Outsourcing: Encouraging business growth

Here, Alec Laurie speaks to three companies about their experiences of outsourcing.

The UK has seen a stark rise in the number of businesses over recent years, where the use of outsourcing has become quite a phenomenon.

With the success of your business comes the increasing demand for your time and resources, which as an entrepreneur you will know are both very precious entities.

Through outsourcing, you are able to distribute a number of your projects to a third party. In adopting such methods, you can ensure your high-quality work will be maintained and distributed on a much larger scale to meet these bigger demands.

Outsourcing simply acts as a helping hand during these key stages of growth, where there are opportunities to access expert skills that you cannot afford to hire yourself and would perhaps otherwise not encounter.

As a result, you are able to focus on other fundamental areas, where you can ensure the right direction for your business.

In order to gain a further understanding of outsourcing, we conducted a handful of interviews with some successful business owners. These individuals spoke of the methods they adopted and how outsourcing benefited their business.

We spoke to Sam Williamson, the Founder of flooring services company Floor Heating Direct (SW), Sean Mallon, CEO of business platform Bizdaq (SM), and Ian Wright, founder of British Business Energy, a site helping businesses reduce their energy cost (IW).

What made you decide to start the business? 

SW: I worked for a large flooring company for many years, but found myself dealing with more complaints than positive reviews.

Customers were never satisfied with the quality of materials that we were using, so I decided to start my own business that specialised in providing customers with quality flooring which would last them a lifetime.

The problem with the larger flooring companies is that they don’t provide the same kind of personable service and advice that a smaller business can. We have grown as much as I feel comfortable handling, and that is almost purely down to the outsourcing that we invested in early on.

SM: I started the business following running a traditional company in our industry. I knew that the process could be simplified and be made far more cost effective for all involved using technology.

We are a platform that helps business owners buy and sell small businesses by simplifying the entire process from start to finish.

Having established the traditional business transfer agent to do the same thing, I realised that people were increasingly turning to online platforms to sell their own business.

The issue these business owners faced was a lack of knowledge of the process, and a lack of support when they hit any stumbling blocks.

As we recognised that business owners were already looking to sell online themselves, we spent two years building an online platform that empowered business owners to sell their business at a fraction of the cost. It’s now become a mission to help business owners to retain more of the value they have built up in their business by achieving a profitable sale.

IW: Like many entrepreneurs, I decided to start my own business because I wanted to be my own boss.

I started my company in particular because I felt there was a gap in the market for good information about business energy in the UK, similar to what can be found for home energy customers.

I’ve previously owned one small business which I sold due to changing market circumstances, but I always wanted to get back into entrepreneurship.

After a few years working in the corporate and startup world, helping to make other people money, I felt the time was right to make the switch back starting my own business.

What services do you currently outsource?

SW: We outsource all of our online activities, including social media management, website maintenance, email marketing, SEO and PPC.

We simply didn’t have the manpower or expertise to handle any of these areas, so it made sense for us outsource it.

The companies that we work with to carry out these activities for us keep us in the loop with the work that they’re doing (especially with the social media), but for the most part we just let them handle it.

They provide us with monthly reports and answer any questions that we may have, but we try to keep as distant from it as possible!

SM: Over the course of our business we have actively focussed on staying as a lean as possible and have outsourced a large portion of our business.

This included the complete build of our original version of the online platform; both front-end and back-end development.

Over time we have now taken this in-house as this is a core competence of our business, however we still outsource some elements of the back-end development during sprints in our development. We have also outsourced our PR, content writing and paid advertising activity.

During these critical early stages of our startup we have to focus on building the best product for our users and anything that is not directly contributing to this we generally look to outsource.

IW: Although I have quite a bit of technical knowledge, I’ve decided to outsource most aspects of the business due to time constraints and budget issues.

Therefore, I’ve outsourced the majority of the web development to a company in India, who provide a high quality work at a much lower price than you’d find in the UK.

