Why You Must Outsource Non-Core Business Activities
Outsourcing non-core business activities is not just an option for business-owners anymore. It’s an absolute must.
When running a business, it becomes so easy to get caught up in your day-to-day activities that you become distracted from actually growing your business.
As any entrepreneur will know, running a business comes with a great deal of mundane tasks that takes precious time away from core competencies.
But these tasks prevent you from scaling your business to its full potential. They slow you down from reaching the vision you set out to accomplish when you started your company in your first place.
As a business owner, you wear many hats. But you cannot do everything forever.
Below, we’ll outline why you must outsource non-core functions so you can focus on your core work and doing what you love.
What are non-core business activities?
Non-core business functions are those activities that keep your business ‘running’, but not necessarily keep your business ‘growing’.
These activities include things such as:
• Processing data
• Logistics and warehousing
• Human resources
• Legal work
• Administrative duties
• Customer support
• Searching for distributors and suppliers
• Invoicing (and chasing unpaid invoices)
• Market research
These activities can consume so much of your time, that you may be left with only half the day to focus on your “core” business. Outsourcing non-core activities like these must therefore be a key strategy your business should execute next.
Your “core” business is your niche area – what you are actually doing to deliver concrete results for your clients and/or customers.
If you’re a business consultant, your “core” business is helping clients grow their business. If you’re a mortgage broker, your “core” business is helping people get the best deal on their mortgages when purchasing property. If you’re a restaurant owner, your “core” business in making amazing food and delivering an unrivalled customer experience.
No matter your niche, outsourcing will always have a role to play.
Benefits of Outsourcing Non-Core Functions
If you find yourself constantly burdened with the non-core tasks we’ve bullet pointed above, keep reading.
We’ll outline the advantages of handing over these problems to somebody else.
1. More time to focus on core business (doing what you love)
The most valuable resource an entrepreneur has is their time. Don’t let it be eaten away with non-core tasks.
If you begin to outsource the non-core items we’ve mentioned, you’ll reap an enormous amount of time and opportunity to focus on growing what you’ve already built.
And that means focusing on your core business – the niche you’ve specialised in. The area where you can deliver the most value to your community. The field you love and that you’ve chosen to dedicate your business.
One hour of managing your accounts can turn into an hour of negotiation and closing a deal on a million-dollar project.
Thirty minutes of bookkeeping can transform into thirty minutes of helping your client navigate a tricky issue that only you know how to solve.
This helps you deliver more value to your market, which in turn places your business on the track to growth.
Nothing beats that.
2. Access experts on demand
It’s harder than it sounds, but don’t try and become an expert on everything yourself.
There are extremely talented, dedicated (and affordable) professionals out there who have committed their lives and careers to tackling the business problem you need solved. They’re often available to you at a fraction of what full-time staff cost.
Whether it be drafting an employment contract, running software, handling payroll, data entry, researching your market or looking for suppliers – there’s an expert on everything.
If you’ve read Robert Kiyosaki’s More Important than Money, you’ll know he’s got a team of “Rich Dad Advisors”. Some of his A-Team includes a real estate advisor, legal adviser, tax and wealth expert, sales expert and social entrepreneur experts.
If you outsource your non-cores to a specialised team, you’ll have the best people to rely on right at your fingertips.
3. Don’t hire any more employees
By outsourcing, you won’t have a need to hire any more employees.
By handing over your problems to outsourced contractors, you won’t have to go through a time-consuming and costly hiring process that might result in disappointment.
Employees, in any case, are very expensive in Australia.
Just think about the costs for a minute.
Superannuation, annual leave, overtime, penalty rates, public holiday rates, sick leave, workers compensation insurance and more.
These costs are reduced (if not, completely eliminated) when outsourcing to highly skilled independent experts.
4. Cut down the HR work
One of the primary tasks of a business is human resources: managing the wellbeing of your staff. This is an incredibly important job – but exceptionally time-consuming.
