they ranked as an industry leader?
- How much turnover is there on their team?
- What do their client reviews and testimonials say?
Taking the time to pick a partner that works with your company helps set the partnership up for success.
Take Your Company Farther With the Right Partner
Outsourcing is possible with many essential business functions and services. It helps save your organization time and money and creates more bandwidth for your in-house team.
Working with a trusted and experienced third-party specialist lets you focus on your top priorities, like business growth, international expansion, and global talent acquisition.
Ready to quickly grow your business beyond borders while maximizing your time and budget? Contact Velocity Global to learn how we simplify hiring, paying, and managing global talent.
