Downsize your Workforce – Turn to Outsourcing for Higher Profits

Downsize your Workforce; Turn to Outsourcing for Higher Profits

What percentage of your expenditure goes to paying employees? Ideally, it should be 30-40% of gross sales. If you’re running a small business, you may find yourself above this margin especially if you’re keen on hiring highly skilled workforce.

One of the ways of mitigating this tricky balance is turning to outsourcing. Outsourcing gives you access to the skills that you need without adding the burden of your payroll. The process needs to be done right; otherwise, you’ll have no value to show for the money spent. Here are some pointers:

1.Explain precisely what you need

Do not assume that the service providers know what to do simply because they have handled similar projects before. Your project is unique. Discuss in length what and how you want it done. Even if you’re not well versed with technical terms, explain what you’re seeking to achieve.

For instance, if you’re outsourcing the design of your company website, what do you want to achieve? Let’s say an interactive website, search engine optimized and easy to navigate. That gives the designer specific goals to meet. Of course, there is always room for the expert to add a creative touch.

2. Vet before Hiring workforce

You should be keen when outsourcing workforce. Send out a formal invite and let the service providers apply for the job. Check out their experience, portfolios, recommendations and prices.

Hold an interview where you have a conversation with the applicants. Don’t rush to pick those with the lowest charges. They’re often starters desperate to clinch the deal, without any much experience with the job at hand. Cheap often turns out to be expensive. Similarly, there is no guarantee that those with high charges will deliver a superb job. Experience should largely be your determining factor.

Begin with a Minor Project

Do not entrust a major project to outsiders from the onset. Let your working relationship develop gradually. Start with a small project and see how that goes. Should you be satisfied with the results, you can now delegate more. If not, you should demand that the service provider makes the necessary amends. If you’re still not impressed, you’re free to go for a different service provider.

4. Pay in Bits

These installments should be tied to various goals. Make it clear that payment will only be made after the work has reached a certain level. This way you avoid the cat and mouse games of missed deadlines. This also allows you to terminate the project in case of obvious flaws without incurring a significant loss.

5.Deliberate on Support

Will your working relationship come to an end once the project is over? Suppose you outsource some metal structures from firms such as Fidelity Steel; will you be in a position to maintain them or will you require support from the company even after the construction is complete? It is unlikely that you’ll maintain the buildings all by yourself. Let the experts do the job. Strike a deal so that they can be there when you need them. If you don’t want the burden of an additional monthly fee, you can consider paying per task.


Do you wish to have the sole custody of the finished work? For instance, if you hire a programmer to develop procurement software; can this software be modified and sold to other companies? Make sure that you’re clear on that.

Remember to write down every detail and sign where necessary. Gentleman’s agreements are no good in business. That formal agreement comes in handy in case of any disputes.