The job involves drafting workplace policies, handling staff complaints (including bullying and discrimination), monitoring staff attendance, approving leave requests, managing employee files, dealing with employment disputes, understanding the modern awards that apply to your business, negotiating employment contracts or enterprise agreements and more.
By outsourcing your non-cores to expert third-party specialists, you’ll minimise your internal staff and massively cut down your HR work.
5. Access to more skills
By outsourcing your non-core business, you’ll gain access to a huge number of other specialists you probably didn’t know existed. And some of them may even be able to help you take ore non-core business away from you.
For example, you may be so tired of managing your website that you hand it over to a website developer.
Little by little, you’ll discover the wide world of graphic designers, copywriters, internet marketers, Facebook Ad specialists, content writers and more.
All these individuals are the best at what they do – and can help you reduce the time you spend on non-core activities.
6. Don’t stress about infrastructure
The beauty of outsourcing means you won’t have to worry about expanding your office space to house all your staff.
Outsourcing non-cores doesn’t just mean outsourcing people.
You’ll be outsourcing the office space, the industrial space, the tools, the equipment, the hardware, the software and all the other resources that are required to complete these tasks.
7. Pay as you need
If you hire a full-time staff member, those costs are fixed. Whether there’s a job or not, you still have to pay them for showing up to work.
If you suddenly find yourself a week with no non-core functions, you’ve spent one week’s worth of salary on an employee who hasn’t contributed any value to your company.
You don’t have that problem with outsourcing – where you only have to pay for a specific service when the need arises.
Doing this maximises resource efficiency and ultimately allows you to completely focus on core activities rather than giving an employee ‘something to do’.
8. Boost your competitiveness
The bottom line of any business is staying alive (and thriving) in a highly competitive marketplace.
If you strategically outsource your non-vitals, using external experts when necessary, you’ll get on track to dominate your competition and scale your business in a way you never thought you could.
The story of Alibaba demonstrates this perfectly.
Case study: Alibaba’s outsourcing success
Outsourcing was one the most important factors behind the success of Alibaba, now one of world’s largest e-commerce companies.
Chinese-based Alibaba was started by Jack Ma in Shanghai, China in the late 1990s. Ma had virtually no experience in business or in computers – and their primary competitors were already flourishing in Silicon Valley, California.
Alibaba began their days outsourcing web development to a U.S. company, which gave Alibaba the leverage they needed to ultimately compete against eBay. The vision was to create a bilingual platform that Chinese and English-speaking markets could both use.
China was severely lacking in web development talent at the time and needed third-party experts to build an internet infrastructure that could get around Chinese government web restrictions.
Ma used these outsourced experts to his ultimate advantage, allowing Alibaba to save a massive amount of time and resources. It also gave Ma an easy gateway into understanding the English-speaking market and led his company to become one of the world’s most profitable e-commerce marketplaces – boasting a $25 billion IPO in 2014.
The easiest place to outsource non-core functions – today
“If you deprive yourself of outsourcing and your competitors do not, you’re putting yourself out of business” – Lee Kuan Yew, former Prime Minister of Singapore.
The time to start outsourcing your non-core business functions is right now.
And the easiest place to start doing this is in one of the most important, yet ultimately mundane, parts of your company.
Invoicing, calculating taxes, monitoring expenses, company structures, and more.
Your business cannot survive without it. But at the same time your business can’t grow if you’re doing all of it.
Here at 2account, our expert accounting specialists are completely dedicated to lifting the bookkeeping burden off your shoulders and letting you focus on what makes your business great.
Our company is built on a passion for business and achieving outstanding results for commercial clients – no matter if you’re a sole trader, an SME or an ASX-listed corporation.
We’ll be your go-to outsourced accountants – helping your business focus on doing what it does best.
Book a free discovery call with us today and we’ll discuss how 2account can tailor its expertise to your business’ vision.
Email us at email@example.com
Call Renee directly on 0417 113 827