Outsourcing is not a new concept, but in the last few years, it has managed to gain some serious momentum – thanks mostly to the onset of the pandemic. COVID-19 changed the landscape for business worldwide, and it is said to have accelerated technology by a decade in just one year.
This dramatic change led to companies competing on a global scale, and the utilization of an outsourced service or product has helped bridge that gap. Right now, 68% of U.S. companies have outsourced at least one business process – with only 37% reporting to do so in 2019.
As companies continue to adapt to this “new normal,” they quickly realize that no business can operate in a silo. Outsourced providers are necessary for businesses to navigate these new challenges, as they have proven to be resilient even in the most uncertain times.
More specifically, as vital as finance and accounting roles are to business profitability, more organizations are recognizing that outsourcing these functions leads to greater business sustainability, growth, and development. Keep reading to find out why outsourcing is not just a fad of the times, but quickly moving to the industry standard.
According to a recent survey conducted by GSA UK, 35% of companies said they decided to outsource specifically for cost savings. Regardless of whether the small business is a startup or is established, cost savings are a priority. Small to medium-sized businesses were hit the hardest during the pandemic, and the quick shift to outsourcing was necessary due to its cost-effective nature alone. On a simple level, outsourcing lowers costs by reducing the overhead associated with bringing on new employees.
Specifically, working with white label accounting or bookkeeping firms rather than in-house CPAs or bookkeepers allows a business to get the same amount done or more for less. Because accounting is a core function, it can’t be cut. This realization has allowed firms to understand that outsourcing makes sense for improving their bottom lines not just during a pandemic, but rather for the foreseeable future.
Centralize Business Focus
While saving money is always in the win column, so is saving and creating time. Outsourcing has serious staying power because it gives companies the time and opportunity to focus on their core business. Even if the business is also an accounting firm, an outsourced partner—or even more specifically, a white label accounting solution—can take on the mundane accounting tasks, all while not having to waste time onboarding a new employee.
If employees are overworked or overwhelmed, more mistakes can happen, and the focus needed for the customer can get lost. Outsourced partners provide the organization the room to concentrate on their specific roles because those roles then become the responsibility of the outsourced team.
Minimize Operational Disruptions
Crisis can strike a business at any time, and it did almost overnight with both the financial crisis of 2008 and the COVID-19 pandemic. Businesses were forced to figure out how to pivot their operations on a dime in an effort just to keep business moving. This is another key indicator as to why outsourcing is here to stay.
Outsourcing can pick up where the business left off or where there is a hole in the process. Utilizing an outsourced partner allows for complete continuity, assuring that operations do not shutter. The pandemic taught many valuable business lessons, but many would agree the number one lesson learned is that this won’t be the last time they face a crisis. Outsourcing is a great avenue for providing seamless service for whatever may arise in the future.
Future Is Ripe for Outsourcing
Many will attest that the pandemic will go down in history as one of the business world’s most challenging times. Even though outsourcing was not a new concept, it became so for many organizations – but for the better.
Thanks to its cost savings, time-saving, and operational ease, business owners will continue to find new ways to utilize outsourcing and white label accounting solutions. As evidenced above, it has a strong case for improving bottom lines, upping employee morale, and continuing to increase customer satisfaction.