Outsourcing and small businesses
22.05.12
Outsourcing – a business strategy that moves some of an organisation’s functions, processes, activities and decision responsibility from within an organisation to outside providers - is a familiar concept to many entrepreneurs.
While large companies turn to it to cut costs, small businesses routinely outsource often because they have no other choice. This is done through negotiating contract agreements with a vendor who takes on the responsibility for the production process, people management, quality, customer service and key asset management of the function.
“With the current wave of job cuts going on around the world in some of the world’s largest companies, outsourcing is fast becoming the next option of business modelling for many firms,” Victor Ekpu, CEO, Mindset Resource Consulting, a research firm based in Nigeria and in the UK, states in an email. Many firms are cutting down on operating costs, especially salaries and employee benefits as well as avoiding all legal obligations required in maintaining employees.
Source: BusinessDay