How To Outsource Work Overseas?

06/02/2023 13:38:55 +0000
Running a business can be challenging, but there are some areas that can make your life a lot easier.
A small business does not typically need to operate with a full time accounting department, human resources department or a web development team.

Most of these roles can be undertaken by virtual contractors, and if you look overseas - you might be able to get these contractors at a fraction of the cost than it would be to hire in the United States.

Consider areas like customer service, telemarketing or even tech support - these are areas where you may decide to outsource. But how might you do that?

Well, there are a number of options from contractor sites like Guru to sourcing companies like Cognizant. These resources can easily get you the workers you need outside of the United States.

We're going to explore these options and examine some of the benefits of doing so. Therefore, if you're ready to learn much more - then read on for all the answers!

What Is Outsourcing?
It's best that we start off by examining what outsourcing is. It is actually quite a straightforward concept that involves hiring staff overseas to carry out tasks for your business.

Generally speaking, businesses will do this to save some money on labor costs, taxes and additional employment benefits which prospective employees in the United States would either legally require or demand to take on the job.

Not only this, but it can also save you money on premises costs such as energy, rent, health and safety requirements etc.

While there will also be an ethical or moral debate on outsourcing, it is a completely legal tactic that many businesses do, and it is not especially difficult to get involved with.

How To Outsource?
As we briefly mentioned, there are a number of options out there - but typically you have two methods to consider; contractor sites and sourcing companies. We're going to have a look at some of these below and explain what they do.
Contractor Sites
Contractor sites are very familiar with people, not just business owners. They have become popular for tasks that range from basic things to more complex matters.

Contractor sites are quite simple - they are there to put prospective clients in touch with prospective freelance workers.

These sites include things like:

  • Fiverr
  • Guru
  • eLance
  • oDesk
Typically, these sites allow for the prospective freelancers to have their own base rate of pay, and the prospective employers have their own requirements, although ultimately the agreement for employment will largely be outside of these parameters.

These sites are usually very easy to use and communication between the two parties tends to be very good quality.

Sourcing Companies
Sourcing companies are usually used if you have larger requirements for your business and you will require multiple employees.
You may have heard of the two major sourcing companies that are used in the United States; Accenture and Cognizant.

These specific companies primarily focus on IT and technology matters and are used by giants of the business world like Facebook, Google and Amazon. However, you can use sourcing companies for other business needs.

The way these sourcing companies operate is by having a headquarters in the United States, normally in New York City, but refer their clients to countries like India - allowing for a reduced salary requirement.

This can, and has, led to a number of media scandals and raised numerous legal/ethical questions.

However, it is not an illegal practice and can be an option for you, especially since companies like this have years of experience and can provide added value.

The Pros And Cons Of Outsourcing Overseas
Nothing is without scrutiny, and you will need to examine some of the pros and cons of outsourcing overseas. Let's examine both the pros and cons in a little more detail.
Outsourcing overseas allows you to forgo some of the formalities that the domestic employment method would require. You do not need to worry about payroll taxes, employment benefits, federal and state regulations etc.

You also do not need to worry about your office requirements, health and safety considerations, discrimination laws, energy bills, mortgage or rent for your business buildings etc.

Outsourcing can be a very useful method for small businesses, because it allows you to get the talent you require to run your business, at a cost that you can afford.

You may also find that the work ethic overseas is much more stable and efficient than domestic workers.

It's also worth noting that sourcing companies like Accenture can provide additional value to your business because workers and other companies see them as a reliable source for services.

This can lead to your business expanding over time as more and more trust in the business world is built up.

While outsourcing has a number of benefits, there are also several potential disadvantages.
One of the biggest disadvantages is the language or accent barrier, which can seriously come into play if you are outsourcing for things like customer service.

As many businesses must focus on their customer service for trust with their customers and to build a reputable brand, customer service is something that must be of a very high quality.

However, if a customer is struggling to communicate with their customer service agent, this can lead to frustration at the business and they are likely to avoid conducting business with you again - and will likely write poor reviews and tell their friends and family.

This goes without saying that this is a detrimental hit to your business, so it's worth thinking about.

This is also the case for your own communication to the employees, if it is ever needed, as you may want to give specific directions for tasks.

Other potential drawbacks include ethics and morality. Many people have long scrutinized businesses for ignoring domestic workers and opting instead to pay a largely reduced rate overseas.

Many people consider paying reduced rates overseas to be somewhat exploitation of foreign workers, along with ignoring the requirement of employment to domestic workers, which many critics believe is anti-American.

The reason you need to consider this is because domestic politics may come into play and prevent outsourcing, or may force changes in the law for how it operates.

This can become problematic if you build your business structure with overseas workers.

What To Remember When Hiring Overseas?
If you decide to outsource, there may be times where you have to get involved directly. If this becomes the case, you should bear some of these points in mind:
  • Start small - do not overreach when you first start off
  • Clearly define your outcomes
  • Search for a track record with overseas workers/outsourcing companies
  • Interview before hiring is always wise
  • Look after your top performers and keep them for as long as possible
The Bottom Line
Outsourcing overseas can be highly beneficial but it is not without its drawbacks. It's worth considering your options fully before you decide to go down this route with your business.
About the Host
Sophie Howard is the founder of Aspiring Entrepreneurs, a community designed to help people develop the skills and confidence to build a business and a life that serves them. Sophie began online in 2013 with an Amazon firm, which she sold for more than $1 million in 2015.

Sophie has lectured on stages all around the world, encouraging and teaching other ambitious entrepreneurs. She has established instructional programs educating thousands of students how to sell online, in addition to releasing over 1000 products.

Sophie has also written a book titled "Aspiring Entrepreneurs: A Guide to Finding Your Best Path to Financial Freedom."
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