In the previous post, we spoke about several harmful business practices that outsourcing can help remedy. But no matter how much you avoid these practices, your business will have to deal with curveballs. The recent (and ongoing) global health crisis is one, but so many others came before that. And so many others will come too. In such cases, outsourcing to cut losses may be a solution.
Averting a Crash
The aviation industry was one of the most heavily affected in the thick of border restrictions to contain the COVID-19 virus. Qantas, one of Australia’s biggest airlines, resorted to outsourcing to cut losses by tapping a third-party agency for its ground services to save $74m annually. It also minimized its spending on ground equipment to save an additional $59m yearly.
Cost-cutting through outsourcing isn’t the be-all and end-all solution to an unprecedented crisis, but it has been employed by large companies to minimize the leaks in a sinking ship. Or in this case, a crashing airline.
What can you save on when you outsource?
Employee Salaries. Outsourcing certain functions lighten the burden on your payroll. When you outsource functions, your fees will mostly go to the services that you contract because the outsourcing company will take care of the staff remuneration, mandatory deductions, and benefits.
Time. Maintaining your own set of employees means being responsible for their skills development. Just like the salaries, the third-party provider will screen the staff assigned to you based on your needs. Also, you can adjust the duration of your contract according to demand. Therefore, you can reduce the frequency and scope of work during the lean season.
Overhead Costs. When you outsource, you can do away with additional office space, supplies, and equipment. You can tap great talent without the huge operational cost when you outsource some functions.
What you can gain when you outsource to cut losses?
Aside from peace of mind because of reduced risk, you can channel the savings to pump up investment in your core functions and boost innovations in this area to seize opportunities. Over time, investments in this area will improve the outcome of the long-term game plan.
Where should you start?
MCVO offers a suite of services – from virtual assistance to accounting and bookkeeping. As a seasoned company that caters to clients from the US, UK, Canada, and Australia, we keep ourselves abreast of the global, regional, and national trends that drive growth for these markets. Send us a message so we can discuss how outsourcing to cut losses through our services can help you get back on your feet.