I’ve outsourced my web hosting and management to a company in the US, which specialises in optimising websites for speed, doing a far better job than I could do myself.

Finally, I’ve outsourced some content creation and promotion to a UK-based freelancer I’d worked with previously. This is vital because she understands the local market.

How has this helped your business to grow?

SW: Outsourcing all of this work has helped us grow because we have invested in areas where our competitors weren’t willing to invest.

We realised that a huge amount of people were looking for the services that we provide online, and our competitors were receiving all of this business, despite their poor online presence.

So once we had a responsive website, solid Google rankings and a strong social presence, we knew that we were in a position of power compared to our competitors, many of whom are afraid to have anything outsourced.

Probably the most important work that we’ve outsourced is our social media profiles. We found it hard to find the balance between being fun and acting like a business online, which didn’t bode well for our social presence.

Since having this aspect of our business outsourced, we’ve noticed a significant increase in the amount of people following us and engaging with our posts, something that we would’ve never achieved on our own.

SM: Outsourcing has undoubtedly enabled our company to remain lean during the critical early stages.

We can hire experts in the area to work a certain amount of hours per month without having to commit to their equivalent full time wage or settling with a less-experienced employee.

Our focus has then purely been on building the product and delighting our users with knowledge that experts are handling the rest.

Importantly it has also given our team a good idea of what we like and don’t like in a potential hire when we bring certain roles inhouse.

Had we have looked to hire these people immediately without outsourcing we would have made a lot of mistakes.

IW: This has helped my business grow in a few ways. First, it allows me to use the best resources available for each task.

While I have the ability to do each of the tasks I’ve outsourced, I’ve found the people I work with can often do it a lot better, faster and often cheaper than I could do it myself.

Second, outsourcing allows me to get more done as its a lot easier to get more done when you have more resources.

Finally, it allows me to focus my time and energy on the key bits of growing the business without worrying about the details.

What advice do you have for other entrepreneurs looking into outsourcing? 

SW: The thing that I found the hardest about outsourcing certain parts of our work was letting someone else control certain aspects of my business.

Like most business owners, I’m very conscious of the fact that even the smallest mistake or slip up could potentially ruin my reputation beyond repair.

So initially, I was extremely reluctant to let another company deal with such a huge and important part of my business.

But once I’d accepted the fact that outsourcing certain aspects of our work would help us grow as a business, I took the plunge and I’ve never looked back!

SM: The most important aspect of outsourcing is in briefing the freelancers. Invest the time in creating solid briefs with clear instructions and you will benefit.

Initially we were a little ambiguous with freelancers and we didn’t see the quality of work we looking for.

However one of the freelancers gave us a very specific questionnaire for discovering what we were looking for which was a great process for solidifying exactly what they needed to do.

As an example, with our content writer we define who the content is aimed at, give an introduction, provide key information to include and provide links to potentially useful resources.

IW: Two things come to mind. First. you have to be very careful when you outsource that you pick reputable suppliers.

For my web development work, I picked the company based on the recommendation of a business associate I trust. Fortunately for me, I have enough technical knowledge that I could judge the quality of the work being done.

However, if you don’t have that knowledge don’t be afraid to ask someone in your network for a second opinion.Picking a bad supplier is not just costly in terms of money, but also lost time.

Second: Don’t always go for the cheapest supplier, instead focus on the value they bring. For example, I could host my website on a shared hosting server that would cost £3.95 per month.

However, the website would be slow and security would be a concern. Instead I spend several times that amount, but don’t need to worry about what happens if my website gets a sudden spike in traffic.

As much as your budget will allow, I would always focus on quality and value over price.

Alec Laurie is managing director of Laudale

Further reading on outsourcing

Ben Lobel

Ben Lobel

Ben Lobel was the editor of SmallBusiness.co.uk from 2010 to 2018. He specialises in writing for start-up and scale-up companies in the areas of finance, marketing and HR.

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