Due to global issues such as the COVID-19 pandemic, economic power shifts, political instability, and climate age, the outsourcing market is evolving at a rapid pace.
Outsourcing is a staffing solution that has gained popularity. Remote work became popular due to the pandemic where people were forced to stay at home. Technology now can provide reliable connectivity which is why remote work was possible in the first place.
What is Outsourcing?
Before we discuss outsourcing trends and their benefits, it’s important to know what exactly is outsourcing.
Outsourcing is a process where a company passes over tasks either inside the company, another company or to third parties. Many companies practice outsourcing to get access to quality talent without getting involved in selection and sourcing.
Does Your Company Need Outsourcing?
Outsourcing can have many benefits for your company. That being said, it is important to make sure your company is reaping the maximum benefits of the method and is well suited for it.
The principle behind outsourcing is that a third party will do the job better, faster, and more efficiently than the hiring company.
Alongside that companies may choose to outsource if they have short projects that suit a temporary team. Outsourcing these projects would be better for the company compared to hiring a permanent team that will have extra duties. Outsourcing can help businesses take fewer risks.
Additionally, outsourcing is a solution for companies with high growth rates. The company may not be able to support its internal staff which is why hiring a pre-trained team from an outsourcing firm would help maintain business flow.
Pros and Cons of Outsourcing:
We have established that a lot of companies are making use of outsourcing.
To help you get a better understanding of whether or not you should go for outsourcing, here is a list of pros and cons
- Enhancing specific department performance by hiring experts
- Allows you to focus on your business better by developing effective and targeted strategies
- By involving a third party, you save time and resources
- Saving human resources as well as time
- Helps increase profit due to lower overheads with cut back on recruitment costs
- Simplifies project management and helps reach high-quality deliverables faster
- Miscommunication can occur due to working with one or many teams
- Outsourcing means sharing confidential data which could be a vulnerability
- Hidden costs can be raised due to different freelancer rates internationally
- When giving project duties to an outsourcing firm or freelancers, you lose managerial authority
Types of Outsourcing:
We have established a basic understanding of outsourcing which is making use of a third party for company projects. Outsourcing is not limited to just one type. You can also outsource services such as digital marketing or IT support.
Although there are no definite types of outsourcing, these are some of the most frequent ones.
- Project Outsourcing
- Business Process Outsourcing
- IT Outsourcing
- People Outsourcing
- Sales Outsourcing
Sales outsourcing is the main focus of this article, and we will soon discuss why businesses spent a whopping $700 billion on outsourcing in 2022 – that’s a 19% increase since 2019! Let’s understand what does it mean to outsource sales unit of your business.
What is Sales Outsourcing?
Sales outsourcing is a business practice. It entails hiring a third-party company or freelancers (salespeople) to help manage or take over your company’s sales process.
Sales outsourcing also means dividing different sales processes amongst teams such as cold calling, lead generation, conducting market research e.t.c
The key behind sales outsourcing is the proper delegation of tasks. Since your company will be hiring an external workforce it is crucial to divide the tasks properly. Outsourcing sales helps your business to focus on its key goals. By hiring a third-party your company can concentrate on internal workings and leave the business processes to the experts.
Who Needs Sales Outsourcing?
Just like outsourcing, it is important to discover whether or not your company requires you to outsource its sales department.
Businesses that lack resources, manpower, or proper tools to train their sales department usually turn to sales outsourcing. Sales outsourcing also helps the company by executing higher-level sales strategies.
It makes it so that the salespeople focus on the sales.
Your company would do good by outsourcing sales if:
- You are trying to sell in a new market
- Your team is busy with administrative tasks and can’t devote time to sales
- Your team is small in number
- Your team is not well-versed in sales
- You don’t have the budget to train your sales team
- Your company lacks the resources to conduct sales
How Does Outsourcing Sales Help Businesses?
Outsourcing sales helps businesses to be more competitive. By hiring a skilled sales team you can boost your competitive advantage in the market.
Outsourced sales companies have tools, technologies, and the proper expertise to help your company close sales and make a profit. These companies can also take over tedious sales processes such as emailing, cold calling, content marketing, and lead generation. These processes are time-consuming and require skilled labor, which is easily addressed by outsourcing sales.
Additionally, outsourced companies don’t have set working hours and can be based anywhere internationally due to remote work. This means an outsourced company can provide you with assistance outside your regular working hours. Your team is also not limited by location and therefore can work on vacation days as well.
Advantages of Outsourcing Sales:
Here are some of the reasons why outsourcing sales are trending nowadays:
1. Cost Efficiency:
We’ve discussed that outsourcing means reducing costs, so let’s highlight how those costs are reduced.
Having a permanent on-site team means paying monthly salaries, training, long ramp-up time, equipment, office expenses e.t.c.
Similarly, hiring freelancers takes fees hourly or per project, difficult to find good resources, manage, pay, and keep them is a lot of work.
Outsourcing sales to another company removes the need for all operational and enablement expenses in a simple way.
Most outsourcing companies ask to be paid based on a service or solution which is upfront. You’re paying only for the service and the responsibility to pay employees falls on the outsourced company. This can be more cost-effective in the long run.
2. Minimizing Management:
When working within a company, you are working with the employees and team around you. There is a need to see what your team is doing as that is what you’re paying them for.
When you outsource sales, you now have access to people who have done the same task many times.
These salespeople are experts in their trade and based on their experience can be left to their own devices. An outsourced team wouldn’t require a project manager or someone to train them as they already know how to provide you with results.
However, this technique could have drawbacks as it requires trust and transparency.
Outsourcing sales help you access new markets as well as help you access global talent. This allows you to hire a diverse group of people with a greater understanding of sales.
Additionally, when opening up to a new market hiring a local outsourcing sales company would help you localize your business approach. Since your salespeople are locals, they understand the market better than you would and can help maximize your sales.
Undoubtedly, one of the biggest advantages of outsourcing is the flexibility it provides.
By handing off your sales duties to an outsourced company, you can now focus on the administrative tasks of your company. This will help you save time and resources.
Nowadays, businesses are competitive. Every business, either a small or a big corporation is working towards maximizing its values, identity, and profits. There are two ways a business can maximize its revenue, reduce its overall costs and create ample profit.
Depending on your business goals, outsourcing sales can still help you save time and resources by handing off the business duties to a team that is skilled and ready to work.
This is why outsourcing sales has emerged as one of the top trends for businesses. It can help you scale your business and test new products and strategies with little risk.
Contact our team if you need help augmenting your revenue cycle with a sales team.
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