Business Plan

Why Outsourcing Is A Good Idea

Outsourcing, the concept of hiring 3rd party service providers to render services or make products or both. Outsourcing is already a pretty common concept today, in fact its the new norm particularly offshore outsourcing. From shoe companies, telcos, banking, logistics, customer service, teaching, casino, product development, anything that can be outsourced, you can expect that companies are outsourcing them already.

The main reason has always been cost, cost for man power, cost for materials, the cost for the space, the cost for the development, cost for the labor and many many more. But it all revolves around costs. With so many benefits that you can get from outsourcing, it just makes more sense to get one. But if you’re still not convinced, below you can find the justification that will get you sold.

Cost for man power: If you’re getting more clients, and scaling is still a very far dream from being possible and you need the additional manpower, why not just outsource it instead? You don’t need to hire more people for your production, the outsource company will do that for you.

Cost for materials: Materials have always been things that companies go for if they plan to start cutting costs. This is because making materials are costly, you have to build a site, source the raw materials, the tools and the people. How about you just save yourself from all that and just get an outsource that can provide all of that for you.

Cost for space: Say you’re in Hong Kong or in New York, in a place where space is always hard scaling for production or growth to meet with demands. If that has been your perpetual problem, why not just save yourself the hassle, the nightmares and just outsource it. Do that and your problems will be over and the best part is that its less risky and less hassle.

Cost for development: Product development is a different department that makes, tests, makes and tests again various materials and design again hoping that it will be approved for production. While there are companies that does this, there are some companies that outsource this service, familiar with brand called Adidas and their boost cushion?

Cost for labor: The cost of labor has been one of the driving force for some companies to outsource their production like Apple, Samsung, Nike, Adidas and many many more. These companies outsource their labor offshore in places where labor is cheap. Why they do that? Its because companies can still be competitive in terms of delivery, service and price while spending less on almost everything especially on labor.

Outsourcing has become the new norm today for the reason that it provides an ultimate cost savings alternative in terms of manpower, materials, space, development and labor. In every industry you can expect that there will be a place for outsourcing. Especially in the electronic company. If you have a company that is in dire need of a new technology to show to the world, there is an electronic engineering company that has been doing it for years.

Show More

Related Articles