Outsourcing does not necessarily take away from your market share. In today’s business world, a key factor in maintaining customers and acquiring new business is to provide a quality product or service. Now, that said, many competitors may also be able to provide high standards of quality in their products and services. It has become essential that businesses go above and beyond the limitations of the historical methods of production or manufacturing. This is evidently difficult while companies try and keep inventories low, overhead costs to a minimum, and capital expenditure as a luxury. Most companies simply cannot afford to keep up with the influx of technological advances in machinery, nor the expense of keeping employees up to par with major change. With this in mind, and of course your accountant or controller crunching the numbers, outsourcing has become essential in the role of continuous improvement of any product or service one has to offer. Outsourcing will allow you to benefit from the expertise of another company, without accumulating the expenses of new equipment, training, and the crazy world of non-conformances.
One might ask, why not use it all the time? Well, there is still a lot of skepticism around outsourcing in that companies have taken a tight strangle hold on the market share that they currently hold. Realistically, this is the only thing that keeps them going. If outsourced services are being provided with great efficiency, at feasible costs, who is to say you are not supporting a potential competitor? This is only controllable by YOU! Take the time and effort to build your relationships in the industry. The ability to outsource may be the deciding factor in whether or not your ship stays above water. Do not be intimidated by another’s abilities to perform a function to a higher degree than you can. Accept this as a benefit to you and your customer. Outsourcing your goods or services to a third party may improve your product or service, render more efficient turnaround times, and ideally, increase customer satisfaction. Test out the potential supplier’s credentials. Send out a “make-work” project for them to complete. The costs associated with this may well outweigh the costs of having poor quality delivered to your customer.
We are definitely in a time where lean manufacturing is crucial in turning profits. Using an outsourced vendor can aid in your facility running as lean as possible. Today’s business practices do not allow for repetitive workloads, the costs involved are simply too high. Having your outsourced supplier take a load off of your operation can create more time for important processes, which are many times overlooked. Innovation and improvements are put on the back-burner when operations are overwhelmed with servicing their customer. Relieving some of your time constraints can allow you to spend more of your expertise on improving what you have to offer.
The retaining of business from the customer’s perspective can be summarized in a few quick notes:
1. Provide the customer with what they need
2. Ensure the product or service is of high quality
3. Meet the expectations set forth by the customer, i. e. Delivery Dates
4. Focused and well informed customer service and correspondence
5. Aid in improving the customer’s ability to be profitable, i. e. provide technical support, product innovation, quality improvement recommendations.
6. Keep the customer informed of what you are doing. If you implement a third party in your process matrix, keep the customer notified. Make them well aware of who you are using, what tasks and or functions are being outsourced and why! The last thing your customer wants to hear from the grapevine is that you are not providing what they are paying for.
This being said, I feel as though outsourcing of services to qualified vendors can aid in providing a greater sense of customer satisfaction and a higher standard of quality products and services. The costs of doing such business will be justified, considering no long term capital expenditures will be incurred. Take the time to shop for the vendor best suited to your needs. Consider the distance factor – relative to your location and your customers. Included in your decision making process should be the potential to gain new customers with your newly acquired expertise.
Adrian Grbic is a sales representative and co-founder of an internet based B2B Networking site to help professionals, salespeople, entrepreneurs, trade people, and freelancers.