Wednesday, June 1, 2011

Looking To Cut Operating Costs?

Looking to cut operating costs?   Monthly Real estate bills taking a bite out of your receivables?  Insurance premiums on the rise?  Payroll costs soaring?

These are all major concerns for today’s small and mid-sized businesses.  These day to day incidentals are necessary evils to stay in business and keep your company operating.  Or are they?
These escalating expenses are perhaps the largest concern of business owners and operators today.  Many product lines require a certain number of staff and inventory in order to keep the operation running effectively.  Over the last 5 years, a new class of businesses has been developed to address just this area of concern.
Business Process Outsourcing” or “BPO” companies have sprouted across the country.  These BPO companies have made it their business to offer the back office services that many of today’s smaller businesses require to operate.  BPO companies can provide the staffing necessary to service, maintain, connect, deliver, invoice, and collect for the services your company may offer today.  All of these services are available without the overhead of real estate costs for the call center or warehouse facility.  No insurance premiums to cover health, dental, or life insurance for the employees.   No lost or down time because of short staff during the summer months when vacation time is at a premium.
Outsourcing has been around for many years.  I’m sure all of us have heard the commercials featuring

Bob, from Account Temps”

where an employee is attempting to disguise his voice, calling in sick to his manager, only to be told

“Not to worry, Bob’s here.  Bob from Account Temps.  Bob has finished the reports you’ve had on your desk and reorganized the President’s files.   Why don’t you take the rest of the week off?  We’ll be fine.  Bob’s here!”. 

Well, you know the rest of the storyline but you understand where I’m heading.

Outsourcing for back office business needs has become a big business in and of itself.  The BPO companies are able to take advantage of the “demand” for staffing and services by providing the “supply” of labor and IT products to fulfill the needs of their customers, the small and mid-sized business owner.   Need a new phone switch for your call center?  Don’t spend $300k to $600k on new switch and phones.  Consider “Outsourcing” it to a BPO company and let them do the work for you.  Maybe outsource the call center function as well?  (and don’t be concerned about shipping jobs “overseas”….. There are plenty of BPO companies operating 100% within the United States).  
We all know the best way to grow any business is to add new  revenue producing customers.  Improving back office equipment is great when times are good but in today's tight economic situation why not consider an alternative?  In exchange for reasonable pay as you go fees, you can take the capital saved on the asset purchase and put it towards marketing and sales, which will help grow your business, not simply keep it operating in place.
In earlier years, outsourcing was limited to on site replacement labor of temporary workers.  Today’s BPO companies have taken it a step further and moved to providing off-site labor and IT services, covering a wide variety of on-demand business services as needed.  All benefits and salaries, real estate fees, insurance premiums, and operating licenses are the responsibility of the BPO companies.

If you are interested in outsourcing some or all of your business needs, or have any questions or comments,  please leave a comment here on the blog or you can reach out to me directly at @DaveHanron on Twitter or you can email me at
If I don’t have a product to meet your needs, I have lots of business contacts I can get you in touch with to help……


  1. the business that is established in t6he real means and with the full effort can never be defeated cause of its strong basis!
    small business it service

  2. Marry,

    Thanks for the comments. Outsourcing has become the "norm" these days rather than the exception. The need is not industry specific either. It touches all industries.

    Look at this year's political races. Many of the candidates are utilizing those annoying auto calls delivering their message to potential voters. Do you think they possess the technology to complete this task? Guess Again! They outsource it to a telecom company. All they have to do is provide the phone list and the desired intervals and they are done.
    Pretty much any business function you can think of can be outsourced, and many major and small businesses alike are heading that way

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