Why Small Business Owners Outsource

why small business owners outsource | Sales Xceleration

There can be many BIG reasons small business owners outsource when they need the power of professional resources, but don’t want the burden of adding to full-time staff. Some of the reasons may be obvious, but certain others might not be what you expect. Let’s explore some of the reasons small business owners outsource to help their businesses grow and succeed:

Small Business Owners Outsource When…

…They Recognize a Problem

Depending on the size of the business and their level of immersion into day-to-day operations, it’s not uncommon for small business owners to be caught by surprise that a problem exists and threatens the very survival of their business. A critical problem can come up suddenly, like the unexpected loss of key personnel, or it could have been anticipated sooner with the right focus on leading indicators (such as the health of a sales pipeline).

Sometimes, it is too late for the business owner to react and right the ship. But regardless of when a problem is recognized, this awareness is always the first step toward a solution – a solution that might just include outsourcing to a needed expert resource.

…They Know the Problem Must Be Fixed NOW

Once a problem is recognized, its relative severity can be assessed. When taking a deeper look, it’s possible the small business owner will decide that smaller-scale corrections can put the business back on course. But when it becomes clear that the problem a) has dire consequences for the future of the business, and b) will not go away without immediate intervention, the prudent business owner takes action.

…They Realize They Can’t Fix the Problem Themselves

Often the first (perhaps a knee-jerk) reaction for the small business owner is to try to personally fix the problem. When the business was young and the owner wore almost all the hats of responsibility, that might have worked. But as a business grows and expands in its reach, revenues and responsibilities to a growing staff, the owner is probably not the best problem solver. After all, the owner had a skill set to get the business off the ground and growing, but this skill set might not be what it takes to engage corrective action on a larger scale.

So typical business owners consider outsourcing once these three factors are in sync: the problem is recognized, it is deemed severe, and the small business owner recognizes that he or she is not the right problem solver.

The Benefits of Outsourcing

When outsourcing is being considered (perhaps among other human capital solutions), it is logical for the small business owner to look for its advantages and benefits. Here are just a few:

Cost Savings

The bottom line is often the first and most critical factor when considering and comparing solutions. If outsourcing doesn’t make financial sense, it will be kicked to the curb as an option right away – even though the cost of no action is often greater than the outsourcing option. But in many cases, outsourcing is a tremendous option in terms of return on investment for these reasons:

  • You can bring in new and necessary part-time expertise at a fraction of the cost of adding to the staff with a full-time employee
  • You won’t have to provide insurance coverage or other benefits to an outsourced consultant
  • In many cases, you won’t have to provide an office or other physical resources to a part-time outsourced professional
  • The solution provider is probably an industry or professional area expert and the time to production is reduced with a more experienced resource

Focus

Choosing to work with an outsourced professional will keep the business owner free to focus on the strategic big-picture management of the company while empowering the consultant to address the problem(s) at hand. The business owner can also maintain or increase focus on what he or she is good at and enjoys doing – with likely better results for the company.

Efficiency

Using an outsourced expert enables the business owner to keep core team members engaged in, and focused on, their day-to-day responsibilities. In other words, normal business operations can be maintained while extraordinary problems can be handled by someone who has the necessary distance and perspective to make the right calls.

Expertise

As noted under “Cost Savings” above, a business owner can probably gain exceptional expertise at a fraction of the cost of hiring a full-time employee. A business owner is typically better off engaging a “fraction” of a highly-qualified resource, rather than 100% of a lesser qualified resource.

Indeed, an outsourced consultant can bring valuable areas of expertise not related to your core competencies. For example, this could entail providing ongoing (but not full-time) sales team oversight, management and mentoring.

Competitive Advantage

An outsourced part-time professional can help companies compete with bigger industry players by bringing full-scale abilities and expertise via a fractional time commitment. This can help level the playing field by enabling the company to maintain industry-based objectivity, avoid problems, and seize opportunities. This consultant can also help maintain professional “distance” and objectivity to help senior leadership make difficult but often necessary personnel and operational decisions related to budget cutting or even downsizing.

Bottom Line:

Small business owners outsource to professional part-time consultants when they recognize a problem, and see it as severe and unsolvable with internal resources. Once the decision is made to outsource, small businesses realize many benefits, from cost savings (for a worthwhile return on investment) to maintaining focus on the core business to added expertise for new competitive advantages. At Sales Xceleration, we understand these benefits better than most. Our licensed Advisors serve as Outsourced VPs of Sales to help small- to medium-sized businesses solve sales problems and grow revenue. To learn more, contact an Advisor today, or give us a call at 844.874.7253.

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