Why Do Companies Outsource BPO Processes ?

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Why Do Companies Outsource BPO Processes ?

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Companies choose to outsource for a number of reasons, but for most of those who go with a Business Process Outsourcing (BPO) provider, the journey to outsourcing starts with a need to cut costs, increase production or scale faster — sometimes all at the same time.

Outsourcing allows companies to focus on their current priorities and leave the back-office work to the professionals without wasting time on admin responsibilities (like accounts payable, accounts receivable and general accounting, etc.). But most of all, outsourcing paves the way to reaching goals, getting new clients and growing your business.

Because when you aren’t busy with an endless list of to-dos, you can finally get things done. Here are the top reasons companies turn to an outsourcing provider

Reason #1: Save Money on Back-Office Tasks

This one might seem obvious but saving money is one of the top reasons that outsourcing clients choose to go with a provider, especially one offshore in India or the Philippines. Lowering budgets has never been more relevant to today and right now, outsourcing is a way to save money without losing people or lowering production.

Also key in the cost-saving discussion is what BPO clients do with the savings. Many clients choose to reinvest that money back into their business. Whether it’s to build a new program, hire a key player or invest in new technology, outsourcing gives clients the opportunity to use the 50-70% savings into something that will actually grow the business, instead of putting it into non-growth areas like accounting, back-office or admin tasks.

But how do these cost savings you keep hearing about actually work? Let’s take for example Accounts Payable Outsourcing. In USA, UK Or Any Other European nation,  an Accounts Payable Specialist would cost you about $66,844 each year, when you take into account salary, estimated benefits cost and separated hire’s salary. When choosing an outsourcing provider that allows for a team of just one AP Specialists offshore (see how Zrima has revolutionized this approach here) you end up paying just $2,250/month or $27,000 per year. With a cost savings of nearly $40K (and a cost reduction of almost 60 percent), it is easy to see why companies choose to outsource something like accounts payable

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Reason #2: Gain Time to Focus on What Matters Most

With so many priorities, company leaders often feel pulled in a million different directions. This can lead to not only lost time but low efficiency and muddled focus as well. By choosing an outsourcing partner dedicated to non-core tasks, companies are able to spend time on strategy, execution and growth, rather than putting out fires. Nothing could be truer in the finance departments of mid-size organizations right now, where being in growth-mode means needing more hours in a day.

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Reason #3: Scale Quickly By Hiring Quality, Offshore Talent

For small- to mid-size companies, building your business and growing your client base are likely two of your top priorities. The thing about admin tasks is that they take a lot of time and money, but don’t directly contribute to these goals.  Fast growth is typically a driver and one of the “why’s” of outsourcing clients and also one of the main benefits to starting an outsourcing relationship. Many desire scale, but don’t want to wait and this is where outsourcing comes in.

No matter the reasons for outsourcing, whether to cut costs, grow the business, hire better talent or get your time back, the benefits of outsourcing are perfect for middle-market companies looking to expand.

Hiring a workforce from the United States may not be affordable for most of the companies. Whereas, it is much easier to hire offshore developers from India at affordable costs. Or you can say that outsourcing to India is affordable. It is because the workforce in India does not expect higher salaries or pays. Therefore, outsourcing to India is feasible and economical in comparison to the United States.


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