Outsourcing In Building Business, Its Advantages And Disadvantages

Outsourcing is the term used when a company provides a service or services for another company that could have been done in - house. Outsourcing jobs and roles within business's and companies has become a key part of building a global network in the twenty-first century. There are several benefits that can be derived from outsourcing certain aspects of your business to other individuals and companies, even if they're on the other side of the world. The world being more connected through business can be a positive step for strengthening relationships that go deeper than that of just business, by exchanging trade and labour between countries more easily they can cooperate in pursuit of shared goals.


Outsourcing off-shore can not only significantly help with building worldwide business relationships and networks, it can also improve efficiency. Efficiency is an essential part of any successful business and implementing ways in which quality and quantity can work in unison is one of the main benefits of outsourcing. Ensuring that a company is able to produce the most in the shortest amount of time whilst still maintaining the highest quality for customers. Outsourcing not only improves efficiency by allowing off -shore specialists to tackle tasks that could be time consuming in - house, but it is also cost effective. Many large companies turn to outsourcing to cut costs of labour and distribution expenses. Off-shore outsourcing is creating positions in less economically stable and developing countries such as India and China, this allows many companies to negotiate the rates in which they are prepared to pay for labour, ensuring that outsourcing has a positive effect on the revenue and net profit. Outsourcing has helped companies mitigate their risk as well as providing a regular income to those who may not have been given the opportunity to earn a wage had these working roles not been created.

Pros and Cons of Outsourcing

Outsourcing allows in - house work to be more focused and specialist, ensuring that time is spent building the core of the business and increasing profits. Whilst making sure that outsourcing is a positive and enriching business exchange for both parties, there are some downsides to the process.

Outsourcing creates jobs in developing countries however leaves thousands, if not millions of unemployed people in countries such as the U. K, America and Australia. With such a significant drop in employment due to outsourcing this could be deemed as counter productive for the benefits with outsourcing. There are also some issues when it comes to the quality of products that are produced, with such large scale factories working tirelessly to efficiently churn out as many products as possible in the quickest time possible. There have been many controversies over the years of gross negligence and unsafe working environments due to companies from the west not enforcing the same health and safety policies they are legally bound to execute in their countries in these factories that are in developing countries. With outsourcing being such a common business practice of today, some consumers are left feeling unsure of how ethically their products have been manufactured. Outsourcing doesn’t only relate to the manufacturing of goods but to specific tasks within the financial industry especially those that are time consuming.

15 April 2020
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