Why do companies choose to outsource work

In today's fast-paced business world, staying ahead means embracing smart strategies. Outsourcing has become a game-changer, especially with the rise of AI technologies.

As an AI-focused outsourcing company, we've seen firsthand how businesses leverage this approach to innovate, reduce costs, and stay competitive. Safe to say, outsourcing is not merely a trend, it is a strategic move to propel your business forward.

The Cost of NOT Outsourcing

Maintaining in-house operations comes with some big costs:

1. Higher Labor Costs

Think salaries, benefits, recruitment, and training. According to CapitalCounselor, businesses on average can save around 70% of operational expenses by outsourcing their external workforce. For instance, outsourcing IT services can save about 40% of the usual costs, while outsourcing bookkeeping, recruitment, and other administrative tasks can result in savings of 20 to 30%.

2. Infrastructure

This covers office space, equipment, and software. In a recent report by Exploding Topics, companies can save up to 50% on office space, 40% on equipment, 30% on software, and 35% on maintenance. These savings stem from not needing to invest in or maintain physical spaces and expensive tools. Instead, businesses can leverage more budget to core activities, drive innovation, and enhance overall efficiency, making outsourcing a smart strategic move.

3. Operational inefficiencies

Outsourcing can reduce fixed overhead costs, such as utilities, office supplies, and administrative support, transforming fixed costs into variable costs. This can save companies up to 30-50% on utilities and 25-40% on office supplies according to K&C. For example, businesses can spend up to $120 to find a misplaced document and $220 to reproduce a lost one. On average, U.S. companies spend $8 billion annually managing paper documents alone (Armstrong Archives) (Avitus Group).

4. Risk Costs

In 2023, global spending on security solutions and services is expected to reach $219 billion, driven by the ongoing threat of cyberattacks and the need to secure hybrid work environments (IDC) (Cybersecurity Dive). Downtime costs are particularly high; about 44% of firms report that hourly downtime can cost over $1 million to $5 million, excluding legal fees, fines, or penalties.

The Secret to Growing Your Business

Outsourcing is a strategic tool that can drive business expansion by providing access to global talent, accelerating time-to-market, and enabling efficient market entry.

1. Access to the Best Talent from Around the World

By tapping into the skills and knowledge of professionals worldwide, businesses can boost their abilities and drive innovation. This access to diverse skill sets allows companies to take on challenging projects and create new products and services that meet the changing needs of the market. Impact of Outsourcing in Healthcare Businesses - Access to global expertise can improve patient care and medical research. By collaborating with specialists worldwide, healthcare providers can develop new treatments and technologies, leading to better patient outcomes and a brighter future for everyone. Impact of Outsourcing in Mortgage Brokerages - Leveraging the skills of professionals worldwide helps mortgage brokerages streamline operations and improve customer service. International experts can offer insights into the latest financial technologies and risk management strategies, making homeownership dreams come true faster and more efficiently. Impact of Outsourcing in Legal Firms - Legal firms can benefit from the global pool of legal professionals by gaining access to specialized knowledge in various areas of law. This helps them handle complex cases more effectively. Collaborating with international experts can also inspire innovative approaches to case management and client service, helping firms stay competitive and provide excellent legal solutions.

2. Speed up the delivery of products and services

By working with specialized providers, companies can streamline processes, launch new products faster, and stay ahead of competitors by meeting emerging trends and customer needs sooner. Impact of Outsourcing on Businesses focused on Healthcare - Outsourcing administrative tasks like medical billing and transcription lets healthcare professionals focus more on patient care. This means doctors and nurses can spend more time with patients, improving their overall care and making everyone feel more valued and supported. Impact of Outsourcing on Mortgage Brokerages - Outsourcing tasks like loan processing and underwriting helps mortgage brokerages speed up the loan approval process. This means they can help more people buy homes more quickly, making the dream of homeownership a reality for many families. Impact of Outsourcing on Legal Firms - By outsourcing routine tasks such as document review and legal research, legal firms can let their in-house lawyers focus on more important and complex work. This allows lawyers to provide better service to their clients, ensuring that each case gets the attention it deserves.

3. Expand into new markets and global reach

According to Cybersecurity Dive, the global business process outsourcing market was worth $232.32 billion in 2020. It is expected to grow at an annual rate of 8.5% from 2021 to 2028, showing that more businesses are using outsourcing to expand.

Why wait to unlock your company's full potential? Start outsourcing your core activities now and experience the transformative benefits firsthand. The advantages are clear: faster product development, improved quality, and the flexibility to scale operations as needed.

Trust CoreBridge, the leading outsourcing company powered by cutting-edge AI technology, to handle your business needs with unmatched precision and efficiency. Partner with CoreBridge today and take the first step towards a smarter, more efficient, and globally competitive future. Let us help you turn your vision into reality.