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California Business Journal
53-5 Common Outsourcing Mistakes to Avoid for Small Businesses

5 Common Outsourcing Mistakes to Avoid for Small Businesses

Part of making a business grow involves knowing when you'll need to outsource for projects. Here are common outsourcing mistakes you need to avoid.

by California Business Journal Editorial Staff
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Aside from liquid assets, time is probably the most precious commodity for a small business owner. About a third of small business owners clock in around 50 hours a week, and many put in more. Under those conditions, anything that promises a little bit of saved time looks like a godsend.

Enter outsourcing. One of the main benefits of outsourcing is that it reduces the time spent on non-critical processes. That promised benefit often leads a business owner into one of many outsourcing mistakes.

Before you leap into a contract, keep reading for five common mistakes that small businesses make with outsourcing.

1. Poorly Defined Goals

Whether you outsource a project or a business function, you need clearly defined goals from the get-go.

Let’s say that you outsource a custom-built website project to replace your WordPress site. You must provide a crystal clear picture of the look and functionality of the site you want. Otherwise, the developer will deliver a site that doesn’t meet your needs or expectations.

2. Outsourcing Customer-Facing Functions

Many big businesses can weather the backlash from things like bad customer service. That’s because they routinely offer a unique service that customers can’t easily replace. Small businesses rarely enjoy the same luxury.

Whenever you outsource a customer-facing function, you trust your customer goodwill to a third-party. No matter how well-intentioned that third-party, they’ll never replicate your level of commitment to happy customers.

3. Not Getting Professionals

Spotting an amateur proves easier with some outsourced services than others. A managed IT service provider with a bad web website? Probably an amateur outfit.

What if you run a small law firm and you’re working a big case? You need professional legal outsourcing for your legal firm or you might risk the case.

Always dig into the service to make sure they can deliver what they promise at a professional level

4. Not Enough Communication

You guide your in-house employees, right? Many small business owners don’t provide guidance for projects or tools for outsourced teams.

If the company you outsource to doesn’t know what’s working and what isn’t, they can’t fix problems. Only you can tell them what isn’t working.

5. No Exit Strategy

Outsourcing relationships can go sour the same way that any business relationship can go sour.

Too many small businesses use an outsourcing company with no clear path to leave that service. Make sure you get clear terms in the contract that define when and how you can sever that business agreement.

Dodging Outsourcing Mistakes

Dodging outsourcing mistakes depends on taking a reasoned approach to the process.

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You must research the companies and pick one with a solid reputation. Set clear goals for the outsourced project or service. Maintain communication, so the service provider knows what’s working.

It also means that you set up a way to exit the outsourcing arrangement in a practical way.

Are you interested in more business tips or news? Check out the rest of our site today for more like this.

Tags: 5 Common Outsourcing Mistakes to Avoid for Small BusinessesBusiness Tipscustomer servicedeveloperemployeeslawlaw firmleadsluxuryOutsourcingOutsourcing Mistakesrelationshipssmall businesssmall business ownerstrust
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California Business Journal Editorial Staff

California Business Journal Editorial Staff

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