9.) Lower Regulatory Costs: Reducing costs was the original purpose of outsourcing and although outsourcing has since been demonstrated to have other significant advantages, cost reduction still remains one of the prime advantages. Companies look to outsource tasks which would be more costly to complete in-house.

There can be significant cost savings when a business function is outsourced. Employee compensation costs, office space expenses and other costs associated with providing a work space are eliminated and free up resources for other purposes. Economies of scale save money when unit costs go down as volumes increase. External service providers, like Audix can achieve economies of scale unavailable to individual firms when they combine the volumes of multiple companies.  Many businesses embrace outsourcing as a way to realize cost savings or better cost control over the outsourced function. Companies usually outsource to a vendor that specializes in a given function and performs that function more efficiently than the company could, simply by virtue of transaction volume.

Example: Audix has several small business clients that may be able to hire an entry level employee, but not necessarily take on all of the additional costs of maintaining a payroll, such as payroll taxes and benefits.  They can take the same budget they were going to use on an entry level staff member and get top of the line professionals to assist with marketing, accounting or administrative duties.

Categorised in: Uncategorized

This post was written by admin

No Comments

Leave a Reply

Your email address will not be published. Required fields are marked *