Outsourcing involves contracting a specific business process to some kind of outside resource provider, typically for such activities as payroll, customer support, social media marketing, or accounting. There are two main categories of outsourcing services available, those being front-office services and back-office services. Front-office services pertain to such things as tech support and marketing, whereas back-office services more often involve purchasing and billing activities. Here are some of the main features of business outsourcing.
Location of Outsourcing Companies
There are three primary locations where an outsourcing company might be operating from, and there is generally some strategic advantage to why they have chosen these locations. Offshore companies are located outside the boundaries of the company which is seeking their services. Nearshore companies are situated in countries that may be directly adjacent to the company seeking their services, for instance, Mexico or Canada in the case of US companies. Onshore companies are those which are located in the same geographic country as the company seeking their services.
Services Provided by Outsourcing Vendors
The services which are provided by outsourcing vendors can generally be categorized into the following groupings. Knowledge services include such processes as data analytics, Internet research, and data mining. Human resource services are those which cover healthcare administration, hiring and recruiting, payroll services, workforce training, retirement benefits, and insurance processing.
Finance and accounting services cover such activities as billing, Accounts Receivable, Accounts Payable, compliance issues, and general accounting. IT and software services include technical support and help desk operations. Back-office transactions are those such as credit and debit card processing receivables and collections, logistics and dispatch, and warehouse management. Customer interaction services are those which cover telemarketing, payment processing, customer support and feedback, and email services.
Thinking of Outsourcing Your Business Processes?
Starting up an outsourcing operation generally requires some significant funding. If you’re thinking of outsourcing, please contact us at GP Solutions, so we can discuss with you some funding options which may be available to you.