Outsourcing 101 Course Podcast

Top 5 reasons outsourcing is exploding

Episode 3 of The Outsourcing 101 Course Podcast


In this episode James Mackay shares the top 5 reasons outsourcing is exploding and why you need to jump on and join the revolution. 

  • Cost saving
  • Convenience of getting jobs done
  • Access to skills not otherwise obtainable
  • Opening up new opportunities
  • Low paperwork

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Everyone has their own reasons for wanting to get into outsourcing. The majority of people I speak to say they want to outsource to save money. And that’s absolutely fine. Outsourcing can be a great way for a business to save money or for an individual to make a dollar go further on a project.

Today I’m going to share the top 5 reasons people tell me they outsource either all or some aspects of their work.

Number 1, as I just mentioned, is to save money.

Here’s something to note upfront: pretty much all outsourcing is calculated and charged in US dollars. In that respect it does make it each to keep a track of.

Depending where you are in the world, the value of one US dollar is very different. Just have a look at the Big Mac index to check it out. Countries are ranked on how expensive burgers are and right at the top you’ll see places like Switzerland where the cost of living is quite high.

On the other end of the scale are countries like the Philippines. I bought a multi-course dinner for 8 people in a very nice restaurant in the Philippines and it cost me $70. The point is, the dollar stretches a lot further in some places than it does in others. And that’s the super basic way of explaining why labour in some countries is cheaper than in others.

You could employ a full time, university qualified assistant in the Philippines for about $7 an hour. Now, while that might sound like very little money, it’s actually more than that person would earn as a nurse or even an engineer in the Philippines.

You can see how far a dollar stretches when you compare that kind of activity. Australians, for instance, could get 3 or 4 times as much work completed for the same amount of money.

The second reason people outsource work is to access skills not otherwise obtainable.

You might not have an iPhone app developer in your circle of friends, or even know how to go about getting one. But outsourcing makes it easy; you simply need to post the job, go through the steps and you’re on your way to getting your project completed. I know I’m simplifying it here, so we’ll go into the process of hiring in another podcast.

The third reason people love to outsource is simply the convenience of getting stuff done. You don’t have to faff around and jump through hoops. Once you’ve got a system in place with your plan and objectives sorted out, outsourcing really is convenient. You can be anywhere in the world and hire a freelancer somewhere else in the world, and stuff just gets done. It’s efficient and effective.

Number 4: Opening up new opportunities.

I have lost count of the number of times people have told me their stories about how their project was supposed to start small but went so well that they expanded and grew quickly. Sure, you have to be careful not to fall into the trap of project bloat, but if you manage everything carefully, then growth can be your friend. New opportunities might include selling digital products to new and previously unconsidered markets or it might mean making your services available to more customers.

Finally, the 5th most popular reason that people tell me they outsource is because of the reduction in red tape. If you’re a solo-preneur, a micro business or a department, things are more efficient when you can focus on being productive rather than worrying about the paperwork and bureaucracy. I’m not saying you don’t need to do ANY paperwork but I like how the outsourcing platforms – Upwork particularly – handles all the compliance and contracts and so on. When it’s all done for you, life is easier and time is used more efficiently.

So there you have it. The top 5 reasons people outsource work. Maybe your reason is something else entirely. I’m not saying this list is definitive but it might give you something to think about. How can you use outsourcing to improve your business or get your project or tasks completed quickly and efficiently?