Outsourcing: 5 Things Every Entrepreneur Should Know

Written by Mac Cassity for Gaebler Ventures

Hiring individuals or teams to perform some of the tasks of your business is a great way to leverage your time and allow you to focus on pulling in new clients. Rather than hire on staff employees, many business owners are choosing to outsource work instead. This article will help you to understand some of the questions you need to get answered so your outsourcing experience will be a positive one for your business.

One of the most valuable lessons any business owner can learn is that they can't do everything themselves.

Running a business can be hard work and if you're trying to do everything from marketing, product delivery and sales, and customer service you'll find yourself quickly overwhelmed and not able to keep up with the demand of a thriving business. Therefore, looking to leverage your time is extremely important. One of the best ways to do this is through outsourcing.

Outsourcing is simply the practice of hiring other individuals or firms to handle parts of your business. This can be everything from selling your products, shipping them, and dealing directly with customers. While the practice of outsourcing can help you run extremely efficient and profitable business, there are some things that you should know first in order to avoid any pitfalls that could be costly or even disastrous to your business.

Below are five things about outsourcing that every entrepreneur should know:

1. Do they offer a service guarantee?

Make sure to find out if the people you choose to outsource to offer a service guarantee. This should be in the form of some type of simple contract in which the outsourcers agree to perform a certain service for a particular fee. It should also include what happens if they don't perform and provide terms for you to get your money back if they don't.

2. Do they provide references of past satisfied clients?

One of the best ways to determine whether or not an outsourced service will work for you is to speak with some of their past clients. These clients can give you some insight into any problems they had to deal with in their own experience. If the individual or firm you are speaking with refuses to provide any references, then stay away from them.

3. What kind of tax implications do you face when outsourcing?

Even though the people you outsource to may be in another country, there are certainly tax implications associated with your hiring others to do work. Make sure to divulge the arrangement with your accountant so they can guide you properly when it comes time to pay taxes for your business.

4. Do the workers you hired work on weekends?

It is important to know exactly at what times and what days the people you hire will be working. If a problem arises on a weekend, will the people you hired be able to attend to it or will you have to wait until Monday to communicate with them? Depending on the nature of the problem, this could be a costly issue for your business in the event a problem does occur.

5. Does your business insurance policy cover the work performed by outsourced services?

Even though you are hiring someone else to perform work, you and your business are liable to your client if something goes wrong. Make sure to discuss this arrangement with your insurance agent and that the policy you purchase provides coverage in the event of a problem arising from the people you chose to outsource your work to.

Taking the time to make sure to follow the advice above can help to limit any problems you might face when outsourcing and help to increase the chances of using outsourcing as a successful tool to run a profitable and efficient business.

Mac Cassity is an entrepreneur and business person. Mac began writing professionally when he was twelve years old for a comic book collecting publication. Today, he has experience in insurance agency management and runs his own freelance writing business, Mac the Knife Articles.

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